Introduction to Estate Planning

- How property passes between the living and the dead

o Intestate, by will, or by will substitutes (trusts, etc…)
- Massive wealth transmission is starting to begin (baby boomers are passing)
- Wealth concentration is occurring in the US at an increasing rate (the rich get
richer and the poor poorer)
- You must have more than $2 million before the estate tax takes effect ($3.5 in
2009)
- P.13 Totfield…what is the most important for democratcy is not that there are not
great fortunes but that they do not change hands
- The right to pass property at death is not treated as a natural law in the US, it is a
law created in statutes

Power to transmit property at death

· Old View: Right of succession to property by will or intestacy of a deceased is
of statutory creation and the state may take that right away Irving Trust v. Day
[3]
· New View: The government cannot completely eliminate the right
to transfer property at death Hodel v Irving [3]
o Basic Rule: The right to dispose of property through
intestacy or will is a fundamental property right and cannot
be abolished. However, some changes/adjustments to the
law can be made (in Hodel the legislation just went too far)
 TC had held that the P had no vested interest in the property of the
decedents prior to their deaths and the congress had plenary
authority to abolish the power of testemantary dispostity of Indian
property and alter the rules of intestate succession (relying on
Irving Trust). The COA reversed citing that the decedents had a
right, derived from the original Sioux allotment state, to control
disposition of their property at death (focued on the right to
transmit, rather than the right to receive)
 Descend vs Devise
 Descend = passing property by intestancy – no
written document (heir)
 Devise = passing property by a will (devisee)
 De minimus adjustments are “ok”
 Property is a bundle of sticks issue...

Issue of the Dead Hand [20]

· General Rule: All kinds of restrictions are allowed in a will unless
the condition violates public policy or a constitutionally protected
fundamental right. Donor intent governs except in extremely
limited cases. The ct cannot question the fairness or wisdom (or
reasonableness). The cts main purpose is to facilitate (rather
than regulate).

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· To invalidate provision (exceptions to the general rule to strike a provision)
= Look for unreasonable conditions, such as:
o Absolute or Unreasonable (i.e. total) restraints on marriage (or promote
divorce/separation) violate the fundamental right to marry and are not
valid
 Partial restraints on marriage are allowed (if reasonable)
 Time: Marry within a certain time is ok
 Religious restraints on marriage are ok (this is arguably not
restricting marriage rather encouraging a certain religion)
Shapira (ok to require marriage into a religious family
as long as the condition is not too unreasonable)
o Religion Requirement violate public policy and religious freedom (ie “you
have to remain catholic”)
o Destruction of property upon death - cts will refuse to allow destruction bc
this encourages economic waste (burning a house will not be upheld)
 Exception: de minimus destruction (i.e. burn a diary probably ok)
o Some state laws may control (may or may not be able to completely
disinherit children / spouse)
o Racial limitations (ie cannot marry an African American is not allowed)
o Creditor’s Rights: May not be able to give away something that a creditor
has a right in
o Illegal Activity: Cannot encourage illegal activity
o What about property without tangible waste? An unfinished work of
art, diary, notes, etc...

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Transfer of the Decedent’s Estate

- When someone dies...figure out where the will is, search for assets and
itemize them (money, property, stocks, real estate, etc), call a local
attorney in the community that has jurisdiction (call bar association),
can also call the county probate clerk for more information regarding
the specific situation.

- Independent vs dependent administration – independent is once

you’ve been assigned by the administrator you don’t need to come
back to court unless someone is challenging it; Dependent
administrators must continually check in with the court.

- Probate is completely separate from federal estate tax issues...they are

entirely different

o Probate court fees, administrator, appraiser, and lawyer fees are

the only (typically) in probate…much highter fees are possible if
you die intestate because of research needed to find heirs and
the such.

Probate v Nonprobate
· Probate: Passes either under a will or intestacy, but in either case under
supervision of the court. Includes all property that is not nonprobate
o Goal: Collect and distribute assets, protect creditors, evidence transfer of
title (title clearing function)
o Examples: Stock account (unless titled with right of survivorship)
“JTWROS”, will
o Issues
 Place of filing of will: Place of Domicile at time of death
(primary jurisdiction) for personal property and ancillary
jurisdiction in any States where real property is located (regardless
of where you are when you die your domicile is where you live full
time)...real property virtually always gets treated according to the
laws of the states in which they are located.
 Statute of limitations to contest a will: 3 years
 Personal representative may need to post a bond to the ct.
 Keep your will at the home, safe deposit box, family members,
attorney…it must be able to be found when needed
o Letters of testamentary to an executor – person in charge of
administering the estate is in the will
o Letters of administration to an administrator – person in charge of
administering the estate is not in the will
· Nonprobate: Everything that does not pass under a will or by intestacy
o 4 types of Nonprobate property:
 Trusts
· Pros: You can also have a will to cover what is not under
the trust – benefit from both

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 · Cons: The trust is only useful for the items remembered to
be put in the trust
 Right of survivorship assets – automatic passing on death
(joint tenancy), i.e. checking accts and real-estate
· Certain items of personal property cannot be titled with
joint tenancy with right to survivorship (i.e. for de minimus
items, possession alone is evidence of title – ie clothing,
furniture, etc.)
· In general we do not worry about personal property (unless
in situation of family squabbles)
o Exception for some personal property: We do worry
about items that are more expensive to track the
ownership chain (for example historical art)
 Assets payable upon death - Aka Contracts payable upon
death (like life insurance, 401k unless no beneficiary designated,
pension plan, “payable on death” type accounts) – ASSETS
PASSING VIA CONTRACT UPON DEATH
 Life Estates and remainders
o Other options to avoid probate
 Small estate exemption: state law rule which allows bypassing
probate if the estate is worth less than a certain amount of money
 Transfer car title by affidavit that you are the heir and the death
certificate
o Nonprobate assets cannot be disposed of by will: Ie cannot change the
terms of a life insurance contract with language in a will
o Most property in this county transfers under some form of nonprobate
action
o Nonclaim statute…creditors have a limited time to file to reclaim debts of
the deceased
o Much more complicated if you have minor children involved...there would
be some question as to wherther you can simply waive the child’s rights to
access to the inheritance. May need to appoint a guardian to protect the
interests of the children and prevent an issue of conflict of interest
o Real property not passing under joint tenancy must (normally) be passed
through probate
o Regardless of probate/nonprobate...you always want to create a will (it is a
good catch all for your interests, both present and future, a good safety net
for anything that you were unable to foresee)

NOTES
- Personal representative finds and determines the extent of assets
o Charged with repaying creditors
o Asked to provide a bond...will can waive necessity of bond
- An estate cannot close with some sort of accounting back to the Probate court (all
creditors taken care of, titles cleared, etc...)

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 o Court must accept the final accounting and discharge the representative
(up until that point they are not off the hook)
- A probate court can interpret and enter wills but for malpractice claims it must be
heard by courts of general jurisdiction

Professional Responsibility
· Theories of Attorney Liability: (Simpson v. Calivas)
· Tort / Negligence Theory = negligence plus attorney owed duty to P (duty
requires some sort of relationship which creates such a duty)
o Majority / modern trend: Attorney has a duty to exercise due care to
intended beneficiaries
o Minority Common law: protects attorneys, no duty to intended
beneficiaries (only to testator client)
· Contract Theory = must show privity of contract (lack of privity is the main
argument made by attorneys) (privity requires close/direct relationship)
o Majority / modern trend: Third party beneficiary to the K can sue the
attorney Simpson (ct allowed beneficiary to sue attorney
for malpractice)...exception to the privity rule.
o Minority Common law: protects attorneys, no privity with 3d party
beneficiaries
· Attorney could be sued for both: There is a clear duty to both the client and
the beneficiaries
· Conflicts of Interest: (Hotz v. Minyard)
o Rule: MPR §1.7: a lawyer shall not represent a client if that representation
will be directly adverse to another client unless the lawyer reasonably
believes the representation will not adversely effect the relationship with
the other client AND each client consents
o Attorneys owe a duty of good faith and to avoid misrepresentations to
their clients Hotz (conflicted attorney liable for
misrepresenting facts to client)
o Options when there is a conflict (i.e. 2 of your clients have
opposing interests):
 Majority view: obligation is to protect the confidence and
withdraw without disclosing the confidential information
 Minority view: lawyers duty to the non-disclosing partner is higher
than any duty of confidentiality so attorney would be required to
disclose i.e. W’s infidelity to H when W and H are both clients
 Other option: balancing test
· Known v unknown harm of revealing, do whatever causes
the least harm
o Rule of thumb for conflicts: if representation is to continue be safe and
give full disclosure and get consent of both parties (keep
everything visible and make sure parties are aware of the
circumstances)
o Always identify “who is the client”...our duties and
obligations are always owed to our clients (just need to

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 identify who they are...can be confronted with the entire
family who can have competing interests)
o Joint representation becomes a real problem with the
lawyers responsibility of loyalty and confidentiality towards
the client
 Make sure you get consent and disclose the fact that you
are representing both individuals

Intestacy: An Estate Plan by Default

The Basic Scheme

· Intestacy applies to Probate Property – all property that is probate will pass by
either:
o Intestacy – default rule (if you don’t want that you can just write a
will)...if you do not do anything, the will the law writes for you (if you
don’t write a will the law will write one for you) – covers everything not
covered in the will
 Statutes of descent (real property) and distribution (personal
property) - UPC 2-101a
o Partial Intestacy – anything not covered under in the will is covered by
intestacy
o Will – should have a residuidary clause which would cover anything not
coverd by the written instrument...a good catch-all
· Heirs...no live person has heirs (Heirs apparent (presumptive) only
o An heir apparent has a mere expectancy not an interest at law and
since it cannot be transferred
- Estates and Protected Individual Code (EPIC) – another version of the Uniform
Probate Code
o Epic will not be on the exam (Prof does not test on Michigan law, she is
merely telling us the references and how it compares to the UPC
o The UPC and the EPIC are very similar
MI EPIC became effective in 2000 and was revised in 2004
• MCL 700.1101 – 700.8102 (EPIC)
• MI court rules can be found at MCL 1.108 – 8.302
• ICLE Institute for Continuing Legal Education
o Has a handy EPIC guide
- Real property is going to be subject to the laws of the state in which it is
located...personal property is subject to the state in which the deceased is located
at the time of death
· Intestacy never benefits in-laws (especially son/daughter in-laws)!
· Uniform Probate Code: (very black and white...if you don’t like how they work
then just write a will so that you don’t depend on them)
o Intestate Share: Any part of the decedents estate that is not handled by
a will pass according to the state intestacy law and a will may expressly
exclude an individual otherwise entitled to an intestate share UPC 2-101

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  Negative wills are allowed in order to disinherit a
child from his intestate share UPC 2-101b (only the
UPC...not traditional rule) Michigan law follows the
UPC
o Share of Spouse: Spouse gets 100% IF no parents alive and all
descendents are also descendents of the surviving spouse, otherwise
spouse’s share incrementally decreases UPC 2-102
 If parents are alive then she gets the first $200,000
+ the first ¾ of the remainder if not children and at
least one parent survives
o Share of Heirs other than spouse (remaining estate after
spouse gets her share, if applicable): Estate will pass to the first
surviving relative, issue then parents, then grand parents. UPC 2-103
o No Taker: If no taker found, then the intestate estate passes to the state
(escheat). UPC 2-105
· Jurisdiction
o Real property is always subject to the laws in the state which it is
located
o Personal property is disposed of under the laws of the state you are
domiciled (normally where your permanent residence is)
o UPC is more generous than many states in the union...in many states (even
with surviving children) the surviving spouse will not get a 100% of the
estate. They will split the estate between the children (by guardianship)
and the wife. MI generally follows the UPC in these instances (but not
specifically...so read EPIC if giving advice)
- Common law vs community property
o Common Law
 Separate Property System (Michigan)
o All of the S.W. States use community property
 Compoletely different from separate property system.
o Virtually every question about how a spouse gets/inherits property will be
different whether it is a community or common law property jurisdiction.
A MI estate plan is drastically different than a TX system...can have huge
impact on snowbirds.

Spousal Share
· 2 elements required to qualify for spousal intestate share: Marriage and Survival
· Marriage Requirement: Generally must be validly married to be
considered a spouse
o Common law marriage: live together long enough to be considered a
married couple
 Rule: if the state recognized CL marriage then it is
indistinguishable. Risk: if anyone wants to challenge the
distribution of the estate, CL marriage is easy to challenge (i.e.
decedents children by a prior marriage). Ie get an affidavit to
evidence that the decedent was the spouse

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 o Same sex couples: marriage where allowed by state law
 A domestic partnership statute may allow intestacy in a
minority of states.
 Much safer route: do a will for a same sex couple bc intestacy
for same sex couples is a fuzzy area
o Bigamous marriage (multiple wives/husbands): Effect on intestacy: the
spouse who is knowingly entering into a bigamous relationship will be
excluded from intestacy (ie the 2d marriage is not valid)
o Married but separated are still spouses until divorce entered – some
states may recognize spousal abandonment
· Survival Requirement: Spouse must survive the decedent (without
simultaneous death statutes then the dead spouses estates would receive the
other spouses estate
o Main problem: proving when someone survives another when TOD is
difficult to determine
o Actual Survival Common law:
 Must prove by preponderance of the evidence (i.e sufficient
evidence) that spouse survived a second later otherwise the
beneficiary is treated as if predeceasing the testator Janus (ct
found W survived H so estate first went to W then
W’s heirs)
o Actual AND Legal Survival Modern approach / UPC /
Revised Uniform simultaneous death act (USDA:
 The UPC requires the taker to prove by clear and convincing
evidence that they survived 120 hrs (5 days) past 1st
decedent UPC 2-104 (actual survival alone is not enough)
and UPC 2-702
 Most wills will actually specify an even longer period of time
(60 – 90 days)...so there is no confusion or a person put on
respirator just to satisfy the period before pulling the plug.
 What is “dead”? Depends on the jurisdiction...and must be
very cautious when determining when death occurs (brain
dead, not breathing on own, etc...)
 Can set type of determination and time periods in will if you
desire
· Calculating Spousal Share
o UPC 2-102 (favors surviving spouse):
 Surviving spouse takes 100% if:
· No surviving issue or parent of the decedent OR
· Surviving spouse is also parent of surviving issue and no
other surviving issue UPC 2-102
 Spouse gets <100% when
· Not all issue are of surviving spouse
· Surviving spouse has own issue
· No issue but surviving parents
· No parents or issue, but surviving issue of parents

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 o Spouse and 2 adult children from prior marriage
 Concern: that the step parent will not be as caring for the children
of the prior marriage and the decedent would have preferred to
treat all the children equally – see 2-102(3)-(4) which decreases
share if stepchildren are present
· Community property Share (not MI, only 9, mostly western, states in the
country)
o If you have briefly resided while married in one of these community states
that person may have a claim to property
o Community property: anything acquired by gift or came into the marriage
with is your “separate” property, BUT any income you have during a
marriage does not belong entirely to the earner, rather, 50% to you and
50% to spouse instantaneously.

Share of Descendents / Issue (blood relatives)

· Rule: Anything that does not go to the spouse is divided under UPC 2-103
o If there are children, the children and their descendents will inherit to the
exclusion of all others
o Basic case: Spouse, then children and other lineal descendents
· If there is a question as to whether someone qualifies as issue, see “transfers to
children”
· Basic Systems
o English (strict) per stirpes: make the first division of the decedent’s
property at the first generation whether alive or not and then drop
shares by bloodline. If not alive, then shares are only divided if dead and
with issue
 A dies; children B C D, C dies with children E and F
· B will get 1/3, E 1/6, F 1/6, D 1/3
· Rule for Strict - Divide based on the # of children either
living or dead (with decendants)
o Per capita with representation (modern per stirpes): Make the first division
of the decedent’s property at the 1st generation where there is a live taker;
the shares then drop by bloodline
 A dies; Children B C D, C dies with children E and F, D dies with
child G, B dies (no children)
· Modern: E 1/3 F1/3 and G 1/3
· Strict: E ¼ F ¼ and G ½
· Rule for Modern: divide at the first generation which
you have living takers. Here the entire first generation was
dead so divided at the 2d generation
o Per capita at each generation (UPC 2-106): Make the first division of the
decedent’s property at the 1st generation where there is a live taker; one
share to each alive taker and one share to each dead taker with issue; my
summary: look at each generation separately and divide equally.
 A dies; Children B C D, C dies with children E and F, D dies with
child G, B alive (no children)

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 · Generational: B 1/3 E 2/9 F 2/9 and G 2/9
o All grandchildren take equally (does not matter the
number of siblings for each child)
o Divide at first living generation. Add all shares of
deceased with issue and divide among 3 generation
equally
· Strict: B 1/3 E 1/6 F 1/6 G 1/3
· No surviving descendents where does the property go? Ancestors
and Collaterals
o Go to parents (go up if there is no one alive below you to collateral
relatives) UPC approach
o If there are descendents (at least one), nothing will go up to your parents
in most states
o If no parents, then UPC uses the table of consanguinity [79]
 1st Line: No spouse, no children, no parents, then it will go to
your brothers and sisters and their children (1st line collateral) –
works in all states...once you knock out spouse, children, and
parents
 Collateral relatives are not children, or grand/great-grand children
or parents and grand/great/great-great grandparents
 If only child...then look to the following systems
·Parentelic system: moving by lines of parentelas out -
closer lines = win
·Look for the closest in kinship – look for the living person
with the smallest number
o BUT When all else fails, the UPC stops at the point you get to
grandparents so you avoid the laughing heir UPC 2-103 – it then
escheats to the state...

Transfers to Children [83]

· Generally: To qualify as issue and inherit, a parent-child relationship must be
established (see meaning of children below)
· Whole and half-blood relatives [83]
o English law put focus on blood relations only and disregarded other types
of relations – ie adoption/halfblood
o Under American law half blood (one parent in common) and full blood
(both parents in common) ok (state laws differ and half bloods may be
disinherited in a state like Mississippi if there are whole blood relatives)
 UPC 2-107: Relatives of half blood inherit the same as if they were
full blood

Meaning of Children (Adoption)

· Adopted [83]
o UPC Rule: The adopting parents step into the shoes of the natural
parents. Adoption severs the parent-child relationship with the natural
children UPC 2-114(b) Transplantation Doctrine - severing

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 from one family tree to be transplanted onto another
(considered harsh...but followed by some states).
 Exception (modern trend): A stepparent spouse of the natural
parent adopting does not sever the ability to adopt from and
through the natural parent which is the same as the stepparent (i.e.
children can inherit through natural and step-father) UPC 2-114 /
Rejected by Strict Rule in Hall (Adopted children lose
all right of inheritance from or through their natural
parents)
 The concern is that the adoptive children would be
superior to natural children and be able to inherit
through two lineages...buy virtue of adoption you get
in a better position
o Adult Adoptions: Generally there is no distinction between adopted
minors and adults
 General Rule: Adult adoptions are allowed but inheritance
rights may be limited if the adoption occurred solely to qualify the
adoptee as an heir Minary (the ct held that when an
adoption is made solely to bring a person under a
will/trust that would thwart the testator’s intent then
the inheritance should not be allowed)
 Purpose of adopting adults:
· Preventing will contests: forces collateral relatives to
challenge the adoption bc they would not be takers under
intestacy bc of the adoption; the adopted adult is now a
child who takes the estate in its totality, assuming there is
no spouse, and no one can challenge that.
· Bring people within the terms of a class gift
o Minary case- held, that when an adoption
is made solely to bring a person under a
will/trust that would thwart the testator’s
intent in a preexisting document, then
the inheritance should not be allowed
o Doris Duke Case: adoption cannot be revoked and
is not the best way to get around a will
 Common Law Limit:
· Can’t adopt a lover
 Adopting a spouse: states vary on this
 Safety Net is “Power of Appointment”- Provision in a will
or trust you give the last beneficiary the right to direct the
remaining estate; a way to cover occurrences that you cannot
anticipate
· You are better off doing this than assuming a
court will act in a certain way

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o “Stranger to the Adoption” (mainly old law that courts
dislike): The adopted child can only inherit from the adopted parents not
the adopted parents relatives (i.e. not through the adoptive parent). [89]
 Everyone other than the adoptive parents was a stranger to the
adoption
 Trend against “stranger rule” to treat adoptive children
indistinguishably with natural children
· An adoptive child could be taken into account as long as
born before the testators death (policy: if testator wanted to
exclude he could have at this point)
 End result: Stranger to the adoption rule has
generally been overruled
· Presumptively adopted children are included in
class gifts and included in estates through
intestacy
o General Problem with Adoption:
 Adoption is a very “blunt” instrument, and can result in a multitude
of unintended consequences; should be used as a tool of last result.
o Adopting out of a class gift (ie “to my children or issue”)
[92] – can be a problem for those adopted children
 In General: Based on the transplantation theory (adoption
completely severs intestate ties with natural parents), and in effect,
when you are adopted you are no longer eligible to receive
inheritance through your natural parents
 Courts are split as to whether this applies- Depending
on our adoption statute, an adoption statute can sever the
relationship to the natural parents relatives. Should it also sever
your entitlement to a class gift? Look at donative intent. If the
person was alive before the testator’s death, then the person was
likely intended to be included. Example: H has child A. A is
adopted by 3d party. H has child BandC. H executes will leaving
estate to “his children”. Does this include all biological children -
ie A who was adopted out of the family?
o Equitable Adoption (Based in Contract Law)
 O’Neil Rule: Equitable adoption requires (1) an agreement b/t the
natural (or Legal) and adoptive parents to adopt the child
(consent/contract between persons able to contract for the child),
(2) natural parents giving up custody, (3) child living with adoptive
parents, (4) adoptive parents raise the child as their own O’Neil
(finding that #1 was missing because natural parents were dead so
no equitable adoption)
· Dissent in O’Neil: (Substance over form) Arguments are
made that it would be better if we actually looked at the
relationship instead of taking a strict contract theory. Apply
a balancing test to determine that there is effectively a

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 parent – child relationship (argues that “equity considers
that done which ought to have been done)
 Note: The O’Neil case cuts against the whole purpose of having
equitable adoption which is to look beyond the formality of
contract law, and to look at the relationship, but instead applies a
strict contract consent standard.
 When equitable adoption occurs...courts will typically not allow
the adoptive parents to adopt from or through the child, only the
other way around in order to benefit the child
· Posthumous children (children born, but not conceived via technology after
the death of a parent) p.99
o Underlying Rule: If it is to the child’s benefit to be treated as a child of
the marriage it will be done so as long as the child is born alive and must
be born within a statutorily determined period of time (usually 280 days)
o General 280 Rule (traditional): If a W gives birth to a child within
280 days of H’s death, there is a rebuttable presumption that the child is a
natural child of the deceased H. If greater than 280 days, the burden is on
the child to establish the relationship
o Uniform Parentage Act: Rebuttable presumption that a child born
within 300 days after the death of her husband is a child of that husband
UPA §204 – many states have accepted this
o Possible issue to take out of posthumously conceived children: Eligibility
for social security benefits depends on whether a state allows a
posthumous child to inherit (inequality depending on what state you are
born)
o The rules are designed to capture the child as “in being” so that they may
be advantaged in intestancy issues
o Reproductive Technology throws a monkey wrench in all of this...
· Non-marital Children (not born in a marriage) p.100
o Common law: Cannot inherit from the father or mother (harsh rule and not
used in the USA)
o American rule: Allows a child to inherit from mothers but state vary with
regard to paternity/fathers (w/o further evidence)
 There is a wide division among the cts whether child can inherit
from father (states may allow the father to prove paternity)
· Many states will only allow the mother to inherit FROM
the child and not the father...even if the child can inherit
from the father
 UPA §204: presumes fatherhood of a child if: 1) while child is less
than 2 yo he lives in the same household and openly holds the
child out as his natural child OR 2) the father acknowledges
paternity in writing.
· Reproductive Technology (a type of posthumously conceived children)
o Potential Rules to apply (this is an unsettled area):
 Balance the Interests: best interest of child, interest of state
(orderly administration of estates), decedents reproductive rights

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 (what Woodward turned on...ultimately the court remands for
more discovery about the intent/wishes of deceased husband)
 Woodward dealt with SS benefits of children born/conceived
well after (2 years) after the death of the husband. SS benefits are
dolled out based on the intestancy rules of the state (if filing based
on survivor benefits)
 Woodward Rule (p.102):
· (1) Genetic relationship must exist between child and
decedent
· (2) Decedent affirmatively consented to the conception
AND
· (3) Decedent consented to support the child
 Restatement 3d of property [109]: Child has to be born within a
reasonable time in circumstances indicating the decedent would
have approved of the child to inherit
 UPA § 707 (stricter test): If decedent dies before implantation then
the presumption is that the decedent is not the parent unless there is
consent in a record that deceased ok’d child
 CA statute: Clear and convincing evidence that a person could use
the genetic material. Notice upon the executor or administrator
within 4 mos of death and child be in utero w/I 2 yrs.
· New Forms of parentage – same sex and surrogate mothers
o Where one partner has a genetic connection and the other partner adopts
the child legally, then both parents can then be treated as parents and allow
the child to inherit through intestacy from both
 Look carefully at UPC §2-114(b)
· Whoever is established to be the parent in family law considerations will most
likely be established to be the parent for inheritance issues.

