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77 Cards in this Set

  • Front
  • Back
Definition of a Will
Legally enforceable written declaration of a persons intended distribution of property after death
Amendment to will
Body of property you wish to distribute at death
Dying testate =
Dying intestate =
Dying testate = with will
Dying intestate = without will
= person drafting will
CPC§ 6110 Requirements for Will (CA)
(a) a will shall be in writing

(b) The will shall be signed by the testator

(c) The will shall be witnessed by being signed by at least two persons each of whom
- being present at the same time, witnessed either the signing

- and understand that the instrument they sign is the testator’s will
CPC § 6111 Requirements for Holographic Will
a holographic will is, whether or not witnessed, if the signature and the material provisions are in the handwriting of the testator (symbols not adequate for will) and dated
Determining Whether Document is a Will
Extrinsic evidence is admissible to determine whether a document constitutes a will pursuant to section 6110 or 6111, or to determine the meaning of a will or a portion of a will if the meaning is unclear
What is the property mentioned in the will is located in another state?
- Ancillary proceeding needed if you have property in another state
- CA will handle CA portion but other state will take care of property in that state
CA Wills Facts
- cannot exclude spouse
- cannot go against public policy
- If beneficiary in will kills the testator and is deemed insane by law they can still collect under the will
- CA allows form wills
Public Policy
- Will cannot force someone to do something against their will in order to get bequest
- cannot require illegal act to be given bequest
Creditor’s Rights
- Creditor’s claims do not disappear at decedent’s death
- Creditor claims generally enjoy priority over claims of estate beneficiaries
- no one can leave the room once the will begins execution
- do not leave anything to the attorney
- interested parties cannot be witnesses
- specificity required in the will
- form wills are acceptable in CA
- the process of reducing the gifts to beneficiaries under a will because the testator’s estate is not sufficient enough to pay all estate obligations
- court will first fulfill the specific bequests and then abate the general bequests
- revocation of a gift by Ademption applies only to specific legacies or devises
- specific devise or bequest is adeemed if the specific property given is not part of the testator’s estate at the time of death
- if the testator owns the specific property at death, the gift is good
- if the testator does not own the specific property at death, the gift is adeemed and the beneficiary is not entitled to the proceeds of the specific property or to any property in lieu of the specific property
Specific Legacy
A gift by will of property which is particularly designated and which is to be satisfied only by the receipt of the particular property described
General Legacy
One which may be satisfied out of the general assets of the testator’s estate instead of from any specific fund; does not consist of a gift of a particular item
C.L.: a lapse devise was a devise to a person who died between the time of will execution and the time of testator’s death
- If the devise was to a person who had died before the time of will execution the devise was a void devise

M.L.: modern anti-lapse statutes generally apply to save both lapsed and void devises
Patent Ambiguities
An ambiguity which is apparent on the face of the will

Latent Ambiguities
An ambiguity that does not appear on the face of the document; ambiguity only becomes apparent with reference to extrinsic evidence

Note: extrinsic evidence is usually allowed if there can be an inference of testator’s intent
- testator can always revoke her will and, in same situations, the government can revoke a will by presumption, to carry out the testator’s imagined intent
3 ways to revoke a will
- Revocation by a physical act to the original will; either to the paper the will is written on or to the writing on the paper
- Revocation by subsequent instrument; either by an express clause of revocation or by inconsistent subsequent provisions
- Revocation by operation of law due to a change in the circumstances of the testator
Effect of Revoking Duplicate Will
A will executed in duplicate or any part thereof is revoked if one of the duplicates is burned, torn, canceled, obliterated or destroyed, with the intent and for the purpose of revoking it, by either
1) The testator or
2) Another person in the testator’s presence and by the testator’s direction
Presumption of Revocation
If the testator’s will was last in the testator’s possession, the testator was competent until death, and neither the will nor a duplicate original of the will can be found after the testator’s death, it is presumed that the testator destroyed the will with intent to revoke it (This presumption is a presumption affecting the burden of producing evidence)
Revival of Revoked Will
The previous will is revived if it is evident from the circumstances of the revocation of the subsequent will or from the testator’s contemporary or subsequent declarations that the testator intended the previous will to take effect as executed
Contesting a will can occur in 4 situations
- procedural: based on requirements for valid will
- capacity; was testator of sound mind
- undue influence
- fraud

