Ny Wills

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Definitions and laws

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• Body of Law in New York governing Wills and Estates
○ Estates Powers & Trust Law (EPTL)
○ Surrogate’s Court Procedure Act (SCPA)
• Issue: all persons who have descended from common ancestor. “Issue” and “descendants” are synonymous, and include those in direct line of inheritance with the decedent i.e., children, grandchildren, etc.
○ Distributees: individuals who inherit property under intestate succession, as contrasted with beneficiaries (legatees—for personal property or devisees—for real property) who inherit under a Will.
○ Residuary: balance of decedent's estate after taxes, etc.

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When does intestacy apply?

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• Article 4 of the EPTL contains the rules of descent and distribution in intestacy and typically apply when:
○ decedent left no will (or left a will that was not properly executed).
○ Will does not make complete disposition of estate (partial intestacy), or
○ heir (“distributee”) successfully contests Will, and the Will is denied probate.

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• Intestate decedent survived by spouse and no children:

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• Intestate decedent survived by spouse and no children: If intestate decedent is survived by spouse but not by any issue, surviving spouse takes entire estate.
○ Example: Conviser dies intestate, survived by his wife Deborah, his mother Marie, and his brother Robert. Conviser never had children. At his death, Conviser owned property worth $300,000. What distribution? Wife Deborah: $300,000. Mother Marie: Nothing; Brother Robert: Nothing.

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• Intestate decedent survived by spouse AND children:

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• Intestate decedent survived by spouse AND children: If intestate decedent is survived by his spouse and one or more children or their issue (descendants), whether of this marriage or an earlier marriage, surviving spouse takes the first $50K off the top of the estate and ½ residuary; and issue inherits left over residuary (share equally).
○ Unless estate is less than $50K: whole estate goes to surviving spouse.
○ Conviser died intestate survived by his wife Carol and two children: Marcia, Jan. Marcia and Jan are by an earlier marriage. Conviser owned property worth $550,000. What distribution? Carol: $50,000 + $250,000 = $300,000; Marcia & Jan: Marcia $125,000; Jan $125,000. (All of Conviser's children divide left over residuary).

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• Intestate decedent survived by children only and no child has predeceased:

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• Intestate decedent survived by children only and no child has predeceased: whole estate passes in equal shares.

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• Intestate decedent survived by children and issue of predeceased children:

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• Intestate decedent survived by children and issue of predeceased children: estate passes to alive children and issue of dead children BY REPRESENTATION: per capita at each generation.
○ Step 1: property is divided into as many equal shares as there are issue at first generational level at which there are survivors (usually children)
○ Step 2: all living persons at first generation level take one share
○ Step 3: shares of deceased persons at first generational level are combined and then divided equally among takers at next generational level is same way. (takers by representation when parent is dead).
Result: persons in same degree of kinship to decedent always take in equal shares.
○ In-laws are not intestate distributees--do not take.
§ Predeceased child cannot convey to spouse--decedent still controls.

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Per capita example

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○ G has 3 children, A, B, C, predeceased by B, who had two children, G1 and G2, and predeceased by C who has one child, G3. A has son, G4.
§ A gets 1/3. 2/3 remain (B and C share) and three takers (G1, G2, G3). Each gets 2/9. G4 takes nothing.

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No longer per stirpes

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○ NO LONGER PER STIRPES: In most states (and formerly in New York), distribution is “per stirpes,” under which issue of deceased child takes share their parent would have inherited if living. In the example above A would take 1/3; G-1 would take 1/3 in place of B; and G-2 and G-3 would take C share or 1/6 each.
§ NEW YORK DOES NOT FOLLOW THIS PER STIRPES RULE. PEOPLE OF THE SAME GENERATION ARE TREATED EQUALLY. Rule is now: Per Capita by Generation.

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Per stirpes, per capita comparison

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§ Gift to someone’s Will or Trust beneficiaries: distributed per capita at each generation: In 1993, Tillie who is single executes a Will that bequeaths $900,000 “to the issue of my brother Bill,” and the rest of her estate to her sister Sue. When Will is executed, Bill has three children: Alice, Carol, and Donna. Alice dies in 1996, leaving a child Andy. Carol dies in 1999, leaving two children, Clyde and Claude. Tillie dies in 2004, and her Will is admitted to probate. Tillie is survived by her sister Sue; by her niece Donna, and by her three grand-nephews (Andy, Clyde and Claude). (Tested July 1999) Who takes the $300,000 to Bill’s“issue”?
□ Per Capita: At first level, Donna is alive, takes 1/3, takes $300K. Combine A and D's shares $300K for total of $600K. Andy, Clyde and Claude each take 1/3 of $600K or $200K each.
□ Per stirpes: Will can override and change default distribution to per stirpes. If only 1 member of 1st generation, no change from per capita, because share drops down to grandchildren (if no issue, then divided by siblings).

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Inheritance rights of adoptive children

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• Inheritance rights of adopted children.: Adopted children and their issue have full inheritance rights from adopting family (and vice versa).
○ child adopted by new family has no inheritance rights from natural parents or other members of birth family.
§ Exception: Where a child is adopted by spouse of birth parent, child and its issue can inherit from all three lines (birth parents lines and spouse’s line). One way street, birth family cannot
□ Example: Davis’s father dies; her mother remarries and the second husband adopts Davis. Davis and her issue have inheritance rights from the natural mother, adoptive father, and family of the deceased birth father.

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Child adopted by a relative

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○ If child is adopted by relative: if adopted child is related to decedent by both birth relationship and adoption, child inherit under birth relationship unless decedent was adopting parent, in which case child inherit under adoptive relationship.

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Adopted child example

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§ Maude (a widow) dies in 1980, leaving a child: Andy. In 1984, Maude’s sister Sarah who already has 2 children, Sam and Susie, adopts Andy. Sarah dies in 2001 and then Granny dies intestate in 2004. Rodney, who wants a ½ share, claims that Andy takes under the adoptive relationship only, meaning that there are only two lines of issue (Sarah’s line and Rodney), and he inherits ½ of Granny’s estate. Is he right? NO. Andy takes under birth relationship only, decedent is not adoptive parent, decedent is grandma. Andy still represents Maude.
□ Rodney takes: 1/3 because there are three lines. Andy, Sam and Susie take: 2/9ths each (2/3 of Maude and Sarah distributed equally).
□ Same facts, except Sarah (not Granny) dies intestate. What distribution of Sarah’s estate? Where adopting parent dies intestate, child takes under adoptive relationship only. Therefore Andy gets 1/3 of Sarah’s estate along with Sam and Susie who each get 1/3.

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Inheritance rights of non-marital children

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• Inheritance rights of non-marital children: Child born out of wedlock (“nonmarital child”) has full inheritance rights from the mother (and mother’s kin) and vice versa. However, the child inherits from the natural father only if paternity is established by one of the following five tests:
1. Legitimated by marriage: Father married mother after child’s birth; or
2. Order of filiation in paternity suit entered during father’s lifetime adjudicating man to be child’s father; or
3. Father files a witness and acknowledged affidavit of paternity with the Putative Father Registry; or
4. After death, paternity established in probate proceeding by clear and convincing evidence (participation in school activities, gifts, NOT support alone) AND father openly and notoriously acknowledged child; or
5. Blood genetic marker test (DNA) plus other evidence proves paternity by clear and convincing evidence (if DNA is rebutted).
• NOT confused with equitable paternity from domestic relations.

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• Circumstances disqualifying spouse from taking intestate share (dismal):

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• Circumstances disqualifying spouse from taking intestate share (dismal):
• Divorce (final decree or annulment)
• Invalid divorce (surviving spouse procured divorce not recognized as valid under NY law. NOT disqualified if deceased spouse procured invalid divorce).
• Separation decree: rendered against surviving spouse. Separation agreement does not result in disqualification, unless specific language in EPTL.
• Marriage is void: incest, bigamy, fraud.
• Abandonment/Lack of support: if surviving spouse abandoned or refused to support
• Assume surviving spouse predecease decedent and drop share to their children or whoever is next in line.
§ No slayer statutes in NY: if one spouse kills the other, create constructive trust.

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Advancements

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• Advancements: Lifetime gifts to intestate distributee: Common Law Background: At common law, a lifetime gift to a child was presumptively an advancement (i.e. an advance payment) of his intestate share, to be taken into account in distributing the estate at death. This was based on a presumption that a parent would always want to treat his or her children equally.
• New York: New York has rejected the “advancement” presumption by statute. In New York, there is no advancement unless proved by contemporaneous writing made at time of the gift that is signed by donor or donee.

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§ On Al’s 25th birthday his father (Fred) gave Al 100 acres of land, and told his other two boys (Ben and Carl), “you’ll receive similar gifts when you reach 25.” Two weeks later, Fred writes Al a letter: “I want you to know that the land I gave you is to be considered an advance on your inheritance share of my estate.” Fred signs it. Two years later Fred dies intestate survived by Al, Ben and Carl, without having made gifts to Ben or Carl. The net value of Fred’s estate is $300,000, and the land given to Al is worth $30,000 on Fred’s death. How should Fred’s estate be distributed?