Advancements [114]
· Old CL Rule: If an individual dies intestate, property (any life-time gift) given
during the life of the decedent is presumed to be an advancement (prepayment of
the inheritance) – a presumption in favor of finding an advancement
oChild would have to provide a writing to prove contrary intent (for it not
to be an advancement)
· New Statutory Rule: The presumption has been reversed; it is not an
advancement unless it is declared as such. Assume it is a gift - UPC 2-109 –
presumption against finding an advancement – most states have
accepted this.
oA gift is an advancement only if the decedent puts it in
writing as such or if the giftee accepts it as an
advancement

Guardianship and conservatorship of minors

· What happens when children do inherit: A minor child does not have legal
capacity to handle their own affairs

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· 2 sides
o Guardianship of person
 If you have a minor child and only one parent dies, the other parent
becomes the guardian
 If both parents die without a will designating a guardian or a
standalone designation (allowed in some states), the ct will appoint
a guardian from the nearest relatives.
o Property management
 Guardian (this is very restrictive and time consuming)
· The goal is to avoid the guardianship of the property (bc of
the time consumption and complexity)
· The book says the guardian never takes title to the property
(only can use the income but not the principle) Guardian
is expected to deliver exactly what was given.
 Conservatorship (modern trend – many states have adopted this)
· Conservator hold the title as a trustee for the minor
and is a fiduciary of the estate with responsibilities to the
minor
· Annual accounting still required but every decision does
not need to be approved by the ct (just before ct once a year
for “check-up” for accounting purposes)
 Protective order (MI law)
· Allows the ct to issue a person to do something with
property (a step below a conservator). For example if there
is only one piece of property, protective order may allow
sale w/o guardianship or conservatorship
 Custodianship (under the uniform transfers to minors act)
· Simply holds property for the benefit of the minor
· Simple to accomplish, ct approval not needed for
management decisions
· Most wills and trusts that distribute property to the minor
contain a facility of payment clause that gives money to
custodian to hold money for the minor
· Property goes from custodian to the minor when age 18 or
21 is reached
 Trust: Better option than all of the above mostly bc the time of
dispersal (can be for any age...not just 18 or 21) can be controlled
better and the amount can be controlled
 Potential State Law Options: MI allows up to $5000 to a minor
who is married, an individual having care or custody of the minor,
to the guardian of the minor, or to a bank account in the guardians
name
· SS benefits can be important to a minor also – these can be paid to a
representative payee
o In the case of an incapacitated person, another individual can apply to the
SS administration and provide evidence of incapacity (minor or otherwise)

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 and make payments to the representative payee for the incapacitated
person’s benefits
o This allows avoidance of guardianship of the estate if SS benefits are the
only assets

Bars to succession

Homicide
· Rule: A killer shall not take from their victim if the killing was intentional or
felonious
o Exceptions: Circumstances that do not bar inheritance: self defense,
involuntary manslaughter, insanity, or if the killer entitled to the property
regardless of the inheritance Mahoney (killing must be willful to
bar)
o Misconduct short of homicide that may bar: Elder abuse,
neglect, or abandonment may also bar inheritance Cal Prob Code §259
· Criminal conviction is not required for slayer statute to apply –
preponderance of the evidence is required UPC 2-803
· What Property: UPC 2-803 bars the probate and nonprobate property
succession to a killer (same under MI law)
· Heirs of the Killer: Killer treated as if the killer predeceased the victim, so if
the killer is barred the next in line takes. UPC 2-1106. The heirs are innocent
and they should not be blamed for the killing (CA approach - majority)
o Minority IN approach: neither the killer or the heirs could inherit
· If no slayer statute (most states have one...if not all states), the cts are split
between three apparent options
o Decedents property goes to the killer (cts should not legislate, already
being punished for the crime and this would amount to double
punishment)
o Killer is barred (public policy requires so...basic equity requires that they
shouldn’t be able to kill someone and get their money) – slayer is treated
as to have predeceased the dead person – possible judicial activism
criticism
o Legal title passes to the killer, but a constructive trust is imposed so that
the property is distributed to the next in line to take Mahoney (middle
ground that holds the property for the next set of
heirs)...this court applies this one.
 Constructive trust...equitable concept that we have
that helps us to fix things that are evidently wrong
without upsetting the statutory scheme while still
getting to what the court believes is the correct
result.
 Constructive trusts are almost the same as the
trust but without any actual trust document
· What about non-probate transfers...it depends. The UPC fixes
this 2-803 by barring a killer from probate and non-probate

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 property. So regardless of will/law then the killer is treated
similarly. The killer as having disclaimed the property...the
disclaimant is treated as predeceased the victim.
· What happens if the next people in line are the killers heirs?
· A criminal conviction is not required for a slayer statute to
apply...different results for criminal trial vs probate are
possible.

Disclaimer
· Old Common law did not allow disclaimer (intestate = title passes even if
disclaimed; will = like a gift & could be refused)
· Modern Rule (virtually every state): treats the disclaimant as
predeceasing the decedent so the property simply passes to the next person in line
· When does the disclaimer need to be made: No time limit under UPC 2-1105 to 6,
BUT IRS requires w/i 9 months to avoid gift tax, MI law: it is intended to
permit a disclaimer in all cases in which the IRS would permit a qualified
disclaimer and allow in other circumstances
· Creditors of the disclaimant:
o General Rule: When disclaimed, the property interest does not reach
the disclaimant; as a result the disclaimant’s creditors cannot attach the
property (the disclaimer relates back)
 Exceptions:
· Minority of states do not allow an insolvent debtor to
disclaim (MI law doesn’t directly deal with it...it is neutral
on the disclaimer effect on creditors)
· Federal Government as a claimant for tax or Medicaid
reimbursement may be able to reach disclaimed property
Drye / Troy (holding gov can attach disclaimed
inheritances)
o Constructive Receipt...if you can put your hands
on the money...the fact that you are trying to
disclaim it doesn’t protect the funds from the IRS
· Distribution upon disclaimer: follow UPC 1106 (like strict per stirpes)
o The 1990 UPC distribution by generational would allow the children of
the disclaimed beneficiary to get a disproportionate share in certain
circumstances
o Law doesn’t want to allow a person to change the allocations amongst the
relatives of the deceased...to keep a person to change the effect of decent
by disclaiming

Review from Tuesday

- Taxation Issues
o When you die...if your taxable estate (bank/stock account, etc) is over the
applicable federal state tax exemption amount your estate will end up
being subject to federal and state estate tax

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  At the federal level alone can be up to 50% of the estate, you then
add state tax on top of that

Wills: Capacity and Contests

Mental Capacity [141]

Test of Mental Capacity

· Requirements to execute or revoke a will (determined at the time of making /
revoking the will) UPC 2-501
o Older than age 18 (an adult) AND
o Sound Mind: Capable of knowing and understanding in a general way
(doesn’t mean you have to know...just capability of knowing):
 (1) the nature and extent of his or her property,
 (2) (their heirs) the natural objects of his or her bounty,
 (3) the nature of the testamentary act that he or she is
performing, AND
 (4) how all these relate to constitute an orderly plan of disposition
of property
· Capable: If you are capable of knowing and
understanding this is enough even if you have no
idea which piece of property you actually own; It is fine
that you did not pay attention as long as you are capable
of understanding.
· Knowing and understanding in a general way: It
is ok if there is not a careful inventory
· The test is not if you actually know or understand, ie wills
are typically not invalidated due to mistake.
· Note: Being of sound mind is a low threshold to meet
(eccentricity will not invalidate a will)
o Even if one lacks capacity for other purposes (K
drafting), one may still be competent to draft a will
Wright (bc once dead no risk to the decedent)
K>Testamentary>Marriage capacity
· Different Mental Capacity Standard During Life v Death Rest 3d of property
§8.1: This covers all of the mental capacity
o If a will or Revocable Gift (if you can get the money back) then
capable of knowing and understanding in a general way is sufficient for
mental capacity
o If a gift is Irrevocable (inter vivos transfers, lifetime transfers) must
have:
 (1) The mental capacity to make or revoke a will, AND
 (2) Understand the effect of the gift will have on your financial
security and those that depend on you
· In re Estate of Wright (1936)

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 o Facts: Wright died 16 months after executing a will that devised a house,
personal belongings and money to his friend (about $10k total), Charlotte
Hindmarch, who was named as the executrix. T also devised a house to his
daughter, his interest in an estate to his granddaughter, and one dollar to
his grandson and several other people. T’s daughter contested the will. T’s
daughter contested the will. A notary had prepared the will and noted that
it was the oddest will they had ever seen. Both witnesses and the notary
testified that T was of unsound mind when he executed the will. Other
relatives and acquaintances also testified that T was not of sound mind
when the will was drafted based on T’s peculiarities, his drinking, an old
head injury, a surgery several years back, and isolated idiosyncratic acts.
Petition for admission of the will to probate was denied on the ground of
testamentary incapacity. The executrix appeals.
o Held, evidence of a testators isolated peculiarities and unusual life style,
without evidence of insanity, hallucinations, or delusions, are insufficient
to deny probate of a will.
o Reasoning:
 In a will contest, sanity is presumed, and the one
contesting the will has the burden of proving that the
testator was of unsound mind when he executed his will.
 The drafter of a will and the subscribing witnesses
have a duty to be satisfied of the testator’s sanity
prior to giving their stamp of approval and verity to the
will’s execution. IF they testify later that the testator was of
unsound mind, their testimony will be subject to close
scrutiny and suspicion.
 Isolated acts, idiosyncrasies, moral and mental irregularities, or
departures from the norm cannot destroy testamentary capacity
unless they directly influenced the testamentary capacity unless
they directly influence the testamentary act. There was
no medical testimony and no evidence of settled insanity,
hallucinations, or delusions.
 T knew the extent of his property
o Importance: Presumption is in favor of capacity and it is OK to be
idiosyncratic, and to leave your property in odd ways, even in
contravention of public norms. BUT the more unusual a will, the more
protective you need to be over your will.
o Ethics Caveat: If a client does not have capacity to enter into a lawyer
client relationship, you cannot draft a will for someone.
· Burden of proof: presumption that the decedent is competent and
the contestant must show a lack of competency Wright
· Ethical Duty: The drafting attorney has an ethical duty to asses the capacity of
the testator
· Defect in capacity: Even if a testator has general testamentary capacity a
person may suffer from a a defect in capacity that may invalidate all or part of the
will

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 o Examples (see infra)
 Insane delusion
 Undue influence
 Fraud
o Remedy: the ct will strike as much of the will as was caused by the
defect
· Why Require Mental Capacity:
o (1) To make sure the will represents the testators true rational desires
o (2) Mentally incompetent man or woman is not a “person” for legal
purposes; sanity and personhood are intertwined
o (3) Mental capacity protects the decedent’s family; Via a theory of
reciprocity an heir apparent provides care and support for the aged with
the expectation of receiving their inheritance. A testator’s insanity should
not be able to defeat or deter such a necessary principle.
o (4) To support the public acceptance of law by requiring reasoned
decisions by giving heirs their “just deserts”
o (5) Provides a sane person assurance that the disposition the testator
desires will still be carried out if the testator later becomes and sane and
drafts a subsequent will
o (6) Protects society at large from irrational acts
o (7) Protects a senile or incompetent testator from exploitation at the hands
of a cunning person.

Insane Delusion [148]

· Distinction between insane delusion and a mistake (It’s the
ability to correct)
o Delusion: False perception of reality which the testator adheres
despite all evidence and reason to the contrary, the testator
would still not change her opinion and it is an insane delusion (false
perception of reality).
 What Fails: Only the parts of the will that are a caused by the
insane delusion fail for lack of testamentary capacity
 No Effect on Disposition Exception: If the insane delusions
do not affect the dispositions, then the entire will stands
 What Happens if Part/Whole Fails: The failing portion or
the entire will goes by state law governing intestacy
o Mistake will not invalidate a will in most jurisdictions; If it is a mistake,
the testator would correct if in fact you intended to do this – a
mistake can be corrected
· Causation is the problem: You must show that the actual testamentary
decision was based upon, or might have been, the insane delusion.
o BUT, Most Courts Will Presume Causation if: There is a
delusion, and it might have cause the disposition.
o SOME COURTS...will say if there is any reason for you
holding to an insane delusion that it will hold the will
provision valid

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  BUT...most courts use a reasonable/rational
person standard and if they would not hold to that
insane delusion then it will not be valid
· Test for Insane delusion: Did the evidence of the insane delusion (1)
demonstrate insanity – Rational person test (2) which caused the disposition at
issue.
o In re Strittmater (1947)
 Facts: Strittmater never married. She lived with her parents until
their death and was devoted to them and they to her. Four years
after their death, she wrote that her father was “a corrupt, vicious,
and unintelligent savage,” typical of the majority of his sex, and on
a photograph of her mother, she inscribed, “moronic she devil.” T’s
dealing with her attorney, over a period of years, were normal. T
became a member of the National Women’s Party and volunteered
one day a week for at least two years. In her will, she left her
estate to the party, as had been her expressed
intent. T died one month after her will was executed. The will
was admitted to probate. Two cousins challenged the will, alleging
it was a product of T’s insanity. A lower court set aside the will.
The lower court’s decision is appealed.
 Held, a will that was executed by a person with insane delusions
about men be admitted to probate.
 Reasoning:
· T’s female physician opined that T suffered from a split
personality
· T had been a member of the party for 11 years when she
wrote: “it remains for feminist organizations like [the party]
to make exposure of women’s ‘protectors’ and ‘lovers’ for
what their vicious and contemptible selves are.”
· It was T’s paranoiac condition, especially her
insane delusions about the male, that led her
to leave her estate to the party.
o In re Honigman (1960) Insane Delusion of Non-Existent
Facts
 Facts: Prior to death Honigman told friends and strangers he
thought his wife to be unfaithful. This suspicion became an
obsession, though he was rational in other respects. Honigman
commented once that he was sick in the head and
that he knew something was wrong with him. Decedent
instructed his attorney to cut his wife’s share of his will to the
statutory minimum plus $2500, and the rest to his surviving
brothers and sisters, or if they predecease their descendants per
stirpes (proportionally divided between beneficiaries according to
their deceased ancestor’s share), upon his wife’s death. Proponents
of the will adduced evidenced which they thought showed a
reasonable basis for the decedent’s belief, including an anniversary

1
 card to the wife from a Mr. Krause, evidence that whenever the
phone rang the wife would answer it, and evidence that Mr. Krause
came over to the decedent’s house one night while the decedent
was out. When the will was offered for probate the
widow filed objections based on insane delusion. The
jury said he was not of sound mind and denied probate, the
appellate court reversed upon law and facts (substituting new facts
even), and this appeal followed.
 Held, If a person believes facts that are against all evidence and
probability and conducts himself, however logically, upon the
assumption of their existence in making his will, he suffers from an
insane delusion; Judgment reversed and new trial ordered.
 Rules:
· Insane Delusion Test: If a person persistently believes
supposed facts which have no real existence except in his
perverted imagination, and against all evidence and
probability, and conducts himself however logically,
upon the assumption of their existence, he is, so far as they
are concerned, under a morbid delusion; a delusion in
that sense is insanity, though on other subjects
he may reason, act and speak like a sensible
man.
· “Might Have Caused” Enough: Any part of a will
that was caused or might have been caused by the
delusion fails for want of mental capacity.
· Burden Shifts: When someone challenging the Testators
mental capacity on the basis of insane delusion and has
presented evidence reflecting the operation of the testator’s
mind, it is the proponents of the will duty to provide a
factual basis justifying the alleged delusion.
· Jury Question: When evidence of a Testator’s delusional
state at the time of drafting a will exists, the courts should
place the issue of capacity in the jury’s hands.
· Dead Man’s Statute (Minority Rule): Evidence
based on a personal transaction or communication between
the witness, an interested party, and the deceased person is
inadmissible and should be excluded.
o In most states this does not apply to probate because
a testator’s will is not a “transaction or
communication” between the testator and the
legatees
o Where dead man’s statutes still exist, court construe
them narrowly
 Importance: It does not matter whether his insane delusion was
based in reality, just whether a reasonable person would have
believed him.

1
  Reasoning:
· General rule is that if a person persistently believes
supposed facts that have no real existence except in his
imagination against all evidence and probability, and
conducts himself however logically, upon assumption of
their existence, he is under a morbid delusion, and that
person is essentially mad or insane on those subjects.
· The issue of the decedent’s sanity was one for a
jury to resolve, and there were sufficient facts to require
a jury decision.
· Proponents argue that even if Honigman was laboring
under a delusion, other reasons support the validity of the
will; this is not the case. A will is invalid if its
dispository provisions might have been caused
of affected by the delusion.
· The dead man’s statute which excludes the testimony of
witnesses concerning a personal communication between
the witness and the deceased, was misconstrued to permit
testimony of P when an objection to her testimony and been
properly raised.
 Fuld’s Dissent:
· The evidence adduced utterly failed to prove
that the testator was suffering from an insane
delusion or lacked testamentary capacity, and much of the
testimony was improperly admitted.
· It does not follow that [the testator’s] doubts of fidelity
evidence a lunacy
o Demonstrating an insane delusion (Split in Jurisdiction)
 Majority Rational Person Test: if a rational person would find
the same thing, the person is not insane; but if a rational person
would find the delusion to be insane, regardless of any factual
basis, he delusion will be held to be “insane”
 Minority Factual Basis Test: if there is any factual basis, some
jurisdictions will not consider the person insane (This is more
protective of testator’s intent)
 Causation Nexus: Even if the testator suffers from an insane
delusion, the insane delusion is irrelevant unless it is shown that
the belief caused the testator to dispose of his or her property in a
way that the testator would not have otherwise
· Majority: Might have been caused approach: The
majority of cts will presume causation as long as you prove
(1) a delusion and (2) an unnatural disposition that might
have been caused by the delusion. Cts presume the insane
delusion caused the disposition. Honigman (ct found
insanity)

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 · But for approach: But for the insane delusion, would
the testator still disposed of his property as he did
o Ie are there other reasons why the testator would
have done what he did
· Process:
o Look at the elements of capacity one by one to see if they are present in
the facts.
 If not present, then evidence of incapacity
o Also look at the factual basis and rational person tests – how does the
result differ?
o How much of the will was effected by this incapacity? That portion will be
stricken

Undue Influence
· Defined: Mental coercion that destroyed/overcame the testator’s free will and
forced him to embody someone else’s intention in his will in place of his own.
o Requisite Mental State (Substituted Intent): “this is not my
wish, but I must do it”
o Proof: May be wholly inferential and circumstantial
· Element Test- To establish undue influence one must show:
o (1) That the testator was susceptible to undue influence
o (2) That the influencer had the disposition or motive to exercise undue
influence
o (3) That the influencer had the opportunity to exercise undue influence
o (4) That the disposition is a result of the undue influence
o (Problem: DOES NOT TELL US WHAT INFLUENCE IS UNDUE)
· Process of Contesting a Will: Can either use (1) presumption approach or
(2) immediately allege the elements
o (1) Presumption of Undue Influence- Created by showing:
 1) Confidential relationship (confide in the other party) AND
 2) Something more; Weakened intellect & received bulk of
estate or other suspicious circumstances (Lakatosh) Depends on
the State
o (2) Once Presumption Established, the Burden Shifts and the
Proponent Must Either:
 1) Disprove the Elements to prove undue influence (very
difficult) OR
· Susceptibility: The testator was not susceptible to undue
influence
· Motive: The influencer didn’t have the disposition or
motive to exercise influence
· Opportunity: The influencer did not have the
opportunity to exercise undue influence (i.e. care giving
relationship) AND
· Causation: The disposition is not the result of the
influence (Lipper)

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  2) Show grantee’s Good Faith by clear and convincing evidence
throughout the transaction and the grantor/testator acted
freely, intelligently, and voluntarily Jackson (Ie show
clean hands)
· Proponent must simply show that the will is free from such
influence, as well as establishing his own clean hands
· This is far easier that disproving all the elements
· What Happens to Parts of a Will that are Products of Undue
Influence:
o If part of a will is the product of undue influence, those portions of the will
that the product of such influence may be stricken and the remainder of
the will allowed to stand, IF the invalid portions of the will can be
separated without defeating the testator’s intent or destroying the
testamentary scheme.
· Restatement (Third) of Property:
o §8.3 Undue Influence, Duress, or Fraud
 (a) A donative transfer is invalid to the extent that it was procured
by undue influence or fraud
 (b) A donative transfer is procured by undue influence if the
wrongdoer exerted such influence over the donor that it
overcame the donor’s free will and caused the donor
to make a donative transfer that the donor would not
have otherwise made.
o §8.3 Suspicious Circumstances within Confidential
Relationships to Raise Presumption of U.I.
 Existence of a confidential relationship is not
sufficient to raise a presumption of undue influence.
There must also be suspicious circumstances surrounding the (1)
preparation, (2) execution, (3) or formulation of the donative
transfer. Suspicious circumstances raise an inference of
an abuse of the confidential relationship. Relevant
Factors (not exhaustive):
· (1) Extent to which the donor is physically or mentally
weakened
· (2) Extent to which the alleged wrongdoer participated in
the preparation or procurement of the will
· (3) Whether the donor received advice from outside
counsel, or other disinterested advisors
· (4) Whether the will was prepared in secrecy or haste
· (5) Whether the Donor’s attitude changed toward others by
reason of the alleged wrongdoer
· (6) Whether there is a discrepancy between a new will and
the old one
· (7) Whether there was a pattern of intended disposition
between wills

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 · (8) Whether a reasonable person would regard the
disposition as unnatural or unjust.
o Estate of Lakatosh (1994)
 Facts: Roger befriended the decedent Rose in her 70’s, visiting
and assisting her. The facts suggest that Rose had come to depend
on Roger. Roger suggested to the decedent that she
give him power of attorney, and the decedent granted power
of attorney and devised all but $1000 of her $268k estate to Roger.
The lawyer who drafted the will was Roger’s second cousin, who
Roger had referred the decedent to on a previous matter. A tape
recording of the decedent at the time of executing her will showed
she did not lack competence, though was easily distracted and of
weakened intellect. Roger unlawfully converted $128k of
Rose’s assets, $72k to a friend of Roger’s who Rose had never
met. Rose revoked Roger’s power of attorney prior though died in
squallor.
 Shifting Burden Rule (Not the Test is Every
Jurisdiction): For a contestant of a will on grounds of undue
influence to shift the burden to the proponent to disprove the undue
influence (through clear and convincing evidence), the proponent
must show through clear and convincing evidence:
· (1) That there was a confidential relationship
· (2) That the person enjoying such relationship received the
bulk of the estate
· (3) That the decedent’s intellect was weakened
 Held, the trial court’s finding rests on legally competent evidence
and Rose’s will should have been revoked because Roger failed to
carry his burden of proving the absence of undue influence.
 Procedural Note: Proponent of the will needs to show the wills
validity prior to getting to an undue influence claim; if it is not
shown to be valid, the contestant never even has to claim undue
influence because the will was not valid from the get go.
 Procedural Walkthrough: Proponent must first show validity,
then the contestant can shift the burden showing a confidential
relationship and “something else,” then the burden shifts to the
proponent to either disprove the elements of undue influence, or
show “good faith” explanation (see above)
o Lipper v. Weslow (1963)
 Facts: Mrs. Sophie Block (T) executed a will written by her son,
Frank Lipper, a lawyer, 22 days before she died. Lipper bore
malice against his deceased half-brother, who was executed from
the will. This resulted in Lipper receiving a larger share under the
will than he otherwise would have received. Lipper lived next door
to T and has a key to her home. After signing the will, T told one
witness that she was leaving her estate to her son and daughter, and
that her other son, Julian, and his children would be excluded

1
 because they never showed any attention to her. The will
provided a lengthy explanation as to why julian was
excluded from the will largely due to the “unfriendly and
distant attitude” T felt had been accorded to her. The children of
Julian contest the will, charging Frank Lipper and Irene with undue
influence. At trial, a jury found that T’s will was procured
by undue influence. D’s appeal, contending that there is no
evidence to support this finding.
 Held (Reversed): A person contesting a will on the basis of
undue influence must supply proof of the substitution of the plan
of testamentary disposition by another as the will of the testator,
the contestants failed to do this, and there is no evidence of
probative force to support the verdict of the jury.
 Undue Influence Rule: Whether such control was exercised
over the mind of the testatrix as to overcome her free
agency and free will and to substitute the will of
another so as to cause the testatrix to do what she would
not have otherwise done but for such control.
 Reasoning:
· The contestants have established a confidential
relationship, the opportunity, and perhaps a
motive for undue influence. However, they must go
forward and prove in some fashion that the will as written
resulted from D’s substituting his mind and will for that of
the Testator. Proof of the substitution of a plan of
testamentary disposition by another as the will
of the Testator must be provided.
· Here the evidence shows that T was of sound mind, of
strong will, and in excellent physical condition. A person
of sound mind has the legal right to dispose of
her property as she wishes, with the burden on those
attacking the disposition to prove that it was the product of
undue influence. T had a legal right to do what she did
whether we think she was justified or not. We conclude
that there was no evidence of probative force
to support that verdict of the jury.
· There is testimony by three disinterested parties stating that
the testatrix intended to disinherit Julian’s spouse and
descendants.
 Recital of Facts:
· Dangerous if Listing Exact Facts; fodder for the opposing
counsel to attack capacity based on erroneous facts.
· If the recital is such a big part of the will, and the facts are
in error, the contestant attorney may argue that the will was
conditioned upon the erroneous facts and thus try to strike
the entire devise.

