Tx Bar '14 - Wills & Estate Admin

Front 1

[Formation]

What makes a will valid?

Back 1

Legal Capacity + Testamentary Capacity & Intent:

Must be executed by a person over 18 (or married or in army) w/ testamentary capacity & intent.

Formalities: signed by T; Signed by 2 Witnesses (>14 y.o.); W's must sign in T's presence (order of signing not critical, must just be 1 contemporaneous transction).

Proof: 1 attesting W; if dead, 2 handwriting Ws for either T/W.

Front 2

[Formation]

Requirements for Holographic Will?

Back 2

1) entirely in T's handwriting

2) signed by T (anywhere);

Note: date NOT needed, extraneous printed words ok. Hologrphic codicil to typewritten, witnessed will is OK!

Proof: testimony of 2 Ws to T's handwriting. Note: Oral wills after Sept. 1, 2007 NOT VALID.

Front 3

[Formation]

What is a self-proving will?

Back 3

Admitted to probate on the basis of an affidavit; no need to call attesting Ws. One-Step

Process: attestation clause prepared as sworn statement (Notary) - T & W sign only once.

Front 4

[Contestation]

What procedure must be followed to contest a will?

Back 4

Will contest can ONLY be filed by interested party w/in 2 years.

Front 5

[Contestation]

What options are available for challenging the validity of a will?

Back 5

MUD FLU

1) Mistake

2) Undue Influence

3) Defective execution

4) Fraud

5) Lack of testamentary capacity

6) testator Unaware of wills contents

Front 6

[Contestation]

What proves lack of testmentary capacity?

Back 6

At the time will executed, the T must have had sufficient capacity to:

BEAD

1) Know the natural objects of his Bounty;

2) know the Extent of his property;

3) understand the nature of the Act;

4) understand the Disposition he is makeing

Note: Capacity to make a will may exist where capacity to make K does not.

Front 7

[Contestation]

What Proves Undue Influance?

Back 7

The contestant must prove:

1) influance was exerted on T

2) that overpower the mind and will of T

3) resulting in a will that would not have been executed but for the influance.

Pleading, begging, cajoling, or threating is NOT enough; the mind of the testator must be overpowered.

Front 8

[Contestation]

What proves fraud?

Back 8

1) Knowingly false representations

2) intent to deceive T

3) T reliance on representations

4) T made a will he would otherwise not have made

Front 9

[Contestation]

When is a no-contest clause valid?

Back 9

Enforcable unless the contest was brought in good faith & w/ probable cause.

A no-contest clause is strictly construed & is not tiggered by a suit to construe a will or by a contest filed by a guardian.

Front 10

If Will is INVALID or CONTESTED = [Intestacy]

Which Jurisdiction's Law's applies?

Back 10

Personal Property: Law of Intestate's domicile at death

Real Property: Situs (where real prop located)

Front 11

[Intestacy]

Intestate w/ Surviving Spouse (SS)?

Back 11

If no descendants:

SS gets all CP & personal SP, & 1/2 fee simle interest in all real SP. The decendant's parents get the other 1/2 interest in T's real SP.

If ALL T's children are children of the spouse:

SS takes all CP, 1/3 of personal SP, & 1/3 life estate in al real property.

Kids take 2/3 of personal SP, outright 2/3 real P & remainder of SS's 1/3 life estate.

If T had children that were NOT children of the spouse:

Then SS will only take 1/2 of decedent's CP, & all of the SP interests are the same as above.

Front 12

[Intestacy]

Intestate w/ NO SS

Back 12

- If deceased has decendants, they will take the whole estate per capita w/ representation.

- If the decesased has no decendants, the parents will take 1/2 each.

- If one parent is dead, H's siblings will take parent's 1/2 share.

- If no parents, the estate pases to siblings & thier descendeants.

- If no siblings T's Grandparents, then aunts/uncles & their decendants.

Front 13

[Intestacy]

How does interestate SP pass to descendants?

Back 13

Per capita w/ representation: equal shares at 1st generational level of living takers, dead taker's descendants take.

Front 14

[Intestacy]

What claims does a spouse have above & beyond intestacy or a will?

Back 14

1) Claim a probate Homestead (right to occupy homestead rent-free for life) or if there is no homestead a $15K allowance.

2) Claim Exempt Personal Prop up to $60K or if there is no prop, $5K cash.

