Wills

Front 1

What bodies of law govern wills and estates in NY?

Back 1

1) Estates Powers & Trust Law (EPTL)

Front 2

What does intestate mean?

Back 2

When a person (decedent) dies without a will.

Front 3

What does testate mean?

Back 3

When a person (decedent) dies with a will (person is testator).

Front 4

What does decedent mean?

Back 4

A person who dies WITHOUT A WILL

Front 5

What does Testator mean?

Back 5

Person who dies WITH a will

Front 6

What is an administrator?

Back 6

A person (usually a distribute) appointed as a personal representative to administer the estate of the decedent

Front 7

What is an executor?

Back 7

A personal representative named in the Will to administer the estate of a testator

Front 8

What is an administration proceeding?

Back 8

A surrogate court proceeding to appoint a personal representative, also known as an administrator, to administer the estate of a person who dies without a will. Ultimately, “probate” the estate

Front 9

What is a probate proceeding?

Back 9

A surrogate court proceeding to judicially determine whether the testator’s will was validly executed and determine the intestate distributes, and appoint the executor to administer the testator’s estate

Front 10

What is intestate estate?

Back 10

Assets held in the decedent’s name alone that do not pass by operation of law or by Will and which the administrator administers in accordance with the EPTL

Front 11

What are probate assets?

Back 11

Assets held in the T’s name alone that do not pass by operation of law and which the executor administers in accordance with the T’s Will

Front 12

What does operation of law mean?

Back 12

Property that passes automatically because of the way title is held in the property and is not affected by intestacy rules of by a will.

Front 13

What does "issue" mean?

Back 13

All persons who have descended from a common ancestor. Synonymous with "descendants." Includes those in direct line of inheritance with the decedent, i.e., children, grandchildren, etc.

Front 14

What is a residuary estate?

Back 14

The Balance of the Testator's estate after all claims, taxes, and "particular" bequests have bee distributed. The remainder or rest of the estate.

Front 15

What is the term for those individuals who inherit property under intestate succession?

Back 15

Distributees (or heirs, but NY prefers distributees)

Front 16

What are those beneficiaries who inherit real property under a will called?

Back 16

Devisees.

Front 17

What is the term for those who inherit under a Will?

Back 17

Beneficiaries

Front 18

What are those beneficiaries who inherit personal property under a Will called?

Back 18

Legatees

Front 19

What is the probate estate?

Back 19

Assets held in the decedent's name alone that do not pass by operation of law and that which the Executor administers in accordance with the decedent's will.

Front 20

What is the basic purpose of probate proceedings?

Back 20

1) To prove a document is the last validly executed Will of the decedent

Front 21

When do such rules typically apply?

Back 21

Article 4 of the EPTL, When: 1) Decedent left no will (or left a will that was not properly executed); 2) Will does not make a complete disposition (partial intestacy); or 3) An heir ("distributee") successfully contests the Will, and the Will is denied probate.

Front 22

Intestacy rules: What is the order of distribution under intestacy?

Back 22

Distribution - Order of priority for appointment as administrator: 1. *surviving spouse* 2. *children* 3. grandchildren 4. father or mother 5. brothers or sisters 6. any other distributee

Front 23

Intestacy rules: What is the distribution if an intestate decedent is survived by spouse and no children?

Back 23

If the intestate decedent is survived by her spouse but not by any children or issue of children, the surviving spouse takes the whole estate.

Front 24

Intestacy rules: What is the distribution if an intestate decedent is survived by spouse and children?

Back 24

If the intestate decedent is survived by his spouse and one or more children of their issue, the surviving spouse takes 50k + 1/2 of the residuary, and the issue take the leftover residuary, UNLESS the estate happens to be less than 50k, then the whole estate goes to the surviving spouse.

Front 25

Intestacy rules: What is the distribution if an intestate decedent is survived by children only?

Back 25

If the intestate decedent is survived by children only (and all children are alive), the estate passes to the children in equal shares.

Front 26

Intestacy rules: What is the distribution if an intestate decedent is survived by children and issue of predeceased children?

Back 26

It passes to "alive" children, and the issue of the dead children by representation or per capita @ each generation. (Explain terms of art)

Front 27

Intestacy rules: What is distribution in most states when an intestate decedent is survived by children and issue of predeceased children? NY?

Back 27

Most states (and NY pre-1992) distribution is "per stirpes," under which the issue of a deceased child takes the share that her parent would have inherited if living. ***NY RULE: Per Capita at Each Generation (PCEG) - "by representation" is controlling. Exception: A Will can ovverride and change the default distribution to "per stirpes."

Front 28

Intestacy rules: explain the steps of per capita distribution under a will when decedent is survived by children and issue of predeceased children (always talk about ALL these three steps in an essay)

Back 28

Step 1. Make the initial division shares - one share for each line of issue (whether the people representing that line of issue are dead or alive) - at the first generational level at which there are survivors. Step 2. All living persons at that generational level take one share each (ppl below that living person take nothing b/c of this) Step 3. The shares of the deceased persons at the first generational level are combined into a pot and then divided equally among the takers at the next generational level in the same way. Result: Persons in the same generation are always going to have equal shares. NOTE: The spouse of a dead intestate distributee does not take, nor could that intestate distributee have conveyed his/her interest in the estate if he/she died before intestator (in-laws don’t count).

Front 29

Intestacy rules: When will PCEG create a different distribution than Per Stirpes (PS)?

Back 29

PCEG creates a different distribution than PS only if more than one person at the 1st generational level died and all have issue. If only person 1 had died, distribution "by representation" or "per stirpes" would give you the same distribution (thus, they come out the same if only one person at the first generational level dies

Front 30

Intestacy rules: What's the distribution for intestate decedent not survived by spouse or issue?

Back 30

No spouse + no issue: *1. All to parents or surviving parent *2. If not survived by parents: Issue of parents (brothers, sisters, issue of deceased brothers and sisters), who take PCEG. Then to grandparents (maternal ½ paternal ½) or surviving grandparent or if neither is living to their children and grandchildren per capita. Note: Decedent's "relatives of the half blood" are treated as if they were relatives of the whole blood.

Front 31

Intestacy rules: What are the inheritance rights of adopted children?

Back 31

1. As a general rule, adopted children and their issue have full inheritance rights from adopting family. 2. child adopted by a new family has no inheritance rights from birth parents/members of the birth parents' family. Exception to 2: Where a child is adopted by the spouse of a birth parent (Mom remarries and new H adopts child), the child and its issue can inherit from both adopting parent and either birth parent. 3. But if the child is adopted by a relative (e.g., and aunt or uncle) (in other words if the adopted child is related to the decedent by both a birth relationship and the adopted relationship), the child inherits under the birth relationship only, unless the decedent was the adopting parent, then the child inherits under the adoptive relationship only.

Front 32

Intestacy rules: Does a child (E son of D) adopted out to a new family take as a beneficiary of a class gift made in the Will of a member of the child's birth family (T - 'income to D for life, remainder to D's issue?

Back 32

No. A child adopted into a new family has no inheritance rights from the birth family.

Front 33

Intestacy rules: Does a child adopted out to another family member take as a beneficiary of a class gift made in the Will of a member of the child's birth family ?

Back 33

Yes.

Front 34

Intestacy rules: What are the inheritance rights of nonmarital (out of wedlock) children?

Back 34

General Rule: Full inheritance rights from Mother and Mother's family But: The child inherits from the LIVE birth father only if paternity is established by one of the following tests: For Paternity during father's life: (i) Legitimated by marriage: Father marries mother after child's birth, OR (ii) Order of filiation in a paternity suit is entered during the father's lifetime, adjudicating the man to be the child's father, OR (iii) Father files a witnessed, acknowledged (b/for notary) affidavit of paternity with the Putative Father Registry. see next card for establishing paternity after father’s death

Front 35

Intestacy rules: What are the inheritance rights of nonmarital (out of wedlock) children if their biological father is dead?

