Wills, Trusts & Estates Prof Blog

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

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Friday, June 20, 2014

Hospital Patients in England Must Now be Consulted on DNR Orders

DNRA court in England ruled that patients should be consulted before a decision is made to put a  Do Not Resuscitate notice in their medical file at a hospital. The court ruled that the human rights of a 62-year-old woman were violated when an order was placed in her file called a Do Not Attempt Cardio-Pulmonary Resuscitation (DNACPR) without her being consulted first. She did not die as a result of the notice, as it was later removed when her daughter found out about it. The ruling did not order that National Guidelines be issued, as was also requested in the case.

See John Bingham, Doctors Should Consult Dying Patients in ‘Do Not Resucitate’ Decisions, Court Rules, The Telegraph, June 17, 2014.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

June 20, 2014 in Disability Planning - Health Care, New Cases | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 17, 2014

Court Upholds Will Executed On Deathbed and Morphine

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The Maine Supreme Court recently approved a will prepared by a social worker for decedent who was on her deathbed.  Ruth O’Brien-Hamel was dying from lung cancer, and in the weeks before her death had been in and out of the hospital.  The day before she died, Ruth was in hospice care and relayed to a social worker that she wanted to make a will in favor of her boyfriend.  The social worker subsequently prepared the will that Ruth signed.  Later that day, Ruth and her boyfriend were married.  Ruth died the next day. 

Ruth’s family contested the validity of will, and argued they should take intestate.  The medical evidence presented by the family included testimony from Dr. Kevin Kendall, who opined the “synergistic effects of Ruth’s sodium level, blood pressure, oxygen level, medications, pain, and imminence of death resulted in Ruth being incapable of normal judgment and reasoning during her stay at the hospice.” 

However, Ruth’s boyfriend, who argued in favor of the capacity brought forth evidence asserting that while “Ruth experienced some delirium while at the hospice . . . that delirium would not necessarily render a person incapable of knowing what his or her assets are.”  The doctor testified that morphine can affect cognitive abilities, but “it does not do so for most patients and the dosages administered to Ruth were low.” 

Arguably, the Court’s decision stemmed from its desire to do justice.  Ruth was estranged from her children for several years prior to her death, and Ruth and her boyfriend had been living together for several years before she died.

See Jeffrey Skatoff, Deathbed Will + Deathbed Marriage + Morphine + Delirium = Valid Will, Clark Skatoff, June 15, 2014.

Special thanks to Jeffrey Skatoff (Clark Skatoff) for bringing this article to my attention.

June 17, 2014 in Elder Law, Estate Administration, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0) | TrackBack (0)

Monday, June 16, 2014

Some Inherited IRAs Are Still Protected in Bankruptcy

IRAAs I have previously discussed, In Clark v. Rameker, The Supreme Court of the United States found that under the bankruptcy code inherited IRAs are not “retirement funds.”  However, this decision does not affect all inherited IRAs. The majority rule under state law includes a state bankruptcy exemption that includes inherited IRAs. Thus, if the bankruptcy proceeding is in a state that uses state rather than federal exemptions, then the inherited IRA is likely to still be protected.

See Jordan Hammer, Florida Inherited IRA Still Protected in Bankruptcy, Even in Light of U.S. Supreme Court Case Clark v. Rameker, Clark Skatoff, June 14, 2014.

Special thanks to Jeffrey Skatoff (Attorney for Clark Skatoff, PA) for bringing this article to my attention.

June 16, 2014 in Estate Planning - Generally, New Cases, Non-Probate Assets | Permalink | Comments (0) | TrackBack (0)

Widow’s Apartment Raided by Police Looking for Her Dead Husband

PoliceJames Jordan Sr. died eight years ago. Now his widow is enduring raids to her home by the New York City Police Department. The police are searching for her deceased husband. She has attempted to stop the raids by posting his death certificate to her apartment door, but the raids have not stopped.  The widow has filed a lawsuit in a Brooklyn federal court.