3) Entitled to a Famiy Allowance sufficient for spouse & children's maintenance for 1 yr by showing that they have inadequate SP for thier support.

Front 15

[Intestacy]

Common issues affecting determination of heirs?

Back 15

Adoption: treated same as natural child; kid inheirts from/through adoptive but only from biological.

Non-Marital Kids: inherit from mom; dad only if TFC paternity presumption is med, executed stmt of paternity, or paternity estblsh'd in probate by C&C.

Half-blood: inherit only half as much as relatives of whole blood.

Stepkids: do not inherit

Front 16

[Intestacy]

Succession problems common to inheritance & wills?

Back 16

120 hr. rule: person who does not survive decedent by 120 hrs is deemed to predecease him.

Murder by Heir/Beneficiary: heir who kills decedant forfeits ALL profits, constructive trust results.

Advancement: lifetime gift considered an advancement against heir's intestate share ONLY IF in contemporaneous writing by donor or acknowledge in writing by donee-heir.

Disclaimer: in wiring; signed, notiarized, & filed w/ probate court w/in 2 months after decedent's death - treated as predeceased.

Front 17

If will VALID = [REVOCATION]

How is a will revoked?

Back 17

A will can be revoked by:

Operation of Law:

- Divorce revokes ALL provisions in favor of former spouse & her relatives; prop is distributed as if spouse predeceased.

- Pretermitted children revoke will to extent necessary to make up for their shares

Physcial Act: T's physical act + intent to revoke.

Attested Wills: can NOT be partially revoked by phys. Act.

Holographic: partial revocation is OK if entirely in T's handwriting.

Subsequent Writing (will or codicil): must be executed w/ testamentary formalities & T has testamentary capacity. Holographic codicil can revoke written, attest will & vice-versa. Will revoked to extent stated in subsequent instrument (full or partial OK; same true for incons provs.)

Front 18

[REVOCATION]

Revocation burden of proof & presumption?

Back 18

BoP = Will Proponent.

Will last seen in T's possession & cannot be found = Presumption that Will was destroyed w/ the intent to revoke.

Presumption Rebuttable if evidence exists person adversely affected by will had access to it.

Also, accidental destruction of Will does not revoke, even if T later decides to revoke; intent must be present at time of act.

Front 19

[REVOCATION]

Can a prior will be revived if a new one is not effective?

Back 19

TX does not all revival of prior wills once they have been revoked.

EXCEPTION: Dependent Relative Revocation (DRR) - In that case, court can revive an old will if they find T revoked based on mistake of law or fact about the validity of another disposition & the revocation was conditioned on the validity of the subsequent disposition.

Front 20

[REVOCATION]

How can a lost will be proved?

Back 20

A lost will can be proved by establishing:

1) it was duly executed,

2) the cause of the will's non-production (suf to rebut presumption it has been revoked)

3) contents of the will, either by testimony of credible witness ( who has read/seen) or copy.

Front 21

[Property Distribution by Valid Will]

Exam Language?

Back 21

If will is validly attested & self-proved, will controls.

If decedent dies leaving a will, the decedent's estate should generally be distributed accd to the will.

Front 22

[Property Distribution by Valid Will]

What are Lapsed Gifts?

What does TX's Anti-Lapse § do?

Back 22

RULE: if Beneficiary predeceases Testator, the gift lapses.

TX anti-lapse §: applies to WILL Bs who predeceases T & are descendants of the T's parents [child, grandkid, bro/sis, nephew/niece] + leave descendant who survives 120hrs.

Prevents bequests to Bs from lapsing by allowing the descendants of the B to take B's share.

Front 23

[Property Distribution by Valid Will]

Lapse in residuary estate?

Back 23

Where residuary estate devised to 2 or more people & gifts to 1 lapses, remaining residuary beneficiaries take residuary in proportion to their interests.

Front 24

[Property Distribution by Valid Will]

Class gift Rule?

Back 24

Gifts by will to calse of persons ("kids", etc.), only suriviving class members take (unless anti-lapse § saves)

Class closes (meaning later born members of class excluded from sharing) when some class member is entitled to distribution (known as "Rule of Convenience")

Front 25

[Property Distribution by Valid Will]

120 hr Rule?

Back 25

Beneficiary must survive T by 120hrs; if not, treat as predeceased (NOTE: anti-lapse § can apply - save gifts). If will required survival, 120 hr does NOT apply.