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□ Should Fred’s gift to Al be treated as an advancement? No. Not contemporaneous writing made at time of gift. What distribution of Fred’s estate, then? Equal shares ($100,000 to each).
□ “advancement” arithmetic: Suppose, in Example #8, Fred’s writing to Al was contemporaneous, making it an advancement. What distribution of Fred’s estate?
® $300,000 Value of Fred’s estate, +$30,000 date-of-death value of advancement property= $330,000
® Because Fred was survived by three children, divide the $330,000 by three, meaning that each child’s share is $110,000, with Al treated as having already received $30,000 of his share. So Al would get $80,000. Ben and Carl get $110,000 each.

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Disclaimer

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• Disclaimer (Renunciation) by intestate distributee or beneficiary: No one can be compelled to be beneficiary under a Will or to take property by intestacy. A beneficiary under a Will or an intestate heir can disclaim or renounce (in whole or in part) their interest in the decedent’s estate. Person who disclaimed is presumed to predecease.
• To be a valid disclaimer,
1) Must be in writing, signed and acknowledged (before a notary public).
2) Must be accompanied by a separate sworn affidavit that they received no consideration for making the disclaimer (unless court authorizes receipt of consideration for the disclaimer).
3) Must be irrevocable (Tested Feb. 1999) (after disclaimer is filed, you can’t change your mind).

disclaimer must be filed with the Surrogate’s Court within 9 months after decedent’s death

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Why disclaim?

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•  Why disclaim inheritance or testamentary gift? #1: To avoid gift taxes—if he disclaims it, it passes directly to the grandchildren; #2: To avoid creditors claims
§  BUT heir or beneficiary cannot disclaim in order to remain eligible for Medicaid (Against public policy). Similarly, cannot disclaim to defeat federal tax lien.
• Will beneficiaries can disclaim.

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Disclaimer example

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Daddy Push dies intestate, survived by two sons, W and Reb, and his two grandchildren (W’s children) Barb and Jen. Daddy Push’s estate is valued at $1,500,000. Three months after his father’s death, W files with Surrogate’s Court a document, signed and acknowledged before a notary public, that states, “I hereby irrevocably renounce and disclaim all of my right, title and interest in the estate of my late father. In a separate sworn instrument, W states: “I have received no consideration for making this disclaimer.” Valid? Yes. (Signed Writing, Sworn Affidavit of no consideration, Irrevocable, Filed Within 9 Months).
§ What distribution, then? Son Reb inherets ½. W’s ½ is treated as though W pre-deceased the decedent. W’s two children would get ¼ each (by applying anti-lapse statute).
§ But if disclaimer creates inequitable result (reduces child's 1/2 share from parent to 1/3 shared with cousins), act as if disclaimer died 1 day after decedent, so disclaimer doesn't reduce someone else's legitimate share.

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Probate

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• Order of priority for administrator: wife, children, grandchildren, parent, siblings, any other distributee.
• Basic Purpose of Probate Proceedings
○ To prove document is last validly executed Will of decedent; and
○ To appoint executor to administer estate
• Probate refers to Surrogate’s Court proceeding: 1) it is judicially determined that decedent died with validly executed will and his or her heirs or intestate distributees are determined AND 2) personal representative named in Will, who is executor, is appointed by court to administer decedent’s estate.
○ If there is no Will left by the decedent there is an administrative proceeding, and it is started by a distributee to be appointed administrator of the estate.

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• Requirements for duly executed will 6 point Test (EPTL 3-2.1)

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1. Threshold: To have capacity to make a Will, the testator must be 18 years old.
2. Signed by Testator (or by someone at testator’s direction and in her presence)
§ When T’s name is signed by another person (proxy signature): such person 1) must also sign her name and 2) cannot be counted as one of the two necessary witnesses and 3) shall affix her address (failure to affix will not invalidate)
3. Testator's signature must be "signed at the end therof"
4. Testator must sign will (or acknowledge his signature) in presence of each witness.
5. Testator must publish the will: must declare document to be their last will and testament, must communicate to the witnesses that they are witnessing a Will (not some other legal document),
6. At least two attesting witnesses (not required to sign in testator's presence or each other's presence).
7. Execution ceremony must be completed with 30 days. Starts to run: When first witness signs (not when the testator signs).

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Signature at end requirement

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○ “Signature at the end” requirement: Conviser signs his Will in the middle of the page. Immediately following Conviser’s signature, the Will names Conviser’s friend Davis as executor. Then follows the two witnesses’ signatures.
§ Is Will admissible to probate, when it was not signed “at the end thereof”? Yes, will is admissible. However, only consequence is that words following signature are ignored.
§ Exception: The entire will invalid only if what came after signature was so important or material that to ignore that and enforce everything else would defeat testator’s intention.

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Contemporaneous transaction

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□ Contemporaneous transactions: Samantha signed before Carrie signed the Will: signing was part of a contemporaneous transaction. (NY Courts: Exact order is not crucial).
□ But where Testator forgot to sign when witness signed, and added her signature in witnesses’ presence a week later, Will denied probate. Why? Testator did not sign in a contemporaneous transaction.

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Will execution issues:

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□ Witnesses are attesting witnesses and must attest to Testator’s signature when Testator signs.
□ Legibility not required: Carrie’s signature is barely legible; does that create a problem? No. Any mark intended as testator’s mark will satisfy signature requirement.
□ Voluntary: Samantha held and guided Carrie’s hand when Carrie signed. No, as long as it was Carrie’s voluntary act. (Testator cannot be comatose or forced to sign).
□ Witnesses signed outside each other's presence: Samantha and Miranda did not sign in each other’s presence; is that a problem? No. In NY, witnesses are not required to sign in each other’s presence.
□ Timing: Miranda signed 14 days after Samantha; is that a problem? No. In NY, the second witness must sign within 30 days of the first witness.
□ Acknowledged signature: Carrie did not sign the Will in Miranda’s presence; problem? No, because she acknowledged the earlier signature. If signature is showing, that is a tacit acknowledgment and satisfies.

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Witness predeceases testator

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○ When Witness Predeceases Will Maker: Burden of proof as to due execution is on the will proponent (the one offering the Will for probate; usually the executor).
§ If Will is not ­­­­­­­­­self proved, both attesting witnesses must testify as to the facts necessary to show due execution.
§ If one witness is dead, absent from state, incompetent or cannot with due diligence be found, testimony of one witness suffices.
If none of the witnesses are able to testify, Will proponents must prove two signatures- the signature of testator and one witness.

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Attestation clause

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Attestation clause, which appears below the testator’s signature and above the witnesses’ signatures, recites all the elements of due execution:
○ Attestation is prima facie evidence of valid execution, but if Will not self-proving, it is not substitute for formal proof (must bring witnesses to prove signatures). Unless self-proving, court should not admit to probate simply on the face of the documents themselves.
○ Attestation is not legally required in any state.
§ Value of an attestation clause: Such a clause is prima facie evidence of facts recited.
§ When useful:
□ Witness w/bad memory - “probate of a will does not turn on the memory of the attesting witnesses”
□ Hostile witness – attestation clause can be used to rebut a hostile witness.

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Self-proving affidavit

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• Self-proving affidavit: Witnesses sign a sworn affidavit in presence of notary public (attorney) that recites all statements they would make if called to testify in court. Affidavit is usually signed at same time Will is executed.
○ Unlike an attestation clause (which is merely corroborative of witnesses’ testimony – you still have to call witnesses to testify, or else prove their signature), self-proving affidavit is legal record of witnesses. Affidavit serves same function as an interrogatory or deposition, i.e., it is sworn testimony.
○ Will is admissible to probate on strength of the sworn recitals in affidavit unless interested party (an intestate distributee, beneficiary, or legatee under an earlier Will) objects, in which case formal rules of proof of due execution apply and must call two attesting witnesses to testify.

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Interested witness statute

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• Interest witness statute: validity of will is not affected if will beneficiary is also an attesting witness, but bequest to witness is void, unless
1) supernumerary rule: at least 3 witness and 2 were disinterested;
2) witness would be intestate distributee if testator died without a will, in which case, "whichever is least" rule applies: lesser of either will or intestate share.
• Compensation that is earned as an executor DOES NOT trigger the interested witness rule. Thus, executor can also be a witness.

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Interested witness example

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○ Conviser’s Will provides: “I give $50,000 to my brother Greg, and my residuary estate to my sister Marcia.” Will, which names Alice as executor, is signed by Conviser and witnessed by Greg and Alice. Conviser is survived by his brother Greg and his sister Marcia as his only living relations.
§ Conviser’s estate is valued at $200,000; what distribution?
§ Is the bequest to Brother Greg void under the interested witness statute? No. If Conviser had died intestate, what would be the amount of Greg’s intestate share? ½ of intestate share ($100,000). Applying the whichever is least rule, the $50,000 is less than $100,000 of Greg’s intestate share. Not void under the whichever is least rule, so Greg takes the $50,000.
§ Conviser’s Will named Alice (who was an attesting witness) as executor. Is Alice qualified to serve (and be compensated) as executor? Yes, even though Alice will be paid by the estate, only beneficial gifts must trigger the interested witness rule.

