QUESTIONS AND ANSWERS
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Last Updated 3/19/09
Q: To what extent do we need to know UTATA? The only thing I have in my
notes is that the UTATA says that pour over trusts do not need to be
in existence at the time of will execution. However, the course
outline that is keyed to the book goes into more detail about UTATA.
Could you clarify please? Maybe I missed some notes in class?
Q1) Clymer v. Mayo - why did the ex-husband not get the trust at her
death? Because it acted as a pour over trust for the residue and thus
probate wills rules apply where the ex-spouse does not take under a
will? Or is it simply because when there is a divorce all will and/or
trusts cancel the gift to the ex-spouse unless otherwise indicated?
For example, if it had simply been a regular intervivos revocable
trust without any pour over provision/function from the will, and the
beneficiary was the ex-husband, would the trust corpus go to the
husband or would it revert to the residue of the estate?
Q2) I don't really understand the difference between self proving
affidavits and attestation clause. I know SPA's are on separate
document while the attestation clause is on the will itself. And I
know that the SPA uses past tense language while the attestation
clause uses present tense language but I am not sure of the legal
significance of the difference between each. And besides the fact
that an SPA can get detached or lost from the will itself and an
attestation clause necessarily is attached to the will, why is one
better or worse than the other? CT
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Questions below are from the 2008 class
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Q From what I remember, we mentioned in class that, when dealing with an oral promise to return property, if the conveyance involves real property, it is unenforceable. However, if it involves personal property, it might be enforceable. However, the Hieble case, where the son had promised his mother to return her property back to her after she overcame her cancer, involved Real Property. So, I'm confused...A: An oral promise to convey real property is not enforceable in a court of law. However, a court of equity can step in, using the equitable remedy of a constructive trust, to prevent unjust enrichment. Technically, the court is not enforcing the oral promise, but rather it is preventing unjust enrichment. So an oral promise to convey real property is not valid, but if you can meet the narrow requirements for a constructive trust (promise, reliance, unjust enrichment) a court might impose a constructive trust that compels the holder of the property to convey it as promised.
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Q: If you ask us on an exam: is this a valid will, would this be a correct way to analyze it?
1. Capacity (both legal and mental)
2. Testamentary Intent
3. Formalities (writing, signature and witnesses)
4. If formalities were not complied with, is it a valid holographic will?
If there is no evidence of lack of sound mind or age (for capacity) do we just assume that it's been satisfied, or do we not even bring up the issue? SG
************************************************************A: a reversionary interest states that if a trust fails, it reverts to the settlor and/or her heirs. This gives them standing to sue to enforce the gift. Don't confuse this with a gift over, which states that if purpose A fails or becomes impossible, the trust should be used for purpose B. A gift over usually defeats an effort to apply cy pres, because the trust instrument itself states what should happen if purpose A becomes impossible.
Q1. The settlor of trust has standing to enforce the terms of a chartiable trust if the settlor has a reversionary interest. My notes states that a settlor has a reversionary interest if the trust assets reverts back to the settlor or settlor's estate if the trust cannot be carry out its charitable purpose. If this is true, then shouldn't the settlor's intestate heirs also have standing to sue the charitable trust? Also, if a charitable trust fails b/c its puprose cannot be carried out, then doesn't the court impose a resulting trust on the trust assets so that the assets are returned to the settlor's estate? If that's true, then do all charitable trusts by default have a reversionary interest?
A: generally, yes
Q2. For an intended class, it must be shown that the testator intended the beneficiaries to recieve the gift as an intended class. My question is, under the plain meaning rule, can the court consider extrinisic evidence to determine whether the testator had such an intent?
A: yes
Q3. For ademption by extinction, do we follow the traditional rule or the CA rule? From my understanding, the CA rule has an additional requirement that the testator intended the gift to be extinguished by ademption. Should we follow this rule as the default rule for the multiple choice and the essay?
A: with the equitable charge, the recipient owns the property outright and is not subject to fiduciary duties.
Q4. I'm having a real hard time differentiating b/t an equitable charge and a trust. It seems to me that an equitable charge is essentially a trust since the testator is transfer property to 3rd person for the benefit of a another? What am I getting wrong?
A: don't worry about it.
Q5. I'm having a hard time understanding the rule against perpetuities is applied. I know that the rule requires that a trust must vest within 21 years of a life in being at the time of the creation of the trust. Does this mean that the trust must explicitly designate who the life in being is? Does the person have to be a beneficiary or the settlor? If the life in being isn't required to be designated, then how does the court determine who the life in being is?
A: Apparently, the theory is that animals and grave markers cannot be measuring lives, limiting an honorary trust to 21 years.
Q6. On a related note, I have in my notes that an honorary trust cannot last longer than 21 years. Is this correct? Couldn't the honorary trust last longer than 21 years since the 21 year requirement doesn't kicks in until the death of a life in being?
A: the latter.
Q7. If the recipient of a secret trust does not use the gift for its intended puprose, then does the court impose a resulting trust and return the gift back to S's estate or does the court impose a consturctive trust to ensure the trust is used for its intended purpose?