Back 35

1) paternity is established in a probate proceeding by a) clear and convincing evidence such as participation in school activities and gifts (however, support by itself is NOT enough) AND b. The father must have openly and notoriously acknowledge the child as his own (such as “this is my kid” or putting his name on birth certificate) OR 2). Blood genetic marker test and clear and convincing evidence if the DNA is rebutted. NOTE – DNA test must be done prior to death. NOTE Do not confuse this with equitable paternity (see domestic relations).

Front 36

Intestacy rules: When is a spouse disqualified under intestacy?

Back 36

Circumstances which disqualify a spouse from inheriting under intestacy: DISMAL 1) DIVORCE: final decree of divorce or annulment valid under NY law. 2) INVALID DIVORCE: The surviving spouse procured, outside of NY, divorce or annulment not recognized as valid under NY law NOTE - Surviving spouse not barred if deceased spouse procured invalid divorce or annulment (One way street). 3) SEPARATION decree: A Final Decree Rendered against surviving spouse. NOTE -Only applies to separation decrees, not separation agreements unless there is specific language in the agreement waiving one's rights under the EPTL NOTE - Doesn't bar spouse if the final decree of separation was rendered against the deceased spouse. 4) MARRIAGE is void: as incestuous or bigamous. ABANDONMENT or LACK of support: surviving spouse abandoned or refused to support deceased spouse (another one way street).

Front 37

Intestacy rules: How is the distribution handled when a spouse is disqualified?

Back 37

Assume that surviving spouse has predeceased and drop share down to kids or whoever is next in line as distributee. Note: NY has no slayer statute per se (but usually constructive trust will be imposed).

Front 38

Intestacy rules: What are the rules on lifetime gifts to intestate distributees?

Back 38

CL: lifetime gift to a child was presumptively an advancement of his intestate share. NY: NY has rejected the advancement presumption by statute. In NY, no advancement unless proven by (i) A contemporaneous writing made at time of gift, AND (ii) signed by donor/donee

Front 39

Intestacy rules: What effect does the disclaiming of an intestate distributee's interest in the estate have? What does a valid disclaimer require? (4)

Back 39

The person who disclaims is considered to have pre-deceased decedent or testator. A valid disclaimer requires: 1. Must be in writing, signed and acknowledged (b/f a notary) AND 2. Must be accompanied by a separate affidavit that no consideration was received and that no one paid you to disclaim (unless court authorizes receipt of consideration for the disclaimer) AND 3. Must be irrevocable (after disclaimer filed, can't change mind) AND 4. The disclaimer or renunciation mst be filed with the Surrogate's Court w/in 9mths after the date of death.

Front 40

Intestacy rules: 1) Why would someone want to disclaim? For what reason can someone not disclaim?

Back 40

1. Avoid taxes or ***To avoid a creditor's claim*** 2. Exception: Can't disclaim if against public policy (avoid being ineligible for Medicare, screw up another’s legitimate share)

Front 41

what would happen if a disclaimer might screw up another persons legitimate share?

Back 41

make it like they died one day later and give it to true person.

Front 42

Execution of Wills: What does a validly executed will require? (7)

Back 42

1. Must be 18 years old, 2. Must be signed by T, or someone at the T’s request in T’s presence Exception: When T can't sign Will herself, then when T's name is signed by another person (proxy signature), such person: a). must also sign her name, b.) cannot be counted as one of the two needed attesting witnesses, and c.) shall affix her address (but failure to affix address does not invalidate will). 3. T’s signature at “the end thereof.” 4. T must sign the will OR acknowledge his earlier signature in the presence of each W. 5. T must “publish the will.” T must declare instrument to be last will and testament. 6. There must be at least 2 attesting Ws (attesting witnesses must attest to T’s signature when T signed the will or acknowledged his signature –must be contemporaneous), AND 7. The execution ceremony must be completed in 30 days. 30 day period starts to run when 1st W signs, not when T signs.

Front 43

Execution of Wills: With regard to Ws, what does NY NOT require? What is the key to NY rule?

Back 43

NY does NOT require that: - Ws sign in each other's presence (other States require) - Ws sign in the T's presence (other States require) Key to the NY rule: T must sign or acknowledge her signature in the presence of the Ws.

Front 44

Execution of Wills: What is a codicil?

Back 44

Codicil a later amendment or supplement to a will executed w/ the same formalities (need 7 point test)

Front 45

Execution of Wills: What would happen if T signed the Will in the middle of it?

Back 45

The will is admitted to probate, but the words following the signature are not given effect. EXCEPTION: An entire Will will be declared invalid but only if matter after signature is so material that to give effect would be to defeat T’s intention.

Front 46

Execution of Wills: On whom is the burden of proof as to due execution (7 points)?

Back 46

The burden of proof is on the Will proponent (the one offering the Will for probate, usually executor) (i) If Will is not self-proved (see below) both attesting witnesses must testify as to the facts necessary to show due execution. (ii) If one witness dead, absent from state, incompetent or can't w/ due diligence be found, testimony of one W suffices. (iii) If none of the Ws are able to testify, Will proponents must prove 2 signatures - the signature of T and one W.

Front 47

Execution of Wills: What is an attestation clause?

Back 47

It appears below T's signature line and above Ws' signature lines. It recites all the elements of due execution.

Front 48

Execution of Wills: What's the proof value of an attestation clause? When is it useful?

Back 48

The clause is PF evidence of the facts presented (not legally req in any state). Useful: (i) W w/ bad memory. Probate of a Will does not turn on memory of attesting witnesses. (ii) Hostile W: if W hostile, Attestation Clause can be used to rebut this W. NOTE – it is NOT a substitute for live testimony – an Attestation Clause is merely corroborative of the W’s testimony. A will proponent must still call the W to testify or prove their signatures.

Front 49

Execution of Wills: What is a self-proving affidavit (SPA)?

Back 49

W signs a sworn statement in the presence of an attorney, recites all the statements that they would make if they were called to testify in court. (7 point test fulfilled) Key: sworn affidavit.

Front 50

Execution of Wills: 1) When is the SPA signed? 2) What is the difference between an SPA and an attestation clause? 3) What happens in probate if both witnesses sign an SPA?

Back 50

1. The Affidavit, which can be signed at anytime after the Will is excecuted, is usually signed at the same time as the Will. 2. Substitute for live testimony: Different from attestation clause - which is merely corroborative of testimony, and you still have to call the Ws to testify or else prove their signatures - A SPA is a substitute for the live sworn testimony of the W. 3. Procedure: The Will is admissible to probate on the strength of the sworn recitals in the Affidavit unless an interested party objects, in which case the formal rules of proof of due execution apply. You must then call the 2 attesting Ws to testify.

Front 51

Execution of Wills: Is the Attestation Clause required in NY? What about the Affidavit?

Back 51

Neither the AC or the SPA are legally required in any state.

Front 52

Execution of Wills: What is an interested W statute?

Back 52

A bequest to an interested W is void unless: 1. Supernumerary Rule - There were at least 3 Ws and at least 2 were disinterested. Therefore, the signature of the witness-beneficiary is not needed to admit the Will to probate, OR 2. ***The interested W (will B) would be an intestate distributee if T died intestate. In which case a “whichever is least” rule applies – The W-B takes the lesser of: a.) The bequest under the will, or b.) His intestate share. Note: The Will is still good, only the bequested to the interested W is affected.