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Foreign wills act

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• Foreign Wills Act: a will is admissible to probate if it was validly executed under: Law where it was executed, regardless or testator's domicile at that time, NY law OR law where testator was domiciled, either when will executed or at testator's death.
○ Rules only go to whether will is admissible to probate in NY, once admitted to probate, NY law governs construction and application of its provisions. 

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Foreign wills act example

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Halle B. executes her Will in Florida, but she does not “publish” the Will. The witnesses thought they were witnessing a power of attorney, not a Will. (The Will would be valid in Florida, which does not have the “Will publication” requirement.) Halle B. moves to New York and dies there five years later. Is the Will admissible to probate in New York? Yes, even though it was not published, it satisfied NED test – valid under the law where it was executed. Once admitted, New York law applies.

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Holographic and nuncupative will

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• Holographic and nuncupative (oral) wills: both are void in NY
○ Holographic will: entirely in testator's handwriting that is signed, but not witnessed
○ Nuncupative: oral will.
○ Exception: valid for armed services during declared or undeclared war (expires one year after discharge) and mariners at sea (expires after 3 years).
○  New Jersey DOES recognize holographic Wills so if NY resident executes Will in New Jersey and dies in NY the Will is valid under the Foreign Wills Act. (An instance where Holographic Wills are admitted in NY!)

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Holographic will example

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○ Example: Davis writes and signs a document in her own handwriting that reads: “This is my last Will. I leave all my property to the Brooklyn Law School.” The instrument is not witnessed; should it be admitted to probate? No. Holographic wills (handwritten, signed, and un-witnessed wills) are not valid in NY unless Davis is in armed forced or Davis is a Mariner at sea.
§ But if instrument, entirely in Davis’s hand, was signed by two witnesses, it would be valid (assuming the 6-point test was satisfied). No requirement that Will be typed.

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Lawyer's duty

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• Lawyer's duties: create valid will only run to client contracting for services (privity of contract).  
○ Example: Leticia Lawyer prepares a Will for Davis and supervises the Will’s execution. However, Leticia does not have Davis declare that document is her Will; the two witnesses think document is a power of attorney. On Davis’s death, the Will is denied probate, and Davis’s estate passes by intestacy. Do intended Will beneficiaries have cause of action against Leticia Lawyer for negligence, recovery being amount they would have taken had Will been validly executed? No, because there is no privity contract between Lawyer and Will beneficiaries.
Estate does have cause of action for negligent estate planning for huge estate tax consequences.

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Will revocation

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• Will can only be revoked in 2 ways:
○ By subsequent testamentary instrument executed with will formalities OR
○ By physical act (with intent to revoke).
§ Signature: Anything done to testator’s signature shows attempt to revoke will as a decisive act of revocation.
□ Suppose Conviser crossed out his signature with a big X; valid revocation by physical act? Yes. This is a decisive act of revocation.

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Will revocation example

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○ Example: Conviser’s three-page Will is found among his papers after his death. At the bottom of each page is written, in Conviser’s handwriting, “This Will is void. Conviser.”
§ Valid revocation by subsequent testamentary instrument? No. The handwriting was not witnessed by two witnesses. Did not comply with 6 point Will formalities. AND, NY does not recognize holographic wills, so holographic changes/revocations are not valid.
§ Valid revocation by physical act? No. It is not cancellation because none of writing crossed the words of the will. The cancel, must cross out words of will. Must deface words of will.
□ Suppose Conviser had written, at the bottom of each page, “I cancel this will.” Valid revocation by cancellation? No.

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Revocation by implication:

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• Revocation by implication: When there are two Wills, but no valid revocation of the previous will.
○ example: In 1994, Rudy G. executes “my last Will.” In 1998, Rudy G. executes “my last Will.” The 1998 Will does not contain language of revocation of earlier Wills.
○ To the extent possible, read two instruments together.
○ Second will is treated as codicil to first will, and revokes first will only to extent there are inconsistent provisions.
○ But if second will is wholly inconsistent with first, the first will is revoked by implication. (first: all property to A", second "all property to B")

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Revocation by physical act of another

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• Revocation by physical act of another (by proxy): must be at testator's request and done in testator's presence and in front of two witnesses. How many people have to be in the room? FOUR: Testator, revoking person, two witnesses.

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• Presumptions regarding revocation of wills:

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1. When will last seen in testator's possession or control is not found after death, presumption is that revoked by physical act.
2. When will last seen in testator's possession or control and is found mutiltaed after testator's death (torn in half), presumption is that testator did mutitlation with intention to revoke.
○ Neither presumption arises if will last seen in possession of someone adversely affected by its contents.
○ Evidence admissible to rebut presumption of revocation where will cannot be found or found damaged. (Exs. Tested July 1996: Will left with attorney for safekeeping – and attorney cannot find it; Tested Feb 1998: T told witnesses that destruction of the Will was accidental.)

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• Changes on face of will after it has been executed:

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• Changes on face of will after it has been executed: How can you make changes to will? write new will and revoke old will or make codicil that changes parts of old will.  Both must satisfy formalities.
○ Words added to will after signed and witnesses are disregarded.
○ Partial revocation by physical act is NOT RECOGNIZED in NY:

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changes on face of will example

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§ Example" Simon’s duly executed Will makes a number of general legacies, including: “10. I give the sum of $5,000 to my nephew, Justin. 11. I give the sum of $2,000 to my niece, Britney.” Simon decides to make some revisions in his Will without the assistance of an attorney. Using a marking pencil, he deleted clause #10 in its entirety and strikes the “$2,000” in clause 11. Using a ballpoint pen, he writes in “$5,000” above the crossed-out $2000, and initials and dates the margin. Simon dies three years later. What is the effect of these changes on the Will? Does not affect the original Will.
□ Does Britney take the $5,000? No. She gets the $2,000 only.
□ Was gift to Justin validly revoked? No, partial revocation by physical act not recognized in NY.
§ Suppose the interlineations and cross-outs in were made by testator T immediately before T signed the Will and the witnesses signed as attesting witnesses. Are the changes valid? Yes. Now they would be part of duly executed will: only changes after execution are nugatory.

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No revival of revoked wills

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• No revival of revoked wills: will that is revoked by later will containing revocation will, first will cannot be revived simply by destroying second will. Only revived if: re-executed, signed again by testator and 2 witness OR republication by codicil--codicil to first will that makes changes to will.
Rule also applies to codicils. Always need validly executed document to make a change.

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Revoked will example

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Tyra executes new Will that, after revoking 1997 Will, leaves her estate in trust: Income to Nigel for life, remainder to Nigel’s children. (Tyra does not destroy 1997 Will.) Later, Tyra changed her mind again. She revokes 1999 Will by physical act, intending to revive earlier Will. On Tyra’s death in 2004, 1997 Will and unsigned photocopy of 1999 Will are found in Tyra’s safe deposit box. Tyra is survived by Nigel, and by her daughter Janice whom she detested and intended to disinherit. Which Will, if either, is entitled to probate? Neither.
§  Will #1 was revoked when Will #2 (with its revocation clause) was executed. Will #2 was revoked by physical act. No revival of Will #1 by revocation of Will #2.
§ When Tyra made second Will containing language of revocation of earlier Wills, 1997 will was legally dead--could not be “revived” simply by destroying later Will, only revived: re-execution or republishing via a codicil to it.

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Dependent relative revocation

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○ Dependent relative revocation (might be applied by NY courts): common law doctrine permits revocation to disregarded when premised upon, conditioned upon, or dependent upon mistake of law as to validity of another disposition (here, the mistaken belief that by revoking Will #2, she thereby revived Will #1).
§ Effect would be to disregard the revocation of the second Will (one that was revoked based on the mistake of law) and permit its probate. Applied by one Appellate Division case, but never by Court of Appeals. If DRR question, argue both ways (permit/reject)
§ Application of DRR is sometimes called the second best solution doctrine. (best solution – giving effect to T’s intent by reviving the 1997 Will – is not possible under New York law.) doctrine should never be applied unless disposition that results from disregarding revocation comes closer to doing what the testator tried (but failed) to do than an intestate distribution.

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Dependent relative revocation example

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If the 1997 Will had said “all to my nephew Nigel” and the 1999 Will said “all to my friend Jay” and other facts were the same, we would not want to apply DRR; it would not be applied. Tyra’s revocation of the 1999 Will (in effect, “I’ve changed my mind, and I do not want Jay to take my estate”) would be independent of her intent to revive Will #1 in favor of nephew Nigel. To disregard the revocation of the 1999 Will would defeat intent. On these facts, the conventional rules would be applied, and she would die intestate.