Q8. On a related note, when a court imposes a resulting trust, the court return the trust assets back to the settlor's estate or to the settlor's intestate heirs? I know technically they end up with the same result but this minor detail has been bugging me.A: usually the intestate heirs, because the estate is long gone.
A: that's generally correct.
Q9. Does the non-self-executing statute and the self-executing statute work concurrently? If so, does the non-self executing statute apply only to claims against the settlor's probate estate while the self-executing statute applies to claims against the settlor's non-probate estate (i.e. against the settlor's property held in will substitutes)?
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A: you are not responsible for this section.
(1) Under UPC section 3-301, does a will start out with informal probate, and then once interested parties are notified, does formal probate then set it? Is it formally probated only by judicial determination? What are the grounds for this determination? Can a will only be informally probated? If so, how and why? Is it if it the will is not contested?
(2) There is a distinction between will gifts conditioned upon a religious faith of the beneficiary and those conditioned upon marriage of a person to a particular faith. The latter is permissible as long as it is a partial restraint on marriage, such as in Shapira, but the former is impermissible. Is this correct? Is it impermissible as violating the Constitution even though it is a private actor enforcing it and does not involve state action?A: We did not consider the religion cases, except to mention those that required a woman to be a "practicing Catholic"--held to involve too much court supervision and therefore unenforceable.
(3) Is a bypass trust a real trust or does it fall under the category of "trusts that are not trusts," such as honorary trusts? How is a bypass trust different from splitting a trust into income and remainder (principal) beneficiaries? How exactly does a bypass trust work besides as a tool to avoid the gift tax problem?A: don't worry about it. Yes, they are real trusts.
(4) CA quasi-community property rules only apply to personal property due to the ancillary jdx issue surrounding real property in other states, correct? Real property in CA, however, will fall under CA community property rules, correct? Is it correct that quasi-property only applies to debts?A: yes, maybe, no.
(5) One should only bring a tortious interference with expectancy tort claim in the alternative when first not succeed in a will contest claim, correct?A: not necessarily. Tortious interference would allow for punitive damages.
(6) For the plain meaning rule, is it correct that should only look to the text for interpretation, however, if it is ambiguous, can the court look to extrinsic evidence to resolve the ambiguity?A: correct
(7) Do the UPC and CA allow partial revocation of a will by physical act? I am all over the place on this issue.A: yes
(8) If you have a form will, and there is at least one material provision that is in the testator's handwriting and the testator signed it, will the printed provisions become part of the testamentary intent and thus part of testamentary document by means of the doctrine of incorporation?A: A few cases have incorporated the printed parts, but generally the answer is that printed parts are not considered to be part of the will in this situation.
(9) I am confused at the revocable living trusts (RLT). So, an RLT is a valid will substitute, but is it a trust? I know it needs the formalities of a trust. Since it is revocable, the creditors can still get at it to the extent that the beneficiary can? How does this change pre- and post-testator's death? JGA: RLTs are trusts and they are also will substitutes. Creditors of the settlor can reach the assets to the same extent that the settler can by means of revoking. This principle also applies after the settlor dies (even though technically the trust becomes irrevocable on the settlor's death)
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Q1. When dealing with Time of Death, this is my understanding: we apply the CL standard that requires irreversible cessation of circulatory and respiratory functions, then, if kept alive artificially, we apply the Modern standard of irreversible cessation of total brain function. THEN, when dealing with who died first, I have that if it is an attested will, we need clear and convincing evidence that the Testator survived by a millisecond. However, if the person died intestate, we apply the standard that requires death by 120 hours (is this the CA standard?). IS MY UNDERSTANDING OF THIS CORRECT?A: yes.
Q2. When dealing with Virtual Adoption, can the child inherit from his natural parents as well as his "adoptive" parents, and can the natural parents inherit from the child?A: maybe, but the answer is not entirely clear.
Q3. What is the analysis for when the parents die while the child is still a minor, and the friends/family adopt the child? Can the child inherit from the natural parents? Does it matter whether they were adopted at death of the natural parent or months later?A: the link to the natural parents is cut off (but remember that this happens after the parents die, so the children will inherit from the parents, but cannot inherit through them)
Q4. When dealing with Interested Witnesses, what is the rebuttable presumption? Is it a rebuttable presumption of a conflict of interest? Also, what happens if the presumption is/is not rebutted?A: read CPC 6122 for the details. If the presumption is not rebutted, the witness is limited to his or her intestate share.
5. With the Doctrine of Revival, do you need to prove intent to revive the first will?A: yes
6. Does Lapse apply to Specific, General, and Demonstrative bequests?A: yes
7. In class, you have an example of Abatement, and I cannot figure out how you obtained the result. The example was that the will said, "I give my Chevy (worth 50k) to A, 100k to B, 10k from my coin collection to C, and the rest to D." In this scenario, there is only 10k left in the estate. In class, you said that C and A get 5k each. If we're supposed to apportion the specific and demonstrative bequests pro rata, I can't figure out why we're giving each of them half (when the ratio is really is 5:1).A: you probably wrote the numbers down wrong. A and C get 5k each if the Chevy is worth 10k and C was entitled to 10k from the coin collection under the will. The other gifts are abated entirely.
A: in the Father Divine case, the court invalidated the gift (which is like using a resulting trust), because it was semi-secret.