Front 53

Execution of Wills: What is the foreign Wills Act?

Back 53

END: Executed, New York Law, or Domiciled. A Will is admissible to probate in NY if it was validly executed under: 1. Law of the state where it was Executed regardless of T's domicile at that time, OR 2. New York Law, OR 3. Law of the state where testator was Domiciled, either when the Will was executed or at death. NOTE: These rules apply only to the question of whether the Will is admissible to probate in NY. Once the Will is admitted to probate, NY law governs construction and application of its provisions.

Front 54

Execution of Wills: What are holographic and nuncapative wills? How do holographic wills interact w/ the Foreign Wills Act?

Back 54

1. Holographic will is a will that is entirely in T’s handwriting that is signed, but not witnessed. 2. Nuncupative will is an oral will (can be on DVD or CD) 3. RULE: Both are void in NY. Exception – both are members of the armed forces and mariners at sea. Trap: But, if handwritten, and witnessed by two Ws, OK. There is no requirement that a will be typewritten. But it does need to be W Application with Foreign Wills Act: if a holographic will is executed in a state that recognizes them, it’s okay.

Front 55

Execution of Wills: If a Will is denied probate due to a lawyer's malpractice, do the intended Will Bs have a cause of action against that L?

Back 55

No. b/c there is no privity of K between Bs and lawyer. The duty is only to the (now dead) client who K’d for the lawyer’s services.

Front 56

Revocation of Wills: How may a will be revoked? What is required to constitute physical revocation?

Back 56

Rule can be revoked in 2 ways a.)By a subsequent testamentary instrument, executed w/ appropriate formailities (7 pt) or b.) By physical act. (Destroying will by accident not revoking) need intent to revoke. Note: Writing this will is void w/o touching any of the words on the will is not enough. But Cross out signature: Yes. b/c anything done to the signature shows an intent to revoke the will. Decisive act of revocation

Front 57

Revocation of Wills: What is the typical express revocation language?

Back 57

Typical EXPRESS revocation language is "I hereby revoke all wills heretofore made by me."

Front 58

Revocation of Wills: What is revocation by implication?

Back 58

If 2nd will wholly inconsistent to 1st will, 1st will revoked by implication Ex: 2 wills – If there is no revocation language in later will, to the extent possible, you read the 2 instruments together. That 2nd will w/o language of revocation is treated as a codicil to the 1st will, and only revokes the 1st will to the extent that there are inconsistent provisions.

Front 59

Revocation of Wills: What does revocation by proxy require (aka revocation by physical act of another)? (4) Therefore, how many people must be in the room?

Back 59

1. Rule: Must be a.) at T’s request b.) in T’s presence c.) W’ed by at least 2 W of the act. 2. Need 4 people, T, revoker, 2 Ws

Front 60

Revocation of Wills: What are the presumptions regarding revocation of wills?

Back 60

1. If will last seen in T’s possession, and not seen after T’s death, T revoked the will by physical act. 2. Will last seen in T’s possession found mutilated, presumption that T was the one who revoked the will by physical act. a. Neither presumption arises if will last seen in possession of someone adversely affected by its contents b. Evidence admissible to rebut the 2 presumptions when the will cannot be found (e.g. Will left w/ atty - and atty can't find it) or when the Will is found in a damaged condition (T told W that destruction accidental)

Front 61

Revocation of Wills: What are the only 2 ways T can make changes in her Will? What about words added after due execution of the will and partial revocation by physical act?

Back 61

1. Rule: a. Write a new will which revokes the 1st will or b. Make a codicil or amendment to 1st will which changes only parts of the 1st will 2. Note: both need to be executed w/ all 7 point formalities (need Ws) 3. ***NY BAR: Key things tested a. Words added to will after signed and witnessed are discarded b. Partial revocation by physical act is not recognized in NY (but full revocation by physical act is recognized).

Front 62

Revocation of Wills: What is the rule of no revival of revoked wills?

Back 62

Rule: If a person executes a will that is then revoked by a later will containing a revocation clause, i.e., "I hereby revoke all WIlls heretofore made by me..." the first Will cannot be 'revived' simply by destroying the later Will. Will can only be revived in one of 2 ways: a. Re-executed: Signed again by T and 2 Ws. b. Doctrine of republication by codicil: T validly executes a codicil to 1st will making changes. NOTE: In NY, ‘no revival’ rule also applies to codicils. NOTE: Always need a validly executed document to make a change.

Front 63

Revocation of Wills: What is the CL doctrine of Dependent Relative Revocation?

Back 63

DRR is a common law doctrine which permits a revocation to be disregarded when premised upon, conditioned upon, or dependent upon a mistake of law as to the validity of another disposition. The disposition that results from disregarding the revocation of the later will must come close to the dispositions T intended when he attempted to revive the earlier will. DRR applied by one Appellate Div case, but never by Ct of App. If get it, argue both ways (this and no revival) DRR sometimes called the 2nd best solution doctrine (Best solution - giving effect to T's intent by reviving, is not possible under NY law)

Front 64

Revocation of Wills: What's the proof of lost wills statute? What 3 things must be proven?

Back 64

Lost Wills statute is used in two situations: DRR and truly “lost” wills. The “Lost Will” proponent must prove a.) The lost or later will was duly executed. 7 pt test b.) the lost or later will was not revoked – thus, proponent must (1) Overcome presumption of revocation that arises from Will’s non-production, or (2) Prove that revocation should be disregarded under DRR c). that the Will’s provisions were” clearly and distinctly proven by each of at least 2 credible witnesses or by a copy or draft of the Will proved to be true and complete.”

Front 65

What 2 conditions must be present for a gift to vest and avoid lapse under NY Anti-Lapse Statute?

Back 65

1. The pre-deceased beneficiary was the T's ISSUE or BROTHER or SISTER AND 2. The predeceased beneficiary has issue who survive T NOTES A condition to a bequest like “if he survives me” trumps anti-lapse). "Issue" includes adopted children and nonmarital children, as well as adopted out children specifically named in will. Doesn't apply to brother/sister-in-law

Front 66

Adopted-out and anti-lapse. T’s son was adopted out by non-relative,but T still named him as a beneficiary in his will. Son predeceases T leaving children. What result?

Back 66

1. Even though son adopted out, because the testator specifically named the adopted out son, the anti-lapse statute saved the testator’s device to the adopted out son’s issue.

Front 67

What happens when there is a lapse in the residuary gift?

Back 67

“Surviving residuary beneficiaries” Rule -If T’s residuary estate is • Devised to 2 or more persons AND • Gift to one fails or lapses for any reason THEN Other residuary beneficiaries will take entire residuary estate in proportion to their interests in the residue, absent a contrary provision in the Will. However, the Anti-lapse statute trumps the “surviving residuary beneficiaries” rule, and the issue of the predeceasing beneficiary take their share (if they qualify)

Front 68

Class gifts: Class gift rule?

Back 68

A rule of construction based on presumed intent. If a Will makes a gift to a group of persons generically described as a defined class ("children," "brothers and sisters," etc.) and some class members predecease T, the class members who survive the T take in equal shares (absent contrary provision of the gift.)

Front 69

How to determine the members of "the class:"

Back 69

Look at who is alive at T’s death to determine the takers of a class gift.

Front 70

Class gifts: Contrast the Class gift rule with the result when Bs are named individually and not as a class?

Back 70

In contrast, if the Bs are named individually and not as a defined class, then if any B dies, the gift to that named B lapses into the residuary, and does not go to the other named beneficiaries. It should be noted, though, that the gift will not lapse into the residuary if the anti-lapse statute applies. (Rule of thumb – anti-lapse trumps the class gift rule)

Front 71

does an adopted out child take as a beneficiary of a class gift in a Will to members of birth family?