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 · Also a will is a public document...do you want to air your
dirty laundry
· Result of undue influence REMEDY: to invalidate only the part of the will that
is the result of the undue influence
· To avoid undue influence: set up a revocable trust, these are difficult to
challenge and no notice requirement (can be secret)

No Contest Clauses (Inter Rorum)

· Defined: a beneficiary who challenges a will shall take nothing under the will
(to discourage will contests and undue litigation) or take a token amount.
· Enforceability:
o Majority Rule
 Courts will enforce a no contest clause unless there is Probable
Cause to support a will contest UPC 2-517. (Probable cause
reduces the risk to the contestant of bringing a
contest, but only if the contestant has a colorable
basis for the claim). IN and FLA don’t enforce no contest
clauses and Cali Minority rule.
 Policy: do not want to shield wrongdoers
o Minority Rule (more restrictive)
 Enforce the no contest clause unless there is an allegation of
forgery, revocation or misconduct by one involved in executing the
will (no matter the amount of evidence any hint of the above
allegations will result in make the clause unenforceable)
 Policy: avoid litigation ie in determining PC, do not want a
defrauder to insert a no contest clause
· Note: IF you are not getting anything under the will in the first place, the
deterrent effect of the no contest clause is obviously ineffective.
· How to Make Effective: Provide heirs or those likely to contest a will more
than a pure token/normative amount that relative to the overall size of the estate
that is just enough to make it worth not contesting the will, or a provision therein.

Bequests to Attorneys [167]

· Majority Presumption of Undue Influence: presumption of undue
influence when atty-draftor receives something in the will (can be rebutted with
clear and convincing evidence); attys by definition have a confidential
relationship
o Exception: when the atty is related to the testator unless the will makes
an unnatural disposition (i.e. Mr Lipper getting most or all compared to
other legatees)
· If you draft a will for someone (a best friend, etc) and you get a large sum of
money (legacy) and you are unrelated then there is a large presumption that
there has been undue influence.
· Minority Approach: Irrebuttable presumption of undue influence unless (1)
atty is related or (2) independent counsel is sought Moses
o In re Will Moses (1969)

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  Facts: Moses (T) was a promiscuous alcoholic in poor health.
Attorney, Mr. Holland, 15 years younger than the married testatrix,
was having an extramarital affair with the decedent, though he did
not draft the will. Daughter of T successfully challenged will, and
Holland appeals.
 Analysis:
· There is a confidential relationship, so we need the “plus
something” for the presumption of undue influence that
shifts the burden to Mr. Holland to rebut the presumption of
undue influence; The plus is that Holland receives the
estate under the will.
· Holland rebuts by saying he did not draft the will. The
drafting attorney states that T was mentally competent and
sober during the drafting, though did not include an
explanation of why the attorney was to receive to the
detriment of the decedent’s heir.
 Held, Holland failed to rebut the presumption that the will was a
product of undue influence
 Drafting Note: When, as an attorney, receiving a portion or the
whole estate as a result of disinheriting a natural heir, have another
disinterested attorney draft the will with an explanation of why the
attorney is receiving, and possibly an explanation of the nature of
the relationship as a matter of protecting the risk of contest.
 Note: The attorney in this case really did almost everything
commonly known to protect the will from an undue influence
contest.
 Better Option is an Inter Vivos Revocable Trust:
Evidences that the trustor actually wanted to do this, the longer that
a trust is in effect the more transactions that would have occurred
involving the trust the less likely a court will undo all the
subsequent transactions; ALSO a trust is a private document, as
opposed to a public will, and only those who know about the trust
can challenge it. Plus, the donor is still alive and able to testify in
defense of sanity/no UI.
o In re Kaufmann’s Will (1964)
 Facts: Will with an attached letter explaining abnormal
disposition of estate to his caretaker/attorney (confidential
relationship). Will successfully challenged, Walter appeals.
 Analysis:
· Presumption of undue influence, based on confidential
relationship and Walter receiving the bulk of the estate,
shifts burden to Walter.
· Court found the will was a product of “an unnatural,
insidious influence operating on a weak-willed, trusting,
inexperienced...” testator.

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  Better Option (Once Again) is an Inter Vivos
Revocable Trust!
· Ethics problem also: Lawyer shall not prepare an instrument giving the
lawyer or related person a substantial gift from a client except where the client is
related to the donee.
· Note: A parent child relationship generally does not cause a will to fail; you are
going to receive as an heir anyway

PRACTICAL CHALLENGE NOTES:

· (1) Challenges are generally only effective if they are done immediately
· (2) Big Money/Estates are almost surely going to be challenged so an attorney
should prepare for such a contest ahead of time both in drafting the will and
evidencing the donative intent.
· (3) Changes made at the end of a client’s life, especially if they are contrary to
previous wills/devises, are more likely to be challenged successfully.

Fraud
· Defined: Testator is deceived by a misrepresentation and results in something
that a reasonable testator would not have done otherwise (“but for” the
misrepresentation). Provisions by fraud are invalid and rest stands unless the rest
is invalidated by that fraud and makes it inseparable from the rest of the will.
· Test:
o (1) Testator is Deceived, AND
o (2) Dispositive provision that would not have been there
“but for” the misrepresentation; PLUS
o (3) Intent to deceive the testator, AND
o (4) Purpose to influence a testamentary disposition
· Elements
o Knowingly made a false statement to the testator with an
o Intent to deceive the testator (individual causing fraud
must know he is doing so) AND
o Purpose to influence a testamentary disposition (the false
representation caused the disposition) (NEED BOTH) AND
o Did influence the disposition “but for” the misrepresentation
· Remedy/Effect: What is the effect of fraud on a will: the portion of the will
that the fraud effected will be invalidated, possibly impose a constructive trust.
Court can then deny probate, or use equity to impose a constructive trust if there
is an apparent alternative donative scheme (person who committed the fraud holds
the property for the benefit of those who should have inherited)
· 2 types of fraud:
o (1) Fraud in the inducement: a person misrepresents facts causing
(inducing) the testator to execute a will (or to prevent him from executing
a will or a change to a will) with particular provisions (difficult to prove
causation). Induced to execute a will a certain way bc of what the
defrauder told the testator, not a lie about the content. Testator knows he
is signing a will and what is in the will. Estate of Carson case pg 208

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  Causation Problem: Did the fraud cause the disposition?
Difficult to prove.
 This is a rarer form of fraud; Usually looks like direct, outright
lying
o (2) Fraud in the execution: misrepresent the character of content of
the instrument signed by the testator which does not in fact carry out the
testator’s intent. Puckett v Krida case pg 209
 Examples: testator tricked into signing something that is not
their will or signing will but person misrepresents the provisions in
the document
· Line b/t Fraud and undue influence: It is common to have both undue
influence and fraud in the same case because it is a fine line and is difficult to
distinguish
o Undue influence is exercising a level of control over a testator to
override a testator’s free will which causes the testator to do something he
would not have otherwise done
o Fraud: the testator still has free will (in theory) it is only bc something
has been misrepresented and this misrepresentation causes the testator to
do something that he or should not have done.
o Distinguishing: Is the will overridden (undue influence) or is the
testator being told something that is not true (fraud)
· Puckett
o Facts: Elderly Alzheimer's testator is afraid of being put in nursing home.
Nurse caring for testator convinces elderly woman that her family is trying
to put her in a nursing home. Testator disinherits family and leaves it to the
nurse instead. Niece challenges.
o Analysis:
 Testator was elderly and stricken with Alzheimer’s
 Nurse was playing on the fears and weak-will of the elderly
woman and Niece was scrupulous in upholding the wishes and
desires of her Aunt (T)
 Nurses fail to rebut presumption of undue influence, but there was
also fraud/intent to deceive; impossible to separate or distinguish if
this is truly undue influence or fraud due to her illness.
o Held, Nurses were unable to disprove the presumption of undue
influence, and there was also fraud of the inducement (they are similar).
Diff b/twn them both is: Fraud is based on faulty assumptions and UI is
not as coercive.

Duress (Beefed-Up Undue Influence)

· Defined: When undue influence becomes overtly coercive, if becomes duress.
A donative transfer is procured by duress if the wrongdoer threatened to perform
or did perform wrongful act that coerced the donor into making a donative
transfer that the donor would not have otherwise made Rest. 3d of Property
§8.3c

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 · Susceptibility Not Required: You no longer need to show that the testator
was susceptible, as you need to in undue influence, because everyone is
considered susceptible to duress (susceptibility required for undue-influence)
· Preventing Drafting of a Will: When a will beneficiary prevents a testator to
draft a will, a constructive trust is imposed for the benefit of the intended legatee.
· Pope v Garrett: Lady physically stopped execution of will & resulted in a
coma/death. Ct says you can impose a constructive trust on innocent heirs
(everyone who inherited under 1st will but would have been excluded under 2d
will which was never signed bc of duress) who happened to the be beneficiaries as
a result of someone else’s fraud for the benefit of the intended heirs because they
would have been unjustly enriched even though they did not personally execute
the duress
· Constructive Trust is only an equitable remedy; not a real trust, an equitable tool
to move money without doing damage to anyone. Sometimes called a fraud-
rectifying trust that may be imposed if the ct thinks unjust enrichment would
result if the person retained the property. Constructive holder must transfer to
constructive beneficiary.
· Latham v. Father Divine- Lady had will in Father Divine’s favor and wanted
to change it but was threatened and died under doc’s hands during a surgery w/o
consent of the dead lady’s relatives. Family wanted a constructive trust w/ them
being 3d party beneficiary. Ct held that he doesn’t get $ and fam gets it bc this is
an attempt to prevent unjust enrichment. (A settlement was reached after this
case). Rule: Where a devisee or legatee under a will already
executed prevents the testator by fraud, duress or UI from
revoking the will & executing a new will in favor of another so
that testator dies leaving the original will in force, the devisee or
legatee holds the property thus acquired upon a constructive
trust for the intended devisee. A constructive trust will be
erected whenever necessary to satisfy the demands of justice.

Tortious Interference with Expectancy

· Exam Note: mention this is one as an additional option if one of the above
appears.
o Advantages: a way around a no contest clause because it is not a will
contest, punitive damages, but not recognized in every state. This is just
a way to recover tort damages from a 3d party. B/c this isn’t a will contest,
a No contest clause may not apply to this type of suit. Punitive damages
may be recovered against the wrongdoer in a suit in tort but not in a suit
seeking to prevent probate of a will on grounds of UI or fraud.
· Defined: Where a 3d party has committed misconduct in the testamentary
process (i.e. fraud – duress – undue influence but NOT mental capacity), those
who would have taken but for the misconduct can also sue the 3d party for
tortuous interference with expectancy.
· Tort Required: There must be an underlying tort in order to claim this; not
simply an immoral act.

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 · General Rule: P must prove
o (1) The existence of an expectancy
o (2) A reasonable certainty that the expectancy would have been realized
but for the interference
o (3) Intentional interference with that expectancy and
o (4) Tortuous conduct involved with the interference (This is the difficult
part) AND
o (5) Causation & Damages
· Anna had an expectancy and reasonable certainty that it would be realized but for
the interference…

Final Point: There are a ton of ways to attack a will that in many respects seems “ok”

Shilling v. Herrera- Guy was the only heir to his sis estate and caretaker moved her in
and took care of her. Bro sent $ and called. He last saw her in March and called but
caretaker ignored him bc she talked sis into changing will to her benefit and sis died in
Aug. Caretaker didn’t get back w/ bro until Dec after the will was already probated. Trial
Ct. said he had no claim bc he didn’t exhaust options. Held: Ct follows Whalen ct that F,
D, UI or other TI required for this is directed at testator. The beneficiary is not directly
defrauded or unduly influenced, the testator is. Ct says the ct erred in finding he had no
claim and R&R. Rule: In this state, if there is an adequate relief available
in probate ct, then that remedy must be exhausted unless the ∆’s
fraud isn’t discovered until after probate, then π can bring a later
action for damages since relief in probate was impossible.

Probate exception to federal jurisdiction rule: exception prohibits the

federal courts from entertaining a suit that encroaches on the
traditional jurisdiction of the state probate courts. (Anna Nicole smith
punitive damages case)

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Wills: Formalities and Forms

Execution of Wills

Attested Wills [223]

SOF (Land) 1677 Wills Act (1837) UPC 1990 Uniform Probate
Code of 2008

Writing Writing Writing Writing

Signature Subscription Signature Signature

Attestation & Attestation & Attestation & Attestation & signature

subscription by 3 subscription by 2 subscription by 2 by 2 witnesses OR
witnesses witnesses witnesses notary

SOF SIMILAR TO TODAY’S LAWS

· Purpose of formalities: want to prevent fraud and undue influence.
· Whether a will has been properly executed depends on 2 things:
o The jurisdiction’s statutory Wills Act formalities AND
o The judicial philosophy as to what degree of compliance with the Wills act
is acceptable
 Common law requires strict compliance Groffman (ct held
must testator must acknowledge to both witnesses at
the same time – testator must strictly comply with
formalities)
 Modern trend focuses on substantial compliance or a harmless
error / dispensing power approach. CL also wanted written wills
for property specifically.
· 3 Requirements for a Valid Attested Will [226] (these must be followed
or else the will may be deemed invalid and denied probate – sending back to
intestate even if there is no fraud etc.; requirements vary by state) UPC 2-502
o Has to be in writing, signed by testator or in the testator’s name by
some other individual in the testator’s conscious presence and with the
testator’s consent AND witnessed by at least 2 individuals w/i a
reasonable time. And attested.
· Writing:
o Oral wills are generally not permitted
o Videotaped wills: UPC is unclear if this will satisfy the writing
requirement, MI specifically disallows. [239]
 Ritual function may not be satisfied – question about the
finality and seriousness of a videotape
 UPC dispensing power (UPC 2-503): if one of the
formalities is missing the ct can overlook this if
the will truly reflects donative intent. UPC says if

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 we can find that testator intended, then it’s okay
and presence requirement is not needed.
o Electronic wills: The UPC would not consider an electronic file to be a
writing but with the 2-503 dispensing power it may be able to be
brought in. If its on a flash drive, may be better.
 NV: specifically allows these but has extremely specific
requirements (issue: risk of fraud if all that you have is a
computer file)
· Signature of Testator – Signed by the testator or another individual in the
testator’s conscious presence UPC 2-502. Accepted signature
examples: signed w/ an X, someone signing for them if they
intended to adopt the doc as the will and they did so in his
presence, someone assisting a person in signing if they
intended the doc to be the will or a typed signature in cursive
font and printed and signed by the witnesses.
o A mark: Is an “X” ok? Yes as long as the testator intends this to be
their signature and IF (1) disabled – cannot physically write her
signature or (2) illiterate
 McCabe Case: X ok as long as witness sees (here, a “weak”)
testator sign and writes the testators name under the X. Ct
wants to be sure intent of the X was for a signature. Ct applied
“substantial compliance”
o Less than full name: What about signing “Pat” and not “Patrick”
 Part of a name is not ok unless there is evidence to show that
the testator intended this to be their full legal signature
 Ie if the testator normally signs with a full name this may not
be ok bc ct does not know why testator did not use full
traditional signature (ie changed mind or was interrupted)
o Signing by another: What if witness helps the testator sign
 If the testator asked for the help it is ok but if the witness
simply helped without request this is not ok
o A digitized signature was
 Valid: held valid in Tennessee bc it has an unusually broad
definition of a signature in that state (almost anything testator
wants to construe as a signature)
 Invalid: Not sufficient for a signature for any jurisdiction that
takes a strict constructionist view of the formalities.
o Rubber stamp
 The rubber stamp would probably be ok under TN’s broad
signature definition and anywhere that has adopted the UPC’s
dispensing power
 States that take the strict formality approach: difficult to know
(if execution ceremony otherwise flawless, then chances may
be better and inability of the testator to write is additional
evidence)
o Writing below (after) the signature

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  Some states require subscription: testator’s signature
must be at the very end
 UPC does not require subscription and neither does MI law
(signature can be anywhere) Some Legislatures also have other
requirements that testator must publish, which declares
in front of witnesses that the instrument is the
will.
 What if there is a line of text after the testator’s signature
· If already on the document and the testator signs above
the line
o Some cases deny probate under the subscription
requirement
o Other cts may look at what the line actually said
 Non-dispositive = ie not giving
something away may, this line is simply
ignored and the rest of the will is put
into probate
 Dispositive = whole will is invalid if line
below signature is giving something
away
o NY statute: may just strike the below line unless
the line is so integral that the testator would
have preferred the will to fail than just striking
the line.
o Strict compliance with formal requirements of
Wills Act: must be in writing, signed by testator,
and attested by 2 witnesses plus any addtl
requirements that are mandated by that
jurisdiction.
· Witnesses: Testator must sign or acknowledge in the presence of 2 witnesses
who then sign and attest within a reasonable time after witnessing UPC 2-
502
o “Presence”
 Line of sight test (minority approach): the testator does not
actually have to see the witnesses signing but must be able to
see them (ie the pen signing) were the testator to look (this
failed in Groffman-under this states law, testator can either
acknowledge his prior signature to both witnesses at the same
time or sign b4 both witnesses.)
· Exception: The test for a blind person is whether he
could see the signer if he had the power of sight
 Conscious presence test (modern trend): The witness is
in the presence of the testator if the testator, through sight,
hearing or general consciousness of events, comprehends that
the witness is in the act of signing

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  UPC Approach: UPC eliminates the presence requirement
for the witnesses during the actual signing (witnesses do not
have to sign in the testator’s presence but the testator must still
sign or acknowledge in front of the witnesses) – but must still
attest w/I a reasonable time
· 2-502a2: only talks about the testator signing not the
witnesses signing
 If you are a 3d party signing for the testator then you
must be in the testator’s conscious presence
 Telephonic presence is not enough.
o “Acknowledgement” – Testator must still acknowledge in the
witnesses’ presence (but witnesses do not have to sign in testator’s
presence – at least under the UPC)
 Under most statutes, the testator need not sign in front of the
witnesses as long as the testator acknowledges in front of the
witnesses that the signature already present is the testator’s.
o Order of signing
 Traditional Approach: Testator  Witnesses. The witnesses
have to witness the signature after the testator has signed
 Modern Trend: MI/UPC 2-502a3: do not require an order as
long as it is all part of one ceremony
· Ie the testator could simply acknowledge the will and
not actually sign it
o Attestation (not required but malpractice avoider – makes it difficult to
challenge a witness instead must challenge)
 Defined: recites that the will was duly executed after the
testator signed but before the witnesses sign and presumes due
execution.
 Creates a prima facie case that the will was duly executed
(evidence that all the formalities have been complied with and
allows admission to probate even if the witnesses have died)
 Delayed attestation (modern trend), What if the witnesses do
not sign immediately
· Statutes vary as to when the signing occurs
· UPC requires the signing within a reasonable time
(but not in the presence of the testator)
· Stevens v. Casdorph- W.Va Ct. Guy had
witnesses during his will signing in a bank but he didn’t
see them sign and there was no evidence to show that
witnesses saw him sign. Nieces challenge nephews
probate. Black rule: traditional rule should be followed
where wills will not be probated if there is no writing
signed by testators w/ witnesses in his presence. Even
though he substantially complied w/ Wills formalities,
must comply w/ all requirements. Wade exception: Ct

1
 held that the will wasn’t properly executed and reverse
Circ. Cts summary judgment for nephew.
o Notarization
 If you are executing your last will, it may be difficult to get a
notary public there, finding 2 disinterested witnesses are easier
and allowable
·We would generally like a notary to prove the will is
valid...however witnesses are ok
 Self proving affidavit: notarized statement stating all the
wills act formalities were followed
· This eliminates the need for witnesses to testify at probate
as to the formalities
· Not legally required...but makes it easier to have the will
probated (even if the witnesses are unavailable or dead)
o Interested Witnesses
 General Rule: The will must be witnessed by 2 disinterested
parties. Morea: guy had 3 parties sign will, two were
interested parties but one got bulk and other didn’t get too
much. Ct says will isn’t void and treat other party who gets
barely anything as a disinterested party.
 Strict Common Law Approach: The entire will is invalidated if
one of the witnesses is interested
· Old UPC: any devise to an interested witness was void (a
number of states retain this from the old UPC)
 Middle Ground: Purging statute – [241]: Purges the
witness of the benefit (does not void the will) only to the extent
that the interested witness is getting more than they would have
gotten under intestacy (See Estate of Morea [239]
disclaimer was not effective to disinterest an interested witness
bc the witness needed to be disinterested at execution,
witnesses interests were purged) (i.e. if by will you get 150k
and by intestacy you’d get 100k, you would only get 100k)
 Modern Trend: Revised UPC eliminates the interested
witness doctrine An interested witness does not forfeit a
devise under the will UPC 2-505 (interested witness
can be challenged under undue influence or fraud
instead) So a will is valid even if witnessed by an
interested party, and that the interested party
doesn’t forfeit his bequest even if it’s greater than
that which he would have received under a prior
will or by intestacy. (Gets rid of purging rule)
 The purging statutes apply only to a witness who is necessary
for the will’s validity. If the will is witnessed by a sufficient #
of disinterested witnesses, the interested witness is said to be a
supernumerary and is entitled to take his full bequest.

