Wills, Trusts & Estates Prof Blog

Lapsed Residuary Gifts Tennessee Style

Julie M. Cochran has recently published her casenote entitled Property Law--Wills--Effect of Lapsed Residuary Gifts in the State of Tennessee (In re Estate of McFarland, 167 S.W.3d 299, 2005), 73 Tenn. L. Rev. 711 (2006).

Here is the conclusion of her article:

In McFarland, the Tennessee Supreme Court upheld an 1852 decision that left lapsed residuary gifts to intestate heirs rather than remaining residuary beneficiaries. In reaching this decision, the court applied traditional will construction principles and adhered to the doctrine of stare decisis. Unfortunately, the McFarland decision was more technically sound than it was logical. Therefore, Tennessee remains stuck with an outdated, impractical rule that the Tennessee Supreme Court had difficulty defending. In defaulting to precedent, the court seems to have washed its hands clean of the issue. It is now up to the legislature to permanently place the Ford rule on its dusty library shelf and acquaint Tennessee probate law with modern times.

Top SSRN Downloads

Here are the top downloads from March 13, 2007 to May 12, 2007 from the SSRN Journal of Wills, Trusts, & Estates Law for all papers announced in the last 60 days:

Rank	Downloads	Paper Title
1	75	Keeping Peace in the Family While You are Resting in Peace: Making Sense of and Preventing Will Contests Judith G. McMullen, Marquette University - Law School, Date posted to database: March 2, 2007 Last Revised: March 2, 2007
2	55	Resolving the Intergenerational Conflicts of Real Property Law: Preserving Free Markets and Personal Autonomy for Future Generations Gerald Korngold, Case Western Reserve University School of Law, Date posted to database: March 1, 2007 Last Revised: March 1, 2007
3	43	Janis: Two Perspectives of Basis Wendy C. Gerzog, University of Baltimore - School of Law, Date posted to database: April 2, 2007 Last Revised: April 2, 2007
4	38	Gerson: Plain Meaning and the GSTT Wendy C. Gerzog, University of Baltimore - School of Law, Date posted to database: February 13, 2007 Last Revised: February 13, 2007
5	14	Legal Regulation of Religious Giving Pauline Ridge, Australian National University - ANU College of Law, Date posted to database: April 16, 2007 Last Revised: May 4, 2007

Helen Walton's Will -- Update

Earlier on this blog, I reported on the death of Helen Walton who died at age 87 on April 19, 2007.  At the time of her death, she was ranked as the 29th most wealthiest person in the world with a net worth of over $16 billion, most of which she received when her husband, Sam Walton (the founder of Wal-Mart) died.

Preliminary reports that her will left the vast majority of her estate to the Walton Family Foundation continue to be circulated as recently discussed in Carol J. Loomis, The fate of the $16B Walton Estate, Fortune, May 1, 2007.

Special thanks to Prof. Joel C. Dobris of the University of California-Davis for bringing this article to my attention.

New Edition of Dobris, Sterk, and Leslie's Estates and Trusts

The third edition of Estates and Trusts by Joel C. Dobris (Professor of Law, UC Davis School of Law)
Stewart E. Sterk (H. Bert and Ruth Mack Professor of Real Estate Law, Benjamin N. Cardozo School of Law), and Melanie B. Leslie (Professor of Law and Codirector of Program for Family Law, Policy, and Bioethics, Benjamin N. Cardozo School of Law) is set for release on July 3, 2007.

Here is the publisher's description of this book:

Estates and Trusts, Third Edition will be published in July and available for Fall 2007 classes. Dobris, Sterk & Leslie's comprehensive Teacher's Manual almost enables the course to teach itself. The Manual goes beyond the usual summaries of principal and note cases, and provides detailed question-by-question lesson plans designed to ensure that both the experienced teacher and the novice can stimulate extensive class discussion. Better still, the Manual is available electronically so that teachers can easily integrate their own questions and insights into those offered by the editors.

The Third Edition of the casebook provides increased focus on cutting edge issues including asset protection trusts, dynasty trusts, and tortious interference with inheritance. The new edition simplifies treatment of estate tax issues, and includes discussion of the estates of various celebrities - including Anna Nicole Smith (complete with photograph), James Brown, Doris Duke, and Andy Warhol - in order to bring complex legal issues to life.

Real Property, Probate and Trust Journal Seeks Articles

The following is from a message sent by Jim Burkhard:

As the summer "writing season" starts, I would encourage you to consider submitting property, probate, estate planning and related articles to the ABA's Real Property, Probate and Trust Journal.

The Journal has approximately 30,000 subscribers. It is refereed, and all article are edited by professionals.

We are currently considering articles for the Fall Issue. Our published deadline for submissions for the Fall Issue is early July, 2007. However, in certain circumstances, that deadline may be extended.

Articles for the Winter Issue should be submitted by September 10, 2007.

Proposals for articles dealing with property law should be sent to Roger D. Schwenke rschwenke@carltonfields.com, and articles dealing with estate planning, probate and trust law topics should be sent to W. Birch Douglass, III at bdouglass@mcguirewoods.com.