Back 71

no

Front 72

what is the rule of convenience?

Back 72

class closes at time a distribution to the class must be made. later born class members are excluded.

Front 73

what is the limitation on rule of convenience?

Back 73

later born class members NOT excluded from taking as members of the class if gestation principle applies. This is a common law presumption that there are 280 days from conception to birth

Front 74

when does the class close for outright gift by will?

Back 74

closes at Ts death

Front 75

Death of Beneficiary During T's Life: Class gifts and life estates rule?

Back 75

If there is a gift of a life estate or an income interest w/ a remainder to a "class of Bs": The class closes at the death of the life tenant or the income beneficiary.

Front 76

Death of Beneficiary During T's Life: Rule on simultaneous deaths?

Back 76

Under USDA Rule: Where the title to the property depends upon the priority of death and it can't be shown that the jt property holders didn't die simultaneously, the property of each person is disposed of as if he survived the other. Applies to distributions of property by any means. See hint for example

Front 77

Death of Beneficiary During T's Life: USDA and jointly held property?

Back 77

Jointly-held property passes as though each co-owner survived. USDA prevents the operation of the right of survivorship in cases of jointly held property. The property passes as though a tenancy in common was involved, not survivorship property. (Need simultaneous death language)

Front 78

Changes in T's family after will is executed: T marries after Will executed?

Back 78

Rule: Marriage following execution of the will ahs no effect on the validity of a will but it may affect the gifts and dispositions under the will. Reason: NY law provides for a "right of election" which provides that one cannot disinherit his spouse.

Front 79

Changes in T's family after will is executed: T “unmarries” after will is executed?

Back 79

If the court renders a FINAL DECREE of divorce, annulment, or separation all gifts to former spouse are revoked by operation of law, as if former spouse pre-deceased T. Fiduciary appointments are also revoked except as to guardian of couple's children. Exclusions 1)all gifts and fiduciary appointments to a son or daughter of the former spouse is not revoked by the divorce, 2) an appointment of the former spouse as guardian of the couple’s children is not affected, 3) If couple reconcile and remarry, all provisions in favor of the former spouse are restored.

Front 80

Changes in T's family after will is executed: Does the statute apply if H/W had applied for divorce or a separation agreement but a final decree had not been entered?

Back 80

No. There must be a final decree for these rules to apply. Divorce or separation decree or annulment.

Front 81

Changes in T's family after will is executed: Does statute apply to a life insurance policy on H's life that names "my wife W" as primary beneficiary?

Back 81

Statute now revokes gifts upon divorce – life insurance, trusts, totten trusts, right of survivorship becomes tenancy in common

Front 82

Changes in T's family after will is executed: What is the term for children born or adopted after the will is executed? Rule for child born/adopted after will executed, if T had one or more children when will was executed.

Back 82

“Pretermitted children.” General Rule: Under the EPTL, a child born or adopted after execution of a will and not provided for or mentioned in the will shares in the estate

Front 83

What happens if if T had one or more children when will was executed, and 1) no provision is made for any children, 2) the will made substantial gifts to the other children, 3) it appears that the T’s intention was to only make a limited provision to the children living at the time the will was executed?

Back 83

1) the pretermitted child inherits nothing, 2) pretermitted child shares in the amount to the other children, as if a class gift was made 3) pretermitted child takes an intestate share

Front 84

Changes in T's family after will is executed: Rule if T had no children when will was executed- does afterborn child take?

Back 84

The pretermitted child takes the intestate share he would have inherited had the T died without a will.

Front 85

Changes in T's family after will is executed: Rules in action: 2003 T executed will that place residue of estate in trust: "Income to W for life, and on her death remainder to my children, A and C, in equal shares." 2005, T and W adopted J. T dies, and 2003 will admitted to probate. T survived by W, and A, C, and J. Distribution? I: Is J (adopted after will executed) "pretermitted" w.in the meaning of the statute?

Back 85

Ask: 1) Is the child born or adopted after will is executed: if Yes then, 2) Is the child "unprovided for by any settlement": if Yes then 3) Is the child neither provided for nor mentioned in the will: if Yes then Result: J takes the same as her siblings as if class gift had been made b/c all 3 requirements met (remember, rules apply also to nonmarital children). The share will come out of the gifts to the other children, the same way a class gift would.

Front 86

Changes in T's family after will is executed: What if children are given different amounts?"I give 100k to my son A and 50k to my son C." Then, T adopts, J.

Back 86

We add the amounts together, and we divide by the # of children, including the afterborn children. 150k to A and C. And with Jodi we have 3 kids 150/3 = 50k. Jodi gets 50k, taken from A and C PROPORTIONALLY.

Front 87

Changes in T's family after will is executed: What if will makes a limited provision, e.g., $5 to A and C, and then T adopts J?

Back 87

Here Jodi is going to take her intestate share, which will come from all the other beneficiaries proportionately.

Front 88

Changes in T's family after will is executed: What if will devises a different amount to each child, e.g., $1mill to D and $5mill to A, then adopts M?

Back 88

Add the amounts together and divide by the number of children including the afterborn child. 6mill/2mill. M gets his 2mill from the other kids PROPORTIONALLY (not equally)

Front 89

T has taken out a 25k life insurance policy naming J as primary B. Doe J take a share as a pretermitted kid?

Back 89

T has taken out a 25k. No. One of the requirements is that J is not provided for by any other settlement. Here life insurance policy is the other settlement. Doesn’t matter how much, parents thought about the afterborn and provided for him. Any form of lifetime transfer may be a settlement, causing the Pretermitted Child statute to be inapplicable (Totten trusts and savings bonds are other examples)

Front 90

T had no kids at time will executed, then adopts J?

Back 90

Conditions to the statute's operation (1+2+3) are the same. However the result is differnt: Afterborn or afteradopted takes her intestate share. Might be all, or ½ less than 50k if mom still in picture. Note: recent statute child must be in gestation to count as an afterborn.

Front 91

what is the common law rule for disinheritence in a will?

Back 91

when a will does not make a complete distribution of the estate, words of disinheritance in the will are ineffective with respect to property passing by intestacy.

Front 92

What is the NY rule in regards to negative bequests?

Back 92

NY: Words of disinheritance are given full effect, even in partial intestacy (when will does not make a complete distribution of assets). If partial intestacy, treat disinherited as if she pre-deceased T.

Front 93

What is “satisfaction of legacies”?

Back 93

Basically this is the Wills equivalent of Advancements in intestacy. At CL, a lifetime gift made after the Will’s execution to a B named in the Will was presumptively made a partial or total satifaction of the legacy, to be taken into account when distruting the testator's estate at death.

Front 94

What is the NY RULE in regards to Satisfaction of Legacies?

Back 94

NY has rejected the 'satisfaction of legacies' presumption by statute. Such a gift is not treated as a 'satisfaction of a legacy' unless proved by: a. A contemporary writing made at time of gift, and b. it is signed by the donor/donee.

Front 95

Reference to facts and events outside the will: What is an extrinsic document? What is Incorporation by reference? What's the multi state rule? NY?

Back 95

Extrinsic Document is a document that is not part of the will. "MS: The terms of an extrinsic document, not present at the time the will is signed (and thus not part of the will itself) can be incorporated by reference if 1) the document was in existence when the will was drafted, 2) the will shows an intent to incorporate the document, and 3) the document is clearly identified by language in the will. NY rule – NY doesn’t recognize incorporation by reference. Everything must be formally executed. Need 7pt test for due execution. Ex: T executes will that provides ""I devise all of my jewelry to persons named in list in safe deposit box. List is found. T's handwriting and signed by T, but not witnessed. The indicated dispositions will not be given effect, b/c IBR not recognized in NY. Note: In trusts, don't confuse this with pour-over trust

Front 96

Reference to facts and events outside the will: What is the Acts of Independent Significance doctrine?