Front 26

[Property Distribution by Valid Will]

Abatement: What happens if there is not enough assets to fill all bequests?

Back 26

If all the assets the T owns at death are insufficient to pay all debts & the expenses of the administration & also satisfy all the specific & general legacies in the will, this is the order of abatement (absent a contrary provision):

1) Intestate Property

2) Residuary Legacies

3) General Legacies

4) Specific Legacies

W/in each category, personal property abates before real property.

Front 27

[Property Distribution by Valid Will]

Ademption: specifically devised property not in estate at death?

Back 27

T c/n devise property not owned at death;

If the subject of a specific bequest isn't in the estate at death, the gift is "adeemed" - if fails completely (ademption applies where T sold specifically devised property).

Front 28

[Property Distribution by Valid Will]

Satisfaction?

Back 28

Lifetime gift to beneficiary named in earlier will is NOT treated as being in total or partial satisfaction of bequest unless:

1) Intention declared in contemporaneous writing by donor or acknowledged in writing by donee-heir, or

2) Will provides benefits are to be reduced by lifetime gifts.

Front 29

[Property Distribution by Valid Will]

Bequests of stock & other securities?

Back 29

Specific language ("my 100 shares"), then ademption applies if the stock isn't in the estate as such (it's a specific bequest).

But, if general langauge ("100 shares"), it's a general legacy & B gets the date-of-death value of 100 shares if T already sold them.

Note also, a specific legatee of stock takes additional securities resulting from action initiated by entity (i.e., stock from a stock split or stock dividend declared after the will was executed, or even different securities as the result of a merger, takeover, consolidation)

Front 30

[Property Distribution by Valid Will]

What is the effect of divorce on a decedent's estate?

Back 30

Divorce revokes all gifts & fiduciary appointment in ex-spouse's favor; T's marriage post will execution = NO effect.

Front 31

[Property Distribution by Valid Will]

What is a pretermitted child entitle to from a deceased's estate?

Back 31

A pretermitted child is a child born/adopted after execution of a will who is not provided for by the will or by any other nonprobate transfer.

If other children have received something under the will, the child takes a pro-rata interest in those bequests.

If there are no other childrem, or the other children are not provided for, the pretermitted child takes his intestate share of all property not bequeathed to SS.

Remember: republication of a will by codicil can have an effect on pretermitted child's status.

Front 32

[Property Distribution by Valid Will]

How can a document be incorporated into the will by reference?

Back 32

1) the document be must be in existence when the will is executed

2) the will must show the intent to incorporate

3) the will must clearly identify the document.

Front 33

[Property Distribution by Valid Will]

How are contractual wills created & what is the effect?

Back 33

A contractual will is not enforceable unless there is clear indication of the contract in the will,

-or-

An enforceable written agreement.

The execution of a joint or reciprocal will does not, by itself, suffice as evidence of a K.

The K can be revoked at any time before the death of one of the testators w/ notice to the other party.

Front 34

[Property Distribution by Valid Will]

Non-Testamentary Assets?

Back 34

Interest that pass at death other than by will or intestacy; NOT PART of probate estate:

1) Prop passing by rt. of suviviorship

2) Prop passing by K

3) Prop held in Trust

4) Items designed to be paid or transferred upon death

Front 35

[Estate Administration]

Where is proper venue for will probate/administration?

Back 35

TX Resident = County of Domicile

Non-TX Resident = either county where principal assets/property located OR county where T died.

Front 36

[Estate Administration]

How long does a will have to be admitted to probate?

Back 36

A will must be probated w/in 4yrs of date of death.

But if the person offereing the will is not at fault, notice, must be given to heirs, & the will can be probated as a muniment of title.

Front 37

[Estate Administration]

What Court has jurisdiction over probate?

Back 37

In counties w/ statutory probate courts or statutory county courts at law, such courts have exclusive jurisdiction.

In counties w/out either, the county courts & district courts have concurrent jurisdiction.

- County Courts = uncontested matters

- District Courts = contested matters.

Front 38

[Estate Administration]

When is independent administration available?

Back 38

Intestacy; independent administrator can be appointed when the will so provides or all distributees agree to have one.

Court can veto if finds IA is not in the "best interests" of the estate.

Front 39

[Appt/Removal Personal Rep.]

In what priority is a personal representative appointed?