Note: in order to contest a will the moving party must have some interest in the will
Involves the process when a person dies either without a will, or an invalid will or a portion of the will is invalid
Adopted Children
- An adopted child is deemed a descendent of the person who adopted them, the same as natural child
- Adopted child cannot inherit from natural parents or their relatives
Nonmarital Children (omitted)
- nonmarital children are recognized as heirs of their mother; they can inherit through and from their mother
- most states permit the nonmarital child to inherit from the father if the paternity is established or if there is a parent-child relationship
Half Blood
- Relatives of half-blood inherit the same share they would inherit if they were of the whole blood
- if it cannot be established by clear and convincing evidence that a person who would otherwise be an heir for the purposes of intestate succession it is deemed the person failed to survive he decedent
- if husband and wife die simultaneously and it cannot be established by clear and convincing evidence that one spouse survived the other, ½ of the community property goes to the husband’s estate and the other half to the wife’s estate
Community Property (Intestate)
- In California, the decedent’s share of community property passes to the surviving spouse or domestic partner in the absence of a will
Separate Property (Intestate)
- The surviving spouse or domestic partner takes 1/3 of the decedent’s separate property if the decedent is survived by
o More than child
o One child and the issue of one or more deceased children
o Issue of tow or more deceased children
- Surviving spouse or domestic partner takes ½ of the decedent’s separate property if the decedent is survived by
o Only 1 child
o No issue, but a parent or the issue of a parent

- Surviving spouse or domestic partner takes all of the decedent’s separate property if the decedent leaves no surviving issue, parent, brother, sister, or issue of a deceased brother or sister
Trust is an estate planning tool which allows property owners, settlers, to transfer legal ownership to a person or institution, trustee, to manage that property/assets for the benefit of another, the beneficiary.
Elements of a Trust
1. Trustor/settler
2. Trustee (trust will not fail for lack of trustee; court will appoint)
3. Trust Property
4. Beneficiary (trust will fail for lack of beneficiary)
5. Trust Purpose
Classifications of Trusts
2 Classifications of Trusts
1. Express
2. Implied
- resulting
- constructive
Express Trusts
- arise from the expressed intention of the owner of property to create the relationship with respect to the property
- can be either written or oral
Implied Trust
- arise from the presumed intention of the owner of property
- someone would be unjustly enriched unless trust was imposed
- resulting trust is remedy court will use to correct an invalid trust
- do not depend on intention but rather constitute a useful equitable remedy in cases involving fraud and unjust enrichment
- can consist of legal entity or partnership or an individual person
- If individual person must have; sound mind, capacity, be of majority and have contractual capacity
Trustee/legal title
- In the event trustee dies, becomes incapacitated, resigns or is removed; a successor trustee will be appointed
- trustee must exercise that degree of care, skill and caution that would be exercised by a reasonable prudent person in managing her own property
- trustee has a duty of loyalty and cannot enter into any transaction in which they are dealing with the trust in their individual capacity
- duty to make accounting/accurate record
- must make trust property profitable
- must pay & collect all debts
- cannot delegate duties
- can hire professionals to assist in trust operation ex: cpa

note: when the legal title and equitable title merges (becomes same person) trust becomes invalid
Trust Property
- lack of trust property invalidates trust
- property may be real or personal property
- trust property must be an existing interest in existing property: an interest that has not yet come in to legal existence cannot be held in trust
Beneficiaries/equitable title
- a trust cannot exist without beneficiary
- beneficiary need not have capacity, age of majority, or contractual capacity to benefit from trust
- more than 1 beneficiary can hold property as tenants in common
- it is not necessary that a beneficiary be designated by name, or by description which makes identification automatic: it is enough that testator uses language which is sufficiently clear to enable the court by extrinsic evidence to identify the beneficiary
- when the settlor describes the beneficiary class as “family” or “relatives”, most courts will validate the trust by looking to the intestacy statutes to define the class
Trust Purpose
- trusts can be created for any purpose that is not deemed contrary to public policy
- Trust purpose cannot be illegal, criminal or tortuous act
types of Express Trusts
2 types of Express Trusts
1. Testamentary Trust: created by will (clause in will not separate instrument)
2. Inter Vivos Trust: created by transfer of property by settler during his lifetime
Testamentary Trust
- trust intent and the essential terms of the trust must be ascertained from
o terms of the will itself
o an existing writing properly incorporated by reference into the will
o facts having a substantial, independent significance apart from their effect on the terms of the will
o the exercise of a power of appointment created by the will
o personal representative must receive trust property
Inter Vivos Trust
- Present Declaration or Present Transfer of Trust Required
o Declaration of Trust: no delivery is required because settler is the trustee; when the trustee is another person, the property must be delivered to the trustee in order to transfer it in trust
o Transfer of Property: a trust can be created by the transfer of property to another trustee; trustee takes legal title upon delivery of a deed or other document
o Must manifest intent when trust property exists
Inter Vivos Trust
- Present Declaration or Present Transfer of Trust Required
o Declaration of Trust: no delivery is required because settler is the trustee; when the trustee is another person, the property must be delivered to the trustee in order to transfer it in trust
o Transfer of Property: a trust can be created by the transfer of property to another trustee; trustee takes legal title upon delivery of a deed or other document
o Must manifest intent when trust property exists
Types of Inter Vivos Trusts
Irrevocable Trusts
- Irrevocable trust cannot be altered, revoked or changed
- All trusts become irrevocable upon settlor’s death

