Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

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Monday, August 3, 2015

Alabama Supreme Court Takes Hardline On Life Insurance Contracts

GavelWhen Wanchetta Reese went to the local Alfa Life Insurance office to sign up her husband for life insurance, she followed all the procedure that was required including answering all health questions truthfully. However, the two agents that sold her the policy did not follow procedure and when informed that the husband suffered from serious health problems told Mrs. Reese not to worry and never included the information in the application. When Mr. Reese died a few months later, Alfa denied the claim stating Mrs. Reese lied in the application and signed the agreement knowing the proper health information had been intentionally omitted which voided the agreement.

In Alfa Life Insurance Corporation et al.v.Wanchetta Reese, the Alabama Supreme Court held that Mrs. Reese failed to properly disclose the health issue which voided the policy under the terms of the contract. A proper verbal disclosure by Reese of the health conditions to the agents was not enough to overcome the contract provisions and the fact that she relied on the representations by Alfa's agents instead of reading the agreement did not change the issue. While it is always a good idea to read a contract, this case shows that residents of Alabama will need to take extra precautions to protect themselves when signing a life insurance agreement and never rely on verbal promises. In the end, the words in the agreement will always prevail.

Special thanks to Turney Berry for bringing this article to my attention.

August 3, 2015 in Death Event Planning, New Cases | Permalink | Comments (0)

Feud Over Rinehart Family Fortune May May End With Gift to Charity

Gina-RinehartFollowing years of legal wrangling, Gina Rinehart and her children appear close to a settlement that has the potential to leave billions to charity. Her children have long urged their mother to leave the bulk of the family estate to philanthropic ventures and the efforts seem to finally have borne fruit after the children seized control of a $3 billion trust. The Rineharts, if a settlement is reached, would be following in the footsteps of tycoons such as Bill Gates and Warren Buffet who have pledged their fortunes to charity and actively court other super-wealthy to follow in their charitable footsteps.

See, Feud Over Mining Mogul's Fortune Could Yield Charity Bonanza, The Chronicle Of Philanthropy, July 30, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

August 3, 2015 in Current Affairs, Current Events, Wills | Permalink | Comments (0)

Article On Community Property In New Hampshire

Article PictureCalvin Massey (Professor of Law, University of New Hampshire School of Law) recently published an article entitled, Why New Hampshire Should Permit Married Couples to Choose Community Property, 13 U.N.H. L. Rev. 35-47 (2015). Provided below is an excerpt from the article:

Two states, Alaska and Tennessee, offer married couples the choice of holding their property as separate or community property. Another nine states use community property as the default arrangement. Yet in each of those nine states a couple can opt out of community property rules by agreement. Only in the remaining thirty-nine states are married couples forced to accept separate property. There is no good reason for this condition to exist. This essay sets forth the advantages of offering married couples the choice of community or separate property and deals with some expected objections to this proposal. Section I details the benefits of choice. Section II examines likely objections and finds those objections insufficient to reject the proposal.

August 3, 2015 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Sunday, August 2, 2015

The Ongoing Dispute Over Tom Benson’s Control Over Texas Trust

Tom bensonI have previously discussed the ongoing dispute over Tom Benson’s estate.  New Orleans Saints owner Tom Benson is appealing a decision by a San Antonio Judge to temporarily relieve him of his position as trustee over a Texas trust fund.  Benson’s daughter is seeking to have her father permanently removed from the position of trustee alleging that he breached his duties.  Tom Benson’s lawyers are arguing that the trustee was simply exercising his discretion.  The dispute over the Texas trust is part of an even larger estate fight between the billionaire and his heirs.  The case will now be heard by the Texas Fourth District Court of Appeals.  There are other cases that are pending in both state and federal courts in Louisiana. 

See Katherine Sayre, Saints, Pelicans owner Tom Benson’s control over Texas assets challenged, defended, The Times-Picayune, July 31, 2015.

August 2, 2015 in Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Fight Over Whitney Houston’s Estate Is Going To Get Ugly

Bobbi kristinaI have previously discussed the ongoing dispute over Whitney Houston’s estate that is becoming increasingly bitter and personal.  This article discusses the legal fight that is going to unfold as the Brown and Houston families’ feud over Whitney Houston’s $20 million estate.  Estate attorneys on both sides of this conflict are likely going to get a huge windfall as competing interests make a claim for part of the estate.  Whitney Houston’s Will is probably going to govern how the estate is distributed.  The one thing the two opposing sides of this dispute seem to agree on is that Nick Gordon, the man claiming to be Bobbi Kristina Brown’s husband, should get nothing from the estate.  This article provides the details of the battle that will likely unfold in the future. 

See Maria Puente, Who will inherit Whitney Houston’s millions?, USA Today, July 29, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

August 2, 2015 in Current Affairs, Estate Planning - Generally, Wills | Permalink | Comments (0)

Article On Statutory Elective Shares

Article PictureMartin D. Begleiter (Drake University - Law School) recently published an article entitled, Grim Fairy Tales: Studies of Wicked Stepmothers, Poisoned Apples and the Elective Share, 78 Alb. L. Rev. 521-551 (2014/2015). Provided below is an excerpt from the article:

Ever since the statutory elective share replaced dower and curtesy, courts have been trying to expand the property subject to the spouse’s elective share. The courts have used a number of justifications for their attempts to accomplish this. In a previous article, the author offered an interpretation of the proper use of public policy by courts when a statute on the subject has been enacted by the Legislature. This article applies that test to attempts by courts to expand the elective share to will substitutes, and finds such attempts to be an impermissible use of public policy by courts.