General information about the article submission process can be found at the ABA's Real Property, Probate and Trust Law Section's website, http://www.abanet.org/rppt/.

I would be delighted to answer any question regarding the Journal. Please contact me at JIMB@LAW.SC.EDU.

The Testifying Dead?

The following is from Jerry Buchmeyer, et cetera, 70 Tex. B.J. 193 (2007):

D. Clinton Brasher of Beaumont received these marvelous admissions “from defense counsel regarding an employee of theirs (up until the time of his death)” who was listed as a fact witness:

1. Admit that ______ is dead.

RESPONSE: Admit insofar as this question is regarding information regarding the death of ______’s body, as his spirit surely lives on.

2. Admit that ___________ will be unavailable to testify at trial.

RESPONSE: Admit subject to ___’s coming back to life and subsequently testifying in this matter, or, for that matter, testifying through a duly appointed oracle. … Inasmuch as this request for admission is meant to cover such things other than whether or not ____ will be available to testify live at trial, no pun intended, Plaintiff objects to the request as vague.

NAPFA Enhances Website

The following is from the PA Elder, Estate & Fiduciary Law Blog written by Neil E. Hendershot:

On Friday, May 4, 2007, the National Association of Personal Financial Advisors (NAPFA) unveiled its new website "Focus on Fiduciary," in conjunction with its Second Annual "Focus on Fiduciary" campaign, "which aims to educate Americans about the need for financial professionals to hold themselves to a fiduciary standard."

Special thanks to Neil for pointing out this development.  You may read his complete post here.

Oregon Governor Signs Domestic Partnership Law

Yesterday (May 9, 2007), Oregon joined the growing number of states that recognize domestic partnerships when Governor Ted Kulongoski signed legislation giving same-sex couples most of the benefits of a traditional marriage.

See AP, Oregon governor signs gay rights bills, MSNBC, May 9, 2007.

Soprano Want-to-be Attorney Resigns

A young attorney (30 years old) discovered that acting like Tony Soprano is not acceptable in the legal arena.  The lawyer was accused of telling Tom, one of his clients, that he could resolve the client's problem by having the person "hurt or killed for a fee."  The intended victim was also an attorney.

The attorney resigned on March 12, 2007 in lieu of discipline.  He was also sentenced to one year in jail (probated for one year) and assessed a fine of $1,000.

I hope he did not practice in the probate area -- but one never knows ---

See Bob Belcher, Local attorney pleads guilty, forfeits license, Corsicana Daily Sun (Texas), Dec. 22, 2006 and Disciplinary Actions, 70 Tex. B.J. 458, 460 (2007).

Funeral Fraud

Tracy E. Smith (J.D., University of Kansas School of Law) has recently published her article entitled Scamming the Elderly: A Look into Funeral Fraud, Prob. & Prop., March/April 2007, at 60.

Among other things, the author discusses three common funeral scams:

• The Sealed Casket Scam -- False claims that a sealed casket protects the body better than a standard casket.
• The Mandatory Embalming Scam -- Embalming is not necessary in many situations but funeral homes often do not reveal this fact.
• The Pay-in-Advance Scam -- A wide variety of things may go wrong if a person prepays for a funeral because of weak oversight and regulations.

California Tax Attorney Blog

Mitchell A. Port, an experienced estate planner from Los Angeles who earned an LL.M in tax law from the University of San Diego School of Law and a J.D. from Southwestern University School of Law, is the author of the California Tax Attorney Blog.

Here are some of the topics of his recent posts:

• Which Property In California Goes Through Probate?
• Tax Audits And Examinations Are On The Rise
• What To Do When Someone In California Dies
• Estate Planning Questionnaire

Disentitlement Doctrine and the Executor/Trustee

Matthew P. Matiasevich (partner, Evans Latham & Campisi, San Francisco) has recently published his article entitled Hog-tying the Contumacious Beneficiary -- The Disentitlement Doctrine in Estate and Trust Litigation, Prob. & Prop., March/April 2007, at 46.

The disentitlement doctrine provides that "a party cannot ask the court for relief on one hand while simultaneously disobeying a court order on the other."

Mr. Matiasevich explains how his theory may be effectively used to stop a beneficiary who is misbehaving (such as by taking estate or trust property without having a right to it) and then sues the executor or trustee for breach of duty.

The Morning After -- Continued

Continuing their discussion featured previously on this blog, John J. Reddy Jr. and Marc S. Bekerman have published their recent article entitled Essential Steps After "Finishing" the Estate Plan: Part 1--Post-mortem Planning, Prob. & Prop., May/June 2007, at 46.

Issues covered include:

• Elections under IRC §§ 754 & 732
• Appraisals
• Review and revision of business documents.

The authors conclude by reminding estate planners that

[t]he estate planning process does not end with the execution of documents and creation of entities.  A good attorney will ensure that all necessary steps are taken to ensure the estate plan is effective by frequent follow-up with the client.

