Thursday, November 1, 2012
An attorney might want to consider checking any wills or trusts that they draft for scrivener's errors. While most errors that occur are harmless leaving little for courts to interpret, some errors can make all the difference in the world about what the testator intended. For example, the attorney could write the beneficiary's name wrong or spell the beneficiary's name incorrectly. If this occurs then an ambiguity exists. If an ambiguity exists, it could give a court license to look at materials that are outside the terms of the trust or will. At the very least, this could lead to difficulty understanding the testator's intent. At the worst, it could lead to large and expensive court battle.
For example, in Miami Children's Hospital Foundation, Inc. v. Estate of Hillman, the court implied that there is a need for precision when listing beneficiaries. The trust instrument in dispute listed the following:
Upon my death, the trustee shall distribute some of the assets of this Trust as follows: . . . All the remaining property, annuities, stocks, bonds and assets in the trust shall be split among the following charities:. . . TWENTY-FIVE PERCENT (25%) to MIAMI CHILDREN’S HOSPITAL FOUNDATION, CRANIAL/FACIAL FOUNDATION, located at 3000 S.W. 62nd Avenue, Miami, FL 33155, ATT: Dr. Anthony Wolf [sic].
It appears that the hospital is the intended beneficiary of the residual of the trust. However, a trial court in Florida disagreed and determined that the settlor intended to bequeath the residual to the foundation that was under the management of the listed doctor in the paragraph, Dr. Anthony Wolfe. The appellate court disagreed and stated that there was no ambiguity within the instrument and that the particular hospital listed was the intended beneficiary. The true problem emerged when the trial court attempted to use outside information after it thought there was an ambiguity. Thus, the lesson here is to make sure that the beneficiary's name is right so that the potential for an ambiguity is avoided.
See Luke Lantta, Making Sure You Get The Beneficiaries' Names Rights, BryanCaveFiduciaryLitigation, Oct. 17, 2012.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.