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Proof of lost wills statutes

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• Proof of Lost Wills Statutes (used to in DRR or truly lost wills): proponent of will must prove: lost or later will was duly executed AND lost or later will was not revoked.
○ Must overcome presumption of revocation that arises from non-production. Or revocation should be disregarded because of DRR
○ All provisions of will must be clearly and distinctly proved by each of at least two credible witnesses or by copy or draft of will proved to be true and complete. Need photocopy.

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NY anti-lapse statute

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• New York anti-lapse statute: if will beneficiary dies during testator's lifetime, gift lapses (fails) since cannot make gift to dead person. UNLESS: gift is saved by state's anti-lapse statue.
○ NY provides that gift does not lapse if it vest in deceased beneficiary's issue who survive testator.
○ Two conditions must be satisfied:
§ Pre-deceased beneficiary was testator's ISSUE or BROTHER or SISTER AND predeceased beneficiary leaves issue who survive testator.

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Anti lapse example

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essica’s Will bequeathed $75,000 to her sister Ashlee, who has four children. Ashlee filed a proper instrument of disclaimer (and a separate affidavit – no consideration received) within 9 months after Jessica’s death. Due to the disclaimer, we read the Will as though the disclaimant predeceased the decedent. Does the anti-lapse statute apply in this case? Yes, anti-lapse statute will save gift. Ashlee is the sister, and has issue who survive testator.

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Anti lapse example

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○ Conviser’s Will devised Blackacre to his brother Bill, and devised his residuary estate to his sister Jan. Bill dies first during Conviser’s lifetime, survived by his wife Hill and his daughter Greenwich. Bill leaves a Will that devises “all my property” to his wife Hill. Then Conviser dies survived by Hill, Greenwich and Jan. Who takes Blackacre? Does the anti-lapse statute apply to the devise to Bill? Yes, because 1) Bill was testator’s brother and 2) Bill left issue who survived testator. Therefore, Blackacre passes to: Greenwich, because she stands in for her father under state anti-lapse statute.
§ But what about the fact that Bill left a Will that devised “all my property” to his wife Hill? Anti-lapse statute does NOT save gift for deceased beneficiary’s estate? No. Statute names substitute takers, not the will.

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Conditional gifts

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• Conditional gifts: if gift fails according to its terms, anti-lapse does not apply.
○ Example: Suppose, instead, that Conviser’s Will devised Blackacre “To my brother Bill if he survives me.” Again, Bill dies during Conviser’s lifetime, leaving a child (Greenwich) who survives Conviser.
○ Does Greenwich take Blackacre under the New York anti-lapse statute? No. Testator says that Brother must survive to get gift. Anti-lapse does not apply because the condition on the taker was not taken. Who gets Blackacre? Falls into residuary estate.

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Lapse in residuary

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• Lapse in residuary gift: surviving residuary beneficiaries rule: if testator's estate is devised to 2 or more persons and gift to one of them lapses or fails for any reason and anti-lapse statute does not apply, other residuary beneficiaries take ENTIRE RESIDUARY ESTATE, in proportion to their interest in residuary, absent contrary provision in will.

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lapse in residuary example

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○ Examples: Simon’s Will, after making various bequests, provides: “I devise all of the rest, residue and remainder of my estate in equal shares to my brother Clay, my sister Francesca, and my friend Ruben.” Simon is survived by Clay and Francesca. Simon’s friend Ruben predeceased him, leaving a son (Ruben Jr.) who survived Simon. What distribution? Does the anti-lapse statute apply to Ruben’s one third share of the residuary estate? No, Ruben was not issue or related as brother or sister to testator. Who takes the residuary estate, then? Clay and Francesca take 1/2 each of Rubin’s 1/3 share.
○ Same facts, except that it was Simon’s sister Francesca who predeceased him, leaving a child (Ryan) who survived Simon. Clay and Ruben also survive Simon. Who takes Francesca’s one third share of the residuary estate? Ryan.

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Class gift rule

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• Class gift rule (rule of construction based on presumed intent): If Will makes gift to group of persons generically described as class (“children”, “brothers and sisters”, etc.) and some class members predecease testator, (assuming anti-lapse does not apply) class members who survive testator take (absent contrary provision).
○ Anti-lapse rules will trump class gift rule. If Anti-lapse does not apply, those in class that predecease teastator, share goes to residuary.
§ Rationale: Testator was “groupminded” in making gift, and wanted this class of persons – and no one else – to share ownership of the property. (i.e. Determining the takers as of testator’s death).

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Class gift example

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○ Example: T’s Will devises Blackacre “to the children of my brother Howard,” and his residuary estate to his wife Wanda. At the time Will is executed, Howard has two children: Andy and Betty. After the Will is executed but before T’s death, Howard has another child: Carl. Then Andy dies survived by his son, Andy Jr. Then T dies and two years later Howard has another child: Donna. Who owns Blackacre?
§ Does Andy Jr. take share under the New York anti-lapse statute? No, because his father was the testator’s nephew (must be testator’s issue, brother, sister).
§ Who takes, then: Betty and Carl each take as surviving class members (1/2 each).

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Named individuals rather than class gift

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○ Contrast result when beneficiaries are named individual and not as class: “I devise Blackacre to Andy, Betty and Carl, the children of my brother Howard, in equal shares.” Here Will makes gifts of one-third shares to three individuals: Andy, Betty and Carl. If Andy predeceases T, his share falls into residuary estate and residuary takers would own share along with Betty and Carl because individually named.

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Class gift and antilapse

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○ BUT antilapse: If gift were “to the children of my son Baxter,” since beneficiary who predeceased testator was within degree of relationship covered by anti-lapse statute (i.e. issue), and left child who survived testator, Andy Jr. would take under anti-lapse statute. Thus, class gift rule gives way to the anti-lapse statute when predeceasing class member is within the scope.

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Gift to adopted child in class

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• Gift to adopted out child: Suppose a child is placed up for adoption and is adopted by a new family. Does the “adopted out” child take as beneficiary of a class gift made in the Will of a member of the child’s natural family? No. Adopted out children do not take as members of Class gifts.
○ Two reasons why adopted out children do not take class gifts:
§ Against NY policy that sealed adoption records are uncovered.
§ Adopted out children have a new family from which to inherit.

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Adopted child class gift example

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○ As a teenager, Conviser’s daughter Paula has a child (Simon) born out of wedlock in 1975; Simon is placed for adoption and is adopted by the Ryans. (Because the adoption records are sealed, the identity of the adoptive family is not known to Conviser or Paula.) Thereafter, Paula marries and has a child Randy. Conviser dies in 1985, leaving a Will that establishes a trust: “income to Paula for life, and on Paula’s death, remainder to her issue.” Paula has just died; the trustee learns of Paula’s teenage pregnancy and somehow learns the identity of Simon. Is Simon (the adopted out child) entitled to a share of the gift of the trust remainder to Paula’s “issue” along with Paula’s son Randy? No.
○ Would Simon be entitled to a share if he had been adopted by another family member (e.g., Simon’s parents died and he was adopted by an aunt)? Yes, he could inherit by birth relationship and not by adoptive relationship (because decedent is not adoptive parent).

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Rule of convenience

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• Rule of convenience: rule of construction used to determine the takers of class gift. class is closed (later born members are excluded from the gift) at ime a distribution to the class must be made.
○ determine distribution rights of each living class member, so distribution can be made without necessity of asking for rebate or refund later on.
○ Outright gift by Will: class closes at T’s death (i.e. when existing class members can demand the gift) (subject to gestation principle—Common law presumption: 280 days from conception to birth (those in womb also take)).

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Rule of convenience example

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○ Life estate, remainder to class gift--closes at death of life tenant: Tim’s Will bequeaths property in trust: “income to my wife for life, and on her death principal to the children of my sister Sue.” At Tim’s death, Sue has two children: Annie and Bennie. Then Sue has another child: Connie. Then Tim’s wife dies and her life estate comes to an end. Two years later, Sue has another child (Donnie). Who is entitled to a share of the trust corpus on the wife’s death?
§ Under “rule of convenience,” when does class close? When any class member is entitled to take—here at life tenant’s death.
§ Does Connie share in gift? Yes, she was born before death of life tenant (so class was still open when she was born).
§ Does Donnie share in gift? No, class closed when life tenant died, and he was born after life tenant died.

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Simultaneous death act

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• Simultaneous death act (Revised Uniform Simultaneous Death Act): absent will provision to contrary if 2 persons die under circumstances such that there is INSUFFICIENT CLEAR AND CONVINCING EVIDENCE that they have died with 120 hours or 5 days, the property is distributed as though he or she survived--meaning two people die within 120 hours of each other, if no proof that one survived the other for more than 120 hours, presume that each outlived the other when distributing their property.
○ Key is to look at whose estate you are distributing. For insurance: treat as though insured survived and beneficiary predeceased the insured.