8. In my notes, I have that cts allow for a Constructive Trust when dealing with Secret Trusts and a Resulting Trust when dealing with Semi-Secret Trusts. On the exam, when dealing with Semi-Secret Trusts, should we say that the court will impose a Resulting Trust, or should we follow the Father Divine case and use a Constructive Trust (due to the cts of equity)?
Also, with Semi-Secret Trusts, do cts automatically use a Resulting Trust? If not, what do you need to show, other than the fact that the conditions are not specified?A: the traditional rule, which we follow, is that semi-secret trusts are invalid bequests, so the gift will not be distributed to the legatee, or if it has for some reason been distributed, it reverts to the estate via a resulting trust.
Q9. In my notes, I have that where the sale of the trust property constitutes a breach of misfeasance, in addition to selling too low, the fiduciary may be liable for appreciation damages. Is this correct?A: If the t'ee sells for too little, breaching the duty of care, and did NOT have the right to sell, apply appreciation damages. Under Rothko, you can also award them for any breach of duty of loyalty.
Also, I'm a bit confused on how to calculate Appreciation Damages.A: difference between amount actually obtained and FMV at time of judgment.
Also, what are the damages for a Co-Trustee who failed to act in response of his co-trustees' conflict of interest?A: we didn't cover this.
10. In the student Q and A's, you wrote that the donor of a charitable GIFT has standing to bring suit. BUT whether the donor of a charitable TRUST has standing is an open issue. My question is: Does the donor of the GIFT need to retain a reversionary interest in order to have standing? Also, if the donor retains a reversionary interest, does that give his family standing (with respect to both gifts and trusts)?A: donor of a charitable gift has standing even without a reversionary interest. In the charitable trust situation, retaining a reversionary interest generally confers standing on the donor (and also his heirs, if they have a reversionary interest also).
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Q If there is a breach of the duty of self dealing, then the deal is undone unless it is sold to a bona fide purchaser, in which case the trustee would have to disgorge profits. But you also said at the end of the In re Rothko case that if there's a breach of the duty of loyalty then the beneficiary is entitled to appreciated damages. So if there is a breach of the duty of self dealing does that mean that the trustee must disgorge profits and pay appreciated damages? Doesn't that seem like double recovery? Or is appreciated values only for breach of conflict of interest? SG
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Q To meet the
requirements under strict compliance, there must be an attestation
clause? In re Will of Ranney this issue comes up. I thought
there were two witnesses who witnessed and signed, but were not read an
attestation clause?
A: technically, the rules for execution of a will
do not require such a clause, but with a witnessed will it is extremely
rare not to have one.
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Q I understand the CA rule with respect to ademption is that we look at whether the testator intended to extinguish the specfic gift. Assuming that the testator did NOT intend to extinguish the gift but the gift is no longer in the estate, would the devisee be entitled to the cash value of the gift? SC
Q Why didn't the Auburn case apply the Doctrine of Revival instead of DRR?
My notes say that under Revival, If you have one will and a second will which revokes it and you revoke/destroy will 2 (intending will 1 to take effect), then we can probate will 1.
And under DRR, I have that an example would be that the Testator Tore Will 1 on the condition that Will 2 would be valid. In that case, the court would not not probate Will 2, but will unrevoke Will 1.
This seems to be the fact pattern in Auburn. But in that case, they used DRR to unrevoke Will 2. Essentially, this looks to me like the above example, only backwards: T tore Will 2 on the condition that Will 1 would be valid. In that case, the court did not probate Will 1, but unrevoked Will 2.
Could they have used Revival in Auburn instead of DRR. If so, why didn't they? FT
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1) You mentioned last night that a notary can be a witness, however in my notes I have that a notary does not count as a witness, you must have 2 other witnesses. What am I missing? How does this relate to the affidavit??
A: if a notary simply notarizes a will, it does not count as a witnessing. But there is no reason a notary could not be an ordinary witness if he or she correctly witnesses the will.
2) Can you explain the doctrine of DRR? How is that related to the doctrine of revival or republication?A: DRR "unrevokes" a will that was revoked under a mistake of law or fact. A will can be revived if a later will, which revoked it expressly, is itself revoked and the T intended to revive the first will.
A: Dispositions in a trust are not normally revoked by will (but see Clymer v. Mayo)
3) I know that when A gets divorced, any gifts etc in A's will to her spouse B are considered revoked. What about a trust? If A gives B several items in A's trust when A dies, are these also revoked? What if A has set up a pour over trust which is supposed to give several items from A's will to B once it is probated, are these items revoked at divorce? If so, where do they go if everything was intended to go into the pour over trust which was then supposed to go to B?
4) Is this the analysis before lapse occurs? Look to see if you can apply antilapse(kindred and no contrary language) and then look to see if the devisees are an express or intended class, then if all fails lapse...correct?A: sounds about right.
5) What is ademption exactly? Specifc gifts are adeemed by extinction and general gifts are adeemed by satisfaction?A: yes, a specific bequest can be extinguished. General and demonstrative gifts can be adeemed by satisfaction, but see class discussion for details. There is no ademption by satisfaction of specific bequests--they simply adeem by extinction.