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  Cali says: a bequest to a witness triggers a rebuttable
presumption that the bequest was procured by duress, menace,
fraud or UI.
 LEAVING OUT AN ATTESTATION CLAUSE IS GROUNDS
FOR MALPRACTICE (unless like W.Va.-which says no
certain form is required, just have something like the attestation
clause i.e. witnesses).
· Functions that formalities (writing, signing, witnessing) serve:
o Ritual Function = you want people to know they are making a will, the
more ritual, the more likely the donor is taking the will seriously and
understands that he is making a will
o Evidentiary function = it makes it easier for cts to determine intent to have
a written document with witnesses
 Ensures the document is truly the testator’s last wishes
o Protective function = require 2 witnesses to attest that the will is the
donor’s intent is a practical way to avoid fraud, duress, undue influence.
Want to protect people from these things
o Channeling function = like evidentiary. If all will look the same and have
similar rules, it is easier for the cts to process them and give similar effect
to similar provisions.
o A flaw in formalities is pretty much malpractice
· Recommended method of executing a will [242]
o Use of a self proving affidavit (beyond an attestation clause)
 UPC: if a will is self proved 3-406(b) compliance with the
formalities is presumed
 UPC 2-504: this lays out what a self proving affidavit should look
like
 Advantage: admission of the will to probate w/o testimony of
subscribing witnesses. Publication: testators declaration that the
instrument is her will.
 Every state requires 2 witnesses, recommends 3 except Louisiana,
which requires 2 plus a notary. If the will is executes somewhere
else instead of La, it’s okay if adheres to that states laws. Penn is
the only state that does not require witnesses as long as the
signature isn’t a simple mark or signed by someone else.
· Safeguarding the will (have the lawyer hold onto the will) [245]
o This is a good thing – this is the common practice (will not get lost, client
will not write additional comments, etc). This sometimes looks like you
are soliciting business.
o Not a good thing and unethical
 The lawyer who has the will may also handle the mistake
o UPC 2-515 solution: allows the will to be deposited with a ct during the
testators lifetime
oGeneral Rule: as long as the lawyer does not solicit the holding on to the
will, then this is ok bc there is no impropriety

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• Swapped Wills (inadvertently executing the wrong wills, but mirror provisions
in each)
o Common Law (strict) Rule: the swapped wills are invalid and the will is
refused probate. See Pavlinko (both wills were meaningless bc
too much would have to be substituted to reform them)
o Modern Trend: The cts will look at the big picture (treat the 2 wills as one)
for the testator’s intent and put less emphasis on formalities Snide (the
ct changed the names to carry out the testator’s intent)
o Alternative approaches to deal with switched wills
 Probate the will that the testator intended to sign
· UPC 2-503 Curative Doctrine Harmless error rule /
Dispensing power cures a defect in the execution ceremony
– the testator did not sign the will
o Defined: mistakes can be corrected if there is clear
and convincing evidence establishing the testator
intended the document to be his will
o This allows the ct to dispense with formalities
lacking as long as they can be confident in the
donor’s intent
o This applies to revocation of the will, additions to
will, reviving wills
 Probate the will that the testator mistakenly signed and reforming
the terms to make the will make sense (like the Snide Ct)
· This is a departure from dealing with mistake and works
best with mirror wills
· Curative Doctrines – Modern Trend to attested wills (mistakes can
be corrected as long as they can be supported by clear and
convincing evidence and will comply with the formailities)
o UPC 2-502 Execution of Wills: 1) a writing 2) signed 3) by the testator
and 4) signed by at least 2 individuals within a reasonable period after
witnessing the signing/acknowledging of the will
o Loosened formalities: need not sign at the end, another may sign for the
testator, witnesses do not have to be present at the same time, witnesses do
not need to sign in the presence of the testator or each other.
o Judicial Doctrines
 Substantial Compliance (stricter) / Ranney (witnesses
signed self proving affidavit but not attestation
clause and ct remanded to determine substantial
compliance): The ct may probate a will if the formalities are
followed to substantial compliance by (not the same as the
innocent mistake doctrine...not as often followed)
· (1) clear and convincing evidence shows that the testator
intended this document to be his last will AND
· (2) clear and convincing evidence shows that the will
substantially complies with the formalities

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  Dispensing Power / Harmless Error UPC 2-503
(substantial compliance w/o the 2d prong – ie no formalities are
needed at all): A will can be probated if clear and convincing
evidence shows that the testator intended this document
to be his last will or be revoked UPC 2-503 (1997) / Hall
(ct allowed unwitnessed will to be probated,
witnessing is the least important of formalities, w/o a
signature and writing CC evidence is much harder to
reach) Michigan has adopted this in MCLA 700.2503.

Holographic Wills [236]

· Defined: A will written with the material portions in the testator’s hand and
signed by the testator is a valid holographic will. No need for witnesses. UPC 2-
502(b):
· Requirements:
o Writing (that expresses testamentary intent)
o Signed (only by the testator though) – definite requirement
 This evidences that the document is a final testamentary intent (not
just a draft)
 Location of signature: anywhere on the document is ok but
preferable at the end
 Intent to be a signature: ie “ I ______ (signature) …
bequest..” this is usually not sufficient
o Handwritten
 Everything (strict view): Must be entirely written signed and dated
in the hand of the testator Mulkins
· This can fail for even one or 2 printed words or another
persons handwriting on the document or for lack of a full
date
 Material Provisions: Material provisions and signature must be in
testator’s handwriting Estate of Johnson
· Issue here: key provisions may be pre-printed and
handwriting only may not convey testamentary intent. The
material provisions must be understood w/o
reading the preprinted text.
 Material portions and extrinsic evidence (UPC 2-503b): More
general approach. Extrinsic evidence includes the preprinted part
of the forms to determine the testamentary intent Muder
· Conditional wills (the entire will is conditioned on how the testator dies)
o If I die on my trip to mt everest then my will is….
o General Rule: Cts usually disregard conditions and still regard the will
as valid by construing the condition as an explanation, not as a condition
precedent, as to why the decedent wrote the will not as an actual condition
to make the will valid
o Note: A conditional devise is different: To A if A survives me

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 · Note: if a letter only bequeaths specific property not covered by a will the ct may
find a holographic codicil Kuralt

Revocation of Wills [251]

·Remember: revocation also requires capacity and UPC 2-503 dispensing power and
harmless error is applicable if formalities are lacking
·UPC 2-507 Will can be revoked by (1) writing a subsequent will revoking
prior will, or partially expressly or by inconsistency, or (2) by physical revocatory
act.
o Applies to an entire will, or for a part of the will, it can
be modified expressly or via inconsistency with earlier
drafted wills
o If it is not the entire estate (the will) the
·Dispensing Power Note: If Dispensing Power (or Harmless Error judicial
doctrine) has been adopted in a jurisdiction, the formal revocation requirements
may fail if there is no reasonable doubt that the testator intended to revoke.

Revocation by Writing, Act, or Presumption

· Basic Rule: you can revoke a will either: See UPC 2-507
· By Writing: Supplemental writing with testamentary formalities (signed,
witness, etc.)
o Requirements:
 Revocation must comply with the wills act formalities (in writing,
signed, and witnessed) AND
 Subsequent writing must qualify as an attested or holographic will
o Types of Revocation: You can revoke by a subsequent will that either
revokes
 Express: “I revoke my prior will” If this statement is properly
executed instrument then it is a valid will revoking the prior
 Revocation by Inconsistency: implicitly by inconsistency (ie
will 1 gives ring to daughter and will 2 gives ring to son – this is
implicit revocation of the initial will/writing)
· The subsequent will shows the testator’s nearest intent and
the prior will is revoked to the extent of inconsistencies
UPC 2-507a1
 Revocation by codicil: If subsequent will only gives away part
of the estate then it does not revoke the 1st will and only acts as a
codicil to the 1st will bc the law presumes the testator does not
want intestacy for the unaccounted for property (in the codicil).
The 2nd will is treated as a supplement or codicil to the 1st will bc it
is incomplete (does not dispose of everything)
· Common law rule (majority): Revocation a codicil
does not revoke the will to which it is attached, but
revocation of the underlying will DOES revoke the codicil
(absent intent otherwise)

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  Revocation by Holographic Will: A formal will can be
revoked by a holographic will; mus simply meet the requirements
of a holographic will.
o Revocation of Will Revokes Codicils (Majority Rule):
Revocation of will revokes all attached codicils, unless the codicil is
clearly intended to stand on its own.
·Make sure that subsequent will makes specific mention
that the will reigns over all previous wills
· By Act: Physical actions will revoke a will if:
o Elements
 Physical Act: tearing, burning, cancel (deface entire will or
provisions), or otherwise destroying the physical will AND
 Intent: performed with the intent and purpose to revoke the will in
whole or part
· For example if you accidentally spill coffee or throw away
your will then there is not an intent to revoke the will
· Problem: If a will is physically destroyed, there is a non-
legal presumption that the will was intended to be revoked;
This is a problem of proving that the destruction of the will
was not.
o Common Law (strict rule): requires destructive act to affect part of
the writing Thompson (no revocation bc writing did not touch
written portions of the will)
o UPC / Majority for burning/tearing: Destructive act just must affect
the will somewhere, not touch the writing UPC 2-507(a)(2)
 Note for Cancellation (This is the Exception)(i.e. crossing out
a word): The majority approach to cancellation requires the act
touches the cancelled words Thompson (a writing on the
back of the will was not sufficient to revoke). (UPC
would allow cancellation to revoke the will/provision even if it did
not touch a word...similar in Mich)
· Majority Rule: This is the only method of physical
revocation under the modern rule that requires touching the
word
o 3d party revocation: A 3d party can do the physical acts if (UPC rule)
 Testator’s direction: The acts occur at the testator’s direction
AND
 Testator’s presence: Destroyed by the 3d party in the
testator’s conscious presence
· Conscious presence – testator comprehends the act in
the general presence…
· Line of sight test- the testator could have been able to
see if they were looking from their vantage at time of the
physical act of revocation by third party.
· Hypos on [234]- (a) If T had witnesses sign will while in
the bedroom and they were in dining room…Works under

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 CP test but not under LOS test. (b) T’s atty takes to T’s
house and T signs will and goes back to office and
secretary calls T and signs the will at office to satisfy
attestation requirement….Under CP test probably wont
work either, under LOS test doesn’t work. (There is no way
T knows what Sec is signing nor does Sec know if this is
what he really wanted)
o Revocation by Destruction/Alteration of Copy- NOT an
effective revocation of the will.
 Also, oral revocation only doesn’t revoke a will, must
follow up with one of the above options
•By Presumption
o Rule: If a will was last in the testator’s possession and cannot be found
following death, a rebuttable presumption arises that the testator revoked
the will by act. See Harrison (The ct denied probate when will
could not be found and presumption was not rebutted) –
Cases vary though – opportunity for disinherited heir to
destroy the will does not rebut the presumption of
revocation (opportunity is not enough to consider that they
destroyed will), BUT testimony that testator recently
referred to a will or a fight with a cohabitating husband
may rebut the presumption.
 Duplicate wills (not photocopies): if presumption doctrine
applies to one will then it applies to all duplicates even if one of
the others is found Harrison
• BUT Revoking a copy is not sufficient to revoke the
will. Tolin (the will was not revoked but the ct
imposed a constructive trust bc of the
testator’s intent to do so)
o Lost wills: What happens if something happens to a will and you did not
intend the will to be destroyed/revoked
 General rule: The will is probated if its contents can be proven
by clear and convincing evidence (ie a photocopy will be used if
you can prove something happened to the original that was not the
intent of the testator)
• Caveat: Some states require the will be in existence at the
time of the testator’s death or that the will was fraudulently
destroyed; VERY difficult to prove either of these scenarios
o NOTE: Unless your jurisdiction bars it, the attorney should keep the
original will in his safe and send a copy home with the client labeled
“copy” and stating where the will can be located.
· Note:
o No Oral Revocation: A will cannot be revoked orally.
o If a will is not revoked, no matter what the testator wanted: the will is
admitted to probate

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 o UPC 2-503 may still excuse error in formalities for revocation if there is
clear and convincing evidence of the testator’s intent to revoke (many
states, inc MI, have not adopted this though)
·Partial revocation by physical act: split of opinion whether allowed or not;
UPC allows ptl revoking but revocation will create a new gift that should be made
by attested writing (otherwise revocation goes into the residue [maj.] OR intestacy
[min. approach]). If state does not allow ptl revocation, the changes are simply
ignored.
oConcerns over fraud/coercion, much easier to physically harm a
document

Dependent relative revocation and revival (DRR)

· Basic Rule: if a testator revokes a will based on a mistaken assumption of law
or fact, the doctrine of DRR will come in and say revocation is ineffective if
o 1) revocation was based upon a mistake and
o 2) the testator would not have revoked his will if he had known the truth
(look at testator intent – ie was the testator eliminating an heir for a
reason?, if so, ct will not apply DRR bc this frustrates intent).
·DRR and Intent: This doctrine is all about the testator’s intent, therefore if the
second, failing, devise is significantly different that the original, courts will not
apply DRR because the testators intent is in question.
· 2 limits (bc it is serious to disregard a revocation) - DRR will generally
apply only when there is a...
o Alternative Plan of Disposition: There is an alternative plan of
disposition that fails (another will or codicil) OR
 Eg testator has valid will, tears it up, executed new will, new will
lacks formalities & new will fails
o Mistake: Where the mistake itself if actually recited in the document in
the terms of the revoking instrument and beyond the testator’s knowledge.
Assists in demonstrating that the mistake cause the revocation
· Typical case: testator destroys old will thinking new will is valid but a technical
deficiency in the new will causes it to be invalid and now the old will is also
invalid. DRR allows the old will to be preserved and not revoked in a case like
this if the ct determines that the testator’s intent would prefer wil1 as opposed to
intestacy.
· NOTE: If a legatee’s share is significantly cut in a second failing will, the court
will generally not apply DRR to bring back the original will, and award nothing,
because it is not clear the testator would have favored the original amount over
the lesser mistaken second devise.
· Presumed intent we have to assume that the intent is present
and do not require facts to demonstrate the intent.
o Don’t have to have actual evidence that it was
conditioned

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 Revival
· Example: testator validly executes Will1 and later validly executes Will2 which
revokes Will1. Testator later validly revokes Will2 intending to give effect to
Will1. Cts are split as to whether Will1 is validly revived.
· Approaches to revival statutes (This is actually what Cancelosi
said in class)
o Minority (common law): Will1 was never really revoked so it could be
probated. The CL says that a will is not effective until the testator’s death.
So, express revocation in Will2 does not apply until death so Will2 is
revoked before death then the Will 1 remains in effect. Will 1 is valid
w/o the testator doing anything other than revoking Will2.
o Majority: the moment you execute a subsequent will, you have in fact
revoked the prior will and the only way the prior will can be revived if you
meet one of the standards for revival. Will2 immediately revokes Will1
upon proper execution. If Will2 is subsequently revoked, the testator must
do something to revive Will1:
 2 alternatives to revive Will1 under the majority / American
approach:
· Intent (majority / UPC): the first will can be revived if the
testator so intends (if the subsequent will is revoked and the
testator intent is that revoking the 2nd will should revive the
1st will then the 1st will is revived (ie this rule would have
saved the WI will in Auburn) UPC 2-509
· Re-execution (minority): (used in Auburn). The Will 1
cannot be revived unless you take some sort of effort to
republish or re-execute Will 1 with formalities or a codicil
with formalities that republishes the first will. This view
requires a second step to revive the 1st will.
o 3 Situations UPC 2-509 Revival of revoked will (majority
review)
 Treatment when Will 2 is Revoked by physical act
· 1) If Will 2 wholly revokes Will 1, then apply the majority
approach – intent to revive needs to be shown (§2-509(a))
· 2) If Will 2 is a codicil only revoking part of Will 1, then
the CL minority approach is used to automatically revive
that portion of Will 1 unless there is evidence to the
contrary (§9-509(b))
 Treatment when Will 2 is (expressly) revoked by a 3rd
writing (codicil)
· 3) Will 2 revoked the Will 1 in part OR whole and Will 2 is
revoked by a 3d later writing. In this case, the Will 1 is
revoked in whole or part unless it is apparent from the
terms of the 3d writing that the testator intended to revive
the Will 1.(§9-509(c))
o Earlier wills are revoked by virtue of
inconsistency

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 Revocation by operation of law: change in family circumstances
· Rule
o Majority: divorce automatically revokes any provision in the decedent’s
will for the divorced spouse unless the will expressly provides otherwise
UPC 2-804
 Insurance (annuity) may still pass to ex-spouse
o Minority: revocation only occurs if the divorce is accompanied by a
property settlement
· Scope (Majority): revocation by operation of law applies only to wills (not to
other nonprobate transfers like life insurance, joint tenancy, etc.)
Note: UPC does apply the revocation to will substitutes 2-804 and this is the
modern trend minority.
· Beneficiaries Affected: (split of opinion)
o Majority approach does not revoke gifts to the divorced spouse’s relatives
like Bloom ( under the theory that the feelings toward the
relatives are not dependent on the feelings of the divorced
spouse)
o Minority approach: The UPC revokes provisions in favor of both the ex-
spouse and the ex-spouse’s relatives. Result under UPC2-804: a stepson
(son of ex-wife) would not get an inheritance.

Components / Scope of a Will

Integration of wills
· Doctrine of Integration: all papers (1) physically present at the time of
execution and that are (2) intended by the testator to be part of the will are
considered to be integrated with the will and part of the will (Rest 3d of
Property)

Republication by Codicil
· Defined: Executing a codicil to a will re-executes or republishes the underlying
will. you have acknowledged the document by word or action that this is your
will.
· Publication: The Testator’s announcement to the witnesses or other parties
present that “This is my will”
· Re-dating: The date of execution of the codicil is now the official date of the
will – a will is treated as re-executed as of the date of the codicil
o Revival by Codicil - This can have the effect of reviving a will that has
been revoked (Expressly or implicitly)
· This is different from the incorporation by reference
o Republication by codicil will only revive a prior will that was validly
executed in the first place
o Incorporation by reference can save a document that was never validly
executed
· Republication may thwart testator intent

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 o Child born after the will but before the codicil. The child is treated as if
the child was born before the will was executed…problem bc it looks like
the testator then intended to exclude the child.
·BIG NOTE: ONLY APPLIES TO A PRIOR DULY EXECUTED WILL; meaning if
the previous will was not properly executed (Duly Executed), republication by
codicil does not occur.
o This only applies to the required Will formalities, other things may be
wrong and republication still occurs

Incorporation by reference (More powerful than republication)

· Defined: a valid will can incorporate by reference a document that was not
executed with the Wills Act formalities giving effect to the incorporated document
IF: UPC 2-510
o 1) the will expresses / manifests the intent to incorporate the document
(low threshold)
o 2) the will describes the document with reasonable certainty (to permit
its identification – low threshold) AND
 The cts will broadly construe this to reach intent – ie
“memorandum” may mean a writing and thus both the notebook
and memorandum in Clark
o 3) the document being incorporated was in existence when the will /
codicil was executed UPC 2-510 (Michigan law is the same)/
Clark
 Exception: UPC’s tangible property list allows a testator to give
away tangible property even if the list (which does not follow the
Wills Act) is created after the will is executed as long as the will
expressly states such intent (UPC 2-513...only applies to
tangible property and must be signed by the testator
and does not have to be in existence at the time of
execution of will)
· If the will conflicts with the document then the will
wins
· MI Law requires to the list to be in the testators
handwriting or signed by the testator at the very end (to
prevent post death additions)
· Result: This allows you to go outside the will statute and use a document that
was not executed with all the formalities and use that document as part of the
dispositive scheme. The ct wants to protect against fraud so this is a specific
statute
· Note: Dispensing power may intervene if one of the formalities is missing…Not
the same required formalities of republication by codicil.
o Because of this, incorporation by reference is more commonly used than
republication.

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 Acts of independent significance (doctrine of non-testamentary
acts)
· Rule: As long as the act referenced in the will has its own significance
independent of its effect upon testator’s disposition of property, the referenced act
can control who takes how much w/o the testator having to execute a codicil
(UPC 2-512 same as Michigan law)
· “The car or house that I own at my death” (I own a BMW and
move to MI and buy a ford...I had the BMW when I executed the
will, the fact that I now own a ford, there isn’t any problems, the
ford will sit in place of the BMW at death)
o The act referenced must have an independent purpose other than the own
testator’s testamentary purpose
 Independent Purpose: upon marriage, a 3d party will, safe
deposit box
· When looking for an act in independent significance look
to something else that is occurring during the testator’s life
time and this is the independent significance (i.e. people
use safe deposit boxes for safekeeping and this is
independent of a testamentary purpose)
 NO independent significance: “I leave my children the amount I
write on a sheet of paper” = writing has no legal effect. No
incorporation by reference unless in existence when will executed.
This MAY qualify as a holographic will or codicil
· If the only reason you were doing something was for
donative intent the act of independent significance is not
triggered.
· Reasoning Behind Doctrine: There are other events other than testamentary
intent that result in the substitution; so long as the substitution has a reason behind
it based on an act of independent significance, not based solely on the intent to
alter the testator’s testamentary intent.
· Effect: Allows a substitution of property to take place within a broad provision in
a will without all the will formalities so long as the act was not premised on
altering testamentary intent.

Contracts relating to wills

· General rule: K’s to make a will or not make a will are valid but must:
o Satisfy K law, offer-acceptance-consideration
 There is not consideration in a contract to care for someone if the
legal duty already exists – ie for your spouse see Borelli 287
(ct held that K to give property to W on death was
not enforceable bc no consideration); note: a stepchild
does not have a duty to care to a step?parent
o Be in writing and signed by the decedent: These cases are highly
susceptible to fraud: To stem this, many states require the contract to be in
writing UPC 2-514

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  Common Law: oral K’s may be allowed if proven by clear and
convincing evidence
· Remedy: The remedies are under contract law also – constructive trust on the
actual beneficiary or heirs at law, specific performance of the contract and force
the taker under the will to perform the contract, damages from those who actually
got the distribution in favor of the contract provisions
· Note: If T makes a contract though does not follow through with it upon her
death, the will still goes to probate and the party who had contracted with the
decedent must file a breach of contract claim.