See Martha Neil, Death Certificate Posted on Door Does Not Deter Police from Raids Seeking Dead Man, Suit Says, ABA Journal, May 6, 2014.

June 16, 2014 in Estate Planning - Generally, New Cases | Permalink | Comments (1) | TrackBack (0)

Saturday, June 14, 2014

Supreme Court Decision Reminiscent of Anna Nicole Smith Bankruptcy

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In Executive Benefits Insurance Agency v. Arkison, the Supreme Court decided in favor of federal bankruptcy judges.  In this case, the Court left intact a lower-court ruling that enforced a fraudulent-conveyance judgment against EBIA.  The Supreme Court reaffirmed its 2011 decision in Stern v. Marshall, removing from bankruptcy judges the power to decide “non-core” matters not directly related to dividing up a debtor’s assets among creditors.

Stern v. Marshall involved a dispute among the heirs of J. Howard Marshall II and the lawyers for Anna Nicole Smith.  The court overruled a portion of the federal bankruptcy laws assigning certain matters to bankruptcy judges and reaffirming the power of Article III judges, who are protected with life tenure and salary protections.  Although the Stern case established the doctrine of “core” and “non-core” matters, the Supreme Court has never fully decided the jurisdiction of bankruptcy cases.  

The court’s decision in Arkison was based on very narrow grounds that the insurance agency allegedly funded with a debtor’s fraudulent conveyances had gotten the benefit of an Article III judge’s review of the case even if it disagreed with authority of the bankruptcy judge in that case.  Yet, the decision has little impact on most personal bankruptcies, since those rarely involve the claims against third parties that bankruptcy trustees make in larger cases when trying to recover money they think has been “bled from the estate.”

See Daniel Fisher, Supreme Court Decides Case With Echoes of Anna Nicole Smith Bankruptcy, Forbes, June 9, 2014. 

June 14, 2014 in Estate Planning - Generally, New Cases | Permalink | Comments (0) | TrackBack (0)

Successor Personal Representatives Can Sue for Malpractice in Florida

GavelAfter the death of Deborah Irby, her personal representative, Dana Ford, hired an attorney, Dale Davidson, for assistance with estate administration. After Ford resigned as personal representative, the successor representative, Alan Bookman, was appointed and then sued Ford and Davidson over alleged improper administration of the estate. Davidson claimed that as successor personal representative, Bookman lacked standing and could not sue him for malpractice. A Florida District Court agreed and granted Davidson’s summary judgment motion.

In Bookman v. Davidson, the First District Court of Appeals of Florida ruled that Bookman did have standing to sue Davidson, and that under the Florida Probate Code a successor personal representative can sue an attorney for malpractice for advice given to a predecessor representative.

See Anya Van Veen, Successor Personal Representative Has Standing to Sue Attorney for Prior Personal Representative for Malpractice, Clark Skatoff, June 12, 2014.

Special thanks to Jeffrey Skatoff (Attorney for Clark Skatoff, PA) for bringing this article to my attention.

June 14, 2014 in Estate Administration, New Cases | Permalink | Comments (0) | TrackBack (0)

Thursday, June 12, 2014

Supreme Court Holds Inherited IRAs Are Not Protected in Bankruptcy

Supreme courtToday, the Supreme Court issued a holding that says inherited IRAs are not protected in Bankruptcy.  In Clark v. Rameker, petitioners filed for Chapter 7 bankruptcy, but sought to exclude approximately $300,000 in an inherited IRA from the bankruptcy estate using the “retirement funds” exemption.  (See 11 U.S.C. § 522(b)(3)(C)).  The Bankruptcy Court ruled that an inherited IRA does not share the same characteristics as a traditional IRA and disallowed the exemption.  While the District court reversed, the Seventh Circuit reversed the District Court.  The Supreme Court granted certiorari. 