Also, I thought a testator could/was allowed to give away or sell gifts in his estate that he intended in his will to give to other people(acts of independent significance)? Because in my notes I have that if this happens, the proceeds of this sale or gift go the intended beneficiary via the ademption doctrine as long as it is a specific gift??A: I don't get it.
A: correct. And he might be liable for a tort if he was trying to hide the assets in this manner.
6) One last thing, a trust does not hide/shield a husband from giving the wife some assets after divorce correct? For example if he buys a car with CP funds and puts it in a trust, the wife is still entitled to 50% of this correct?
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Question #1: Regarding the "per capita" system of dividing assets among the decedent's issue, I have a note that under the California Probate Code, if a will says "per capita," that Cal. Prob. Code § 240 and the Modern Per Stirpes should be applied instead. For purposes of the Exam, should we ignore this rule and apply the per capita system when you say "per capita"?
A: for the exam , you can assume "per capita" really means per capita.
Question #2: I apologize if I am repeating a question previously asked; however, I could not find the source for a note in my outline. If a document is incorporated by reference into a Will (e.g., a Memo book) – how is that incorporation affected by future changes the incorporated document? For example, I execute a will on 1/1/2008 and incorporate by reference a notebook of mine that was in existence on 1/1/2008 (there is also intent and sufficient description). Q2a: If I make changes to the notebook on 3/1/2008 and then die on 6/1/2008, what version of the notebook (if any) is incorporated by reference and properly submitted for probate?
A: changes made to the incorporated document after the will is executed are not valid because those changes were never properly incorporated into the will (but remember that republication by codicil can be helpful sometimes)
Q2b: And would this same rule apply for Integration if the notebook were present at the time I executed the will (and I intended it to be integrated)?
A: yes, same principle applies.
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Q1. For purposes of anti-lapse, is the CA rule that the transferee
can be kindred of the testator OR kindred of the deceased's spouse?
A: yes.
Q2. With respect to self-dealing, is the rule that if one gets theA: yes, but remember that the consent/disclosure must be before engaging in the transaction.
consent of all the beneficiaries and provides full disclosure of the
transaction, then the "no further inquiry" would not apply and
instead we inquire as to whether the transaction was (1) done in good
faith and (2) fair and reasonable.
Q2b: Could you give an example of whereA: can't think of one right now--a more likely scenario is that it is in good faith but not reasonable.
the transaction would be fair and reasonable but conducted in BAD faith?
Q3. I understand how appreciation damages apply in the context of aA: For assets that drop in value you do not apply appreciation damages--it only applies if the value goes up. If the T'ee engages in self-dealing and is forced as a remedy to give back the house, there would be no issue of appreciation damages, even if the value rose. But if the t'ee sold the house for $100,000 to a third party and at time of judgment the house is worth $200,000, the t'ee would have to disgorge profits on the sale and also pay $100,000 in appreciation damages.
conflict of interest, but how would they apply in a self-dealing
scenario? For instance, if the normal remedy for self-dealing is that
the transaction is undone and therefore the property is restored, how
would the trustee pay appreciation damages on say, a house that he
returned and the house has actually dropped in value? SC
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Q: In my notes I have written down that a
codicil amends an
existing will. In Johnson v. Johnson, (P. 279), however, the
court holds that the holographic codicil republished the invalid
typed-written portion of the testator's will. What I don't understand
is how a codicil, which by definition amends an existing VALID will,
can republish an INVALID will. Is/can a codicil been viewed as an
independent will and thus using a theory of incorporation by reference,
the typed-written will is then validated? SC
Question #1 Intestate Succession & Quasi-Community Property: A student previously asked whether real property located outside California is not quasi-community property at the time the testator dies, to which you responded "depends." In my notes, I have that the status of the real property (QCP or SP) depends on the laws of the jurisdiction where the real property is located (and succession is determined under the laws of that jurisdiction as well). Q1(a): Did you answer "depends" because the answer depends on whether that jurisdiction is a community property or common law jurisdiction?A: correct
Q1(b): This may be splitting hairs (since it won't matter for succession), but if real property is located in another community property jurisdiction, would that real property be considered community property or quasi-community property for California purposes (i.e., would it pass to the surviving spouse under California Probate Code ("CPC") 6401(a) or (b))?A: it would go according to the law of the jurisdiction in which it is located, not California law.
Question #2 No-Contest Clauses in Wills: In both the online review lecture and the online student Q&A you mentioned that the "default rule" for validity of a no-contest clauses in a will is that such clauses are "valid unless there is probable cause to contest." In my class notes, I had a California rule that they are valid unless the contestant (a) alleges forgery or subsequent revocation by a later will; or (b) contests a provision benefiting the drafter of the will or any witness. These two standards do not necessarily conflict, but they also are not the same (the default rule supplies the burden, whereas California provides potential substantive challenges). For purposes of the Multiple Choice, should we apply the default rule, California, or both?A: the default rule.
Question #3 Substantial Compliance: For the curative doctrine of Substantial Compliance, is the inquiry into whether the document substantially complied with the requirements merely a facts and circumstances inquiry? Or, like with the Dispensing Power, are there certain formalities that cannot be missed (e.g., a signature)?A: it is a "near-miss" standard--small deviations from the rules do not invalidate the will.
