Wills & Trusts Slapdowns

Front 1

Attested Will:

Back 1

A valid will requires testamentary intent, capacity, and will formalities.

A formal attested will must
(i) be in writing, signed by the testator (or by another person
in his presence at his direction, or by a conservator), (ii) the testator’s signing or
acknowledgment of his signature or will must occur in the joint presence of at least two witnesses; and
(iii) the witnesses must understand that the instrument being witnessed is the testator’s will.

Front 2

Holographic Will:

Back 2

A holographic will is a handwritten will. In order for it to be valid all material provisions must be in writing including a signature.

Front 3

Integration

Back 3

All papers actually present at execution are integrated into the will if the testator
intended the papers to be a single will. Intent is shown by a physical or logical
connection.

Front 4

Republication by attested codicil

Back 4

A codicil is a testamentary instrument modifying an earlier will and must be executed with the same formalities as a will. A will is deemed republished on the date of the codicil.

Front 5

Incorporation by Reference

Back 5

Any separate document may be incorporated into the will by reference if the document is in existence on the date of the will, clearly described in the will, and proven to be the document described in the will. (Note- holographic wills can also incorporate printed or typed material.)

Front 6

Acts of Independent Legal Significance

Back 6

Blanks in a will can be filled in by referring to acts or documents executed during
the testator’s lifetime, primarily for non-testamentary motives.

Examples: The names in the front cover of my bible will each get $500, my real
property according to my brother’s will, a gift of $500 to each person employed
by me at the time of my death. All of these have independent significance.

Front 7

Revocation. 3 ways you can revoke:

Back 7

1. By subsequent instrument
2. By physical act
3. By operation of law

Front 8

Dependant Relative Revocation

Back 8

DRR cancels a revocation based on a mistaken assumption of law or fact.
Applies where testator (T) revokes his will on the mistaken belief that another
disposition would be effective and but for the mistake T would not have revoked his will.

Front 9

(Attested Will)- I give $50,000 to my sister Mila

$100,000 (in handwriting)

Back 9

To approach the problem above organize chronologically:

1. Revocation by physical act (w/ the “X”)

2. Interlineation (with the handwritten $100,000)

3. Holographic Codicil (since the $100,000 is in handwriting)

4. Dependant Relative Revocation

(Since the interlineation will fail due to the fact the change was in amount and because of the failed holographic codicil (due to no signature), you
should apply DRR.

The argument is “but for my mistaken belief that my
subsequent devise would be effective I would not have made the revocation to begin with.”)

Because the subsequent bequest is a higher amount, the court will give Mila $50,000 because the Court knows that my intent was to give Mila at least $50,000.

Front 10

Revival

Back 10

Revival is a theory that allows a revoked will to be probated because the revoking will was itself revoked by a physical act. In order to apply, will 1 must still be in existence, T must have intent for will 1 to have effect, and will 2 was
revoked by a physical act.

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Ademption

Back 11

Ademption occurs when a “specific” gift that is mentioned in the will is not a part of the testator’s estate at his death.

2 types of ademption:

1. Ademption by Extinction
2. Ademption by Satisfaction

Front 12

Omitted Spouse

Back 12

Spouse omitted from premarital will receives intestate share unless
omission was intentional as shown in will, spouse provided transfer outside of the will, or spouse made valid agreement waiving right to share in decedent’s estate. The intestate share of the SP may not exceed onehalf of the value of the decedent’s SP in the estate. Generally will take 1/3 or ½ of SP depending on the number of children who survive the decedent.

Front 13

Pretermitted Child

Back 13

A pretermitted child is one who is born or adopted after the execution of the will and will receive his/her intestate share unless omission was intentional as shown on the will, T had other children and left estate to parent of omitted child, or T provided for child by transfer outside of the will.

Front 14

Slayer Statutes

Back 14

3 views:
(i) legal title goes to the slayer outright;
(ii) a slayer may not inherit because no one should profit from his own wrong; and
(iii) slayer may inherit
but the court imposes a constructive trust to prevent unjust enrichment (this is
the view CA follows when its slayer statute is inapplicable).

A person who feloniously and intentionally kills the decedent is not entitled to any property
or benefit under the will; trust, intestacy, life insurance, joint tenancy, or otherwise.

Front 15

Elder Abuse

Back 15

A person found liable by clear and convincing evidence of elder abuse will be treated as if he/she predeceased the decedent. Includes physical abuse, neglect, or fiduciary abuse.

Front 16

No Contest Clause

Back 16

Will be enforced unless beneficiary, with reasonable cause, brings contest on
grounds of forgery, revocation, or invalid transfer to person who drafted instrument.

Front 17

Per Capita w/ Right of Representation

Back 17

In CA if issue survive and are of unequal degree of kinship, property passes per capita with right of representation, i.e. there is division at the first
generation of living children.

Order: Spouse ->Issue -> Parents -> Siblings or their Issue -> Grandparents &
then their issue -> Step-Children -> Next of kin -> Parents of Pre-Deceased
Spouse -> Escheat to the State.

Surviving Spouse takes all CP and 1/3 of SP if more than 1 child or grandchild, ½ if 1 child or grandchild, or parent, or siblings, and all SP if none
of the above.