Back 96

AIS also called non-testamentary acts doctrine. Acts performed by T after the will is executed which have a purpose or motive independent of any testamentary purpose are given full effect when distributions are made. T executes a will, devising "the auto" I own at my death to A, currently owns a Taurus. Dies owning a Mercedes. A gets the Mercedes. Applies to all tangible property. Exception for title documents (deeds, stock certs, bank passbooks) - these items can only be transferred by operation of law.

Front 97

Problems associated w/ Testamentary Gifts: What are the five gift classifications?

Back 97

1) Specific gift: Tangible, personal property. 2) Demonstrative legacy: A general amount, but T designates a specific source FROM which the amount is to be paid from. 3) General legacy: A general amount. I give 5k to G. 4) Residuary disposition: "I give all the rest, residue, and remainder of my estate to brother J." 5) Intestate property: If a partial intestacy results b/c will was poorly drafted, and the will has no residuary clause. If no residuary, and no anti-lapse applicable b/c dealing w/ friend, will goes to partial intestacy.

Front 98

Problems associated w/ Testamentary Gifts:Issue: What happens when there are so many claims against the estate that there aren't enough assets to cover all the gifts made by the will?

Back 98

Rule: The gifts under the will "abate." Abatement: Not giving effect to gifts so that creditor’s claims can be satisfied.

Front 99

Problems associated w/ Testamentary Gifts: Absent a provision in will, what is order of abatement of T's property to pay debts and claims?

Back 99

Rule: Start at the bottom of the gift classifications list, and work way to top: 1. Intestate and residuary property: Debts and expenses paid out of here first. For this purpose, two classifications dealt with the same. If there are still debts: 2. General Legacies: Abate pro rata (proportionately) 3. Demonstrative legacies, abate pro rata. 4. Specific gifts. 5. Last (won't see on bar): Items that qualify for the estate tax marital deduction always abate last.

Front 100

What if a Will makes a specific gift of property and the property cannot be found or is not owned by the testator at death, what then?

Back 100

The gift fails under the DOCTRINE OF ADEMPTION, without regard to the testator's intent.

Front 101

To what does ADEMPTION apply? NOT apply?

Back 101

Ademption ONLY applies to specific devises and bequests. NOT to GENERAL or DEMONSTRATIVE legacies. Assets will have to be sold to satisfy a general disposition if there is not enough cash, or to satisfy a demonstrative disposition if the designated account is empty.

Front 102

Problems associated w/ Testamentary Gifts: 3 Statutory exclusions to the doctrine of ademption?

Back 102

1) insurance proceeds for lost, damaged or destroyed property: Beneficiary takes the insurance proceeds to the extent they are paid after death. 2) proceeds received under an Executory K: (K that hasn’t been performed yet) Beneficiary will take the sale proceeds which are paid after death. If K fully performed (proceeds paid) b/f death, B gets nothing. 3)Proceeds from a guardian or conservator’s sale of specifically bequeathed property. In this situation, B entitled to receive the money or the property into which the proceeds from the sale or the transfer can be traced. If can’t be found, you have ademption. It is adeemed.

Front 103

Problems associated w/ Testamentary Gifts: What happens if a T makes a specific gift of property that is encumbered?

Back 103

Exoneration of liens: MBE/CL: If T made a specific bequest of property that was subject to a mortgage or other lien on which T was personally liable, then B was entitled to have the lien "exonerated" (paid from the residuary estate). NY RULE: Liens on specifically bequeathed property are not exonerated (paid off from residue) unless the will directs exoneration. A general direction in the will calling for payment of T's debts is not considered an expression of intent that liens be exonerated. The no-exoneration rule applies where proceeds of any life insurance policy are payable to a named B. If the insured has borrowed against the value of the policy, B takes subject to lien, w/ no personal liability. Unless B pays off the debt, however, C will foreclose and so the B is under a practical compulsion to pay.

Front 104

Problems associated w/ Testamentary Gifts: Ademption rules applied to bequests of shares of stock and other securities

Back 104

For ademption purposes, gifts of shares of stock in publicly traded corporations are general legacies (they don't adeem) unless T says "I give MY stock" which evidences an intention to make a specific bequest. Gifts of shares of stock in a closely held company are considered specific legacies. They are going to adeem if they don't exist anymore. Example: T executes a will making the following gifts: "I give 5k to be paid from the proceeds of sale of my Acme stock to friend F": "I give my 100 shares of IBM common stock to my sister S": I give 100 shares of Kodak common stock to my brother C": At time of will, T owned 100 shares each of Acme, IBM and Kodak. T sold the Acme stock and used the sale of the proceeds to buy a Caddy. T then sold the IBM stock and used the proceeds to buy AT&T stock. T sold Kodak stock and used the proceeds to buy Polaroid stock. Who gets what? F: (5k from Acme that became the Cadillac) This is a demonstrative gift, and ademption does not apply. F will get the 5k from other assets (but if T still owned Acme stock, E would have a duty to sell it to raise the 5k). S: (my 100 shares of IBM) this is a specific gift which no longer exists. Ademption applies and S gets nothing. C: (100 shares of Kodak) It's a general gift, and ademption doesn't apply to general gifts. C will get the value of 100 shares of Kodak stock, coming from other sources. Remember, stock in a closely held corp is considered a specific gift, and ademption applies. The word "my" is irrelevant when dealing w/ closely held corps.

Front 105

Problems associated w/ Testamentary Gifts: Stock split rule?

Back 105

When dealing w/ bequest of stock: If a stock split occurs it is treated as a specific gift, regardless of whether or not it was a specific gift before the split ("my") or whether the stock was publicly-traded or closely-held. Note: A specific bequest of stocks includes splits, but not stock dividends declared after the will was executed. E.g. "I give 100 shares of British Air common stock to Harry." The stock splits two-for-one. Harry will take 200 shares.

Front 106

Non-Probate Assets: Definition

Back 106

Non-probate assets are interests in property that are not subject to the disposition under the will or via intestacy and therefore are not part of the probate estate. Probate estate in contrast: Property that a decedent owned SOLELY in his name at the time of death is disposed of pursuant to the terms of the will.

Front 107

Non-Probate Assets: What are the four general categories of non-probate assets?

Back 107

1. Property passing by right of survivorship (bank account, joint stock account, real property, payable on death accounts) 2. Property passing by K is a non-probate asset (life insurance policy, employee benefits payable to a B other than decedent or decedent's estate. If paid to the insured's executory or insured's estate, it becomes a probate asset) If T has life insurance policy that names A as B, even if he leaves proceeds to someone else in will proceeds still payable to A (will is ineffective to undue the designation of LE policy). 3. Property held in trust, including a revocable trust (terms of the trust will govern disposition of the assets). 4. Property over which decedent held power of appointment.

Front 108

Elective share statute: Purpose What is the elective share?

Back 108

Protect the surviving spouse against disinheritance by giving decedent's surviving spouse a minimum share of decedent's estate. Elective share = GREATER of 50k OR 1/3 of the estate, * plus interest at 6% beginning 7 months after issuance of Letters Testamentary to executor (or Letters of Administration to the administrator appointed by the court).