Contracts to make a will

· A contract or breach of K cannot revoke a will: The only way to
revoke a duly executed will is under the revocation statute
· UPC 2-514 allows a contract to be enforceable if it is in writing and signed
by the decedent – likely directing specific performance like delivery of
property, as long as K law is satisfied (O-A-C) Estate of Fritz ct
enforced a contract to dispose of property at death as if it was
a will bc it was in writing and signed by the decedent (one
witness).
· Quantum Meruit claim possible if ct does not enforce the K to create a will

Contracts Not to Revoke a Will

· Usually arise when joint or mutual wills (is there an implicit K not to revoke
these?)
o Joint will: single document executed by both spouses that serves as
each individual spouses will
o Mutual wills / mirror wills: each spouse has their individual wills
but the provisions are the same. There is an agreement of first to the
spouse then to the children.
 NOTE: The mere fact that you have mirror wills does not give
rise to the presumption that there is a contract not to revoke.
 Clear and Convincing Evidence: You must have clear
and convincing evidence of a contract
· Remember, UPC 2-514: In order to have a contract about a will, they require
that either the provisions of the will have the material provisions of the
contract or have an express reference to the contract in the will OR a writing
signed by the decedent evidencing the contract
· Rule: No presumption of a K not to revoke: Mere execution of a
joint of mutual will does not give rise to a presumption of a contract not to
revoke, need clear and convincing evidence that the contract not to revoke
exists otherwise the surviving party may dispose of their property as they wish
UPC 2-514
· Spousal Rights: The jurisdictions split when determining who should take
first where a surviving spouse remarries and there is a suit for breach of K not
to revoke will with 1st (now deceased) spouse

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 o Majority: 3d party beneficiaries have priority over surviving spouse’s
second - spouse and their elective share
o Minority: (Putnam): surviving spouse is above everyone else and
contracts that discourage or restrain the right to marry are void as
against public policy – so 2d wife gets property

Mistaken or ambiguous language in wills (Parol Evidence)

·Extrinsic evidence distinction
o If used to prove the validity of the will then extrinsic evidence is
admittable
o If used to construe an already valid will, the cts are more cautious to
admit evidence absent ambiguity

Common Law approach: no extrinsic evidence, no reformation

[365]
·Plain meaning rule (majority / CL approach): In construing and giving effect to a
will, the words used in the will should be given their plain meaning; This is the
Four-Corners approach.
o Extrinsic evidence is not admissible to show the testator intended
something other than the plain meaning unless there is a (latent under CL
or latent and patent under the UPC) ambiguity Mahoney (ct found
“heirs at law” was not ambiguous so did not admit extrinsic
evidence)
o The New Restatement Rejects this Approach
·No Reformation Rule: Courts will not change a will when it is valid on its face.
· Determining if an ambiguity exists: Patent v Latent Ambiguity
o Rule: Cts admit extrinsic evidence to help construe a latent ambiguity, but
not a patent ambiguity.
 Patent ambiguity: a conflicting devise within the same will,
ambiguity is apparent on the face of the will, no
extrinsic evidence is needed to realize that there is an ambiguity.
· BUT Some cts will fail the will in this case others will
reform the will and or refer to extrinsic evidence to
understand the ambiguity
· Note: Patent ambiguities are not very common
 Latent ambiguity: the ambiguity appears only when the terms of
the will are actually applied, not on the face of the will. Extrinsic
evidence is required to establish and construe the ambiguity
· 2 Latent ambiguity doctrines
o Equivocation: No person or thing perfectly fits the
description (but you are kinda close); the will
clearly describes a person or thing but there are
more than one person or thing to that fits the
description. The will is clear on its face still so a
lawyer will not likely catch this. (example: 2 people
/ things fit the description in the will)

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  Result: The ct will admit extrinsic evidence
to determine which person or thing was
intended
o Misdescription: No person or thing exactly fits the
description but 2 or more persons/things partially fit
the description
 Result: the ct will admit extrinsic evidence
to establish the Misdescription, strike those
words, and see if the clause can be given
effect Arnheiter (ct ignored the
wrong street number since the
street name was right and the will
made sense with just the street
name – close to reforming the will
on the way to the modern
approach)

Modern approach: Openly reforming wills for mistake

· Modern Trend: There is a trend to allowing extrinsic evidence for any kind of
ambiguity (no matter whether it is latent or patent) and repudiate the common law
plain meaning doctrine set forth above
o Rule: When there is an ambiguity, extrinsic evidence can be admitted to
construe a reasonable interpretation of the ambiguity
·Scrivener’s Error
o Rule: Extrinsic evidence is admissible to establish and correct the mistake
if a scriveners error frustrated the testator’s intent IF the Erickson
Elements are met:
 Clear and convincing evidence of a scrivener’s error AND
 Clear and convincing evidence its effect on the testator’s intent
· Mistakes Reforming donative Documents to Correct Mistakes
Rest3dProperty§12.1
o A donative document, even if unambiguous, may be reformed to conform
the text to the donor’s intent if the following is proven by clear and
convincing evidence:
 A mistake of law or fact, in expression or inducement, affected the
terms of the document AND
 What the donor’s intention was [need to know what the donative
intent actually was]
· Gifts by Implication [384]
o Doctrine of probable intent: (NJ only I think) if a contingency
occurs which no provision was made in the will, the ct will place itself in
the testator’s shoes to determine intent of the testator (moves far away
from traditional rule)
 If a gap – something or someone, then the ct will figure out what
the donor would have intended, look at family circumstances and

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 the overall testamentary scheme, and provide what they think the
testator wanted
 Solution: A well drafted residuary clause can solve this problem

Death of beneficiary before death of testator [387]

- Notes...good lawyers would have build contingencies into the will (if child
predeceases the testator, etc...) should have been prepared for these possibilities.
The will should have been able to deal with the these issues and been able to
prevent a lapse gift and the need for common law to be invoked.

Introduction
· Basic rule: if a devisee (the person receiving the gift) does not survive
the testator then the devise lapses (lapse = fails)
o Anti-lapse Statutes- substitute takers for the deceased devisee
(ie to the person the legislature thinks the deceased would have
wanted to inherit, similar to intestacy)
· Basic Terms (these are not all in the book but we need to know them)
o Specific gift: gift identified in a will with sufficient detail
(specificity) that it is clear (from the terms of the will) which asset
from the testator’s estate the beneficiary is entitled to received
 2 types (not in book but important)
· A Specific Gift that at the Time of the Will
can be Precisely Identified- Gift that is
described with such precision that the property can
be defined at the time testator executes the will
o example – I give maternal grandma’s
wedding set inscribed… to daughter
Miranda. (must be very specifically
described)
o There is no question what item is being
given and to whom
· A Specific Gift of General Nature: this is a
gift that is still precise but is described in broader
terms so that the property it refers cannot be
ascertained until the testator’s death
o Example: I leave all my jewelry to my sister
sarah (do not know which pieces but it is all
the jewelry at death); all my stock to cousin
ruth
o General gift: gift that is insufficiently described to be identified
precisely where the exact property cannot be determined at
execution or when the testator dies; BUT this is an identifiable gift.
 Gift of Legacy- this is a gift more of an amount or legacy
(gift of money; 15 shares of coca cola stock – this is
general bc it did not say “my 15 shares” rather it said “15

1
 shares” so the executor may have to purchase coke stock to
make the devise)
o Demonstrative Gift: hybrid bt general and specific gifts (share
qualities of both); I leave $5000 from my bank acct # … to my
friend tom – general bc it is a bequest of cash but specific bc the
bank acct is designated
 If the named source of the demonstrative gift is not
sufficient to devise as described in the will, the executor
will look elsewhere in the estate (usually the residuary) to
make up the difference to the devisee
o Residuary Gift: what remains after all specific, general, and
demonstrative gifts have been satisfied. This is the leftovers.
· Default common law rules to deal with lapsed gifts: If a
specific or general devise, the devise falls into the residue (UPC 2-604)
o Failed Specific or General Devise- Specific or general
devise lapses, then the devise falls into the residue UPC 2-604a
 Example – specific gift to bob, bob dies, the gift is now part
of the residuary estate
o Residuary Devise (entire residue lapses because sole devisee
predeceases testator): heirs take by intestacy
 No Residue of a Residue (COMMON LAW -
minority rule)- If there are 2 residuary devisees and one
survives, it does not matter, the deceased residuiary’s share
passes by intestacy
 UPC 2-604b (Majority Rule)- Eliminates the no
residue of a residue rule and allows the estate to pass to the
other residuary devisee (if an Antilapse statue does not
apply)
· Example: If a share of a residuary fail – 1/3 of
residuary beneficiaries dies – no residue of a residue
rule applies at common law. If a share fails, then
that share does NOT get divided among the other
residuary beneficiaries – it goes to the heirs at law
of the deceased residuary beneficiary. (MCL is the
same as UPC)
 All Residuaries Die- If the devise of the entire residuary
estate fails (only one beneficiary for the residuary) then the
heirs at law take by intestacy
o Class Gift (ie to my brothers or siblings)- if one member of the
class predeceases, his share goes to the class, remaining members
divide up the residuary (common law...if it is to a class of persons,
and one or more predeceases then the remaining members divide
the gift)
o Void Devise: same as lapsed devises – the devise is void and it
will reside through intestacy; devise to someone who is already

1
 dead at the time the will is executed and treated as predeceasing
the testator or is an ineligible taker
 Note: You cannot leave anything directly to an animal or
an inanimate object...it will end up passing through
intestacy, since the devise is void. (Estate of Russell)
 Precatory Language- Language which simply
expresses a hope wish or desire for something to happen
(ie; someone care for something), and the courts will not
enforce this (Estate of Russell).
· Effect- If the courts can identify language in a
devise as precatory, they can simply wipe said
language out of the devise and avoid the lapse
analysis.

Antilapse Statutes
· General Antilapse Rule: UPC 2-605 (replaces traditional
common law by providing replacement takers when a
devise would otherwise fail...this can be drafted around
and should be by a competent lawyer)
o (1) Where there is a lapse and
o (2) The predeceased beneficiary meets the statutory degree of
relationship (blood/legal familial) to the testator and
o (3) The predeceased beneficiary has issue who survive the
testator, the lapsed gift goes to that issue UNLESS
o (4) the will expresses a contrary intent (antilapse can be
drafted around)
 Example: Words of Survivorship or an alternative
distribution if a lapse occurs
· Family Presumption: That testator would prefer that the gift go to the
predeceased beneficiary’s issue rather than fail; this generally only applies
to family relationships.
· Difference from Common law: normally if a gift lapses, it goes into
the residuary estate and is shared among the residuary (in antilapse
applies, the gift goes to the predeceased beneficiary’s issue)
· How Wills can Beat Antilapse Statute:
o Draft to Avoid: Antilapse statutes are only default rules and
therefore can be drafted around
o Testator Intent Destroys- Antilapse statutes do not
apply when the testator (generally) manifests intent that they not
apply
 Words of Survivorship: this means if you have words
“to my surviving children” because it indicates an intent of
the testator only to those surviving; see also Allen Case
(the testator’s will said “living” at my death
which the ct read to be words of survivorship

1
 and the estate lapsed for those who
predeceased – antilapse statute did not apply)
· Not words of survivorship = “to share
and share alike”
 UPC 2-603 says words of survivorship alone may
not be enough to show intent not to apply the antilapse
(this is criticized and is a minority)
 Note: Antilapse will not apply if the testator provides an
alternative distribution if a lapse occurs: Testator specifies
an alternate beneficiary if one beneficiary predeceases
· Spouses
o General Rule: Antilapse statutes do not apply to gifts to spouses
Jackson (better to fall into intestacy – if the spouse
also gets the residuary - than go to W’s heirs who
may be outside the family, however, here the ct
allowed predeceased W’s children to take by
substituting an OR for an AND in H’s will)
 “Or” = contrary intention to give the gift to the alternate
person designated by the testator
 “And” = not contrary
· To A and A’s heirs and assigns (“heirs and
assigns” words of limitation)

Class Gifts
· Class Gift Rule: if devise to a class and one member predeceases, then
the surviving members divide the gift UNLESS an antilapse statute applies
(for linear relationships) (which would give the gift to the class member’s
heirs)
· Test to determine if the provision is a class gift: was the
testator “groupminded”- Three Levels:
o Clearly “Groupminded”- A class label usually required
AND do not use individual names
o Middle ground - Class label and Individual names
 Natural Class- Clear and known understanding of who
constitute the group; ie; brothers, sister, aunts, nieces, team-
members
 Is a class gift per Moss (if gift to individual and
class, construe as a class)
 Restatement §13.1 [399]: NOT a class gift; If group
label AND names are used: disposition presumed to NOT
be a class gift but this is a rebuttable presumption if
“groupmindedness” is shown
o Not “Groupminded”- Just individual names
o If you wanted to give it to a group of people bc they were your
children then it is a class gift – ie to K and I my children and K and

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 I are your only children. IF one child is left out then it is more
difficult to prove a class
· Bottomline: Class Gifts are generally problematic due to inconsistency;
don’t use them.
·

Changes in property after execution of will

Ademption by extinction (Adeemed means “taken away”)

· Defined: if a will includes a specific devise (those identified in the will with
sufficient detail that it is clear which asset the beneficiary is
entitled to receive) of real or personal property but the testator sells or
gives the property away then gift is considered “adeemed” in effect the gift fails.
· Scope: This does not apply to general, demonstrative (specific and general
qualities), or residuary devises (what is left over); ONLY APPLIES TO SPECIFIC
DEVISES
· Approaches to Ademption:
o Common Law: Where testator makes a specific gift, later transfers that
specific gift, an irrebuttable presumption arises that the
testator intended to revoke the gift (Is this the same as the
identity approach?)
o Identity approach (Majority): If the specific item that is referenced in the
will does not exist in the testator’s estate at death then it is extinguished.
The identity must exist at death. No extrinsic evidence allowed.
Testator’s intent not considered. Wasserman (ct held apt building
sold before the testator’s death was adeemed)
 Wasserman v. Cohn (1993)
· Facts: T (Frieda) created trust funded at execution and
retained right to add property by inter vivos transfers and
will, amend, revoke, withdraw. Trustee was directed to
distribute the property as set out in the trust, including a
provision ordered by D, as trustee, to convey a building to
P (Elaine). But T had sold the building before death and
never conveyed interest in property to the trust. P sues
asking trustee pay her proceeds of sale.
· Held: (1) Ademption applies to specific gift of real estate
contained in the trust, therefore when during life T disposes
of subject of a specific legacy in will, devise is adeemed.
(2) Trust construed to same rules applied to wills. Identity
theory supports ademption. MA strict in formalities and
follows traditional rules.
· P’s Arguments:
o (1) Testator’s Intent? Nope, Court says that they
have long adhered to the “identity approach”, and
looks to whether the property was in

1
 existence and owned by the testator at
death.
 Court says the doctrine is based on the
probable intent of T
o (2) General/Specific Dichotomy is too formalistic
and is ignorant to T’s intent; Court says it is the
proper first step.
o Two Step Approach for Ademption:
 (1) Is the devise general or specific? (Ademption by Extinction
only applies to specific devises)
 (2) Then apply the doctrine of ademption
o Intent approach (UPC §2-605(a)(6)): If a specifically devised item
is not in the estate at death then the beneficiary may still be entitled to the
cash value of the item if the beneficiary can show the intent for ademption
not to apply. This goes beyond the traditional rule and is picked up by the
UPC which wants to achieve donative intent whenever possible. UPC 2-
605a6 (presumption in favor of ademption but rebuttable
by showing testator’s intent)
 Example: if testator says “my ford car” and buy rollsroyce = as
long as the rolls was intended to replace the ford (specifically
devised) then heir gets the rolls (ie if sold car and bought house,
heir does NOT get the house bc it is not a replacement)
 Michigan Law: Presumption against ademption unless facts and
circumstances show that ademption was intended.
 (MAJORITY RULE – WORDS OF SURVIVORSHIP ARE
SUFFICIENT TO OVERRIDE ANTILAPSE...YOU CAN
ALWAYS HAVE EXTRINISIC EVIDENCE
· UPC 1990 – FLIPS THIS AND SAYS THAT WORDS
OF SURVIVORSHIP ARE NOT SUFFICIENT TO
OVERRIDE ANTILAPSE...YOU NEED MORE
WORDING (but this is the minority)
·
· How to avoid ademption under Identity Theory:
o (1) Characterize as general, not specific: construe a gift to be a general
devise to avoid ademption by extinction. The executor then needs to go
purchase the item and give it to the beneficiary when it is not present in
the estate
 100 shares of coke stock = general (not “my 100… = specific).
Cts can get around ademption by extinction by construing it as a
general devise. Must go buy 100 shares and give to beneficiary if
general
o (2) Classify the Inter Vivos Gift as a Change in form, NOT substance: If
the change is not significant, ademption should not apply because the asset
is still in the estate

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  A company is sold to C and all the shareholders now hold company
C not A. The cts will treat this as a change in form and read the
gift as company C stock even though it said company A stock
o (3) Construe the will at the time of death, not execution: Normally a will is
construed relative to the time of execution, but if a beneficiary can
persuade a court to construe at the time of death, the specific gift may still
be found in the estate (this is an issue with cars – “I give my car to J”)
 “My ford car” means whatever ford at the date of death even if it is
not the ford at the time of execution

Stock Splits
· Stock Split Example: Gift of 100 shares of stock and bt execution and death stock
splits 3:1 so the estate now has 300 shares
o Traditional Rule: Was the bequest specific or general:
 Specific (all shares of this stock at death): devisee would get the
specified shares plus any accretion
 General (no particular property only a general benefit represented
of the value of 100 shares): the beneficiary would receive only the
specified shares of stock (not the splits).
o Modern trend: shares specified plus those from a stock split unless there is
a contrary intent (no general/specific distinction)
 Michigan
· Dividends
o UPC 2-605: applies to dividends and stock splits; cash dividends are
treated separately. Stock dividends are swept up in the provision to be the
same as a split – stock splits and dividend reinvestment are
included in the devise

Ademption by Satisfaction of General Pecuniary (money)

Bequests
· Rule: UPC 2-609 requires the intent to adeem be specified in
writing for satisfaction to apply and extinguish the gift under the will (same as
advancements); no presumption of satisfaction of a gift to a child
· Alternate Rule (traditional rule): If the testator is a parent of the
beneficiary and after executing a will transfers similar property to that under the
will there is a rebuttable presumption that the gift was made in lieu of the will
· This applies to general bequests only. Specific bequests follow the
ademption by extinction rules supra.
· Similar to the Doctrine of Advancements under intestacy law.
o Advancements have basically disappeared in all states...unless it is
very specifically noted by the testator (intent)
· Only applies to (1) Money gifts made (2) after the execution of a will.

Exoneration of liens
· Issue: is a specific devise of land subject to a mortgage

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 · Majority rule (modern trend): real property passes subject to the mortgage.
UPC 2-607
· Minority Rule (traditional...commonlaw): the gift of the real estate is
exonerated from the lien and the mortgage must be paid off out of the general
assets of the estate and title of the real property passes free of the mortgage

Abatement
· The estate has insufficient assets to pay all debts and devisements
· Rule: absent intent in the will to the contrary, residuary devises are reduced first.
Next, the general devises are extinguished as long as it takes. If money still
needed to pay off debts, the specific (demonstrative) devises will be reduced pro
rata.
· UPC 3-902 has liberalized this rule: they specify this order but allow a ct to
determine if the testamentary plan would be defeated by the
statutory order to abate shares as necessary to give effect to the intent of the
testator.
o Michigan 700.3902- Not identical to the UPC, but has a substantially
similar effect; you can adjust the order of the abatement to avoid
frustration of donative intent
· How to Draft Around Abatement Problems:
o Leave everything to the residuary (that way your spouse gets something)
o Use fractions rather than specific amounts (1/2 of the estate to X, etc...)
o Make specific provisions to take effect if debt must be paid off

- ADD ADEMPTION BY EXTINCTION UPC 2-606

o PRESUMPTION IS AGAINST ADEMPTION
 REJECTS THE INTENT THEORY

Restrictions on the Power of Disposition: Protection of the Spouse and

Children

Marital Property Systems

· No matter what you say in your will, the surviving spouse and minor children will
get some share of the estate
·Only and Issue in Marriage
·2 basic property systems
o Separate property (majority) – from England – MI is like this
 Each party to a marriage own what they earn, and what they
acquire otherwise.
 H and W each have separate title to their property, but this can be
defeated by commingling of funds and joint ownership
 To create fairness – the elective / forced share statutes apply to all
of the property in the decedent’s estate and will give the surviving
spouse typically 1/3 of the estate
o Community property – from European continent (minority)

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  Every penny earned is a “forced share” bt the H and W – each has
an community ½ interest in each dollar earned during the course of
the marriage
· Exceptions: property acquired through gift or inheritance.
 Important distinction: Community property states include only the
property earned while married.
 Elective Share: There is no elective share in community
property state.
 Hypo: W makes $100k for 10 yrs, no expenses, H is stay at home
and earned $0.
· If W dies in separate property estate the will disposes of the
$1m, if H dies, he gets to dispose of nothing bc he owns
nothing
· If in a community property state, it does not matter which
dies, H and W each have the right to dispose of $500k –
half of the amount earned during the marriage

Rights of Surviving Spouse to Support [419]

Social Security
·Social Security [419]: you qualify for benefits because of your relationship to the
covered worker (current spouse, divorced spouse if married > 10yrs [and not
remarried?], minor children)
o Even if surviving spouse has never worked, they will receive the
decedent’s social security if they can meet the statutorily determined
length of marriage.
o Note: If a surviving spouse remarries, generally they are not entitled to
the SS anymore
o Multiple Surviving Spouses: Each surviving spouse that can meet
the statutorily determined period of marriage gets the FULL amount they
would have been individually entitled to. The amount is NOT decreased
pro rata due to multiple surviving spouses.

Private Pension Plans

·Like SS, under ERISA, pension plans make it impossible to prevent retirement
benefits from going to spouse; You CANNOT disinherit your current spouse.
·2 types of plans
o Defined benefit plan: pays a certain amount per month for the
remainder of the retirees life. Fixed, guaranteed payment, subject to rules
that require benefits in a joint/survivor annuity (X to worker on retirement
and Y to surviving spouse for the rest of the spouses life). This benefit
cannot be waived without the consent of the spouse
o Defined contribution plan – a 401k plan. Each worker has their
account once they reach retirement. There is not as much protection for
spouses under the DCP. The spouse is entitled to be the death beneficiary

1
 unless the spouse consents otherwise. But the worker can still withdraw
the entire amount w/o consent of the spouse.

Homestead
·These provide a surviving spouse the right to occupy the family home for
their lifetime or at least provide a certain value of the homestead free of the
claims of creditors. You cannot dispose of the homestead without consent of your
spouse
·UPC 2-402: UPC exempts debts against the homestead only up to $15k (a few states
exempt the entire amount) So spouse is only entitled to the amount of the
exemption

Personal Property Set Aside

·Surviving spouse is entitled to have certain tangible property set aside up to a
certain value.
·UPC 2-403: limits the set aside to $10k (same as Michigan)

Family Allowance
·For maintenance and support to ensure the surviving spouse has enough money
while the will is being settled/administered.
·UPC 2-404: limits the allowance to a “reasonable allowance” and imposes a 1 yr
time limit when the estate will not have enough money to cover all the creditors

Dower and Curtesy

·Dower (wife) / curtesy (husband) gives the widow a life estate of 1/3 of her husbands
qualifying land
·If you get the signature of both spouses upon sale, then you do not have to worry
about the dower right clouding title.
·Dower usually is not elected bc the forced share normally will give more
value to the widow

Rights of Surviving Spouse to a Share of Decedent’s Property

Property subject to the elective share [438]

·Rule: Surviving spouse has a right to either take under the will OR a statutory
fractional (elective) share of the decedent’s estate
o UPC § 2-202 (Partnership Theory): The maximum fraction, after 15
years of marriage, is 50%. The commentary to the UPC explains that this
fraction is intended to implement a partnership theory of marriage, rather
than the traditional support theory.
 Michigan Completely Ignores the length of the marriage, and gives
you a formula based on probate estate (only applies to the probate
estate)
o Traditional Rule (Support Theory): Surviving Spouse takes 1/3 of
the estate.