In holding that IRAs are not “retirement funds,” the Court explained that inherited IRAs do not operate like ordinary IRAs.  Unlike a traditional or Roth IRA, an individual may withdraw funds from an inherited IRA at any time, without paying a tax penalty.  The owner of an inherited IRA must withdraw its funds; either by withdrawing the account balance within five years of the original owner’s death or by taking minimum distributions on an annual basis.  Unlike a traditional or Roth IRA, the owner of an inherited IRA may never make contributions to the account. 

Whether the given funds fall within “retirement funds,” is an objective inquiry.  The Court looks to the legal characteristics of the account in which the funds are held, asking whether the account is one set aside for the day when an individual stops working.  Various distinctions of inherited IRAs led the Court to conclude that funds held in such accounts are not objectively set aside for the purpose of retirement.

This decision most notably has two important ramifications for spouses.  A spouse who inherits has the ability to roll the assets into her own IRA and postpone distributions from a traditional IRA until she turns 70 ½.  Yet, like other IRA owners, she may have to pay a 10% early-withdrawal penalty if she takes money before age 59 ½ from her own IRA.  If the spouse chooses not to rollover, the account is considered an inherited IRA and under today’s decision those assets would not be protected in bankruptcy.  Thus, spouses have one more reason to do a rollover.

See Clark v. Rameker, 573 U.S. __ (2014); Deborah Jacobs, IRAs Not Protected In Bankruptcy, Forbes, June 12, 2014. 

June 12, 2014 in Estate Planning - Generally, New Cases, Non-Probate Assets | Permalink | Comments (0) | TrackBack (0)

The Harsh Penalties of Not Disclosing Offshore Accounts

BagA jury recently upheld a huge IRS penalty accessed to Carl Zwerner for not filing with the Offshore Voluntary Disclosure Program for his offshore account. Since the jury found that Zwerner’s violations were willful, he must pay the maximum penalty of 50% the account balance for the three years that he failed to file. The total amount due in penalties equals more than the balance of the account.

See Charles Rubin, What Does the Zwerner Case Mean to Practitioners?, Ruben on Tax, June 7, 2014.

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

June 12, 2014 in Estate Planning - Generally, New Cases | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 10, 2014

Appellate Court Issues Temporary Stay on Gay Marriage in Utah

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After same-sex marriages were allowed in Utah for seventeen days, the 10th Circuit Court of Appeals recently granted a temporary stay of order.  In December a federal judge lifted the ban on gay marriage, however, Utah claimed on appeal that the ruling interferes with the state’s ability to enforce its laws.  The state says its predominantly Mormon population favors a ban on gay marriage. 

Utah Attorney General Sean Reyes said the state “appreciates the opportunity for more time to allow all parties a chance to address such important issues.”  Plaintiffs have until June 12 to respond to the stay motion.

See Kevin Lessmiller, Appellate Stay Trips Up Gay Marriage in Utah, Courthouse News Service, June 9, 2009. 

June 10, 2014 in Current Events, New Cases | Permalink | Comments (0) | TrackBack (0)

Monday, June 9, 2014

Canadian Court Thwarts Neo-Nazi Group’s Bequest

Nazi

A court ruling issued last Thursday prevents a violent U.S. hate group from inheriting the estate of a New Brunswick man.  The late Harry Robert McCorkill left everything he owned to the National Alliance, a violent West Virginia-based Neo-Nazi group. 

“This was a strong statement indicating that it is against Canadian public policy to bequeath money to organizations that spread hate.”  Calling the materials of the National Alliance “racist, white-supremacist and hate-inspired,” Justice William Grant of the Court of Queen’s Bench of New Brunswick voided the will of McCorkill. 

Before his death in 2004, McCorkill bequeathed his estate the National Alliance.  Among his possessions are Greek and Roman coins, Nazi memorabilia, and a human skull.  The estate is valued around $280,000.

See Stewart Bell, Violent U.S. Neo-Nazi Group Loses Battle To Inherit Late Canadian Coin Collector’s Estate, National Post, June 5, 2014.

June 9, 2014 in Estate Planning - Generally, New Cases | Permalink | Comments (0) | TrackBack (0)