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Simultaneous death act example

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○ Mary, a widow, is the insured under a $25,000 life insurance policy that names as beneficiary “my son Sam if he survives me; otherwise my daughter Donna.” Mary executes Will that leaves her residuary estate “one half to my son Sam and one half to my daughter Donna.” Mary and Sam are both killed instantly in plane crash. Mary is survived by Donna and a grandson, Sam Jr. Who takes the life insurance proceeds? Mary’s residuary estate?
§ Presume that Mary survived under RUSAD, $25,000 life insurance proceeds: Goes to Donna because Sam did not survive Mary.
□ Why not apply anti-lapse: Sam did not meet the condition of survival.
§ Mary’s residuary estate: Donna takes ½, of course. Other ½: devised to Sam’s son (by applying Anti-Lapse statute—applies because no condition of survival).

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Jointly held property and simultaneous death act

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○ Jointly held property: passes as though each survived other--severs right of survivorship in jointly held property, so passes as though tenancy in common, rather joint survivorship.
§ If H and W are joint tenants (with right of survivorship) or tenants by entirety die simultaneously, ½ goes to H’s heirs, ½ goes to W’s heirs.

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• Testator marries after will execution:

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• Testator marries after will execution: Person executes a will then marries. In NY, marriage following execution of will has no effect on will. Elective share protects spouses.

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Testator is divorced after will is execution: if final decree of divorce, annulment or separation, read will as though spouse predeceased testator.

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• Testator is divorced after will is execution: if final decree of divorce, annulment or separation, read will as though spouse predeceased testator.
o Exception: all gifts in favor of issue of divorced spouse are not revoked by operation of law. Appointment of spouse as guardian is not affected.
§ If couple reconcile and remarry, all provisions in favor of former spouse are restored (statute applies only if divorced, annuled or separated) AT TIME OF TESTATOR'S DEATH.
o Contrast intestacy DISMAL, but under will only final decree of divorce, annulment and separation.
o Passing by operation of law (Life insurance/Totten Trust): divorce or annulment or separation decree excludes spouse from taking passing by operation of law.

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Divorce after will execution example

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o Conviser’s Will devises Blueacre to his wife Tyra. Will, which devises rest of Conviser’s estate to his brother Jay, names Tyra as executor and guardian of couple’s child Janice “if she is able; otherwise my brother Jay is to serve as executor and guardian.” Two years later Conviser and Tyra divorce; Conviser dies without having changed his Will.
§ Who takes Blueacre under Conviser’s Will? Brother Jay under the residuary clause.
§ But if will read so former spouse predeceased testator, doesn’t anti-lapse statute apply in favor of Tyra B’s daughter Janice? No. Tyra was wife, not issue, brother, or sister.
§ Who serves as executor of Conviser’s estate? Brother Jay who was named as alternate. Revocation applies to fiduciary appointments.
§ Who serves as Janice’s guardian? Tyra, divorce revokes rule does not apply to guardian of children.
§ Does the statute apply if Tyra had applied for divorce but final decree had not been entered at Conviser’s death? No. Need to have final decree to trigger revocation
§ Does statute apply if decree of separation was entered against Tyra before Conviser’s death? No. Must have final decree of separation. Separation agreement that explicitly waived rights under EPTL would cut off rights.

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• Pretermitted child (born or adopted after will is executed):

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EPTL does not protect children living when will executed, but attempts to treat after-borns same as already borns. (applies to nonmarital children if paternity is established).
o Statute applies only: to first and afterborn children (including adopted); who are unprovided for by any other settlement and who are not mentioned in will.  
o If testator had one or more children when will was executed:
§ If no provision made for any such child, pretermitted child gets nothing.
§ If gifts were made to testator's other children, pretermitted child share in gifts to other children as if class gift were made.
§ If appears intention of testator was to make limited provision only to testator's children living at time when will executed, pretermitted child takes intestate share. (Limited provision means testator mostly disinherited living children, but not inflicted on afterborn).
§ If children are given different amounts, pretermitted child probably takes proportionate share of each gift.
§ Ex. “I give Blackacre to my son Michael and $30,000 to my son David.” Thereafter, testator adopts Ed., who would take: 1/3 from Michael and 1/3 from David
o If testator had no other children when will executed, pretermitted child takes intestate share.
o If pretermitted child is provided for by another settlement (i.e., life insurance policy with him as beneficiary), then pretermitted child does NOT take share in will.

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Negative bequest rule

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• Negative bequest rule: words of disinheritance are given full effect even in partial intestacy.
o Hill’s Will devises Blueacre to her daughter Greenwich and her residuary estate to her husband Billy. The Will provides: I intentionally make no provision for my son Greg, as he married out of the faith and has been a great disappointment to me.” Hill divorces Billy in 1996 and dies in 1997 without having changed her Will. She is survived by Greenwich and Greg.. (Greg had no children.) Who takes the residuary estate?
§ Billy? divorce revokes rule revokes the gift to Billy. Billy gets nothing. Creates partial intestacy of the Residuary, b/c the Will did not make another gift.
§ Who takes then?
§ Common law: Greg would take ½ of the residuary estate (partial intestacy à disinheritance ignored).
NY Statute: Greg gets nothing. Treat as though Greg had predeceased Testator. Greenwich would take all. (But if Greg had children, would take that ½ partial intestacy through anti-lapse as distributees)

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• Lifetime gift to beneficiary--Satisfaction of legacies:

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Common Law Background: lifetime gift to beneficiary named in donor’s Will (executed before gift was made) was presumptively in partial (or total) satisfaction of the legacy, to be applied against amount to which the beneficiary was entitled under Will.
o New York: New York has rejected “satisfaction of legacies” presumption by statute. Gift is not treated as “satisfaction of legacy” unless proved by contemporaneous writing made at time of gift that is signed by donor or donee.
o Conviser writes a Will that makes a $25,000 bequest to Davis. Thereafter, Conviser gives Davis $10,000 cash, telling her (in the presence of a priest, a bishop, and a rabbi): “I want you to know that this a down-payment on the legacy I have given you in my Will.” Conviser dies two years later. Should the $10,000 gift be treated as a partial satisfaction of Davis’s legacy? No, there was no contemporaneous writing made along with the gift.

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Incorporation by reference

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• Incorporation by reference--extrinsic document: Common law and in nearly every state, terms of extrinsic instrument, not present at time will is signed (so not part of will itself), can be read into will if 1) document in existence when will was signed; 2) will shows an intent to incorporate document's terms and 3) extrinsic document is clearly identified by language in Will.
○ NY: does NOT recognize incorporation by reference rule. All document relating to Will must conform to Will Formalities.

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Incorporation by reference example

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○ On May 1, 2002, T executes a Will that provides: “I devise all of my jewelry to the persons named in a list dated March 5, 2002, which I have placed in my safe deposit box.” After T’s death the list is found. It is in T’s handwriting and signed by T, but not witnessed. It names various pieces of jewelry and the beneficiaries thereof. Should the indicated dispositions be given effect? No. Because in New York, doctrine of incorporation by reference is not recognized,

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Act of independent significance

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• Act of independent significance (non-testamentary acts): lifetime acts that have own purpose or motive independent of any testamentary purpose. Act that occur after will is executed should be given full effect in distributions (included in distribution of Will):
○ Exception for title document: deed, stock certificates, bank passbooks. Held to higher standard and cannot be passed by doctrine of independent significance.  

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Act of independent significance example

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○ Example: Davis executes a Will that bequeaths “the automobile that I own at my death” to her niece Lulu, and “the furniture and furnishings in my living room” to her sister Cheryl. Thereafter, Davis trades her 1989 Chevy in on a brand new (red) Mini Cooper. Shortly before her death Davis removes a Picasso (worth $80,000) from her den and mounts it on her living-room wall. What is the effect of these acts on Davis’s Will? Does Lulu take the Mini? Yes. Does Cheryl take Picasso? Yes.

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Classification of gifts through will

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• Classification gifts through will:
○ Specific gift: Only that asset can satisfy gift. “I devise Blueacre to my son John.”
○ Demonstrative legacy: general amount from specific source. “I bequeath $5,000, to be paid from the proceeds of sale of IBM stock, to Donna.”
○ General legacy: Gift of general dollar amount. “I give sum of $5,000 to George.”
○ Residuary disposition: “I give all rest, residue and remainder of my estate to my brother Jim.”
○ Intestate property: If partial intestacy results because Will was poorly drafted, has no residuary clause.

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Abatement

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• Abatement of legacies to satisfy creditors' claims: if there are more claims against estate than there are assets to cover, then gifts abate so that creditors claims are satisfied.
○ Absent will provision, order of abatement:
§ Intestate and residuary property
§ General legacies
§ Demonstrative legacies
§ Specific gifts
○ Within each class of gift, no distinction between real and personal property. Within class, abate pro rata.

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Ademption

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• Ademption: if will makes specific gift of property and property is not owned by testator at death, gift fails under ademption, without regard to testator's intent. Does not apply to general legacies (general amount) and demonstrative gifts (general amount from specific source). Only applies to specific gifts. Demonstrative gift will turn into general gift if there is no cash available from source designated.  