Front 109

Elective share statute: Compare w/ intestate share

Back 109

Under intestacy: If IT survived by spouse and issue: 50k plus 1/2 balance of the estate. If IT survived by spouse and no issue: whole enchilada. Thus if decedent dies without a will, surviving spouse's intestate share will always be larger than elective share - unless Testamentary Substitutes were used.

Front 110

When is the elective share calculated?

Back 110

in theory the elective share is only applied to T’s net probate estate (value of estate after payment of debts, but before payment of estate taxes)

Front 111

What happens if the elective share is not satisfied? Can a T defeat the protection of the elective share statute by transferring non-probate assets to other person as testamentary substitutes?

Back 111

the other beneficiaries contribute pro rata – includes beneficiaries under the will, beneficiaries of T-Subs, and/or intestate distributees. Thus, to prevent a T from defeating the elective share statute, the elective share includes the probate estate AND T-subs.

Front 112

Elective share statute: What is the general rule to remember when trying to determine if something is a T-Sub?What are the 7 T-Subs?

Back 112

Generally speaking, if T still has some sort of interest in the property, it's probably a T-Sub. Exception: a gift made w/in 1 yr of death. T’S LEG UP: 1. TOTTEN Trust accounts – including bank accounts in the T’s name in trust for another (depositor can take out as much as wants, but payable on death) and payable on death securities 2. SURVIVORSHIP Estates: joint tenancies, tenancies by the entirety, joint bank accounts, and Survivor Bank Accounts created after 9/1/1966. Watch out for pre & post marriage scenarios. 3. **LIFETIME transfers w/ strings attached: a. Trust where B gets interest, but T retained power to revoke, invade, consume or dispose of principal or name new Bs AND b. irrevocable transfers (made during marriage) where T retained life estate (made on or after 9/1/1992) (note-only half is a T-Sub) 4. EMPLOYEE pension, profit-sharing, deferred compensation plans. 5. GIFT of more than 13k w/in 1 yr of death. Also, 'gifts cause mortis' (gifts made in fear of impending death) regardless of the amount of gift are T-Subs. 6. UNITED STATES gov't bonds and other P.O.D. arrangements. 7. POWERS of appointment: Property over which decedent held a presently exercisable general power of appt (but not property over which he held a general testamentary power)

Front 113

Elective share statute: What aren't T-SUBS?

Back 113

LOGPIT 1.) ***LIFE insurance*** Whether payable to surviving spouse or 3P 2.) ONE-HALF qualified pension and profit sharing benefits 3.) GIFTS of less than 13k made w/in 1 year of death 4.) PRE-MARRIAGE irrevocable X-fers.(e.g. a gift to a friend) 5. IRREVOCABLE X-fers made more than 1yr b/f death 6. TRANSFERS (irrevocable) w/ retained life estate made b/f 9/1/92 and made during marriage. Note: Generally speaking, if T doesn't retain an interest, it's not a T-Sub (major exception is life insurance)

Front 114

Elective share statute: What amt of T-Sub included in calculating the "elective share estate"

Back 114

Rule: The full amt, EXCEPT: 1. When the “consideration furnished” test applies. Rule: Where you have survivorship estates w/ deceased spouse and 3P, that surviving spouse has burden of proof as to decedent's contributions TO the assets' acquisitions (if RP) or the amount of deposit if you’re dealing with a joint bank account.. S spouse, dead spouse, 3P, S spouse has to show much was the dead spouse's 2. Survivorship estates of dec spouse and surviving spouse (JT, TE, Bk acct WROS) Rule: 1/2 is a T-Sub. Consideration furnished test doesn't apply when dealing w/ survivorship interests between dead spouse and surviving spouse.

Front 115

Elective share statute: T-Subs and Intestacy: What happens with survivorship estates involving the T and the SURVIVING SPOUSE?

Back 115

half is a T-sub. Surviving spouse is entitled to claim an elective share in his spouse’s property, not in someone else’s property

Front 116

Elective share statute: T-Subs and Intestacy T died survived by wife W. No kids. T left 100k in bk acct in trust for his cousin C. No other assets solely in his name. T had a jt bk acct of 140k with F created after marriage to W. T contributed all the money into this bk acct. What happens under intestacy? Under elective share?

Back 116

1. Under intestacy: W would get nothing. But can't screw spouse. 2. Under elective share: a) T trust w/ C worth 100k. b) Jt bk acct w/ friend, consideration furnished test - all 140k. c) Total amt of T-subs is 240k d) W entitled to 1/3 of 240k in T-subs e) entitled to 80k, b/c not getting anything else.

Front 117

Elective share statute: How do T's Bs contribute to satisfy the net elective share?

Back 117

Rule: To satisfy the net elective share, all Bs contribute pro rata. Includes Bs under the will, Bs of T-subs, intestate distributees.

Front 118

Elective share statute: Do elective share trusts satisfy surviving spouse's right of election?

Back 118

b/f 9/1/94, right to an elective share could be eliminated thru use of an elective share trust that gave surviving spouse life estate, as long as least 50k was given outright to spouse. If the sum of outright dispos of at least 50k plus the principle of the trust equaled or exceeded the 1/3 elective share amt, surv spouse had no right of election TODAY: Life estates (or other terminable interests) no longer satisfy the elective share entitlement. For estates of decedents dying on or after 9/1/94, a life estate will not satisfy the elective share entitlement. (Not controlled by date the will was executed but date of death). Can still see this if will executed prior to 9/1/94 that contains an elective share trust w/ T dying on/after 9/1/94.

Front 119

Elective share statute: What happens to a surviving spouse's LE trust income interest if she files for an elective share?

Back 119

You read the trust as though surviving spouse pre-deceased T. Kill the trust, as if no longer LE in W. Accelerate the remainder and remainderman gets the whole thing immediately.

Front 120

What is the elective share quick formula (p.72) ?

Back 120

To get the ELECTIVE SHARE ESTATE you add 1) the net probate estate or intestate estate + 2) T-subs (full value) + 3) T-Subs with surviving spouse (1/2 in) + 4) T-Subs with 3p (consideration furnished). Then you multiply the elective share estate by 1/3 and you get the ELECTIVE SHARE AMOUNT.

Front 121

What is the elective share quick formula for determining whether the surviving spouse is satisfied?

Back 121

Take the elective share amount and subtract the amount the surviving spouse receives under the Will or via intestacy, and then subtract the T-subs with surviving spouse (1/2 out). This gives you the net elective share.

Front 122

Elective share statute: Can a spouse of decedent not domiciled in NY at time of his death claim an elective share under EPTL?

Back 122

No. Only spouse of a dec domiciled in NY at time of death has a right of election. State where dec domiciliary at time of death will govern.

Front 123

Elective share statute: Exception to the last rule?

Back 123

If T expressly states in his will that the disposition of his property in NY is to be governed by NY law. In such a scenario, T's net estate for elective share purposes will include value of other state's assets, even though NY court can't adjudicate ownership. Otherwise, surviving spouse would have to do “ancillary proceeding” in NY to clear title of the NY property.

Front 124

Elective share statute: What is exempt property?

Back 124

EP = items which surviving spouse gets first off the top, b/f property passing by will, intestacy, or elective share. Just mention the exempt personal property set-aside, unless they specifically put it in play. Basically, in addition to the elective share, surviving spouse gets $56,000 in personal property (including Cars up to 15k, home items - up to 10k, cash up to 15k, animals, farm machinery etc up to 15k, and books pictures videos etc up to 1k)

Front 125

Elective share statute: How to strengthen any NY Bar exam question involving a surviving spouse?