Revocable Trusts
- avoids the costs and delays of probate and has a number of advantages over a will
- Interest passes to the beneficiary during the settlor’s life; it merely becomes possessory on the settlor’s death
- Allows settlor to change, amend or revoke anytime during lifetime
Advantages of Revocable Trust
- management of assets
- planning for incapacity-avoidance of guardianship
- avoidance of probate
- secrecy
5 Methods to Revoke Trust
. Trust purpose is fulfilled
2. Trust terms require termination at specific time
3. revocable by Trustor
4. Legal & equitable titles merge (trustee and beneficiary same person)
5. Beneficiaries mutually agree trust purpose is no longer viable
Sprinkle/Spray Trust
- a trust in which the trustee has discretion to decide how much will be given to each beneficiary
- trustee has discretion as required by the circumstances or tax bracket of the beneficiary
- Trust will include specific language on how to use trust
Totten Trust
- a deposit in bank account/trust by the settlor of his own money for the benefit of another
- settlor may be named the trustee
- during settlor’s lifetime the trust can be revoked and settlor can use funds for their own benefit
- does not require delivery; beneficiary receives trust funds upon settlor’s death
Revocable Living Trusts
- are subject to the same policy constraints and rules of construction applicable to wills

Uses of Revocable Trust
1. Avoiding probate
2. Need to plan for Incapacity
3. Privacy Concerns
4. Minimizing Will Contest
5. Asset Management Needs
“Pour-Over” Gifts from Will to Revocable Trust
- allows for the disposition of testamentary assets with a trust created during settlor’s lifetime
- Will designates assets to be “poured” into trust
- Trust must be in existence before or executed concurrently with will
- Trust may be amendable and revocable
- Gift is valid even though trust is unfunded during settlor’s lifetime
Illusory Trust
- when a settlor’s spouse challenges a revocable inter vivos trust as illusory because the settlor retained full control over the trust’s assets until the moment of death
- trust instrument provides that at settlor’s death, trust assets should be paid to someone other than the surviving spouse
Spendthrift Trust
- a trust that prohibits the beneficiary’s interest from being assigned and also prevents a creditor from attaching that interest
- trustee allocates trust property as instructed by Trustor; Trustor has instituted restraints on trust property
2 Exceptions to the Enforceability of a Spendthrift Trust
1. If the beneficiary is the settlor and the trust is not a special needs trust established for the benefit of a disabled person
2. If trust is created for fraudulent transfers into the trust

Note: some jurisdictions, CA included, allow the garnishment of a spendthrift trust for judgments of alimony and child support

Asset Protection Trust
These trusts are established out of the U.S. in order to “hide” assets from U.S. courts and government; analogous to Swiss Bank accounts

Medicaid Qualifying Trust
- trust that elderly use to prevent showing of income in order to qualify for Medicaid
- if there are enough assets in trust in order to care for elderly, courts will enforce use of those funds
- Although the resources of both spouses are considered in determining eligibility for Medicaid, after one spouse is institutionalized, the statute provides the community spouse some protection against claims by the state
When the beneficiaries can compel the early termination of trust
1. If all the beneficiaries of a trust consent and none of them is under an incapacity
2. If the continuance of the trust is necessary to carry out a material purpose of the trust the beneficiaries cannot terminate trust