Question #4 Plain Meaning & Estate of Russell: In the online review lecture, you stated that we should follow the Estate of Russell rule for purposes. Does this mean that we should follow the Estate of Russell rule for purposes of multiple choice questions? (I apologize if this question seems obvious, but in many other situations we are applying the default/traditional rule for purposes of multiple choice, and I want to be clear on which rule to apply.)A: On multiple choice, I would specifically ask about (and mention) the case, as in "according to estate of Russell..." If you have an interpretation question on the essay, it would probably be best to try the plain meaning rule first, then see what the result would be under Russell.
Question #5 Anti-Lapse Statutes: In my class notes, I have an "orphan" note that "if the spouse predeceases, then anti-lapse does not apply." I cannot seem to find a situation where this would apply, since a person is still kindred under CPC 21110(c), even if your genetic relation is through the testator's deceased spouse. Is there a situation where if the spouse predeceases, the anti-lapse rules do not apply?
A: the spouse is not kindred of the testator in most situations, so I presume the missing hypo is that the testator has a gift to his spouse and she predeceases the testator--antilapse does not apply.
Question #6 Exception to Ademption by Extinction: This may be a very small matter, but in my notes, I have that the general rule for insurance proceeds from the condemnation or destruction of a specific devise/bequest is that they still adeem. However, the California rule is that such devise/bequest will not adeem (presumably the devisee/legatee will get the proceeds in place of the specific devise/bequest). For purposes of the multiple choice, which rule should we apply?A: don't worry about it.
Question #7 Exoneration of Liens: In my notes, I have a traditional and a modern rule for whether liens (e.g., a mortgage on a house) are paid off before the property is transferred to the heir/devisee (traditional = yes; modern = no). For purposes of the multiple choice, which rule should we apply?A: the modern rule.
Question #8 Standing for a Charitable Trust: In my notes, I have that for purposes of the multiple choice, we should apply the rule that the Donor of a Charitable Trust DOES have standing to bring suit (following the New York rule from Smithers and the California rule). However, in the online review session, you stated that we should follow the traditional rule that the Donor does NOT have standing (following the Carl J.Herzog Found. v. Univ. of Bridgeport case). For purposes of the multiple choice, which rule should we apply? DJWA: We should assume that the donor of a charitable GIFT has standing--this is also the California rule. Whether the settlor of a charitable trust has standing is an open question.
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Q1. Do we need to know the specific CPC section
numbers?
A: no.
Q2. For adoption, do we follow the UPC exception
that if
adopted by the
spouse of the natural parent, you can still inherit from the other
natural parent (dual inheritance allowed) or does this not apply (no
dual inheritance allowed at all)?
A: we follow the UPC rule here.
Q3. For children conceived after the father's death, I have two sets of
requirements, not sure which one to follow. The first requires
judgment of paternity by the court, time limit of 1-2 years, consent
of father to use sperm to create children, and proof that father
agreed to support resulting child. The CA rule says specified in
writing and signed by witness, notice given to interested parties
within 4 months of death, and child was in utero
within 2 years of
death.
A: Follow the principles laid out in the case we read, not the
California
rules.
Q4. For revival of the old will do we follow the
CA rule
where the
old will is revived if it's evident that testator intended the 1st
will to take effect or do we go through the DRR requirements or are
they essentially the same thing when applied?
A: Apply the doctrine of revival.
Q5. For incorporation by reference is it true that
changes
to the
incorporated documents are not valid if made after the incorporation?
For example in Clark v. Greenhalge, the
will
incorporates the
memo/notebook, but if the testator keep adding things to the
memo/notebook after she executes the will, is that valid? If they are
valid, does that mean the will can be informally changed after
execution of the will w/o following the formalities (like act of
independent significance? Are they acts of independent significance?)
A: What is incorporated is the document as it exists at the time of
incorporation. Later additions or modifications are technically
invalid.
Q6. To form a natural class, each member of the
class is
named
individually (such as all of the testator's children), but must the
testator also intend to create a class (requirement of intention) as
in Dawson v. Yucus? Alternatively, even if
there is
no natural class,
the testator can still create a class if he intended it to be a class?
A: If you make a gift to A, B, and C, and they form a natural
class, you
do not need to show intent--because they are a natural class, the law
essentially presumes intent to treat them as a class. And if the
recipients are not an express or natural class, you can still try to
prove the testater intended them to be
treated as a class.
Q7. How do you tell when something is precatory
language and not
actually a trust created w/ legal obligation?
A: This is always a question of interpretation of the language--based
on the
language used, did the testator merely intend to impose a
moral
obligation (precatory) or a legal
obligation?
Q8. I have in my notes that life insurance
policies and
contingent
remainders are considered property in existence, making the trust
valid. Why are they not future interests (expectation or hope of
receiving property in the future) and therefore invalid as trust
property? Are royalties in general considered future interests?
A: Because they are legally enforceable property interests.