Back 125

Mention the exempt personal property set-aside: In addition to the elective share, the surviving spouse is entitled to exempt personal property up to $56,000 in value, including: 1. Car up to 15k value 2. furniture appliances, computers, etc up to 10k value 3. 15k cash allowance (which isn't subject to creditor's claims, except for funeral expenses) 4. Animals, farm machinery, tractor up to 15k. 5. Books, pictures, videotapes, software, etc up to 1k.

Front 126

Elective share statute: When is spouse DQ'd from taking elective share (and exempt property)?

Back 126

DISMAL * DIVORCE - final decree of divorce or annulment valid under NY law * INVALID divorce/annulment: procured by surviving spouse * SEPARATION decree (***NOT AGREEMENT***) rendered against surviving spouse * MARRIAGE void as incestuous or bigamous ** ABANDONMENT and LACK of support by surviving spouse

Front 127

what is power of appointment?

Back 127

authority created in (or reserved by) a donee enabling a donee to designate, within limits prescribed by the donor, the persons who shall take the donor’s property and the manner in which they take it.

Front 128

What is a power of appointment?

Back 128

PoA is an authority created in or reserved by a person enabling her to designate, within limits prescribed by the creator, the persons who shall take the property and the manner in which they take it.

Front 129

What is the purpose of a power of appointment?

Back 129

Allows the donee to look at facts in existence at a later date when distributing the property.

Front 130

Who is the donor?

Back 130

The creator of the Power of Appointment.

Front 131

Who is the donee?

Back 131

Person given the power of appointment.

Front 132

What are the people who will take the property subject to the power if the donee fails to exercise the power of appointment called?

Back 132

The takers in default.

Front 133

What types of power of appointment are there?

Back 133

1) General power of appointment, 2) Special power of appointment; 3) Presently exercisable power of appointment; 4) Testamentary power of appointment.

Front 134

What is a general power of appointment?

Back 134

Donee can appoint to herself, her creditors, or to her estate as if she owned it herself.

Front 135

What is a special power of appointment?

Back 135

Donee cannot appoint to herself, her estate, or her creditors. Normally there is a limited class to where the donee can appoint (i.e. to the issue of my brother)

Front 136

What is a presently exercisable power of appointment?

Back 136

Donee can appoint during donee's lifetime in a trust instrument (don't have to wait for a will).

Front 137

What is a testamentary power of apointment?

Back 137

Donee can only appoint by will after donor's death.

Front 138

Is a residual clause enough to exercies the testamentary power of appointment?

Back 138

Yes, by statute in NY.

Front 139

Is a residual clause enough to exercies the testamentary power of appointment? (e.g. "all the rest, residue and remainder of my estate to . ." where estate includes what the donor asked the donee to have power over) What is the rule in NY?

Back 139

In NY, a 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.

Front 140

Where the instrument requires a speific reference to the power in order to appoint, will a residuary clause suffice?

Back 140

No. In that case, the takers in default of appointment take.

Front 141

Is a presently exercisable power of appointment exercisable by will?

Back 141

Yes. A presently exercisable power of appointment is ALSO exercisable by will UNLESS exercise by will is expressly prohibited.

Front 142

What types of powers of appointment are testamentary substitutes for elective share purposes?

Back 142

General presently exercisable powers of appointment only because donee can appoint to herself, her estate, her spouse, etc.

Front 143

What types of powers of appointment are NOT testamentary substitutes for elective share purposes?

Back 143

1) General testamentary power of appointment (cannot access during her lifetime only in her will), 2) Special power of appointment (can't get at it during her lifetime)

Front 144

Can creditors reach a general presently exercisable general power of appointment?

Back 144

Yes, because the donee can appoint to himself he is treated as the owner for creditor purposes.

Front 145

Can creditors reach a special presently exercisable power of appointment?

Back 145

No

Front 146

Can creditors reach a general testamentary power of appointment?

Back 146

No, except if the donee was both the donor and donee of the POA, or she exercises it in favor of her estate

Front 147

Powers of Appointment and RAP:Cite the Rule Against Perpetuities

Back 147

Rule: No interest shall vest more than 21 years afer a life in being at time of grant.

Front 148

What does the rule against perpetuities attempt prevent? Worst or best case scenario?

Back 148

VESTING of an interest coveyed too far in the future. RAP looks at the worst case scenario--what is the latest an interest could possibly vest.

Front 149

Cite the Suspension Rule.

Back 149

For an interest to be valid, there must be identified persons who could together, convey a FSA within 21 yrs after a LIB

Front 150

What does the Suspension Rule attempt to prevent?

Back 150

Dead Hand Control. If 2 people cannot combine to create a FSA within 21 yrs after a LIB, gift is void.

Front 151

What is a spendthrift clause? What does the Statutory Spendthrift Rule prevent?

Back 151

Spendthrift clause in a trust prohibits voluntary and involuntary transfers of a beneficiary's interest. Spendthrift Rule- In NY, all income interests are given spendthrift protection. income beneficiaries cannot assign or convey their income interest. Thus creditors can transfer or reach income (but not corpus). Exceptions - creditors who furnish necessaries, suits to enforce child support or alimony, suits by Feds asserting tax lien, by creditors to the extent of income beyond education and support.

Front 152

What does the NY Perpetuities Reform Statute do?

Back 152

It reforms gifts that would fail under RAP by reducing age contingendcies to 21 years

Front 153

What are the 4 types of POWERS OF APPOINTMENT?

Back 153

1. General POA 2. Special POA(also Limited) 3. Presently Exercisable POA(can be combined with general or special) 4. Testamentary POA (can be combined with general or special)

Front 154

10 steps under the RAP and Suspension Rule Checklist?

Back 154

1. Identify the interest 2. Determine whether you are "measuring" from date of creation or date of exercise 3. Determine whether 2nd look applies 4. Give the RAP Rule 5. Find an LIB and Run with it. 6. Most Likely apply the New York Reform Statute 7. Give the Suspension Rule 8. Look to see see if there is an income interest in an unborn beneficiary and state that the income interest is void

Front 155

What are the three steps in an analysis of whether a power of appointment meets the RAP requirements?

Back 155

1) Identify the type of power of appointment, 2) Determine whether the power itself is valid, 3) Determine whether the interests created by the POA are valid

Front 156

For a special or general testamentary power of appointment to meet the RAP, what must happen?

Back 156

It must be certain to be EXERCISED within LIB plus 21 years (NOTE – generally, if such a power is given to a person who is a LIB at the time the power is created, the power is valid)

Front 157

For a general presently exercisable power of appointment to meet the RAP, what must happen?

Back 157

It must be certain to BE ACQUIRED within LIB plus 21

Front 158

When assessing whether the interests created by a SPECIAL POWER OF APPOINTMENT OR A GENERAL TESTAMENTARY POWER OF APPOINTMENT are valid under the RAP, what date do you use to measure?

Back 158

To be valid, interests creted by the exercise of a special power of appointment OR a general testamentary power of appointment are measured from the date of the instrument CREATING THE POWER, NOT THE POWER’s EXERCISE (this is because NY teats the donee of the power as the donors agent, who merely “fills in the blanks” in the donor’s will or trust)

Front 159

When assessing whether the interests created by the exercise of a power of appointment that is BOTH GENERAL AND PRESENTLY EXERCISABLE are valid under the RAP, what date do you use to measure?

Back 159

Measured from the date of the instrument exercising the power, not from creation (NOTE – when the power of appointment is a general presently exercisable power of appointment, we do not “fill in the blanks”

Front 160

What happens if you find that the interest created by the power of appointment violates the RAP?