Back 39

1) Executor named in will

2) SS

3) Principal Beneficiary in will

4) Any other beneficiary in will

5) Decedent's next of Kin under intestacy

6) Creditor of Decedent

7) Any other person of Good Character

Front 40

[Appt/Removal Personal Rep.]

What are the powers of an independent executor?

Back 40

The exector has the power to do any act, w/o court order, that a dependant administrator could be authorized to do by a court order.

If a will creates a power of sale, real property can be sold irrespective of estates debts. If the will doesn't specifically give power of sale, real property can only be sold to satisfy estate debts.

Front 41

[Appt/Removal Personal Rep.]

How does a person representative close the administration?

Back 41

[Optional] May file a closing report w/ the county court records containing a verified affidavit that shows:

1) property initially received

2) debts paid & expenses

3) names & addresses of distributees.

May also file for a declaratory judgment seeking a discharge from liability on things that have been fully disclosed.

Front 42

[Appt/Removal Personal Rep.]

What actions must a personal representative (executor if named in will; administrator if by court) take upon appointment?

Back 42

1) W/in 20 days he must post bond, unless the will waives bond;

2) Publish a "Notice of Administration" in local newspaper w/in 1 month.

3) File an "Inventory of Estate" w/ the court w/in 90 days.

4) Give Notice to named beneficiaries w/in 60 days after will admitted to probate.

Front 43

[Appt/Removal Personal Rep.]

For what reasons can an independent administrator be removed for cause?

Back 43

1) Failure to file "Inventory" w/in 90 days;

2) Failure to give Notice to named beneficiaries w/in 60 days of probate;

3) Misapplied or embezzled estate property or is about to;

4) Fails to make required accounting;

5) Is guilty of gross misconduct or mismanagement;

6) Becomes incompetent or sentenced to penitentiary;

7) material conflict of interest prevents proper performance of administrator's duties.

Front 44

[Alternatives to Formal Admin]

What methods are available to "clear title" when no administration is necessary?

Back 44

Depending on whether there is a will or not, a person can file a muniment of title (will) or for a statutory heirship proceeding (if no will).

Informal or small estate administration may also be appropriate.

Front 45

[Alternatives to Formal Admin]

What is an informal administration?

Back 45

TX law favors informal administration. Available in small, uncomplicated estates not including legal title items (property) if all distributees agree & judge doesn't veto.

Front 46

[Alternatives to Formal Admin]

What is a muniment of title proceeding?

Back 46

To apply:

1) estate can have no debts;

2) file w/in 180 days.

T's will is probated as muniment of title; court determines the will is valid, then operates to transfer property from T to B. No executor appointed & No administration.

Front 47

[Alternatives to Formal Admin]

What is a statutory heirship proceeding?

Back 47

Court order establishes the person is dead, left no will, and suvived by people named as heirs; also fixes amount of intestate shares. Does NOT require appt. of personal rep.

Front 48

[Alternatives to Formal Admin]

What is a small estate administration?

Back 48

Where decedent dies intestate leaving estate whose value (not including homestead) does

- NOT exceed $50,000,

- heirs entitled to the estate w/ NO need for appt. of per. rep./admin./etc.

Heirs need only file an affidavit w/ basis for distribution.

Front 49

[Creditors Claims]

What does the administrator have to do to notify creditors of the estate?

Back 49

No SOL;

Administrator must give notice to secured creditors ("SC") w/in 2 mos (unsecured ("USC") = 1mo) after appointment;

The SC then have 4 mos. or 6 mos from death to present their matured, secured claims. If they fail to do so, they will only be protected up to the value of the collateral.

No notice other than the notice by publication is necessary for USC, but an administrator can give personal notice to each that will trigger a 4 month SOL on the debt.

Front 50

[Creditors Claims]

How is a dependent administration different w/ respect to creditors?

Back 50

1: the claim must be authenticated;

2: the personal rep. must allow or reject the claim w/in 30 days.

3: the claimant must file suit on a rejected claim w/in 90 days or the claim will be barred.

Front 51

[Creditors Claims]

What is the priority of claims in an insolvent estate?

Back 51

The order of payment is

1) Funeral expense & expenses of last illness up to 15K;

2) The Family Allowance;

3) Administration Expenses;

4) Secured Claims;

5) Child Support reduced to Judgment;

6) State Taxes;

7) Cost of Decedent's confinement in prison;

8) Reimbursement to Medicaid;

9) All other costs.