1
·Scope/Non-Probate Transfers – What property is counted to determine the
elective share
o Traditional Rule: the elective share statute give the elective spouse a
fractional share of the probate estate only and non-probate transfers
are excluded.
o Modern Approaches:
 Judicial Approach to Inter Vivos Trusts: The assets in the inter
vivos trust created or amended is part of the estate and subject to
the elective share Sullivan if the trust was “created during
marriage by the deceased spouse” Bongaards (not a trust
created by spouse’s mother to benefit the spouse)
· Sullivan v. Burkin
o Facts: W elects against H’s will. Seeks
determination that assets held in inter vivos trust
created by H during marriage should be considered
part of estate in determining her statutory share. H
had a deed of trust under which he transferred real
estate to himself as sole trustee. Net income payable
to him. And retained right to revoke anytime.
Directed principal and undistributed income given
to the Cronin family on death. He dies while still
trustee. Will said he intentionally neglected to leave
anything to W and grandson. Directed that after
payment of debts, expenses, taxes, residue paid over
to the trustee (the Cronins).
o Two Issues:
 (1) Was the inter vivos trust
testamentary, and thus included in
the estate?
 (2) As a general principle, do
surviving spouses have special
interests in inte vivos trusts
created during the decedents life?
o Held: (1) Sullivan’s trust was not testamentary in
character, and the inter vivos trust was legit. (2) In
the future, property in inter vivos trusts should be
considered part of probate estate when computing
statutory forced share of surviving spouse. (BUT
this ruling applies only to trusts created or amended
date of this opinion.)
o Wife’s Claim: The inter vivos trust was an invalid
testamentary disposition and constitute assets of the
estate.
o Reasoning:
 H still has right to dispose of all separate
personal property during life without

1
 consent or knowledge of W even if purpose
to disinherit her.
 This trust was testamentary and a valid inter
vivos trust. A trust is not testamentary and
invalid merely b/c settlor reserves beneficial
life interest and power to revoke/modify.
Fact that h controlled it here didn’t
invalidate it. (RST of Trusts 57)
 Kerwin Rule states that a spouse may
dispose of any personal property within their
life, and it will not form part of their estate
to share by statute; Court won’t retroactively
invalidate this rule on a theory of advisory
reliance, BUT the court will not follow the
rule in the future on public policy grounds.
o New Rule: Decedent spouse can’t defeat
testamentary statutes by creating a trust in which
he/she alone has general power of
appointment. When a marriage is terminated
upon a spouse’s death, right of surviving spouse
shouldn’t be so restricted as by the Kerwin rule.
· Bongaards v. Millen (20 Years Later)
o Facts: Trust set up by Jean’s mother. Jean is life
tenant and had limited power of appointment over
remainder. During her life, could’ve terminated the
trust resulting in trust being paid to her but instead
appointed remainder to her sister. Jean disinherited
H in her will. H claims elective share against Jean’s
estate. Court rejected this b/c trust created by a
third party, not Jean. Compared to Sullivan,
property never in the estate in first place.
Ultimately, H got summer home he and w owned in
jointed tenancy but nothing else from her estate.
 Sullivan rule applies only to assets of a trust
(1) created during the marriage (2) by
deceased spouse
 Nub: “When a third party places that
property in a trust, the property is not being
removed from that elective share “estate.”
 Also, for tax purposes, if you have control
over property and power to receive it, will
be taxed on it (Economic Benefit Doctrine).
 Other Tests to Include Non-Probate Property in Estate:
· Illusory transfer test: A revocable trust is illusory and
not really in existence. Eventually cts decided the trusts are
created but count as part of the probate estate

1
 (this gets the inter vivos trust back into the estate for
elective share purposes); look for how much control
the spouse retains
o This is the most widely used test to include inter
vivos trusts in the decedent’s estate
· Intent to defraud test: look for some evidence that the
decedent spouse was trying to defraud the surviving
spouse. Factors:
o Control retained by the transferor
o Amount of time between transfer and death
o Degree to which the surviving spouse is left without
an interest in the decedent’s property, or other
means of support
· Present donative intent: was the intent to give a gift
instead of taking away from the spouse (same factors as
above)
 Choice of Law:
· UPC §2-202(d) The law of the decedent’s domicile shall
govern the right to take an elective share of property
located in another state.
 Statutory Schemes
· NY Test: Enumerates what items are included in the
elected statutory share of an estate; Decedents estate and
probate estate count to calculate the elective share. Simply
add which items get added back to the probate estate for the
forced share to apply to.
· Del Test (rejects the UPC): Incorporate by reference
the federal estate tax rules. All property included for estate
tax purposes is subject to the elective share
 UPC Approaches UPC 2-201 to 214
· 1969, augmented estate which is like the NY
approach. Take probate estate and add back in certain non
probate transfers and give the surviving spouse a share of
the augmented estate
o Augmented estate includes transfers decedent
retained power to revoke, joint tenancies, any
transfers >$3k w.i 2 yrs of death, $ received by
spouse on decedent’s death – ie life insurance.
o This is the more common model
· 1990, very different Partnership approach based on the
duration of the marriage: adds back transfers made during
and before the marriage if the decedent spouse retained
some control similar to IRC Estate Tax Law, and calculates
the surviving spouses elective share (a sliding percent
based on the duration of marriage). Three Steps:
o (1) Determine the “Elective Share Percentage”

1
 o (2) Determine the value of the Augmented Estate
o (3) Determine the elective share amount
 NOT THE MOST POPULAR
MODEL
·Life Estate Issue: An issue arises when a decedent leaves a surviving spouse a
life estate in property
o Traditional rule: the surviving spouse can renounce the life estate and not
be charged the value of the life estate
o Modern Rule: The surviving spouse can renounce the life estate, though
either the whole or partial value of the life estate will be charged against
her elective share, thus reducing it.
·UPC 2-212: under the UPC, a surviving spouse must be alive to file a
petition for the elective share.
·MCLA 700.2202- (Variant of the 1969 UPC)- You have to make the election
during the surviving spouses lifetime, if the surviving spouse is incapacitated the
right of election under the elective share can be exercised only by a court order if
there is a finding that exercise of the elective share is necessary for support of the
incapacitated spouse.
o MICHIGAN HAS ADOPTED THE SUPPORT THEORY

Waiver of the elective share [452]

·General Rule (UPC §2-213): a surviving spouse may waive their right to an
elective share at any time as long as the waiver is:
o (1) in writing and
o (2) signed by the waiving spouse with full disclosure
·Common Application: Most commonly found in a prenuptial or post/ante-nuptial
agreement.
·What Can You Waive:
o (1) Elective Share
o (2) Homestead allowance
o (3) Exempt Property
o (4) Family Allowance
o (5) Rights Under Intestacy
o NOTE: You cannot waive a right to a government benefit (ie; social
security)
·The waiver is not enforceable IF she can prove:
o Involuntary That the waiver was not made voluntarily OR
o Unconscionable/Lack of Full Disclosure That the waiver was
unconscionable when executed and the surviving spouse did not know (or
could not reasonably know) the deceased spouse’s financial situation)
 If spouse did not know the extent of the other spouse’s property
you cannot waive a right to that property – there must be adequate
disclosure
· MCLA 700.2205- Requires that the waiver be after fair disclosure
· In re Estate of Garbade

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 o Facts: Prenup agreement signed (before marriage) where W waived
elective share and other provisions. Also required H maintain a $100,000
policy on his life for W’s benefit. He died unexpectedly 2 years later. W
got assets up to $340,000 and filed notice of election to take share. H’s
sons (petitioners) from prior marriage claim that her right had been
waived. W claimed that her waiver of elective share procured by fraud,
misrepresentation, duress.
o Held: Waiver upheld. Prenup agreement not secured by fraud.
o Reasoning:
 There is a presumption of legality in a duly executed prenup
agreement. And W had burden of proving fraud, of which she was
unable.
· In re Grieff
o Facts: H and W waived elective share rights against each other’s estate in
a prenup. H died 3 months after marriage, leaving will devising entire
estate to kids from prior marriage. W petitions for elective share anyway.
o Appellate Division Held: Court invalidated prenup b/c it was clear H
was in a position of great influence and advantage in relationship with
future W and exercised bad faith.
o Held: Remand for a determination of fact-based inequality.
o Reasoning:
 Contestation of prenup must establish fact-based-
particularized-inequality before proponent of prenup suffers
a shift in burden to disprove fraud or overreaching. Particularized
and exceptional scrutiny.
·Main point: The courts are increasingly willing to enforce one-sided agreements if
disclosure was adequate Garbade / Lutz (if spouse read the prenuptial
and there was disclosure, then the ct will enforce it)

Community property issues for the surviving spouse

·Characterizing property:
o Domicile when $ earned controls characterization: The
jurisdiction the couple is domiciled when personal property is acquired
controls the characterization of that property
 if a community property jurisdiction then that property is owned
50/50 bt H and W
 if separate property jurisdiction this property remains separate even
if you move to a community unless there is a commingling of the
asset
o Real property is governed by the laws of the state it is located
o Domicile at death will control the survivor’s marital rights. Ie if in MI the
surviving spouse will have the right to MI intestacy, elective share, etc.
·Migrating Couples
o Separate to Community (issue – lack of share of the estate):
 The property acquired in the SP state remains separate

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 What happens when the wage earning spouse dies and is left with
nothing bc all earnings acquired in separate property state, but
spouse dies in community property state
 Some community property states have created quasi
community property status to some property similar to an
elective share to deal with this problem of the nonwage earning
migrating couple
o Community to Separate (issue - windfall):
 Community property remains shared when you move to SP state.
And surviving spouse gets this 50% CP share plus an elective share
of the 50% probated when death occurs in separate property state
(possibly a windfall)
 Some states may require converting community
property to separate property if surviving spouse would
get a windfall

Spouse omitted from a premarital will (pretermitted spouse)

·Presumption: when the testator marries after executing his will and dies w/o
revising the will to provide for his surviving spouse, there is a presumption that
the testator accidentally disinherited his spouse(unintentional disinheritance of
spouse or child)
o How to rebut the presumption: Show that -
 The failure to provide for the new spouse was intentional
 The testator provided for the spouse outside of the will
in lieu of under the will OR
 The spouse validly waived the right to share in the
testator’s estate.
·Scope: ONLY applies to wills drafted prior to the marriage.
·What share of the estate does the omitted spouse get?
o General Rule: intestacy share goes to the omitted spouse;
o UPC 2-301 gives the surviving spouse intestacy share BUT only to the
extent that the estate is not otherwise devised to a child of the testator who
(1) is born before the testator married the surviving spouse
and (2) the heir is not a child of the surviving spouse
 Effect of the UPC: if the testator leaves his entire estate (100%) to
a child from a prior relationship, the omitted spouse will get
nothing even if she meets the requirements
· If $ is left to decedent’s stepchildren, this does not
disinherit W. She can take intestate share based on all gifts
to anyone other than the children from a prior relationship.
·Note: A spouse’s estate can claim under the pretermitted spouse doctrine (unlike
elective share where the spouse must be alive)
·Probate property only: Omitted share statutes typically only apply to probate
assets
·How to protect a spouse

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 oThe typical omitted spouse also qualifies for an elective share (which
includes non-probate property usually)
o If the intestate share under the omitted spouse statute is less than an
elective share, the intestate share counts toward the elective share. You do
not get the elective share plus the intestate share (only one or the other)
SPOUSE OMITTED - Doesn’t apply if it appears from the will or other
evidence that the will was constructed in anticipation of the marriage
(intent)

Rights of issue omitted from the will (Pretermitted Children) [466]

·General rule (except LA): if your parents want to disinherit you, they can.
Omitted child statutes focus on unintentional omission of a child. YOU CAN
NOT DISINHERIT YOUR CHILDREN IN LOUISIANA.
o HOWEVER...disinheriting your children is just inviting a will
contest.
·Presumption: When a testator has a child after executing a will, then dies w/o
including that after born child in the will, there is a presumption the testator
intended to amend his will UPC 2-302
o Child’s Share: under UPC 2-302
 No children alive when will executed: child gets intestate share
 Children alive, but disinherited at least 1, the afterborn child gets
no more than what was given to the the children who were alive
(we are not going to allow the rule to treat the afterborn child
better than the children who were alive at the time of execution.
· Allocation rules under 2-302
o Only applies to children born after will is
executed (some statutes actually protect all
children...but not UPC)
o IF no children are alive at the time the will is
executed, it gives the afterborn children an equal
share to the intestate share unless the will gives
everything to the surviving parent of the omitted
child.
o To Rebut (to prevent the child from getting his share, similar to the
exceptions for the pretermitted spouse):
 Failure to provide for the child was intentional
 The testator provided for the child outside the will OR
 The testator had one or more children when the will was
executed and devised substantially all of his estate to
the parent of the omitted child. (traditional rule requires a
child be alive when will executed for this exception to rebut the
presumption – UPC does not require any children be alive at
execution?)
o Admission of Extrinsic Evidence to Rebut: Missouri v Mass.
statutes

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  Missouri: No extrinsic evidence to show omission was intentional.
Just look at the face of the will. (protects the child)
 Mass rule: This ct will look at the extrinsic evidence to determine
if the omission was intentional
o Note: There are some pretermitted statutes that include
ALL children
·Effect/Share of the Estate: typically the child’s intestate share.
·Blanket disinheritances are usually not valid, ie “no children are to take,” the
specific name must be mentioned to affirmatively disinherit a child
o Lineal Disinheritance: Specifically omitting a predeceased parent is
sufficient to omit all lineal descendants who would take the parent’s
intestate share (In re estate of Laura)

NOTES...be aware of republication by codicil and it’s possible effect on

pretermitted spouses and children

Nonprobate Transfers

Introduction to will substitutes (as much as 80% of property in US is

transferred non-probate)
·Nonprobate transfers – life insurance, joint tenancy, pension accounts, revocable
trusts, etc are typically covered under contract law (a lot are considered gifts,
gratuitous transferes, payable on death...you are not getting anything back, you’re
dead). Property passes upon death of the first person.
·Wills act formalities are not required for these substitutes
o Wills formalities (evidentiary, channeling, etc...) are not required
because the testator is performing actions himself rather then an
intermediary (probate court) doing it for them. We also have contract
law that will apply and protect the interests of the parties.
←
Shift in Analysis of Non-Probate Transfers
- Courts are now shifting away from requiring the strict will formalities to
validate a Inter Vivos Trust, but instead looking to see whether the transaction satisfies
the underlying functions the will formatlities were established to protect (ie; Evidenciary,
Protective, Ritual, etc...)

Revocable Trusts

Introduction [299]
·Inter Vivos (set up while you are alive) Trust Elements (assets in
trusts never go through probate):
o (1) Donative intent
o (2) Delivery (must be delivered during the life of the settler)
o (3) Acceptance
·Revocation: When a particular trust sets forth an express method of revocation
(express does not = exclusive...so it doesn’t have to be exclusive), only that

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 method is valid. Pilafas (p.307) trusts can only be revoked by their
terms, not by wills act requirements...not extending the common
law rules of wills to trusts; governed by the terms of the trust)
·Common Law Revocation: Presumption that if a will is last seen in T’s
possession and can’t be found after death, it is presumed to be revoked
·The Problem of Delivery and Revocation of Trust:
o Settler and Trustee are the same person: If the settler was also
the trustee and the settler executed a will revoking the trust, this
constituted delivery and is a valid revocation.
o 3d party as trustee - Delivery: If you have a bank as the
trustee, most courts have found that if the trust says revocation only by a
writing delivered to the trustee, a will revoking the trust is not sufficient bc
lack of delivery. when trustee and settler are the same person
o Trust is silent on how to revoke: (Majority Rule) IF the trust is
silent about delivery: cts have held that any method to show an intent to
revoke can be upheld, so a will works in this case
 UPC accepts that any method that provides clear and convincing
evidence of the testator’s intent to revoke unless there are
provisions in the terms of the trust
o Divorce: may not automatically revoke depending on the jurisdiction
(unlike wills)
·Formalities: Statutory formalities (in writing, signed by the testator, and witnessed
by two witnesses) are not required for inter vivos trusts; Revocable inter vivos
trusts are widely recognized as valid will substitutes that do not have to comply
with the wills act formalities, even when the settler is also the trustee and life
beneficiary. Farkas
·Perfect Will Substitutes v. Imperfect Will Substitutes- (look up)
·Creditor’s Rights:
o Modern trend:
 General/Standard Rule: General rule that when a person
creates for own benefit a trust for support or a discretionary trust,
creditors can reach maximum amount which trustee under terms of
trust could pay to him or apply to his benefit.
 At Death (Reiser): Courts split but majority allows reaching the
trust (only to extent not satisfied by the estate) owned by trustee
over which he had such control at time of death and would have
been able to use it for own benefit (Economic Benefit Doctrine).
·Statutes’ Ability to Reach Trusts: Varies by jurisdiction, but there are a few
that are widely understood as unreachable .
o (1) Life Insurance
o (2) Savings Bonds
o (3) Retirement Benefits
·Limits on Trusts:
o (1) Trusts can only deal with property actually in the trust (therefore the
property must exist during the life of the settlor); thus trusts cannot deal
with after acquired property (exception on p.305) if they went through the

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 steps to add the property to the trust at the formation of the instrument and
the property was acquired after the trust was created)
o TRUSTEE CANNOT BE THE ONLY BENEFICIARY (it can be on
of many/few...but not only)...it must be setup to give to
someone at death (otherwise it would defeat the purpose
of the instrument as a will substitute)
·Advantages of trusts...help to plan for possibility of incapacity
(don’t have the concern of others changing will as health
declines; trusts aren’t public, wills are; can avoid ancillary
probate (resulting from property owned in another state); you
don’t have to give away much (you still own the items, but give
them away at death and avoid probate);
·Trustees have the legal title to the trust property and beneficiaries have an
equitable title to the property
 Hold trustees to a fiduciary standard of conduct
· Trustees are personally liable to a breach of that
duty (standard)

Pour Over Wills [310]

·Defined: A will that devised the residue of the estate to a trustee to hold the assets
in a revocable inter vivos trust – commonly funding the trust at death
·Common law attempted to validate the provision by using incorporation by reference
or independent significance bc of unpredictability:
· Issues with Pour Over Wills:
o (1) Are they valid absent will formalities
o (2)
· Two Doctrine to Validate Pour Over Wills:
o (1) Incorporation By Reference- A will can incorporate by reference
a trust instrument in existence at time will executed but cannot incorporate
trust amendments made after the will executed.
 Criticism: Cannot include after trusts after the execution of the
will; defeats the benefit of flexibilitiy that is the goal
o (2) Independent Significance- Will may dispose of property by
referring to some act that has significance apart from disposing of probate
assets by reference to an inter vivos trust that disposes of assets transferred
to the trust during life.
 Note: Thus trust doesn’t have to be in existence at time will
executed under this doctrine but must have some assets in it before
T’s death
o Difference Between the Two: Difference is that independent
significance requires that the trust have some property transferred to it
during life and Incorporation requires trust be in existence at time will
executed. Under Independent, assets poured over into the trust are subject
to terms of trust. The will can pour over assets to the trust as amended
after execution of the will.

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 · Current Law Fixing Problems in The Two Doctrines; Current law:
Universal enactment of UPC 2-511:
o (1) No requirement that a trust exist at will execution or that property be in
the trust (This fixes the Inc by Ref problem that the trust must be existing
at the time of execution)
o (2) The trust can be amended and written later (No writing requirement
under UPC)
o NOTE: These only apply to trusts, not additional wills.
· Case Law:
o Add Clymer and preceding Hypo from other outline.

Payable on death arrangements

NOTE: Once again, the reason why trusts tend to be more lax on
formalities (in contrast to wills) is because the will functions (protective,
evidentiary, ritual, etc...) are satisfied/provided for through other steps
inherent in the trusts process.

Life insurance – POD clauses

·Types of Life Insurance:
o Whole Life- Once a predetermined amount is paid in full, the insured is
covered for life
o Term Life- The insured person is only covered during the term of the
policy
 Note: If you are in poor health, you are out-of-luck on this one
·Note: These are CONTRACTS, therefore often you look to contract law for
answers.
·Common Law/Traditional Rule: Only life insurance policies are exempt from
the wills act formalities. Other POD provisions in written instruments that do not
qualify as a will are invalid at death (Wilhoit)
·Modern Trend: All contracts and instruments with POD clauses are valid w/o will
formalities because they are not testamentary UPC 6-101 / Hillowitz
o UPC 6-101: reflects this modern trend and applies to nonprobate transfers
on death. Any POD provision will be considered as non-testamentary and
will not have to comply with the wills act formalities. [330]
 No survival requirement: No requirement that a beneficiary
actually survive the decedent (except for life insurance contacts)
 POD contracts do not lapse so the beneficiary’s estate will be
entitled to the amount
·Changing the terms of a will substitute:
o Majority rule: must follow the procedures in the contract to change
the beneficiary and cts will generally uphold their terms even if there is a
state law provision that revokes a ex-spouse beneficiary under other
instruments Cook

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 o Minority: Any POD designation to an ex-spouse would be automatically
revoked by divorce (UPC 2-804) Revokes pretty much everything;
Michigan Follows this.
o Practical aspect: do not rely on a statute to undue designations upon
divorce. Expressly change the designations.

Pension Accounts
·Whether it is defined benefit or contribution participants always have a right to
define the beneficiary on death. Some plans do not provide payment on death
though if the employee is single – federal law requires payment to continue at a
reduced amount if married
·Not considered Testamentary in Nature
·Defined Benefit Plan General Rules:
o (1) You have a right to designate a beneficiary during your life
o Read the Langbein article for rules
·Defined Contribution Plans Rules (There is a modern shift towards this):
o (1)
o Note: Questions of what happens upon death is now more important
·How do pension accounts align with wills law
o Pensions accounts generally pass outside of probate
o ERISA preempts all state laws with relate to pension plans so even if a
state passes a law that appear to impose the law of wills on pension
accounts the state law is actually not valid. (Egelhoff).
 Basically wipes out any state law that comes close to it under

Multiple party bank and brokerage accounts

·Main problem: how is the account actually titled (joint tenant, agency, POD
account)
·Presumption: If there are 2 names on the bank acct there is a presumption of a
joint tenancy with right of survivorship which can be rebutted (in some
jurisdictions) by clear and convincing evidence to the otherwise intent UPC 6-
211
·Alternatives (to avoid the joint tenancy presumption):
o Agency account
o Payable on Death account
o Transfer on Death (For Security Accounts)
·Franklin v. Anna Nat’l Bank of Anna
o How to Rebut the Presumption: Form of a joint tenancy agreement is not
conclusive regarding intent of depositors, but the person claiming
adversely must establish by clear and convincing evidence gift not
intended.

Joint Tenancy in Realty

·Joint tenancies in real property are similar to will substitutes but is not a pure form

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 o Pure form = a financial arrangement that allows one to retain control over
the property throughout an individual’s lifetime with the transfer only
occurring at one’s death.
o Joint tenancy in realty: this functions to accomplish a transfer on death
outside the probate system but when property is titled as joint tenancy both
joint tenants have active involvement in the property and to dispose of the
property, the other joint tenant must consent
o Joint Tenancies give away a little more than the other non-probate
transfers; limited power of revocation

Trusts: Creation and Characteristics [485]

(notes...as much as 80% of property transferred after death is non-probate)

Introduction
· Trust Defined: A relationship that is viewed with a high standard of conduct
through which one or more persons (the trustees) hold and manage property for
the benefit for one or more beneficiaries (This is a fiduciary relationship)
o You must feel comfortable that the trustee would manage the property in
the trust effectively; you are in effect giving someone your property to
either manage efficiently or to drive it into the ground.