Back 160

Use the NY “wait and see/second look doctrine” – wait and see what happens – look at the time the POA is exercised, fill in the blanks looking at the facts in existence when the donee exercises the power

Front 161

What are the two general rules when you have an income interest built on a prior income interest? (e.g. income to X, then on his death T pays income to X’s children)

Back 161

1) an income interest built on a prior income interest, the second income interest is usually VALID, 2) an income interst built on a prior income interest conditioned upon reaching a certain age, the second income interest is void, but saved and thus valid because the NY Reform Statute will force vesting within LIB plus 21 years

Front 162

Problems associated w/ Testamentary Gifts: Rule on mistake? T told lawyer to draft will and give E 300 shares of Exxon stock. L's sec'y mistyped the figure as 200 shares which T didn't notice when he read the will. At T's death he owned 300 shares.

Back 162

E gets 200 shares b/c the plain meaning of the will won't be overturned by extrinsic evidence. Absent suspicious circumstances, and where the will is unambiguous, it is conclusively presumed that T read the will and intended the consequences.

Front 163

Problems associated w/ Testamentary Gifts: 2 Types of ambiguity? What type of evidence is admissible for each?

Back 163

Latent ambiguity: when language of will results in a misdescription when applied to facts to which it refers (2 or more persons or things fit the description, or no one fits description exactly, but 2 or more persons fit description in part). Extrinsic evidence, including declarations by T to her attorney or to 3P, are admissible to clear ambiguity. Patent ambiguity: When uncertainty appears on the face of the will. EE, including statements made by the T to attorney, BUT not declarations by T to 3Ps, is admissible to cure this type of ambiguity. W/ a patent ambiguity, won't allow evidence that contradicts what the will said. If extrinsic evidence doesn't cure the ambiguity, the gift fails, b/c no ascertainable B.

Front 164

Problems associated w/ Testamentary Gifts: What are Conditional wills

Back 164

"Conditional Wills – Impose an obligation only if some condition is satisfied. Bar exam – argue both ways. Limited instance in which you would do this. Unlikely to be on bar, would have to tell you what’s going on in T’s head.

Front 165

Problems associated w/ Testamentary Gifts: K to make a will.

Back 165

A joint will is a will of 2 people in one document. I: Was the will executed pursuant to a K that the survivor would not revoke the joint will after the death of the other person? Statutory R: A K to make a will or not revoke a will can only be established by an express statement that the Will’s provisions are intended to constitute a K between the parties. If you have a K will and the survivor breaches the K by writing a will with inconsistent provisions, first probate the new will, even though it differs from the K will. Then the court will impose a constructive trust in favor of the original intended Bs. A K Joint Will can be revoked by agreement of the parties while they are both alive. Estate can't revoke K will on behalf of decedent spouse.

Front 166

Will Contests: 4 things needed for testamentary capacity?

Back 166

Did T have suff cap to 1. Understand the nature of his act 2. Know the nature and approximate value of his property 3. Know the birth object of his bounty 4. Understand the scope and meaning of the provisions of his will Notes: The capacity to make a will requires less capacity than is required for any other legal instrument Even if before writing and signing her will, T adjudicated incompetent and a guardian appointed to manage her affairs, court can still find capacity if court determines that T executed her will during a lucid interval

Front 167

Will Contests: What is insane delusion?

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T of sound mind on other subjects, but has a persistent belief in supposed facts that have no real existence except in T's perverted imagination. The facts are against all evidence, probability, and control and produce the exercise of the testamentary act.

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Will Contests: ***What is Undue Influence (UI)? Who has the burden of proof and what must they prove?(3)

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Testamentary capacity subjected to and controlled by a dominant influence of power. Burden of proof is on contestant to prove: 1. The existence and exertion of an influence AND 2. The effect of such influence was to overpower mind and will of T AND 3. The product is a will or a gift in a will which wouldn't have happened but for that influence. Influence not undue unless the free agency of the T was destroyed such that Will produced is essentially a Will, not of the T, but of the one exerting the influence.

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Will Contests: While evidence of UI is usually circumstantial the following situations alone is NOT enough to show UI

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1. The opportunity to exert influence (one child who took care of T and held POA and who winds up w/ bulk of estate not enough alone) 2. Susceptibility to influence b/c of age or illness 3. Unequal dispositions (fact that some children took less than others/excluded entirely not enough

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what can be used as an inference of undue influence?

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1. A will a. A will makes a gift to one in a confidential relationship, and b. The person was active in preparing the will unless this inference is rebutted.

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what happens if you make a bequest to the drafting attorney?

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1. Even if no objection is filed, the surrogate’s court automatically inquires into whether a bequest to the drafting attorney was voluntarily made (known as Putnam Scrutiny)

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what is needed to appoint a drafting attorney for a will?

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1. Under NY law a. A drafting attorney who is named as executor of the testator’s estate, must give written disclosure to the testator that i. Any person can be named an executor, not just an attn; and ii. Executory receives a statutory commission, percentage set by statute, sliding scale; and iii. Attn will also be entitled to legal fees for representing the estate. 2. The testator/client must sign the written disclosure in the presence of two witnesses. 3. If the drafting attn fials to comply with the statute the attn only receives only half of the statutory commission.

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Will Contests: What is the effect if drafting attorney fails to comply with disclosure statute?

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The attorney would receive only 1/2 of the statutory commission

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Will Contests: What is an "in terrorem" clause?

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A clause in a Will that says if anyone objects to T's Will, the objector will get nothing. (“no contest clause”)

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Will Contests: What's the majority rule on in terrorem clauses?

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No-contest clauses are given full effect unless court finds that contest was brought in good faith and w/ probable cause (it wasn't a frivolous suit designed to extract a settlement)

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Will Contests: What's the NY rule on in terrorem clauses?

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The clause is given full effect even if there was probable cause to challenge the will.

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Will Contests: What are the exceptions to the NY rule that in terrorem clauses are fully enforceable?

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1. A forgery or that the Will revoked by a later Will, if Surrogate finds that there was probable cause for the contest. The revoked Will clause is strictly construed to apply only to a Will revoked by a later Will, and not to a Will revoked by physical act. 2. If contest filed on behalf of an infant or incompetent (action taken by a 3P (the guardian) should not work a forfeiture 3. A construction proceeding to construe the Will's terms: not challenging the Will, just want to know what interests are created by it. 4. An objection to the jurisdiction by the court.

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what is the definition of a “power of attorney”?

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i. A written authorization for an agent to act on behalf of the grantor of the power. They may be general or specific, with as many variations as the drafter of the power wishes to contrve under the circumstances.

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what is a non-durable power of attorney?

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i. Power of attorney that is revoked by operations of law by either the grantor’s death or incapacity. The power of attorney remains valid until notice of the death or disability is received by the attorney in fact.

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what is a durable power of attorney?

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i. Power of attorney that extend beyond the grantor’s incapacity and has specific language to that effect.

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what are health care proxies?

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a type of durable power of attorney that appoints an agent to make health care decisions on behalf of the grantor. It does not become effective until the grantor become incapacitated and remains effective despite the incapacity. A health care proxy must be In writing, Signed by the grantor or another at his direction and witnessed by at least two adults. The health care proxy must state that the grantor appeared to execute the proxy free from duress.

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what are living wills?

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a. Generally state an individual’s desires, should he become terminally ill or be in a persistent vegetative state, regarding whether to administer withhold or withdraw: life sustaining procedures artificial nutrituion or hydration; and treatment to alleviate pain. The NY Court of Appeals has held that a patients right to decline treatment is guaranteed by the common law.

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Distinguish Ademption from Abatement

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Ademption - When specifically bequeathed property is not in the T's estate at his death, the bequest is adeemed (it fails)
Abatement is the process of reducing testamentary gifts in cases where the estate assets are insufficient to pay all claims against the estate and satisfy all bequests and devises.
Abatement-