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Simultaneous Death

Back 18

For purposes of intestate succession, if it cannot be established by clear and
convincing evidence that a person who would otherwise be an heir has survived the decedent by 120 hours, it is deemed that the person failed to survive the decedent.

Front 19

A valid trust requires

Back 19

a settlor, delivery, trustee, intent, trust res, beneficiaries, and a valid trust purpose.

Settlor/Trustor - Creator who often provides assets to create trust

Delivery - Handing over property from settlor to trustee

Trustee - Person holding legal title to trust property and managing assets

Intent - Settlor must intend to create trust in the present

Trust Property (Res) - Must be presently existing property interest

Beneficiaries - Person(s) holding equitable title and receiving benefit of assets

Valid Trust Purpose - Purpose cannot violate law or public policy

Front 20

Discretionary Trusts

Back 20

Trustee has discretion to pay income or principal

Front 21

Mandatory Trust

Back 21

Trustee lacks discretion; must pay per the terms of the
trust

Front 22

Spendthrift Trusts

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1.Limits voluntary and involuntary alienation
2.Look out for exceptions to the spendthrift trust:
i. Creation during Pending Litigation (to defraud
creditors)
ii. When the settlor is the beneficiary (cannot
create own spendthrift trust)

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Honorary Trusts

Back 23

Not a valid trust as lack human beneficiaries, but trustee can carry out settlor’s wishes to care for animal, maintain
grave.

Front 24

Secret Trusts

Back 24

Fact of the trust is secret; promise enforceable by
constructive trust.

Front 25

Semi-Secret Trusts

Back 25

Trustee named but beneficiaries are secret;
unenforceable

Front 26

Revocable Trusts

Back 26

Settlor retains right to amend or revoke during lifetime

Front 27

Totten Trusts

Back 27

Bank account for benefit of third party

Front 28

Charitable Trusts

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1.Trust for charitable purposes that benefits large number
of unidentifiable beneficiaries (ex. Medicine, education,
science, research).
2.Tip: look out for the Doctrine of Cy Pres when the
charity the trust names as the beneficiary is no longer in
existence when the settlor dies.

Front 29

Trustee’s Powers & Duties

Writing Approach-

Back 29

Step 1: First discuss the trustee’s sources of powers to make decisions regarding allocation of receipts and expenses and various other decisions.

Step 2: Second, isolate the actions by the trustee and make that your major head note. For each action, you will need to identify which duties the trustee had breached or imminently will breach.

Step 3: Third, for each breach of a duty, identify the available remedies.

Front 30

Trustee’s Sources of Powers:

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1. Express Powers
2. Implied Powers
3. Uniform Prudent Investor Act (UPIA)

Front 31

Trustee's Fiduciary Duty

Back 31

Trustee owes fiduciary duty to administer the trust solely in the
interest of the beneficiaries. A breach can mean personal liability for trustee.

Front 32

The Prudent Investor Rule -

Back 32

Trustee has duty to invest and manage trust assets as
a prudent investor would in light of purposes, terms, distribution requirements and
other circumstances of the trust.

Note: this is not a duty but rather a standard the
trustee should follow for carrying out his duties.

Front 33

Duty of Loyalty: Self-Dealing -

Back 33

Trustee cannot buy or sell trust assets for trustee or spouse; trustee cannot borrow trust funds. If trustee engages in self-dealing, courts apply the no further inquiry rule.

Trustee’s good faith and
reasonableness of transaction are irrelevant.

Front 34

Remedies for the beneficiaries for breach of Duty of Loyalty by Trustee

Back 34

1. Ratify the Transaction- waive breach if outcome is
positive

2. Surcharge the trustee- sue for any resulting loss

3. Trace and Recover the Property- except if purchaser is a BFP w/o notice of the breach

Front 35

Trustee's Duty of Loyalty to Residuary Beneficiaries

Back 35

Trustee breaches duty of
loyalty by not acting in the best interest of the beneficiaries.

Ex: Selling trust property to buyer to increase value of trustee’s own property.

Remedies include ratification and surcharge.

Front 36

Duties Relating to Care of Trust Property:

Back 36

a. Duty to collect and protect trust property

b. Duty to earmark trust property

c. Duty not to commingle trust funds with the trustee’s own

d. Duty not to delegate investment decisions

e. Duty to maintain marketability of trust property

f. Duty to keep trust property productive

g. Duty to diversify investment

h. Duty not to speculate

i. Duty to account to trust beneficiaries

j. Duty to invest

Front 37

Modification & Termination of Trusts

Back 37

General Rule - If the settlor and all beneficiaries consent, trust may be modified or
terminated (only possible when settlor is alive)

The Claflin Doctrine - Trust cannot be modified or terminated, even if all
beneficiaries agree, if to do so would be contrary to a material purpose of the settlor.
Material purpose includes spendthrift, support, discretionary trusts.

Changed Circumstances - In Cal. court may modify or terminate trust (upon petition
by trustee or beneficiary) if changed circumstances mean continuation in the same
manner would defeat purpose of the trust.

Front 38

Trust Checklist

Back 38

Trust Formation
Types of Trust
Trustee Powers & Duties
Modification & Termination