August 2, 2015 in Articles, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0)

New Book On Planning For Art Collectors

ArticleThe first edition of Handbook of Practical Planning for Art Collectors and Their Advisors by Ramsay H. Slugg has recently been published and is available through ABA Book Publishing. Provided below is a description of the book:

Art is an asset of passion, as author Ramsay H. Slugg begins this invaluable guide, yet has unique and not unimportant financial characteristics. These elements make art possibly the most difficult asset to incorporate into an overall estate and financial plan. Handbook of Practical Planning for Art Collectors and Their Advisors addresses two essential elements of art ownership: planning for the ultimate disposition of the art, including how to represent the wealth represented by the art into any estate and financial planning, and also the practical considerations for collectors as they actively collect and plan for the art’s eventual disposition.

After a brief discussion of the art market generally, the author introduces and explains a client-focused process that can be used when advising art collectors. This includes explaining both the income, estate and gift tax consequences of various options, as well as the important and often emotional non-tax considerations of collecting and disposing of art. The book also discusses the role and importance of other advisors who are involved in these decisions, including art advisors, risk management professionals and appraisers. To better illustrate the material, the book features enlightening case studies. Particular attention is given to the charitable solutions available as these are often especially appealing to many collectors and their advisors.

Handbook of Practical Planning for Art Collectors and Their Advisors is accessible to all levels of knowledge, and is designed not only to trusts and estates professionals who have clients who collect art, but also for the art collectors themselves as well as the many other professionals involved, including art advisors, risk management advisors, valuation advisors, and financial planners.

August 2, 2015 in Books, Estate Planning - Generally | Permalink | Comments (0)

Saturday, August 1, 2015

Judge Retroactively Recognizes 2001 Common Law Same-Sex Marriage

Same-sex-unionsA Pennsylvania Judge has recently recognized a common law same-sex marriage even though one of the spouses died before the State legalized same-sex marriage.  Thanks to Judge C. Theodore Fritsch Jr.’s decision Sabrina Maurer will be able to collect death benefits and have access to her spouse’s safety deposit box.   Kim Underwood died a year before a Federal Judge ordered Pennsylvania to recognize same-sex marriage and any marriage performed before the ruling.  This new decision extends that rule to validate common law marriages that existed before same-sex marriage was legalized.  This decision will likely have a major impact on a whole host of issues dealing with estate planning and distribution of probate and non-probate assets. 

See Maryclaire Dale, Judge deems gay couple as spouses after 1 partner’s death, New Jersey Herald, July 31, 2015. 

August 1, 2015 in Current Affairs, Estate Planning - Generally, Intestate Succession, Wills | Permalink | Comments (0)

Lawsuit Seeks To Bar Man Convicted Of Murdering Mother From Receiving Life Insurance

Slayer houseIn Chesapeake Virginia, a man has filed a lawsuit to prevent his half-brother to be able to collect on their deceased mother’s life insurance.  Ryan Martinez and his girlfriend Airika Liljegren were both convicted in 2013 of killing Martinez’s mother and her boyfriend.  Christopher Ellett is now attempting to prevent his half-brother from being able to claim $75,220 in life-insurance proceeds under his States slayer statute.  The lawsuit is also seeking both compensatory as well as punitive damages.  Martinez tried to make a claim for the insurance proceeds two months after he was arrested.  Mr. Ellett alleges that Martinez had a financial motive for killing his mother.  This case brings attention to the issue of undue influence; it is common for States to have Slayer Statutes that seek to prevent evil heirs from being able to profit from their crimes. 

See Margaret Matray, Suit aims to make sure Chesapeake man involved in mother’s death won’t benefit from insurance, The Virginian-Pilot, July 31, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

August 1, 2015 in Current Affairs, Estate Planning - Generally, Non-Probate Assets, Wills | Permalink | Comments (0)

Article On New Statutes Concerning Gifts To Caretakers

Passing Down PictureRobert Barton (Holland & Knight), Lisa M. Lukaszewski (Neal, Gerber & Eisenberg), & Stacie W. Lau (Holland & Knight) recently published an article entitled, Gifts to Caretakers: Acts of Gratitude or Disguised Malfeasance? New Statutes May Decide for Us, 29 Probate & Property 3 (May/June 2015). Provided below is an excerpt from the article:

Although financial elder abuse is most commonly perpetrated by family members, elder abuse by caregivers remains a major problem. In response, legislatures in several states, and most recently, Illinois, have enacted statutes appropriately making it more difficult for unscrupulous caregivers to extract gifts. These statutes create a presumption of fraud or undue influence for such gifts and, of particular note for estate planners, the possibility of liability and professional discipline for attorneys effectuating gifts that run afoul of these statutes.

This article examines the background and purpose of these statutory schemes, explores the applicability of the presumption of fraud or undue influence, discusses how to overcome the presumption, and concludes by providing tips for estate planners and attorneys representing fiduciaries and beneficiaries in jurisdictions with such statutes or which are considering such statutes.

August 1, 2015 in Articles, Estate Planning - Generally, Wills | Permalink | Comments (0)