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Ademption example

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○ Example: Turner executes a Will that provides: “I devise Blackacre to my son John, and my residuary estate to my daughter Ruth.” Two years later, Turner sells Blackacre for $10,000 cash and a $90,000 note that is secured by mortgage on Blackacre. Turner dies six months later, survived by John and Ruth.
What does John take? Nothing, it was specific gift and Testator does not own it. Ademption. Does not take note and mortgage, instead Note and Mortgage go to Residuary (Ruth).

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Three statutory exemptions to ademption

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○ Three statutory exceptions to ademption
§ Casualty insurance proceed for lost, damaged or destroyed property: beneficiary takes insurance proceeds to extent paid after death
§ Executory contract (still pending at death)--beneficiary gets sale proceeds paid after death.
§ Sale by guardian or conservator of specifically bequeathed property: beneficiary is entitled to receive money or property into which proceed from sale or transfer can be traced. If cannot trace, then ademption applies.

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Ademption example

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§ Tony S executed a Will that, among its provisions, bequeathed “my gold tie pin to Uncle Junior.” Tony S died two years later. The gold tie pin was stolen prior to Tony S’s death, and $10,000 in insurance proceeds was paid, by reason of the theft, to Tony S’s estate after his death.
o Is Uncle Junior entitled to casualty insurance proceeds? Yes (exception to Ademption – casualty insurance paid after death on bequeathed property).
o What if the insurance proceeds had been paid to T before T’s death? Statutory exception does not apply – ademption applies and Junior gets nothing.

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Ademption example

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§ Rudy G executes a Will that provides: “I devise Greenacre to my friend Ed K. I devise Blackacre to my brother Michael B.” Rudy G enters into a contract for the sale of Blackacre to Price. The contract is still executory at Rudy G’s death. Greenacre is taken by eminent domain by the NY Thruway Authority. Rudy G deposits the $75,000 condemnation award in bank account (balance at Rudy G’s death (w/ interest) =$78,000).
o Blackacre (executory contract for sale): M.B. takes payments on contract (ademption exception for executory contract paid after death).
o What if contract was fully performed on April 1 and Rudy G died on April 4? Statutory exemption does not apply: ademption applies. M.B. takes nothing.
o Greenacre, taken by eminent domain.
® Common law rule: Under “identity” theory, ademption applies. Reason why asset is not in estate at death is irrelevant. No asset for specific bequest, then ademption.
® New York: Follows common law rule. Ademption applies. Ed K gets nothing.

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Ademption example

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§ Suppose, instead, that Rudy G became incapacitated, and Rudy G’s conservator sold (here, it is not taken by eminent domain) Greenacre (devised to Ed K) to raise funds for Rudy G’s care.
o Is Ed K entitled to the proceeds from the sale of Greenacre? Ed K can take if funds can be traced (statutory exception applies – ademption does not apply).

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Specific gift of encumbered property

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• Specific gift of encumbered property--no exoneration of liens: common law--if testator made specific bequest of property that was subject to mortgage lien or other similar encumbrance on which testator was personally liable beneficiary was entitled to have lien "exonerated" (paid from residuary).
○ NY Rule:  Liens on specifically devised property are not exonerated property are not exonerated unless will directs exoneration. Devisee takes subject to mortgage.  

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No exoneration of liens example

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○ Davis’s will includes the following clauses: “1st I direct that my executor pay all of my just debts out of my residuary estate as soon after my death as may be practicable. 2nd I devise Blackacre, my farm in Mohauk County, to my sister Lulu. 3rd I devise my residuary estate to my Sister Sue.” At Davis’s death Blackacre is subject to a mortgage lien securing a $12,000 note. Lulu demands that Davis’s executor pay off the loan so that Blackacre will pass to her free of the lien.
§ Is Lulu entitled to have the lien exonerated? No, because in NY, unlike at common law, there is no exoneration of liens unless the Will directs. Lulu takes: exactly what the testator owned (Blackacre subject to the lien).

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Gifts of stock

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○ Gifts of stock in publicly traded company are general gifts and do not adeem.
§ Exception: if testator gives "my XX stock" which evidences an intention to make specific bequest and ademption applies.
○ Gifts of stock in closely held corporation is presumptively specific bequest and ademption applies, so if stock sold before death, there is no gift.

Gifts of shares of stock where stock split occurs are treated as specific bequest for purposes of split. (my language and public or closely held irrelevant) and includes full split amount.

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○ Conviser executes Will that includes the following gifts: “4. I give $5,000 to be paid from the proceeds of sale of my Acme stock to Davis. 5. I give my 100 shares of IBM common stock to my sister Golda. 6. I give 100 shares of Kodak common stock to my brother Ben”. At time he wrote his will, Conviser owned 100 shares each of Acme, IBM and Kodak stock. Conviser later sells the Acme stock and uses the sale proceeds to buy Cadillac. Conviser sells te IBM stock and uses proceeds to buy AT&T stock. Conviser sells Kodak stock and uses proceeds to buy Polaroid stock. Conviser dies without having changed his Will. Who takes what?

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§ Davis (“I give $5,000 to be paid from proceeds of sale of my Acme stock”): demonstrative legacy (general amount, specific source). Ademption applies only to specific gifts, not demonstrative gifts. Davis gets $5,000 and because there is no Acme stock, other assets will have to be sold. (But if Conviser owned Acme stock at death, executor would be under a duty to sell it to raise $5,000.)
§ Golda (“I give my 100 shares of IBM common stock”): specific bequest. Ademption applies to specific bequests. Golda gets nothing. Testator did not own IBM stock at death.
§ Ben: (“I give 100 shares of Kodak common stock”): No “my”. Since Kodak stock is regularly traded security, for ademption purposes: treated as a general legacy. Ademption does not apply. Ben gets date of death value of 100 shares of Kodak stock (executor will have to sell other assets to raise the money).

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Closely held stock gift

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○ “100 shares of FamilyCo stock to my brother Ben,” and FamilyCo is a closely held corporation. Conviser later sells all of his FamilyCo stock to his sister.
§ As FamilyCo stock is not listed on any stock exchange or regularly traded, even if there is no possessive pronoun (“my”) in bequest, for ademption purposes: closely held stock is specific bequest (ademption applies). Gift fails, Ben takes nothing.

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Stock splits

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○ Stock splits: When issue is stock split, bequest of stock treated as specific bequest whether or not a possessive pronoun (“my”) was used, and whether publicly traded or closely held stock is involved. (A specific bequest of stock includes stock splits but not stock dividends declared after the Will is executed.)
§ Suppose Conviser did not sell his Kodak stock (“I give 100 shares of Kodak stock to Ben”). Instead, Kodak splits two-for-one. Split shares are treated as specific bequest Ben takes additional shares produced by stock split even though would have been classified as general legacy for ademption.

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Change in form only for stock splits

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○ Change in Form: Does not trigger ademption-- Stock for Stock exchange
§ Davis makes a Will that bequeaths “my 1,000 shares of Tracor stock to my daughter Lulu.” In 1990, Tracor is acquired by IBM in a friendly takeover in which Tracor shareholders get one share of IBM stock for every two shares of Tracor. Davis dies in 1997 owning 500 shares of IBM but no Tracor stock.
Ø Does ademption apply? No. Change in form, not change in substance. IBM is directly traceable to Tracor stock, so Lulu takes the 500 shares of IBM stock 2 for 1.

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Nonprobate assets

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• Nonprobate assets: probate assets are property owned solely by decedent, at his death that is disposed of pursuant terms of will.
o Nonprobate assets: interests in property are not subject to disposition by Will or inheritance and are not part of probate estate for purposes of administration.
§ Property passing by right of survivorship (joint bank account, joint tenancy, tenancy by entirety automatically goes by right of survivorship)
§ Property passing by contract: life insurance, employee death benefits paid to beneficiary other than insured's executor or estate. If executor or estate is name, part of estate.
§ Property held in trust, including revocable trust.
§ Property over which decedent held power of appointment.

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Nonprobate example

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o Example T has a $50,000 Aetna life insurance policy that names Husband Bates as beneficiary. T dies still married to Bates, leaving Will that provides: “I direct that proceeds of my Aetna life insurance policy be paid to my sister Ann.” Who takes the $50,000 policy proceeds? (McCarthy v. Aetna Life Insurance Co. (N.Y. 1997)) Bates under insurance contract. Life insurance companies do not allow changes by will. Will is ineffective with respect to nonprobate assets.