The German-American Estate Interface

Max Riederer von Paar (partner, Rubin, Winston, Diercks, Harris & Cooke, LLP, Washington, D.C.) has recently published his article entitled The German-American Estate Plan: You Say Tomato and Ich Sag Tomate, Prob. & Prop., May/June 2007, at 59.

Here is the conclusion of his article:

If a U.S. domiciliary has a German beneficiary to whom he or she would like to make a bequest, it might be beneficial to create a bequest payable out of the U.S. estate (and not the trust) for the benefit of the German beneficiary.  Such a bequest could be designed in a way that takes advantage of the different tax exemptions under German and U.S. estate and gift tax law.

An interesting planning option available to U.S. domiciliaries with German assets is the use of a U.S. partnership to hold such German assets.  Once the assets are transferred, the estate planner could transfer the partnership interest into the client's U.S. trust.

In any circumstances, it is a good idea to spend some time with a German estate planning attorney to discuss the potential planning opportunities for German clients who are U.S. domiciliaries.

Estate planning for German citizens who are U.S. domiciliaries can present a challenging task.  An estate planner who is aware of the pitfalls of cross-border estate planning in general, and German-American estate planning in particular, will find the planning interesting and rewarding and will have client who can live with both: a tomato and eine tomate.

Tax Apportionment

The testator’s will directed that all taxes be paid from “my estate.”  The estate paid federal and state estate taxes on a taxable estate in which the value of non-probate property exceed the value of probate property.  Under local law, taxes are equitably apportioned unless the testator directs payment.

In Estate of Malik v. Lashkariya, 861 N.E.2d 272 (Ill App. Ct. 2006), the court held that the word “estate” meant probate estate and therefore equitable apportionment was precluded.

Estate Distribution

New Jersey law requires an in kind distribution of assets in the probate estate if there is no objection and it is “practicable” to do so.

In Estate of Hope, 916 A.2d 469 (N.J. Super. App. Div. 2007), the court held as a matter of first impression that the statute did not require the in kind distribution of real property where two of the four residuary beneficiaries objected to in kind distribution, the beneficiaries requesting the in kind distribution did not submit a plan for subdividing the property, and the consultant the executor retained reported that dividing the property would reduce its development potential.

Creditors and Nonprobate Assets

Elaine H. Gagliardi (Professor of Law, The University of Montana School of Law) has recently published her article entitled Remembering the Creditor at Death: Aligning Probate and Nonprobate Transfers, 41 Real Prop. Prob. & Tr. J. 819 (2007).

Here is the Editors’ Synopsis of her article:

As more people choose to avoid the cost and time involved with probate administration by using nonprobate transfers, creditors of decedents face increased procedural challenges and practical difficulties in collecting debts. In this Article, the author proposes legislative reforms that would unify the creditor claims procedure for probate and nonprobate transfers when beneficiaries are unwilling to pay claims. The author argues that a more unified claims procedure would still allow efficient passage of property at death and would encourage fair treatment of all beneficiaries and creditors.

Apportionment

The Maryland high court issued its opinion in Pfeufer v. Cyphers on March 19, 2007.  The court decide that

A testator may direct inheritance taxes to be paid from the entire residuary estate prior to apportionment among residuary legatees even when a statute exempts some of the residuary legatees from the payment of inheritance taxes.

Special thanks to Matthew B. Bogin (Rockville, Maryland) for bringing this case to my attention.

E-Filing of Wills in Texas

Mary Wahne-Baker (Symposium Editor, Texas Tech Law Review) has recently published her comment entitled Where There's a Will, There's a Way: The Practicalities and Pitfalls of Instituting Electronic Filing for Probate Procedures in Texas, 39 Tex. Tech L. Rev. 423 (2007).

Here is the conclusion of her article:

The rate at which e-filing is becoming a part of the legal culture is remarkable. Texas, with its proud history of independent thought on legal matters, has taken the crucial initial steps to begin the process of creating an e-filing system for its state courts.  It has pioneered pilot programs and created committees. It has seen the juncture of opportunity and practicality, and it has started off in the right direction. But by ignoring the unique opportunities presented in probate e-filing, Texas has disappointingly failed to grasp the full potential of the system it has created.

Texas should use its characteristic foresight and mandate e-filing for probate matters in its state courts. This Comment demonstrates that probate e-filing is convenient and efficient for both courts and attorneys. E-filing in probate courts has proven effective in other states. The focus in Texas, therefore, should not merely be upon proposals or committees. Texas must pass legislation giving county clerks the latitude they need to establish computer terminals in courthouses for public access to court documents. Furthermore, Texas should follow its own statutory precedent for public access to electronically recorded files and charge a minimal copy fee for paper printouts of electronic documents.  Texas should look to the solutions discovered in Colorado courts and amend section 81 of the Texas Probate Code to allow attorneys to submit an initial scanned PDF file of a will. Following that submission, Texas courts should require that attorneys submit the original will prior to issuance of letters in a probate case. When Texas takes these bold but necessary steps, it will truly be following the path toward the horizon and will reclaim its rightful title as a probate pioneer.