Q9. In terms of the duty not to delegate
discretionary
duties, is the
rule for inexperienced trustees to consult someone and exercise their
own judgments or can they actually delegate by selecting someone
carefully and supervising/monitoring them? AG
A: the traditional rule (which we will follow) is that the t'ee must exercise her own judgment in all
discretionary
matters, although some modern courts are allowing more delegation, if
done
carefully.
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Q: class example: T gives his chevy
worth 10,000
to A; $10,000 to B; $30,000 from sale of coin collection to C; rest to
D. T dies with the chevy and 10,000 in
cash.
cash. So, B and C were owed a total of 40,000 and the estate only had
20,000. the order to abate gifts is 1st residue, 2nd general, 3rd
specific. So, why did the specific gift of the chevy
get sold for cash
to pay B and C?? GP
A: This is mostly correct, but the last gifts to
be abated
are specific and demonstrative, pro rata. As I said in
class,
another way to say it is to pay specific/demonstrative gifts first,
then
general legacies, then the residue.
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Q: Regarding the statute of limitations that
allows
creditors to bring
claims on decedent's estate:
1. when decedent dies testate and the will goes through probate - is
it the responsibilty of the executor to
notify the crediotrs?
A: The exact procedure is stipulated by statute, but you are not
responsible
for the details.
Q2. when the decedent dies intestate and/or has a
trust -
does someone
have to notify the creditors in these situations?
In my notes I have that only when there is a will do the creditors
have to be notified because there is state action - and they must have
notice in order to not violate their due process rights... but without
probate I have no notes on whether creditors need to recieve
notice or
not....hope that makes sense? SE
A: If there is no probate, there is not state action and no
constitutional
notice requirement. The self-executing statute starts running
automatically and cuts off the rights of creditors in one or two
years--notice
does not matter.
*************************************************************
I had some hypos regarding Ademption
by
Extinction that I would like
your help in clarifying. Could you please identify the result of
each
hypo and briefly explain the legal theory behind it?
Q1. "I give my 100 shares of Kodak stock to X." Kodak
stocks split
2:1 and as a result there are 200 shares of Kodak stock. What
does X
get?
A: 200 shares of Kodak stock.
Q2. "I give my 100 shares of Kodak stock to
X." Prior to death
Testator sold 100 shares of Kodak stock and used proceeds to purchase
100 shares of MSN stock. What does X get?
A: Nothing. The gift is specific and extinguished (unless X can
show that
the testator did not intend to extinguish the gift).
Q3. "I give my red Honda to X." Prior
to death Testator sold red
Honda and used proceeds to purchase silver Mercedes. What does X
get?
A: same result. Most courts would say that this is not a mere
change in
form.
Q4. "I give my red Honda to X." Prior
to death Testator traded red
Honda for silver Honda. What does X get? BN
A: same result, most likely, but a closer case.
***********************
>Q If Dawson v. Yucus was decided under
our
anti-lapse rule then the gift
>of the farm to the dead nephew would not lapse into the residue,
but
>go to the dead nephew’s issue, making a class gift analysis
>unnecessary?
A: yes. .
Q: Is the UTC our rule regarding the duty to inform and account to
>beneficiaries?
>
A: Follow the rule as we gave it in class and during the review (it is
fairly
general).
QCan extrinsic evidence be looked at to
decide if a
holographic will
>has the necessary testamentary intent on the theory that the
extrinsic
>evidence would go to the validity of the will?
>
A: Yes.
Q: What is our rule for multiple choice for interested witnesses
signing
>a will – is there a prsumption of
fraud,
undo influence, or duress, or
>is the gift to the interested party invalid, or is the entire will
>invalid?
>
A: It creates a rebuttable presumption of
undue
influence.
Q Is there a causation element to the fiduciary duty not to delegate
and
>are there causation elements for all the breaches of the fiduciary
>duty of care?
Yes.
QWhat fiduciary duties were violated in Marsman v. Nasca?
>
A: Probably the duty to administer the trust in accordance with the
trust
instrument, and the duty to pay income to the beneficiary.
Q Is it true the real property acquired outside of California by
a
>married couple domiciled in California is not quasi-community
>property, and that quasi-community property only encompasses
non-real
>property?
>
A: Objection: compound question. (1) depends; (2) true.
Q: Do we use a 120 hour standard for survival (if the issue is
>simultaneous death)?
>
A: only for intestacy.
Q Can D.R.R. be used where a codicil is executed to a will based
on a
>mistake of fact – in that the codicil revoked a section of the will
>based on a mistake of fact and the testator would not have revoked
>that section of the will had they known the true facts?
>
A: If I understand the question correctly, yes.
Q Are damages for a breach of the duty of care where the
breaching party
>has the right to sell adjusted for inflation?
>
A Maybe.
Q Under UTATA can a pour over trust be modified just as
informally after
>the settlor has died? DL
A: No--in that case you need to go thought the more formal modification
procedure we learned in class--unforeseen circumstances, etc..
***********************************
>Q: Can an properly executed codicil make a fill-in the blank
>will valid? Based on the Johnson Rule, it seems that if the
codicil
>was properly executed and the codicil and fill-in will could be
read as
>one document then it should work? How about through
incorporation by
>reference?
A: I assume you mean a form will that is not properly executed.