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Elective share statutes

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• Elective share statutes: to protect surviving spouse against disinheritance, by giving spouse entitlement to minimum share of decedent's estate.
o JLo dies leaving a Will that provides: “I give $23 to my husband Ben A, one dollar for each miserable year I spent with him. I give all the rest of my estate to my faithful Chris, in appreciation of his many services.”
o What are Ben A’s rights? Entitled to an “elective share”
o Amount of elective share is greater of $50K or 1/3 of net probate estate.  
o If spouse's elective share is not satisfied, other beneficiaries contribute pro rata.
o Contrast with intestate share: entire estate if not survived by issue or $50K plus balance if T is survived by issue. Intestate share is always larger, unless testamentary substitutes are in play

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Testamentary substitutes

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• Testamentary substitutes: elective share includes probate estate AND testamentary substitutes:
○ Totten trusts: including bank accounts in testator's name in trust for another and payable on death securities.
○ Survivorship estates: joint tenancies, tenancies by entirety, joint and survivor bank accounts. Watch out for pre- and post-marriage scenarios.
○ Lifetime transfers with strings attached: transfers with retained power to revoke, invade, consume or dispose or principal or name new beneficiaries AND irrevocable transfers with retained life estate.
○ Employee pensions, profit-sharing, deferred compensation plan if employee designated beneficiary. Qualified plan: only one half is testamentary substitute, regardless of beneficiary.
○ Gifts: in excess of $13,000 annual gift tax exclusion within one year of death AND gifts causa mortis in fear of impending death (even within $13,000 exclusion).
○ U.S. government bonds and other payable on death arrangements
Powers of appointment: property over which decedent held presently exercisable general power of appointment (but not general testamentary power).

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Not testamentary substitutes

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• Not testamentary substitutes (generally where T does not have an interest, except for life insurance):
○ Life insurance proceeds: whether payable to surviving spouse or third party
○ One half of qualified pension and profit sharing benefits
○ Gifts made less than $13,000 within one year of death.
○ Pre marriage irrevocable transfers
○ Irrevocable transfers made more than 1 year before death: transfers in which grantor did not retain power to revoke, invade, consume or dispose of principal, or name new beneficiaries.
○ Transfer (irrevocable) during marriage where testator retains life estate before Sept. 1, 1992.

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Amount included in elective share estate for Survivorship estates with third party

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Survivorship estates with third party. Consideration furnished test applies: surviving spouse has burden of proving amount of dead spouse's contribution to asset.

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Amount included in elective share estate for Survivorship estate held by deceased spouse and surviving spouse:

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○ Survivorship estate held by deceased spouse and surviving spouse: half is testamentary substitute (automatically), regardless of which spouse furnished consideration for property acquisition. No consideration test applies.
§ NY fiction for elective share purposes: joint account between living and dead spouse is severed. Half to dead spouse, half deemed to go to living spouse. Treated as though dead spouse gave half to spouse in will.

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Amount included in elective share estate for Survivorship held by deceased spouse and third party, created before marriage:

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○ Survivorship held by deceased spouse and third party, created before marriage: although consideration furnished test applies, it is applied only to half property's value. Added complication is raised by rule that irrevocable dispositions before marriage are not testamentary substitutes: 1/2 value is testamentary substitute and 1/2 is irrevocable. If T provided all of consideration, then only 1/2 of amount included.

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Procedural rules for elective share

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○ Timing: If estates is admitted to probate: surviving spouse must be filed within 6 months after letters (either letters testamentary or letters of administration) are issued by Surrogate's Court at start of probate proceeding.
o If no estate administration: notice of election must be filed no more than two years after testator's death.
○ Personal right: right of election is personal to surviving spouse because purpose of elective share statute. Heirs/estate cannot elect, but guardian of incapacitated spouse may elect on behalf with court approval.
○ Waiver: can be waived with or without consideration, before or after marriage, as to particular will, testamentary substitute or as to all wills and testamentary substitutes
o Explicit waiver of all rights in testator's estate waives surviving spouse's right to elective share or intestate share, but does not waive right to specific gift under testator's will. Must also be explicit waiver of such bequests.

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Multi-jurisdictional issues with elective share

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• Multi-jurisdiction problems: only spouse domiciled in NY at time of decedent's death can claim elective share.
o Exception: if decedent expressly states in his will that disposition of his real property in NY is to be governed by NY law.
o Otherwise, Testator's will is admitted to probate and entire estate is administered in state of his domicile, but ancillary administration proceedings require in NY to clear title of NY property under situs rule.
o Property out of state: even though NY court cannot adjudicate ownership of real property in other state, NY takes account of value of real estate in other states to calculate elective share.
o H, NY domiciliary, owns real property in Florida. H’s net estate against which New York elective share applies includes value of FL real estate.

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Exempt personal property from elective share

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• Exempt personal property: property that spouse gets "off the top", before will, intestacy or elective share. Surviving spouse is entitled to personal property up to $56K including:
o Cars (up to $15K)
o Furniture, appliances, computers (up to $10K)
o Cash allowances (up to $15K)
o Animals, farm machinery, tractors, etc. (up to $15k)
o Books, pictures, videotapes, software, etc (up to $1k)
o Add as after thought unless clearly in play.

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When spouse is disqualified from taking elective share

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• When spouse disqualified from taking elective share (DISMAL):
o Divorce: final decree of divorce or annulment valid under NY law
o Invalid divorce/annulment: procured by surviving spouse
o Separation decree (NOT agreement): rendered against surviving spouse
o Marriage is void: incestuous or bigamous
o Abandonment and lack of support: by surviving spouse.

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Powers of appointment

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• Powers of appointment: authority created in (or reserved by) donee enabling donee to designate, within limits prescribed by donor, person who shall take donor's property and manner in which they take it.
○ Taker's in default: take if donee fails to properly exercise power
• Classification of powers of appointment
○ General: donee can appoint to themselves, their estate, their creditors.
○ Special (limited): donee can only appoint to limited class and donee cannot appoint to herself, estate or creditors.
○ Presently exercisable: donee can appoint during donee's lifetime. Do not have to wait for will.
○ Testamentary power: donee can only appoint by will after donee's death.

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Powers of appointment and elective share

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• Powers of appointment and elective share: testamentary substitute for elective share purposes only if can presently appoint to herself (present general power of appointment), look to who and when appoints and then apply testamentary substitute rules.
○ General testamentary power of appointment: cannot be part of elective share because she cannot exercise power when she is alive (it cannot be for her benefit).
○ Special power of appointment: cannot be part of elective share (cannot appoint to herself).

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Exercise of power of appointment

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• Exercise of power of appointment: General will provision(residuary: I leave all my property) exercises all powers of appointment held by donee UNLESS donor called for its specific reference in donee's will. If specific reference required, must specifically refer to Power of Appointment (from donor), not just "any powers of appoint I have".

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General power example

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• Tom’s Will creates a trust: “Income to my daughter Dana for life, and on Dana’s death the principal shall be distributed to such persons, including Dana’s estate, as she appoints by Will. If Dana does not exercise this power of appointment, the principal shall be distributed to Dana’s children.”
○ Tom is donor (the creator) and Dana is donee of general testamentary power of appointment: Dana is not limited in class of beneficiaries to whom she can appoint. Dana by her Will can appoint the trust property to herself, or her estate, or her creditors. Dana’s children, who will take the trust property if Dana does not exercise the power of appointment, are the takers in default.

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Testamentary power

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• Suppose, instead, that Tom’s Will provides: “… and on Dana’s death the trustee shall distribute principal to such of Dana’s descendants as Dana appoints by her Will…”
○ Dana is donee of special testamentary power of appointment because Dana is limited in class to whom she can appoint. She can only appoint among her descendants, and cannot appoint to herself, her creditors, or her estate.
○ Dana dies some years later, leaving a Will that devises “all the rest, residue and remainder of my estate to my son John.” Dana’s Will makes no reference to her testamentary power of appointment.
§ Did Dana’s Will exercise testamentary power of appointment (whether a general or special testamentary power), even though Will makes no mention of the power of appointment? Yes. New York: Will exercises all powers of appointment held by the testator (both special powers and general powers) unless the instrument creating the power called for its exercise by a specific reference to the power.

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Exercise example

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• Tom’s Will gave remainder “to such of her descendants as Dana appoints by Will that specifically refers to this power.” Dana’s Will devises “all the rest and residue of my estate, including any property over which I have a power of appointment, to my son John.”
○ Did Dana’s Will exercise the power of appointment? No, because there is no specific reference to power (which was condition stipulated in Tom’s Will). Statute defers to Tom’s Will.
○ Who gets the property? Takers in default (Dana’s children).

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Exercise example

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• Suppose, instead, that Tom’s Will provides: “The trustee shall pay the income to my daughter Dana for life. However, during her lifetime Dana can appoint the trust property to anyone, including herself, by a written instrument delivered to the trustee. (This is a presently exercisable general power of appointment – inter vivos general power.) If Dana does not exercise power of appointment, on Dana’s death trustee shall distribute trust principal to Dana’s descendants.” Dana dies some years later, leaving a Will that devises “all the rest, residue and remainder of my estate, including any property over which I may have a power of appointment, to my son John.”
○ Did Dana exercise this presently exercisable power of appointment by her Will? Yes -- A presently exercisable power of appointment is also exercisable by Will, can be exercised during Donee’s lifetime, but does not have to be (unless instrument stays otherwise). valid exercise.

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Creditors and powers of appointment

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• Creditors: if donee has general presently exercisable power of appointment, creditors can reach appointive assets, even if donee does NOT exercise power.
○ Creditors cannot reach any other power of appointment, except general testamentary power of appointment exercised for herself or in favor of her estate.