Modification or Termination Without Consent of Beneficiaries
- courts typically enforce trusts according to their terms because trust instruments typically reflect the intentions of the trust settlor
- as time passes, the language of the trust instrument may become less reliable as a guide to the settlor’s intentions because it is not clear how testator would have responded to the changed circumstances

Modification Due to Mistake ( Uniform Trust Code)
A court may reform the terms of a trust, even if unambiguous, to conform the terms to the settlor’s intention if it is proved by clear and convincing evidence that both the settlor’s intent and the terms of the trust were affected by a mistake of fact or law

Unanticipated Circumstances Affecting Trust Objectives
California statute gives the trustee authority to terminate a trust, without even obtaining consent, if the trust principle falls below $20,000
Charitable Trust
- a trust created to benefit a specific charity or the general public
- 100% of the assets in Charitable Trust is tax deductible
- purpose must be either religious, scientific, charitable, literary or educational
- beneficiary must be indefinite class of people
- Settlor can draft a charitable trust specifically for a certain group of persons or religion without violating the 14th amendment
Charitable-Remainder Trust
- a trust that consists of assets that are designated for a charitable purpose and that are paid over to the trust after the expiration of beneficiary’s life estate
Cy Pres Doctrine
Doctrine permits a court to implement a testator’s intent and save gift to charity by substituting beneficiaries when the named charitable beneficiary is unable to take the gift due to non-existence
In Order to Apply Cy Pres
- gift must be to charitable organization
- it must be impossible, impractical or illegal to carry out donor’s stated charitable purpose
- must appear that donor had charitable intent
When Cy Pres Is Not Applied If Testator
- has manifested a specific charitable intent
- has anticipated possible failure of the trust
- has made an alternative disposition of the gift if the charitable gift should fail
A power of appointment is a power that authorizes the donee to designate recipients of the appointive property
One to whom a gift is made; the person in whose favor a power of appointment is created or reserved (Trustee)
One who gives something without receiving consideration for the transfer; person who creates power of attorney (trustor/settlor)
People to whom the donee appoints the property (beneficiary)
Objects of the power/class of permissible appointees
class of people eligible to receive the appointive property
Takers in Default
People who would take in the absence of exercise; whether or not they are explicitly named in the instrument creating the power
Power of Appointment is classified as
1. General
2. Special

General Power
- donor can give the donee a general power, which entitles the donee to appoint to anyone, including themselves
- general power is taxable by IRS

Special Power
- donor restricts the class of potential appointees
- allows tax benefits from IRS
- “reference to a specific power” in order for the exercise to be effective
- if donee fails to exercise special powers; class will receive property in default
- when a power is special, a donee’s contract to appoint is unenforceable, at least so long as the contract benefits a person outside the class of permissible appointees
Time of Appointment is broken down into 2 categories
1. Presently Exercised
2. Testamentary

Presently Exercised
- donor gives donee a power of appointment that the donee is free to exercise immediately
- Donee can exercise power by either creating another trust or
- If the power is not presently exercisable, the assumption is that the donor wanted to permit the donee to retain discretion until some point in the future, when more circumstances relating to the appointment will have unfolded

- donor requires that the power be exercised by Will
- a release assures that the appointive property will pass to the takers in default
- In many jurisdictions, the donee of a power may execute a “partial release” of the power; binding herself not to exercise the power in favor of a particular class of people
Property Covered by General Power
- Creditors must first attach to donee’s personal property, if those assets are insufficient, then creditors may attach appointive property
- refers to those persons appointed in law to inherit an estate in case of intestacy
Pretermitted Child (child within wedlock)
1. Those which protect only children born after execution of testator’s will
2. Those which protect all children who have been unintentionally disinherited
- to have capacity to make a will, a testator must have the ability to communicate their wishes and to understand and appreciate the following
o the rights, duties and responsibilities created or affected by the will
o probable consequences for the testator and, where appropriate, the persons affected by the will
o significant risks, benefits and reasonable alternatives involved in the disposition
Lucid Intervals
Periods during which testator did have sufficient understanding to make a will
Insane Delusion
An irrational, persistent belief in an imaginary state of facts resulting in a lack of capacity to undertake acts of legal consequence

Note: an attorney who fails to investigate a client’s testamentary capacity incur liability to a pension disinherited by the will drawn by the attorney