According
to Johnson, the answer is yes, but only if you decide that the
holograph was a
codicil to the form will. A holographic will could also
incorporate the
form will by reference, but the elements of incorporation would have to
be met
("I hereby incorporate by reference a form will that I filled out on
this
date...")
*******************************
> Q: Does the doctrine of substantial compliance and the
harmless
>error rule apply to holographic wills or only to attested wills? BC
>
A: In theory, either one, but it is less likely with holographic wills
because
the formalities are less.
*******************************
>Q If a gift in a will was revoked by operation of law (e.g.
divorce),
>does the gift go by intestacy or back to residue?
>
A: If the gift is revoked, it remains part of the estate.
If there
is a valid will with a residuary clause, it goes via the residue.
Otherwise, the gift is not disposed of by will and goes by intestacy.
>Q: Is the only time a gift falls into residue when a beneficiary
predeceases T? DK
>
A: Any part of the estate not disposed of by specific bequests is
part of
the residue. Rememnber that the
residue refers
to all the rest of a person's probate estate. Thus, a bequest
that fails
for ANY reason is part of the "rest" of the estate and becomes part
of the residue.
*****************************
>Q: I understand republication by codicil to be when a testator
revokes
>will 1 by executing will 2. Then, testator executes a codicil to
will
>1. Will 1 is republished by codicil and will 2 is revoked by
>implication.
>
A; No. When you execute a valid codicil to an existing will, that
codicil
republishes the will. As a result, you must read the will and the
codicil
as a single document, dated on the day the codicil was executed.
In
addition, under the Johnson case, if the will was improperly executed,
republication has the effect of making it a valid part of the will.
>
>Q: Can the doctrine of revival be applied to this situation? Is it
>correct to say:
>Testator executes will 1. Then, testator executes will 2,
which
>revokes will 1 by an express clause or inconsistency. Then
testator
>executes a codicil to will 1. Is it correct to say that will
1 is
>revived by the codicil or does revival apply only when testator
>revokes will 2 with an express intent to revive will 1?
>
A: Only partially correct. You should have a look at CPC
6123(a)
for the revival rule.
*********************************
>Q1. Must the assets be retitled in the
name of a
trust if you declare
>yourself trustee over those same assets?
A: Yes, if they have title documents.
Q2. When the trustee and settlor and
different
people, a trust can be
>created in two ways: 1) delivery of a trust deed OR 2)delivery of
>trust property with some evidence (written if real property) of the
>settlor's intent to give the property
in
trust? Is this true?
A: in this case, the trust is created by a deed or indenture of trust,
and
delivery of that deed to the trustee.
Q: Also, can a trust deed be oral? What exactly is a trust deed?
EO
A: The trust deed is a document that creates a living trust. It
cannot,
by definition, be oral.
**********************************
1) In your Dick & Jane hypo where there is a formal will that says
"To
Dick" (his son) and then the Testator has another child and he wishes to
change the will. If he simply crosses out the sentence containing "To
Dick" and adds (in his own handwriting) "To Dick & Jane" and
signs it,
that creates a holographic will, yes?
A: yes, if it is an understandable sentence and a material provision.
But what happens to the rest of the provisions of the formal will that
are still typed? Are they invalidated so that only the portions in the
testator's handwriting and signed are now valid as a holographic will?
A; your hypo would create a partial revocation of that provision (and
perhaps a
codicil substituting a new gift). The rest of the will remains valid as
is.
2) On your handout of trust language, #7 states: "No interest in the
principal or income of this trust shall be anticipated, assigned,
encumbered, or subject to any creditor's claim or to legal process,
prior to its actual receipt by the beneficiary."
In my notes I have that this is a spendthrift provision because both the
voluntary and involuntary alienations are disabled. I understand that
the involuntary alienation is disabled because of the part about
creditor's claims. Is the voluntary alienation disabled because no one
can anticipate or assign an interest in the principal or income so that
goes to the beneficiary's right to transfer?? AM
A: Anticipating or assigning income often means you sold the right to
receive
the income in exchange for a lump sum--that would be voluntary
alienation.
**********************************************
Q Modern Portfolio theory: how do you reconcile the requirement
of
taking the individual beneficiaries' needs into account (and
preferring, say, income beneficiaries if the settlor
implied that--
like if the income beneficiary is the settlor's
old
mother, and the
remainder beneficiary is a charity) with the duty of impartiality?
A: Because the settlor's intentions
govern. If the settlor wants her
mother well
taken care of, that wish overrides the duty of impartiality.
**************************************************
Q1. What is the rule with respect to the validity of a no-contest
clause in a
will?
A; valid unless there was probable cause to contest.
A2. In order for a codicil to be valid, does it have to satisfy
the
formalities of either an attested will or a holographic will?
A: yes
Q3. With respect to the plain meaning rule, if we determine the
language
of a will is ambiguous, then extrinsic evidence is admissible to
determine what
the language means. Can we admit extrinsic evidence for both
patent and
latent ambiguities?
A: yes, we aren't making that distinction.
Q4. With respect to pour-over trusts, I understand that the pour
over
provision language in a will “funds” a trust & other language
in a will can “create” a testamentary trust. Therefore, a
pour-over trust is not the same thing as a testamentary trust.
a. However, is it possible for a
pour over
provision in a will to fund a previously created testamentary
trust? Or
does the trust being funded have to be a living trust?