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creditors examples

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• W has presently exercisable general power of appointment.
○ Can W’s creditors reach appointive assets even if W does not exercise the power? Yes, since W can appoint to herself, she is treated as owner for creditor purposes.
• Suppose, instead, that W holds presently exercisable special power of appointment (“to such of W’s descendants as he appoints”). W dies leaving a Will that exercises the power.
○ Can creditors of W’s estate reach assets that are subject to the power of appointment? No. It must be a general presently exercisable power of appointment.
• Suppose, instead, that W holds a general testamentary power of appointment. W dies leaving a Will that exercises the power.
○ Can creditors of W’s estate reach assets that are subject to the power of appointment? No. It must be a general presently exercisable power of appointment.

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RAP and powers of appointment

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• RAP and Powers of appointment:
○ RAP: deals with vesting only, for interest to be valid under RAP: must vest within lives in being at time for grant, plus 21 years.
○ Suspension rule: concerns possible suspension of ability to transfer fee simple. Must be identified persons who could, together, convey fee simple absolute within life in being plus 21.
○ Statutory spendthrift rule: income beneficiaries cannot assign or convey income interest.
○ NY reform statute saves gifts from RAP and suspension rule by reduce age contingencies to 21 years.

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Is creation of power valid?

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○ Is the creation of the power valid: To be valid, general testamentary power or special power of appointment (whether inter vivos or testamentary) must be certain to be exercised, if it is exercised, within L-I-B + plus 21 years.
§ Donee alive: given to someone who is life in being at the time power is created, there is no problem.
§ Donee unborn: a general testamentary power or special power is given to an unborn beneficiary it is void. (b/c power could be exercised beyond LIB + 21y).

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○ Is exercise of power to create interests valid:

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○ Is exercise of power to create interests valid: For interests created by exercise of general testamentary power or any special power of appointment, measured from date of instrument creating power, not from date of power’s exercise. donee of power is merely donor’s agent, “filling in the blanks” in donor’s disposition.
§ General presently exercisable are measured from date of exercising power. NOT filling in blanks for donor's will or trust.

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Second look doctrine

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○ Second Look Doctrine: Although clock starts at time power was created, second look doctrine permits courts to take into account facts that exist when donee “fills in blanks” (exercises power). Effectively, eliminates need to take into account hypothetical events that could have happened, but in fact did not happen, after the date RAP clock began to run.
§ ONLY applies to Powers of Appointment, does not apply to regular trusts. Not applied to general, presently exercisable Powers of appointment.

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Income interest built on income interest

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○ Income interest built on prior income interest, second income interest is usually valid. Income interest built on prior income interest conditioned upon reaching certain age is void, but saved because NY reform statute will force vesting with in LIB plus 21.
§ Income interest in unborn beneficiaries violates suspension rule because NY spendthrift rule, prevents an income beneficiary from assigning his income interest, unborn child could not join with others in theoretical conveyance of interest within LIB plus 21.
§ If cannot be saved, throw out bad part and accelerate to remainder

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Mistake

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• Mistake: absent suspicious circumstances, conclusively presumed that testator read will and intended its consequences, so plain meaning will not be overturned by extrinsic or outside evidence.
○ Tom tells his lawyer to draft his Will and give his nephew Ed “300 shares of Exxon stock.” The lawyer’s secretary makes a mistake and types the figure as “200 shares” which Tom did not notice when he signed the Will. At Tom’s death he owns 300 shares of Exxon stock.
§ What does Ed get and why? 200 shares. Absent suspicious circumstances, conclusively presumed Tom read Will and intended consequences (even though he did not notice).

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Latent ambiguity

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• Latent ambiguity: misdescription in will, not evident by looking at will even careful proof reading by third party will not catch mistake.
○ Extrinsic evidence is admissible to cure latent ambiguity. Types:
§ Facts and circumstances admissible. (evidence about T, family, claimants under will and their relationships to T, T's habits and thoughts)
§ Testator's declarations of intent to third parties
§ Testator's statements to attorney who prepared will
○ If extrinsic evidence does not cure ambiguity, gift fails because no ascertainable beneficiary.

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Patent ambiguity

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• Patent ambiguity: mistake on face of will (careful proof reading would catch mistake): Will provides: “I give the sum of twenty-five dollars ($25,000) to my buddy Davis.”
○ Extrinsic evidence is admissible to cure patent ambiguity
§ Facts and circumstances admissible.
§ Testator's statements to attorney admissible
§ BUT testator's declarations of intent to third parties NOT admissible.
• NO precatory language: wish, hope, etc.

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Conditional wills

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• Conditional wills: will expressly provides that operative only if some condition met. Question whether 1) probate would be denied if condition does not occur, OR 2) does reference to condition merely reflect motive for making will?
○ NY courts split on effect of conditions, so must apply both ways.

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Contract to make a will

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• Contract to make a will: Joint will: will of 2 people in one document. Contract to make will or not revoke will can be established only by express statement in will that its provisions are intended to constitute contract (needs consideration) between parties. (Joint will not construed as contract, unless there is express statement creating contract).
○ If joint will is contractual will and survivor breaches contract by executing later will with inconsistent provisions: 1) probate new will, even though will #1 was written as contract; 2)impose constructive trust in favor of original intended beneficiaries (because may have other assets in will 2 being disposed of, that are not in will 1).
○ Contractual joint will can be revoked by agreement between parties while both alive, but deceased spouse's estate cannot revoke contractual will on behalf of deceased spouse.

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Testamentary capacity

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• Testamentary capacity: must have sufficient capacity to--1) understand nature of act (know making a will), 2) nature and approximate value of his property, 3) know natural objects of his bounty (who society expects you give to) and 4) understand disposition he was making.
○ Legal capacity for making will is lower threshold than other legal standards for capacity: even if person is adjudicated incompetent and has guardian appointed to manage her affairs, may not lack capacity to make will.  Might have executed will during lucid interval.

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Insane dilution

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• Insane dilution: testator is generally of sound mind, but has persistent belief in supposed facts that are against all evidence, probability and control which cause or effect testator's act.

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Undue influence

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• Undue influence: burden of proof is on contestant:
○ Existence and exertion of influence
○ Effect of such influence was to over power mind and will of testator
○ Produced will or gift in will would NOT have been executed but for influence.
○ Situations not satisfying undue influence on their own:
§ Opportunity to exert influence is not enough (Fact that one child (who received major share of the estate) lived with mother, wrote checks for her, helped on income tax, held a power of attorney, not evidence that the opportunity was taken advantage of
§ Susceptibility to influence because of age or illness)
§ Unequal dispositions
○ Inference of undue influence: satisfies burden of undue influence, if will makes gift to 1) person in confidential relationship AND 2) person was active in preparing will.

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Bequest to drafting attorney

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○ Bequest to drafting attorney: even if no objection filed, Surrogate's court automatically inquires whether gift was voluntarily made (Putnam Scrutiny.
§ If will names drafting attorney as executor, attorney must give written disclosure to client: 1) that any person, not just attorney, can be named executor; 2) executor receives statutory commissions; 2) attorney will also be entitled to legal fees for representing estate.
§ Client must sign acknowledgment of disclosure in presence of 2 witnesses other than attorney/executor.
§ Failure to comply with statute: lawyer's commissions as executor will be reduced by half.

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No contest clause

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• No contest clause ("in terrorem") clauses: clause in will that says if anyone objects to will, gets nothing.
○ In most states, given full effect unless court finds contest brought in good faith and with probable cause (not frivolous suit designed to extract settlement).
○ NY: clause is given full effect, even probable cause to challenge will.
§ Exceptions:
§ Ground of contest is forgery or revocation by subsequent will (if Surrogate finds probable cause for contest). Exception does NOT apply if will contest is on ground that testator's will was revoked by physical act.
§ Filed on behalf of minor or incapacitated beneficiary
§ Construction suit over interpretation, not about admissibility. (includes deposition regarding drafting of will, unless specifically excluded)
§ Objection to jurisdiction
Undue influence or lack of testamentary capacity are NOT exceptions to no contest clauses.

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Powers of attorney

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• Power of attorney: written authorization for agent (attorney-in-fact) to act on behalf of grantor of power. May be general or specific, with as many variations as drafter of power wishes to contrive.
○ Nondurable powers of attorney: revoked by operation of law by either grantor's death or incapacity. Remain valid until notice of death or disability is received by attorney in fact.
○ Durable: extends beyond grantor's incapacity, unless has specific language is terminated by grantor's incapacity.

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Health care proxies

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• Healthcare proxies: type of durable power of attorney that appoints agent to make health care decisions on behalf of grantor. Not effective until grantor becomes incapacitated and remains effect despite incapacity.
○ Must be: in writing, signed by grantor or another at his direction, witness by at least 2 adults.
○ Must state grantor executing free from duress.

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Living will

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• Living will: states individual's desire, should he become terminally ill or be in persistent vegetative state regard whether to administer withhold or withdraw: life sustained procedures 2) artificial nutrition or hydration 3) treatment to alleviate pain.
○ COA had held patient's rights to decline treatment is guaranteed by common law.