Parties of a trust
·Need at least 3 parties to have a trust who may or may not be the same
person (“person” covers both a natural individual and a legal creation such as a
corporation (If you just use the term “individual” while drafting, you exclude
corps as a person))
o Settlor – the person who creates the trust
 Inter vivos – created during life either by:
· Declaration of trust – Applies only when the settlor
declares he or she holds property in trust for a beneficiary
(ie the settlor is also the trustee). This could be oral but
generally should be in writing (must be for land
because of statute of frauds)
o Either the deed or the property must be transferred
to the trustee to be effective.
· Deed of trust- used when settlor is transferring property
to another person. This transfers legal ownership to the
other person (settlor and trustee are different people)
o Delivery Required: The deed of trust or the trust
property (preferably both) must actually be
delivered to the trustee for the trust to be created
 By will – testamentary trust
 Note: A settlor may also be a beneficiary and trustee but
CANNOT be the sole beneficiary Farkas Case (must
have a 3d party to whom something has been
transferred)

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o Trustee – The person who holds the trust property for the benefit for one
or more beneficiaries; the trustee holds legal title to the property (Can be
more than one)
 Who
· The trustee may be a 3d party, beneficiary, or settlor.
· Trustee can be institutional or amateur
 Types of Trustees:
· Amateur Trustee- A person not in the business of running
trusts
· Institutional Trustee- A professional trustee (every bank has
a professional trusts dept.)
 Duties Owed (Fiduciary):
· Loyalty- Trustee does have responsibility to administer
trust solely in interest of beneficiaries of trust and prove
that any expenditures made were for trust purposes
(Jimenez)
· Prudence
· Note: The duty of trustee is not the same as that of
custodian; custodian is much more lax
 The trust will not fail for want of a trustee: As long as
you can show the settlor intends to create the trust, even if you fail
to name a trustee, the trust will not fail for want of the trustee. The
ct will appoint a trustee to keep the trust from failing
· Rare exception: If the ct concludes the powers given to
a specific trustee were personal only to be exercised by that
trustee, then the trust will fail
 BOTTOMLINE DOCTRINE: Trust will not fail due to trustee’s
failure to satisfy his legal duties, or for want of a trustee.
 Legal Title: The trust holds legal title
· The beneficiaries have equitable title and do not own legal
title.
· To safeguard beneficiaries: fiduciary standards apply
to the trustee – these are a higher standard of conduct
than those applying in arms length transactions
o Must engage in activities in the best interest of the
beneficiary
o Fiduciary duties may be a problem for amateur
trustees especially
 Responsibilities of a Trustee/General Rule: A trustee must
have active duties to perform or the trust fails [492]
· Investment: Selection and monitoring investments
· Administration / Accounting: Keep the property safe,
reporting requirements
· Distribution to the beneficiaries
 Trustee Must Accept the Trust in order to be named a
trustee, generally by accepting delivery. UTC 701

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 · How to Accept a Trust:
o (1) Delivery of Trust property
o (2) Any other affirmative action that shows
responsibility has been accepted (cashing a check
paid in consideration for service as trustee, etc...)
· Silence and inaction by a trustee are not sufficient to accept
the trusteeship. You must affirmatively accept
trusteeship to have liability imposed
· W/o accepting a trusteeship, a trustee may:
o Temporarily preserve the trust property
o Inspect the trust property
·Beneficiary – the person with the beneficial equitable interest in the assets; they
have equitable title to the property within the trust
o Pursuing Property: The beneficiary can follow/pursue the property
into the hands of who it was passed to and can retake it if it was passed
gratuitously (unless they are a BIOCOB, then they have to go against the
trustee.)
 i.e. if a trustee squandors the corpus of the trust in violation of his
fiduciary duty, the beneficiaries can go after those persons who the
money passed to as long as they are not bonafide purchasers for
value.

Creation of Trust
·UTC §402 Requirements to create a trust
o A trust is created only if:
 The settlor has capacity to create the trust
 The settlor indicates an intention to create the trust
 The trust has a definite beneficiary OR is
 A charitable trust
 Trust for an animal under §408 or
 Noncharitable trust under §409
o The trustee has duties to perform AND
o The same person is not the sole trustee and sole beneficiary
·A beneficiary is definite if it can be ascertained now or in the future
·A settlor can empower a trustee to select beneficiaries from an indefinite class UTC
402c
·Lawful Purposes only: A trust may be created only to the extent its purposes are
lawful UTC 404

Intent to Create
·Rule: the intent to create a trust exists anytime one party transfers property to
another party with the intent to vest the beneficial interest in a 3d party. No
technical words are necessary to create a trust. All you need is some
manisfestation of intent. Jimenez (gift to father to hold money for the
benefit for daughter’s education was determined to create a

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 trust); Lux (“maintaining real estate for grand children” created a
trust)
·How to distinguish bt a gift and a trust (no trust created by the
following)
o Precatory language: language that expresses a wish but does not rise
to the level of a commandment or express requirement is simply a “gift
with a wish.” This creates a moral obligation but is not enforceable in ct
 Do not use the word “hope” if you want to create a trust
o Equitable Charge: this arises when property is given to someone
expressly subject to a claim of a creditor. This is a debtor-creditor
relationship not as a trustee and no fiduciary duties are owed to
the creditor.
·Transfer of Property: A transfer of property with language expressing intent to create
a trust can create a trust.

Necessity of Trust Property

·General rule: a trust cannot exist w/o trust property or trust res Rippestein
(trust was not funded so it was not enforceable)
o Note: A nominal value is sufficient to satisfy this requirement
o Exceptions:
 Pour over will: funding through a pour over will suffices to
create a valid trust Glymer case
 Unfunded life insurance trust – trust where the trustee is
named as the beneficiary of a life insurance policy and the trust
does not otherwise hold any assets [314]. The res is the future
right to receive the life insurance proceeds
·Trust v. Debt [511]
o Trustee must account for specific property depsotied with him to keep
those separate from his own funds whereas a recipient of funds, where
there’s solely a debt, entitle to sue whatever funds to commingle with
other own monies. In debt, amount owed remains constant whereas in
trust, trustee obligated to return property increased or reduced while held
in trust.
o A trustee CANNOT commingle trust assets with other assets.
o Different SOLs – shorter for debts, longer for trusts

Necessity of Trust Beneficiaries [518]

·General rule: Must have one or more ascertainable beneficiaries for a valid trust
o Exceptions: the beneficiary need not be ascertainable for charitable
trusts and classes of beneficiaries (future grandchildren,
etc.) (Policy: The public trusts and charitable trusts do not require an
ascertainable beneficiary bc the AG can enforce these so unjust
enrichment is kept in check.)
o Rationale: Without a beneficiary there is very little one can do to
enforce the terms of the trust.

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 o Note: The settlor cannot be the only beneficiary of a trust, must have at
least one other.
·Ascertainable defined:
o Majority: must be able to identify the beneficiaries by name or a formula
set forth in the trust which allows for objective identification
 Familial terms are typically ascertainable (issue, nieces, children)
 “To my Friends” is not objectively ascertainable See Clark (a
narrower identifiable set of friends would be ok)
o Minority rule: UTC 402c would allow a trustee to select the
beneficiaries from an indefinite class (opposite result from Clark)
 Ie. To my friends as the trustee selects (A kind of power of
appointment)
· Note: Though if the trustee fails to exercise this power, the
estate goes to the testator’s original heirs
 Power of Appointment Note: Creation of a power of
appointment cannot occur with words creating trustee (check
this...); ie: “To Jim as trustee to distribute to my friends as he
chooses” is invalid because you are naming him as the trustee in
the same sentence, but “To Jim to to distribute to my friends as he
chooses” is valid, naming Jim as the beneficiary not as trustee.
· This is purely formal distinction; All the decision making
power still lies with Jim.
 Note: This is adopted in only a few states.
·Issue: Does the language only give a power of appointment and NOT a trust?
o Note: need to distinguish power of appointment to the beneficiary which is
a discretionary power to convey property
 Power of appointment is nonfiduciary and the beneficiaries need
not be ascertainable. Property stays with the donor and never
transfers to the donee. Donee only has power, not title. Trust says
who will get the property.
·Honorary trusts (not technically trusts)
o Defined: Simply describes an arrangement where someone is voluntarily
agreeing to do something such as trusts for the benefit of pets or to
maintain one’s gravesite.
 Note: Normally these would fail for want of beneficiary but the
honorary trust doctrine saves them as long as the trustee is willing
to honor the terms (Searight)
 Wills Note: You cannot devise property to a pet under wills law
 This area of law is growing and currently popular
o Honorary Trust Doctrine: An honorary trust is a moral obligation and
courts will allow a trustee to choose to honor the trust but is not obliged to
 Note: Simply describes an arrangement where someone is
voluntarily agreeing to do something: NOT technically a trust and
no fiduciary obligations arise as a result.
o Limitations on Honorary Trusts:

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  (1) Cannot be Capricious- An honorary trust cannot be funded
with more money than could reasonably be spent within the life of
the honorary duty (can’t leave $20 mil to take care of a pet)
· Note: A court may be able to reduce the amount to a
reasonable one to uphold the honorary trust
 (2) Public Policy- Cannot be established for purposes against
public policy or unlawful reasons
 (3) Cannot set up a trust to pay for Criminal Costs
 (4) Must satisfy the rule of perpetuities
· Note: A pet life is not a vlid life for measuring the rule of
perpetuities
·Statutory Reform (alternative to honorary trusts, though are
actually trusts)
o UPC 2-907: a trust for the care of a pet is valid for the life of the pet
 Michigan Follows this rule
o UTC 408: now provides that a trust can provide for as long as the animal
lives; other options also exist to care for grave sites, etc under state statute
= unlike honorary trusts, these are enforceable trusts
o UTC 409: a trust may be created for a non-charitable purpose without a
definite ascertainable beneficiary to be selected by the trustee and valid for
up to 21 years. Such a trust was previously interpreted as only an
honorary trust

Necessity (really just a preference) of a Written Instrument [528]

·Rule: a writing is only a possible requirement
o Note: Even though a trust is oral and fails under the statute of frauds,
courts of equity may still enforce trust obligations
·Practice Point: Always provide for a trust using a written instrument.
·UTC 407: a trust need not be evidenced by a trust instrument but an oral trust can
only be established by clear and convincing evidence
·Constructive Trusts- Commonly Imposed in Three Situations:
o (1) Fraud or duress,
o (2) Trust was a product of a confidential relationship,
o (3) Generally, where a trust was a product of a confidential relationship
where a trust would have been kept secret.
·Secret Trusts (normally trusts created at death must be in writing but sometimes the
cts will allow in evidence
o Secret trust is a testamentary trust that does not appear on the face of the
will. An agreement outside the will that a beneficiary/trustee hold
property for a 3d party beneficiary (will leaves money to beneficiary but
will does not indicate trust is to be created).
 Traditionally: If the intended beneficiary can provide evidence of
the agreement the ct will admit extrinsic evidence and impose a
constructive trust on the beneficiary/trustee for the benefit of the
intended beneficiary.

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  Testator will leaves $ to T. B later comes forward saying that T
was suppose to hold the $ for B’s benefit
 Policy: intended trustee would be unjustly enriched if no evidence
was admittable
o Semisecret trust– testamentary trust that appears on the face of the
will but it does not disclose the intended beneficiary or details of the trust
Oliffe (semi secret trust fails bc ct knows $ was not for the
trustee but do not know who the beneficiaries are suppose
to be) Example: “I give you $10k in trust as agreed”
 Traditionally: This type of trust simply fails and the ct does not
admit extrinsic evidence; the assets will either pass to the residuary
or to the testator’s heirs in intestacy.
 Policy: already evident that you were not intended to benefit bc it
was given to you to hold in trust. No evidence needed to avoid the
trustee from being unjustly enriched. No ascertainable
beneficiaries so the trustee does not get the property
o Modern Trend: Restatement of trusts proposes a constructive trust in
both cases and also allows extrinsic evidence in both cases and usually
impose a constructive trust in favor of the intended beneficiaries;
somewhat abandoning the secret/semisecret dichotomy.
o Underlying Problem with Semisecret or secret trust- Testator’s intent is
often unclear, and the chance for unjust enrichment is greatly increased,
though this often pales in contrast to the secrecy that these type of trusts
appear to offer.
 Note: If this type of trust goes to court the details will often
become public thus frustrating the secretive intent to create the
trust in the first place.

Rights of Beneficiaries to distributions from trust [533]

·Mandatory Trust– Trustee must distribute all the income to the designated
beneficiaries in the designated amount; trustee has virtually no discretion as to the
distribution of the corpus of the trust.
·Discretionary Trust– lets the trustee decide the payment of income interest or
both.
o Discretionary Support Trust– directs the trustee to make
distributions according to a support standard; Two types:
 (1) “Ascertainable Support Standard”- A standard of
living that can be can be ascertained through examination and
valued; “such amounts as are necessary to support my children in
the style of living to which they are accustomed”
 (2) “Discretionary Support Standard”- This is a different
standard than simply stating “as necessary” to support my children;
this is an objective determination, not an “ascertainable” one; this
is a riskier style of support trust in terms of testator’s intent
because the trustee will determine what “as necessary” entails.
o Trustee Duties:

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  Duty to decide: subject to trustee’s fiduciary duties to the
beneficiaries
 Duty to inquire (Cancelosi Emphasized): Trustee has the
duty to inquire into the needs of the beneficiaries before exercising
discretion as to the beneficiary’s status and needs Marsman
(Trustee cannot simply assume that the beneficiary is
“OK” trustee is responsible for being wary of
beneficiaries status, not the beneficiary; the trustee
must inquire as to the needs of the beneficiaries, not
wait for them to come to the trustee)
· Traditional Rule: Trustee has an affirmative duty to
inquire into the beneficiary’s needs and circumstances
whenever the trust expressly authorizes the trustee to go
into principal to support the beneficiary (trustee’s
obligation to determine the “support standard” the
beneficiary need not come to the trustee to prove ie lifestyle
is not being maintained)
· What Factors are Permissible in Determining the Needs of
Beneficiary (539): Within the language in the trust itself, a
good drafter will enumerate the permissible factors to
determine the disbursement of the body of the trust BUT,
the presumption is that the
 Duty to act reasonably (even if trustee has “sole discretion”)
 Duty to act in good faith (even if trustee has “sole
discretion”)
·Considering the beneficiaries other Resources in determining “needs” (539-540)
o Majority Rule: rebuttable presumption (if trust is silent) that the settlor
intended the beneficiary to receive support without regard to other
resources – trustee should not take into account other assets
o Minority: Restatement of trusts: the trustee should take other resources
into acct unless the settlor intent or purposes of the trust will be better
accomplished by doing so
o Note: Its better to simply list the criteria/factors for determining the need
of the beneficiary within the language of the trust itself.
·Standard of review (Extended discretion) of trustee actions [540]
o General rule: If trust is silent the cts will not substitute their judgment
as long as the trustee acts in good faith and within the bounds of
reasonable judgment.
 Marsman- Even if a trust gives a trustee “sole and uncontrolled
discretion,” the ct will still apply a reasonable and good faith
standard, but if there is language trying to give unfettered
discretion to the trustee, this will move the “good faith” and
reasonableness to a more lax standard; think of it on a sliding scale
·Exculpatory clauses (clauses that protect the trustee from liability)

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 o General Rule: Ct held provisions inserted that are not overreaching or
abusive are generally effective unless there is (1) bad faith or an (2)
intentional or (3) reckless indifference to the beneficiary
o Uniform Trust Code §1008: An exculpatory clause that is drafted or
caused to be drafted by the trustee is invalid as an abuse of a
confidential relationship unless the trustee can show the clause
is fair under the circumstances and the effects were communicated to the
settlor.
 Safe Harbor Provision- If settlor is represented by independent
counsel this is a safe harbor for the trustee
o Note: Cts will never enforce an exculpatory provision if it attempts to
relieve a trustee of all liability or for actions that are in bad faith, or
intentional or reckless indifference (ie; willful etc. actions.) Usually only
protected for little mistakes – cts construe exculpatory clauses narrowly

Rights of beneficiary’s creditors [543]

· Base Rule/Starting Point: As a general rule, creditors can reach a debtors
property as long as the property is transferable (ie revocable trusts can always be
reached by creditors) UTC 505, and irrevocable trusts are governed by the
below?

Mandatory & Protective Trusts

·Mandatory- Mandatory trust tells the trustee how to pay out income, principle, etc
o Rule: the creditor can force the trustee to distribute income to the creditor
just as the beneficiary could have.
·Protective-

Three Types of Trusts:

Discretionary Trusts [544]

·Discretionary trust: gives the trustee the ability to decide distribution (Immense
amount of control going to the trustee.)
·Issue: can the beneficiary’s creditor reach assets held in a discretionary trust
·Rule: Creditors cannot compel trustee to make a payment bc the beneficiary cannot
compel payment (Important Exception: unless trustee is also the settlor Reiser);
Rationale- Won’t allow the creditor to have a greater right to the trust assets than
the beneficiary
o Exception / Creditor Approach:
 Cutting off income procedure: creditor entitled to an order
directing trustee to pay creditor before paying beneficiary and
trustee doesn’t need to pay any part of trust fund to beneficiary.
But if trustee determines to do so, trustee must pay creditors who
now stand in beneficiary’s shoes and thus creditor can deprive
beneficiary of trust income even though creditor not necessarily
paid. Hamilton

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 · Likely Result: The creditor will not get any money, but
neither will the beneficiary; the value to the creditor in
doing this is in the leverage/pressure it puts on the
beneficiary.
· Cts can order this procedure. Validated in Hamilton
Case
 No payments to 3d party beneficiaries A trust cannot
circumvent this by making a payment to suppliers to the
beneficiaries (ie Doctors, groceries)
·Discretionary Support Trusts: (Discretionary trust with ascertainable
support standard)
o Traditional Rule Still Applies: Creditors still cannot reach the
beneficiary’s interest in the trust even though they have an interest to the
extent of support (cts imply a spendthrift provision in support trusts)
(suppliers of necessaries may have a claim against distributions that are
made to support the beneficiary)
o Exceptions (where direct payment from the trustee can be forced)
 Spouses alimony and child support with claims can effect those
claims against the trust. UTC §504 (Note: the Restatement comes
out the opposite and does not allow spouses/children)
·UTC and the Restatement Approaches to Discretionary Trusts and
Ascertainable Discretionary Trusts:
o UTC 504- Beneficiary’s creditor cannot compel a distribution from a
discretionary trust, even if trustee has violated standard of distribution or
abused his discretion. But the beneficiary himself could compel
distribution for own benefit by proving trustee violated a standard of
committed abuse of discretion
 Exception- But there’s a special exception to traditional general
rule governing discretionary trusts under 504c spouse, child,
former spouse w/ valid support judgment or oder that hasn’t been
paid can claim that trustee of discretionary trust violated standard
or abused discretion in failing to make a distribution and court
should compel trustee to make discretionary distribution to satisfy
cliam and court can limit amount paid as it determines equitable
o RST- Opposite, allows creditors to compel distribution

Spendthrift Trusts [547] (Most Common)

·Purpose: Need spendthrift trusts to protect a mandatory trust from creditors
(protects beneficiaries).
·Rule: a trust with a provision that expressly states (1) a beneficiary cannot assign his
interest in the trust (ie to pay a debt) and (2) the beneficiary’s creditors cannot
attach the interest in the trust
o Big Exam Note: In order to have a spendthrift trust you must have
BOTH prongs (Cancelosi hit on this multiple times and says people miss
this on the exam).

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 o Rationale for Having ST: American protection of settlor/testamentary
intent
o Exceptions:
 Alimony / Child Support: The income from a spendthrift (and
support) trust can be reached to satisfy the claim of a former wife
for alimony and child support (dispersed in payment or lump sum
if trust is being terminated Shelly
· Majority Rule UTC §502 / 503: spendthrift provisions
must restrain both voluntary (to beneficiary) and
involuntary transfers (to creditor) of the interest but claims
of children and spouse are generally exempt form
spendthrift exceptions
 Claims by the Federal Government- Generally preempt
spendthrift provisions – federal tax liens are the most powerful
liens at large, also for state tax lien here
 Creditors for basic necessities under the UTC
· Majority Rule: where supplies of necessaries can reach
spendthrift trust assets for beneficiaries on the theory that
most settlors would want this
· Minority: supplies of necessities are not exempt under the
UTC §503 – have no claim
·Tort Claimants/Creditors:
o Majority: Sheffel is the majority rule that tort claimants cannot reach
assets in a spendthrift trust
o Minority (but the trend): GA will allow reaching the assets in trust
bc of the balance of the equities
·Clause Required For Spendthrift Trusts: Must have some sort of language
“trust intended to be a spendthrift trust” to limit the beneficiary from alienating
his interest and that creditors cannot access it. These are usually automatically
inserted into trusts

Self Settled Asset Protection Trusts [557]

·Defined: irrevocable trusts wherein the settlor and beneficiary are the same person.
Must also be administered by an independent trustee who can exercise
discretionary judgment over the assets, and include a spendthrift clause restricting
the transfer of the settlor's interests in the trust assetss
o Exception arises if SSAPT was set up to fraudulently evade a current
creditor
·General Rule Creditors always have recourse against your entire interest in a self-
settled trust even if the trust is discretionary, spendthrift, or both UTC 505
·Although there are SSAPT statutes to protect the settlor in the US this law is
unsettled as how an out of state ct would treat such a statute so general rule above
applies

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Modification and Termination of Trusts [572]

Introduction
·General Rule:
o Settlor Alive: If the settlor and all the beneficiaries consent, an
irrevocable trust may be modified or terminated; No concerns regarding
preserving settlor’s intent because the settlor is the one changing it (trustee
has no COA)
 Trustee Objects: The Trustee does not need to consent to the
modification of the trust, they have no interest in the trust itself
 Settlor Objects: If the settlor objets to modification of the trust
while they are still alive, the trust will not be modified.
o Settlor Dead: rights of the beneficiaries alone are not sufficient to
terminate or modify if the trustee objects
 English Approach: After the settlor dies the ct is not as
deferential to the dead hand as to the living beneficiaries. If all
beneficiaries consent, modification or termination is allowed
· Note: A trust can be modified if all beneficiaries have legal
capacity and consent to the modification.
 American Approach: Always leans in favor of the settlor,
trustee can object
· Claflin Doctrine: US trust cannot be modified or
terminated even if the beneficiaries consent if the
termination or modification would be contrary to a material
purpose of the settlor as long as they don’t violate the law
as it stands or is against public policy
o “Material Purpose”- Pretty much any purpose of the
settlor; this is a question of fact.