A: assets could pour over via the will of A into a testamentary trust
created
by B.
b. A living trust that is funded
via a pour
over provision in a will becomes funded and “valid” after the
testator’s death. However a living trust is created and “goes
into effect” during a settlor’s
lifetime. What is the difference between a trust that “goes into
effect” and a trust that is “valid”?
A: I don't believe there is any difference in most cases.
Q5. What is the definition of a trust
failure?
Does it mean that a trust was in fact created, but that it could no
longer pay
out because there is no one to pay to?
A; A trust usually fails because it becomes impossible for it to
continue in
existence. But it can also fail if it was not validly created.
In the Clark v. Campbell case, did the trust fail or was the trust
never
created? I think the trust was never created because “my
friends” did not indicate an ascertainable trust beneficiary.
Does
the distinction matter?
A: The attempt to create a trust failed.
Does a resulting trust apply when there is both a trust failure and a
failure
to satisfy the creation requirements of a trust?
A: I suppose it could. But if an attempt to create a testamentary
trust
fails, you normally don't need a resulting trust because it will fall
into the
residue or go by intestacy.
Q6. When a settlor dies, the settlor’s creditors can reach to the same extent
they
could reach when the settlor was
alive.
However, when an income beneficiary dies, the income beneficiary’s
creditors are completely cut off – is that true?
A: yes.
Q7. If a settlor is dead, then
a
mandatory trust can be terminated before its natural end if you can
prove that
there is no remaining material purpose to be carried out. But if
the
trust was mandatory as to income & was supposed to provide lifetime
income
to a person, when would there be no remaining material purpose to be
carried
out? Can you please provide an example of a trust that is
mandatory as to
income that can be terminated before its natural end?
A: if the only purpose is to provide income, and the beneficiary does
not
particularly need lifetime support, I suppose you could terminate it.
Q8. I still don’t understand the difference between a
marital deduction trust and a bypass trust? I understand that a
bypass
trust is funded with an exemption amount & paid to a spouse, and is
used to
prevent a spouse’s estate from paying estate tax twice. How is
the
marital deduction trust different?
A; The marital deduction trust usually includes any assets of the
deceased spouse that go to the surviving spouse beyond what is in the
bypass
trust.
*****************************************************
Q: Can an administrative deviation be used to make an invalid
trust
valid, such as a candy trust or discriminatory trust, or must the trust
already be valid before it can be corrected? TC
A: It has sometimes been used for that purpose.
**********************************************************
Q: When a 2nd will expressly revokes a 1st will (which is
otherwise
valid), and the 2nd will is then contested, would the first will be
revived? Or would the estate be transferred by inheritance? I am
asking
this because I am trying to get at the issue of whether the testator's
heirs
would have standing to bring a will contest or whether only the
beneficiaries
under the 1st will would have standing to contest the 2nd will? RK
A: If the second will is challenged and found invalid, it will not have
revoked
the first will, thus the first remains valid. For this reason,
anyone
with a pecuniary interest in the first will has standing to contest the
second.
**************************************************************
>Q: I am getting a bit confused as to how to approach a "lapse"
issue on the
>exam. I realize that on the exam we are to use the Modern CA
rule re:
>lapse. In this case, I know that we should do an anti-lapse
analysis
>and that a class gift analysis is unncessary
b/c
the anti-lapse statute
>covers a class gift as well.
>
A: If you have a gift in a will "to A and B" and A precedeases
the testator, you will try to "save"
the gift by applying anti-lapse (which would give A's gift to A's
issue).
If that does not work, you try to apply class gift analysis (which
would give
A's gift to B). If neither works, A's gift lapses and goes into
the
residue.
>Q: My question is: are we ever going to use the CL "no
residue
of a
>residue" rule at all? And if so, if we do a lapse analysis
under
the
>CL, it seems to me that we would only be doing a "lapse" and a
"class
>gift exception" analysis (and no anti-lapse analysis b/c there is no
>statute). Am I correct in my assumptions? Or should we
ALWAYS
do an
>anti-lapse analysis EVEN IF we are analyzing under CL.
>
A: Under the modern Calif. approach, the residue is treated as a
class
gift. This, suppose "residue to A and B" and A precedeases testator. Once again, try to
apply anti-lspse. If that doesn't
work, B takes the entire
residue.
>Q: The reason I ask is b/c I was looking at one of the questions in
your
>website and you instruct the student to first apply the anti-lapse
>statute, and then see if a class gift analysis can apply. I
was under
>the impression that anti-lapse only applied under the Modern CA
rule and
>that there was no such thing in CL. PLEASE HELP!! I AM
SOOO
CONFUSED. SY
>
A: That is correct--first try to apply anti-lapse and if that does not
work,
try to apply class gift analysis to a specific or general
bequest. With
the modern rule (abolishing the no residue of a residue rule), a gift
of
residue to A, B and C effectively treats A, B, and C like a
class.
So in case of a possible lapse in the residue, simply try to apply antilapse--if that fails, there is no need for
class gift
analysis, because the modern residue rule takes care of the problem.