Modification [574]
·Rule: Cts are more willing to change administrative provisions as compared to
dispositive provisions
o Strict approach: Dispositive provisions: must show
 1) unforeseen changes or substantial impairment to
settlor’s intent,
 2) that the proposed modification will not make the trust more
beneficial to the beneficiary AND
 3) all beneficiaries must then consent…
· Note: If there are unascertained beneficiaries (ie; those not
born, etc...) this will be very problematic
 BUT this is a high standard bc US approach protects settlor’s intent
Stuchell (ct declined to modify the trust when there
were no unforeseen changes and the only purpose of
the modification is to advantage one beneficiary
more)

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 o Administrative Provisions: accounting, recordkeeping will be more
readily changes by a court
 Note: This is much different from distributive provisions, which
as a general rule are not modifiable
o Modern Trend: UTC 412 Modification or termination bc of
unanticipated circumstances or inability to administer trust effectively
(equitable deviation)
 (a) Allows modification for administrative or dispositive terms if
circumstances were not anticipated by the settlor BUT the trust
must still be in accordance with the settlor’s probable intention
 (b) Administrative provisions may be modified if the existing
terms would be impracticable, wasteful, or impair the trust
intention (without regards to settlor’s intent)
o Wasteful provisions not enforced (against public policy).
Commentators say that even if a settlor anticipates decrease in value, the
ct will not enforce a provision that is completely irrational and not in the
best economic interest. Ct will not let the trust be wasteful
·Tax purposes: A number of states allow modification or reformation for tax
advantage purposes UTC 416
·Reformation: Typically a doctrine that allows a change of a mistake that did not do
what the settlor thought it did (no change in circumstances) UTC 415
o Note: Distinguish this from Modification/Equitable Deviation!
·Equitable Deviation / Modification: making an outright change to reflect a
change in circumstances to follow what the settlor would have done if he had
known what was going to happen (i.e. under UTC 412)
·Trust Protectors/Power to Change a Trust: Solution to these problems: give
someone the power to change the terms of the trust for both admin and
distributive provisions to avoid ct. (this is good drafting)
o Appoint a trust protector to take care of unanticipated circumstances –
endorsed by UTC
·Add notes on Power to Invade the Trust! (see other outline)
·Look to other outline to double-check this section, seems to be missing a lot of what
Cancelosi was touching on

Termination of a Trust [580]

·Base Rule (Claflin Doctrine): Trust cannot be terminated or modified prior to
the time designated by the settlor even if all the beneficiaries agree UNLESS the
material purpose has been fulfilled (need to determine material purpose – See
Brown where the ct declined to terminate the trust bc its purpose
was to provide a lifelong income stream).
o Unfulfilled Material Purpose: Some trusts cannot be terminated bc
termination would eliminate the material purpose
 Support trust
 Spendthrift trust
 Discretionary Trust

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  Trusts that do not disburse $ until a beneficiary reaches a certain
age (and age has not been met)
·Small Trusts: Termination of small trusts may be permitted if administration fees
are so high that the principal would be eliminated by paying the trustees UTC
414
·Irrevocable Presumption: Presumption that trusts are irrevocable unless the
trust provides for otherwise
o Minority: trust is revocable unless declared otherwise
 UTC §602 has adopted the minority approach – possible trend
·Modern Trend: UTC 412 / Stuchell allows termination if circumstances not
anticipated by settlor and termination will further the purpose of the trust

Trustee Removal [585]

·Rule: Trustees are only removed for serious beaches of trust or dishonesty, not for
simple disagreements with beneficiaries
o If trustee is specifically named by the settlor then it is very difficult to
remove a trustee
o UTC: allows removal for persistent failure in administering the trust (a
broader approach)
o Under either approach, consent of all the beneficiaries is not sufficient to
remove the trustee unless trust provides for otherwise?

Building Flexibility into Trusts: Powers of Appointment

Introduction [589]
·Generally: A clause that adds flexibility to a trust based on the trustee’s ability to
make decisions at some point down the line that the settlor does not want to or
cannot currently make.
·Language:
o Donor- The person who creates the power of appointment (you are
giving the power of appointment)
o Donee- The person who receives the power of appointment
o Appointee- The person, if in fact a power of appointment is exercise, in
whose favor the power of appointment is exercised
o Taker in Default of Appointment- (Not required); the person who
the trust defaults to if the power of appointment is not exercised.
·POA Defined: POA is a primary way for a settlor to handle unforeseen
circumstances and gives donee power to choose who next will take the beneficial
interest in the property (ie appointees). Discretionary and fiduciary duties are
NOT owed
o General POA: Permits the donee to exercise his power in favor of the
donee, estate, or creditors of the estate (ie donee can appoint to himself,
estate or creditors)
o Special POA: Donee cannot exercise in favor of donee, estate, or
creditors of the estate (anyone except himself);

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 o Testamentary POA: Power exercisable only at death of the donee by
will (donee can only designate where the money will go on the donee’s
death)
o Inter Vivos / Lifetime POA: Must be exercised during the donee’s
lifetime, if at all
o Note: Be weary of situations where someone claims to be giving a power
of appointment, but is actually making the decisions themselves and just
using the purported donee as a conduit for the alleged donor’s wishes.
·Property subject to a power of appointment
o Common Law: Historically it is viewed as belonging to the donor.
Until the donee actually does something, the donor or his estate still owns
the property
o Under federal tax law, if you have a general POA, you are treated as the
owner bc the only thing that stops ownership is writing that you are
appointing the property to yourself.
·Relation Back Doctrine- Tell what happens to property if a POA is never
exercised by the donee (look in other outline and add to notes)
·Creditors:
o General POA
 Majority Rule: Donee’s Creditors cannot reach the POA and its
property until it is exercised bc the donee does not have a property
interest until exercised Irwin (Ct required POA to be
exercised before creditors could reach the property)
· Exception: If the donee is also the donor then creditors can
reach the trust assets
 Minority / Modern trend: Donee’s creditors can reach the
presently exercisable POA property even if POA is not exercised
bc the donee can reach the property whenever he wants (substance
over form)
· MCL 556.123 (Follows this provision)- if a donee
has an unexercised general power of appointment and he
can presently exercise such a power any creditor of the
donee may be appropriate proceedings can reach any
property/interest the donee could appoint, TO THE
EXTENT that the donee’s original/own assets are
insufficient to pay off the creditor.
o Special POA
 Majority Rule: The donee’s creditors can never reach the
appointive property bc the donee does not have a property interest
·Elective Share Claims (Surviving Spouse):
o Majority: Surviving spouse of a general power donee cannot reach
appointive property at donee’s death bc they are not considered part of the
probate property (elective share statutes generally don’t pick up appointive
property)
o Minority: UProbateCode 2-205 provides the surviving spouse a share of
appointive property that the decedent held under a general POA.

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 Exercise of a Power of Appointment [607]

Exercise by residuary clause in donee’s will

·Issue: Does a residuary clause in the donee’s will exercise a POA if not expressly
referenced?
·Rules:
o Majority Rule: Residuary clause does not exercise a POA held by the
testator unless there is contrary intent evidenced (not like Beals)
 Look to the will, extrinsic evidence
o Minority Rule: the residuary clause does exercise the general POA, but
not a special POA, unless there is intent showing otherwise. (Like Beals
where the ct allowed a will’s residuary clause, without
reference to the testator’s POA, to exercise a general POA)
o Minority Rule #2 (very small): The residuary clause exercises a
general and special POA as long as the devisee is an object of the
class/power
o UPC 2-608 Exercise of POA
 In the absence of an express requirement as to how a power must
be exercised, a general residuary clause is considered as exercising
a general POA IF the creating instrument (ie takers in default
of appointment) does not contain an alternate gift if the
powers are not exercised.
·Choice of Law (Donee or Donor’s Domicile):
o Administration of the Trust:
 Donor’s drives the administration of the trust
o Power of Appointment:
 Jurisdictions are split as to whether the donee or donor’s domicile
controls the choice of law.
·Blanket Exercise Clauses: Cts are split. UPC requires specific reference to
the POA. “all property that I have POA over” this may not be enough if a
specific exercise is required
o UPC 2-704 establishes a presumption that donor intent is that the donee
reference to a specific exercise of the power is to avoid an accidental
exercise of the power
·Antilapse [613] – what happens when donee exercises POA but appointee
predeceased the donee.
o Majority: antilapse statutes do apply to POA’s bc the intent of the
statute is to meet donative intent and if general POA it is like property
 When a gift is given to someone who is dead and the issue is
substituted for the initial taker
←

Trust Duration and the Rule Against Perpetuities

·The major alternatives under RAP
o Traditional RAP (1920’s) = interest must vest if at all within lives of being
plus 21 years

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 o USRAP (1980’s) = Vest within 21 years or within 90 years
o Perpetual Trust = 20 states no longer follow the RAP in full

Trust Administration: The Fiduciary Obligation

Introduction [771]
·Source of Trustee’s Authority
o The Trust Instrument Itself (This is Paramount)- Trust
documents will control over statutory provisions, and set the parameters
for a trustee’s duty
 Drafting Note: If a settlor wants a trustee to be able to do
something the best way is to draft it into the trust itself, no need to
justify the power under a state statute because the trust instrument
controls the statute.
 Note: This means the Settlor can basically set whatever level
authority they want the trustee to have, but most do not.
o Legislation; Two types of statutes (these are subordinate to
the terms of the trust instrument itself):
 (1) Enumerates Specific Powers of Trustee (UTC §816)
· Purpose of 816: all the powers granted in a trust document
are useless if a 3d party refuses to accept your document.
The enumerated list helps 3d parties (ie a bank) to accept
the what the trustee can do (i.e. what transactions). A broad
statement of powers is ambiguous for some 3d parties to
interpret. 816 provides some clarity on a practical basis to
enumerate specific powers.
 (2) Broad Default Statutes (UTC §815)- That grant broad
power unless disclaimed within the trust instrument itself; These
give the trustee broad powers, only limited to the language of the
trust itself.
· UTC §815 – intended to grant trustees the broadest possible
powers.
o Trustee can exercise all powers over the trust
property which an unmarried competent owner has
over individually owned property and any other
powers appropriate to achieve the proper
investment, management, and distribution of the
trust property
o The broad powers granted by UTC 815 are still
subject to the fiduciary duties
 Michigan Law: Michigan Law has a statute that grants both
broad discretion and enumerates some trustee powers as well.
·Trustee Fiduciary Duties (Limits on Trustee Powers)
o Common Law Duty to Inquire: There was a duty to inquire but this
is superseded by a duty to act in good faith and excuses 3d parties from

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 actually inquiring into whether the trustee actually has authority. UTC
§1012 excuses this inquiry though.
o Fiduciary duties (See Below for Detailed Description of
these Duties)
 Duty of Loyalty- You must administer a trust solely in the
interest of beneficiaries (basically you are supposed to focus solely
on the interest of the beneficiary when administering the trust)
 Duty of Prudence
 Duty to inform, etc.
·Co-trustee Liability
o Traditional Unanimity Rule: If more than 1 trustee of a private non-
charitable trust, they must act as a group and with unanimity, unless trust
instrument provides otherwise.
 Individual Power: One of several trustees doesn’t have power
alone to transfer or deal with the property.
 Joint and Several Liability: Must act jointly thus a co-trustee
liable for wrongful acts of another to which he has consented or
which, by his negligence through inactivity or wrongful delegation,
has enabled co-trustee to commit.
o Modern Trend (UTC §703): A majority of trustees is only needed for a
trustee decision.
 Liability: Even if unanimity not required, trustees remain under
duty to prevent serious breach of trust by co-trustees if needed by
bringing suit.

Duty of Loyalty [779]

·Rule: The trustee owes a duty of absolute loyalty to beneficiaries. Everything the
trustee does must be in the best interest of the beneficiaries (no self dealing) UTC
802
·Breach: When there is either self-dealing (1) through the facts or (2) per se (see
below)
o Self-dealing: The trustee (or their agent or equivalent) is on both sides of
the transaction; this is a breach of the duty of loyalty.
o Loyalty defined: duty to act in good faith and reasonably
o Per Se Duty against self dealing: construed strictly, trustee cannot continue
to act as trustee when there is a conflict of interest. Hartman /
Gleeson
 No further inquiry rule: Good faith and fairness will not save
a self dealing transaction
· If there is a self dealing transaction then there is a breach –
nothing else matters. Gleeson (ct found breach of loyalty
when trustee lived on the land held in trust bc the trustee
was acting in his interest)
· Close family member exception UTC§802 is more
generous when involving close relatives so they may not be
necessarily void. A conflicted transaction by the trustee

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 with a close relative or lawyer is presumptively voidable
not absolutely forbidden
· Standard: once self dealing is proven, no need to inquire
into good faith/reasonableness Hartman (duty of self
dealing applied to the spouse of the trustee, breach of trust
occurred when wife got property through the trust’s public
auction)
 Defenses/Actions to Avoid a Self Dealing/Conflict
Transaction:
· (1) all the beneficiaries consent with full disclosure,
· (2) Courts give advanced approval of self-dealing/conflict,
· (3) settlor authorizes self dealing transaction, OR
· (4) corporate bank trustees can deposit trust assets into the
bank’s own accounts
· BIG NOTE: Still need good faith and transaction must be
objectively fair and reasonable
·Remedies:
o Unwinding of Transaction: Once self dealing is established,
beneficiaries can compel an unwinding of the transaction
o Constructive Trust: When there was a sale to a bona fide purchaser for
value, or impose a constructive trust
o Turning Over of Profits:

Duty of Prudence / Care [791]

Older (Constrained) Prudent Man Standard
·Rule (UTC §804): Trustee must exercise the skill and care that a man of ordinary
prudence would make of their own property – reasonable care, skill, and caution.
o Restrictive/Conservative Judicial Gloss: Courts, through a
hindsight judicial doctrine, restricted this doctrine away from considering
any risk investment; the courts would simply look at the level or risk in
evaluating prudence, not the potential for outcome.
·Investment Problem: With this restrictive gloss, investment or gain on the trust
to counteract inflation is very risky for the trustee, thus it didn’t happen.
·Note: Prudence standard applies even when the trustee has absolute discretion
Collins

Modern Trust Law – Prudent Investor Standard [796]

·Prudent Investor Standard: Must evaluate the prudence of the overall portfolio
and not at each individual investment and is very strongly related to the obligation
to diversify Collins Estate (it is not prudent to invest the entire trust
in one investment)
o Resulting Note: Riskiness of a risky investment may be justified if
investment of the trust as an aggregate is reasonably prudent.
o Note: Hindsight is not used when evaluating under the prudent investor
standard.
·Prudent Investment Standard Elements (3):

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o (1) Sensitivity to the relationship between risk and return; sometimes
it’s OK to take a greater risk if there is a possibility of a greater return, but
must meet the Prudent Investor Standard.
 Collins Estate: Prudence standard applies even when the trustee
is said to have “absolute discretion” in the trust instrument; it is not
prudent to invest the entire trust in one investment.
 Note: As Cancelosi says, “don’t put all your eggs in one basket”
o (2) Diversification –
 General Rule: Trustees have a duty to diversify unless
reasonable circumstances justify not diversifying (i.e. if
diversification is not prudent)
· James: Ct held that maintaining an investment portfolio
with 71% in one company was a violation of prudence and
duty to diversify, even if the settlor wanted one main stock
(UPIA §3)
 Examples of Reasonable circumstances when
diversification is not required (It is rare that
diversification is not in the best interest of the trust):
· (1) Prohibitive Transaction/Re-organization costs
· (2) If the trust is only one part of a beneficiary’s overall
portfolio (unusual circumstance)
· (3) A mutual fund or something that is diversified in itself
or at a sub-level (T-Row, etc...)
· (4) NOT Exhaustive, make an argument for this on an exam
 Authorization to Not Diversify: A settlor may authorize
retention of inception assets in a trust, in theory the settlor could
immunize the trustee from needing to sell and diversify.
· Older Cases- More comfortable with this and often
allowed this
· Modern Trend- Courts are more uncomfortable in
allowing this today because of modern portfolio
theory; Basically, the trustee has discretion and discretion
means prudence which means diversify
 Mandate: settlor says stock can never be sold. Cts will assume
settlors do not want a wasteful investment such that the entire trust
would be compromised – Like Pulitzer where the ct allowed
modification of the trust to allow for diversification. There is a
split of authorities on this point.
o (3) Delegation:
 Traditional (Non-Delegation) Rule: A trustee is under a duty
to beneficiaries not to delegate acts that the trustee could
reasonably be expected to perform; Particularly the trustee was not
allowed delegate out the selection of trust investments
 Modern Rule (Rest of trusts §171, UTC 807, UPIA §9) Allows
delegation including investment process bc expertise advice is

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 commonly needed, but even in delegation there is a duty to
supervise
· Shriners: Trustee may delegate but must still monitor the
delegatee and investments and use their judgment
(Otherwise this is a breach of the duty of prudence) and a
trustee may be liable if the loss is caused/can be attributed
to the lack of supervision.
· Still a duty to supervise even if duty is delegated
Uniform Prudent Investor Act §171 [820]
o Prudence/Reasonable Care still required in the
selection to the delegatee,
o Instruction to tell the delegatee what is being
delegated (ie terms to abide by)
o Monitoring Shriners (ct held monitoring an expert is
still required by the trustee)
· If the UPIA is followed then the trustee will not be liable
for mistakes or negligence of the delegee
 Two Categories of Amateur Delegation:
· (1) Amateur Trustee who consults with a third party to
manage the trust assets, but is still paying attention to the
accounts, this type of delegation is seen as prudent and the
trustee is generally exempt from liability.
· (2) Seeks advice from an expert but don’t bother to check it
and follows it blindly. This type of delegation usually
results in liability.
 Prudence Requirements of Delegation:
· (1) A trustee must do a reasonable investigation into
selecting the delegee
· (2) The trustee must make known the scope and terms
of the delegation
· (3) Trustee must monitor and review the choices
made by the delegee, under the modern rule this does not
mean you are required to ultimately make the decisions, but
you must have a process in place in order to review the
financial statements.
· Liability Note: IF, you meet these three requirements, the
trustee is deemed to have acted prudently and will
generally not be liable for the losses (UTC §807, MCLA
§700.1510)
·Trustee liability
o Generally: If a trustee delegates with due care
o If delegate appropriately and the agent then acts negligently: Trustee has
an obligation to bring suit against the agent bc trustee could be liable if the
negligent loss was not recovered. If trustee fails to pursue the agent, the
trustee breaches by not trying to rectify the agent’s errors.

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 o A successor trustee is not personally liable for the breaches of a prior
trustee unless the successor trustee unreasonably fails to discover or
rectify the breach

Subrules Relating to the Trust property [830]

·These are additional ways a trustee can be found liable for breach of trust if
disregards a duty and a loss results.

Impartiality and the Principal and Income (This is the most

litigated sub-rule)
·Rule: A trustee has a duty to be impartial amongst present and future beneficiaries.
One beneficiary can not be favored over another (ie remaindermen and life
beneficiaries must both be treated equally See
o Dennis- Ct found trustee liability for decreasing the value of the
principal while favoring the income (short-term) beneficiaries because
trustee acted unfairly and failed to keep up the real estate, renovate,
modernize, take other reasonable steps that might give reamindermen the
probability of producing reasonable income (Uniform Prudent Investor
Act (UPIA) §6); Trustee could have sold the property and reinvested the
proceeds so as not to create a partiality problem.
 Bottom-line: Court does not believe the trustee acted prudently
 Note: Inception assets (assets that were in the trust from the
beginning) do not get deference over the rights of beneficiaries;
Simply because property was in the trust from the beginning does
not mean it should be held when it will be to the detriment of the
beneficiaries.
o Common Problem: You have both current beneficiaries (those present)
and remainder beneficiaries (those not present); the current beneficiaries
who are in your office asking for things immediately may be deemed to
have been treated “better” than those remainder beneficiaries who are
quietly (and politely) sitting in the background waiting for an eventual
benefit.

Duty to collect trust property [830]

o Rule: Trustee has a duty to obtain possession of the trust w/o unnecessary
delay, to examine the property, and take reasonable steps to control and
protect the property (UTC §809)

Duty to Earmark Trust Property

o Generally: Trustee has the duty to designate which property is the
property that was intended to be put into the trust to avoid commingling
with non-trust property; This can result in a conflict between the trustee
and the executor
 Reasoning: A failure to earmark could make a trustee able to
claim property that is more valuable, or likely to gain value; this is
opportunistic and bad.

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 o Liability:
 Traditional Rule: The trustee is strictly liable if he does not
designate the property as the trust property (and not the trustee’s
property)
 Modern Rule: Trustee only liable for losses resulting from an
investment failed to earmark if the failure to earmark actually
caused the loss (not just general economic conditions)

Duty not to commingle Trust funds with the trustee’s own

o Rule: There is a duty not to commingle, per se violation because
commingled trusts funds are difficult to ascertained and the trustees
creditors can reach the commingled funds
 Modern Exception: A corporate trustee can hold funds in a
common trust fund that may pull from a number of different
sources, BUT there must be very careful record keeping, and
trustee cannot commingle their personal assets in the trust fund.
o Liability:
 Traditional rule: if you have commingling and a loss, there is strict
liability
 Modern rule: liable for the loss only if the commingling caused the
loss

Duty to Disclose and Account to the Beneficiaries [832]

o Rule: a beneficiary is entitled to disclosure information that allows the
beneficiary to enforce their rights under the trust
 Fletcher- Ct ordered trustees provide the
beneficiaries with a copy of the trust and other
related documents (see also UTC 813)
 Duty to account protects the trustee from liability to the extent the
information was disclosed and the beneficiary failed to object
 Exception - Confidentiality clauses in the trust are an
exception to general rule: express clauses in the trust for
confidentiality will be upheld but beneficiaries are still likely
entitled some information at least about their interest in the trust
o Constructive fraud: when the trustee makes statements in accounting
without reasonable efforts to ascertain their accuracy, there is a breach of
duty National Academy of Sciences (ct held trustee liable for
payments made to beneficiary that were only to occur if
she did not marry – she did marry but the trustee did not
investigate)
o Accounting:
 Annual Account- A trustee is generally obligated to provide an
anual account of the trust assets
 Beneficiary Waiver- An individual may waive the annual
accounting, though only to themself unless they are the only
beneficiary.

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EXAM:

-3 Hours, Laptops allowed, open book open note.

-Michigan Law will NOT be tested on
-Anything Else is fair game
-Don’t need to cite unless Cancelosi specifically asks for a cite. If you are citing a case,
explain why it is relevant
-DON’T Add facts that are not there
-Structure:
-Two long traditional essays
-Three or Four Short Answer Questions (1-2 Paragraphs about specific points of
law, there are CLEAR answers for these)
-10-15 Multiple Choice Questions WITH a required explanation of why you
picked the correct answer
-These are used to state whether a rule is being used properly

Charitable Trusts

Nature of Charitable Purposes [729]

·Rule: A charitable trust must be for a charitable purpose to take advantage of the
RAP avoidance and not have a ascertainable beneficiary requirement.
o Examples of charitable purposes: Restatement 2d of Trusts § 368 / UTC
405
 To relieve poverty
 Advance education
 Advance religion
 Promote health
 Gov or municipal purposes AND
· Trusts to promote political parties are considered non-
charitable [736] BUT it is ok to promote government
 Other purposes beneficial to the community
· “Sufficiently beneficial” Shenandoah
o Result if the charitable trust only benefits one person: You
can have a charitable purpose that benefits only a few people as long as
those people are drawn from a large pool (ie scholarship to 1 person from
the Traverse City area)
o Benevolent trusts that do “good things” are not a
charitable purpose
 Mere financial enrichment is not enough for a charitable purpose,
unless the beneficiaries are poor or in a needy conditions which
would allow the trust to fall under “poverty” Shenandoah (ct
held giving money to the 3d grade at a designated

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 school was not for a charitable purpose even though
education was mentioned)

Modification of Charitable Trusts: Cy Pres [737]

·Rule: Where a trust with a general charitable purpose expresses a particular
charitable purpose that becomes impossible, impractical or illegal to carry out, the
trust purpose can be modified under the cy pres doctrine (as close as
possible) to serve another charitable purpose to further the settlor’s intent
·Key issue here: distinction bt general and specific charitable purpose
o KEY: For cy pres to apply the ct must determine that the donor
had a general charitable purpose before invoking cy pres Neher
(ct found the settlor’s general charitable purpose was to
benefit the community, not build a hospital, so the ct
allowed the trust to be modified and build a admin building
instead of the impractical hospital)
o Presumption general charitable intent UTC 408b
·The UTC has continued an expansion to allow cy pres if the trust purpose becomes
unlawful, impracticable, impossible, or wasteful UTC 413b
·Administrative deviation is ok [742]: A ct will still allow administrative
deviations without regard to cy pres.