Wills, Trusts & Estates Prof Blog

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

Monday, August 17, 2015

Court Refuses To Reform Testamentary Trust On Request Of Beneficiaries

GavelThe current income beneficiary and her adult children, the presumptive remainder beneficiaries (takers in default of her exercise of a power of appointment) of a testamentary trust created more than eighty years ago by the will of the income beneficiary’s father petitioned the Delaware Court of Chancery for an order changing the trust’s administrative provisions to make it a directed trust, that is, one in which the trustee would take direction from an investment advisor, a position which would be held by two of the income beneficiary’s adult children. In effect, the corporate co-trustee would carry out administrative functions. The will had been admitted to probate in New York and in 2001 the co-trustees, the income beneficiary, and a bank obtained the permission of the New York and Delaware courts to move the trust’s situs to Delaware with the income beneficiary and the Delaware affiliate of the original corporate trustee as co-trustees. In In re Trust under Will of Flint, the Court of Chancery denied the petition, finding that drastically changing the role of the corporate trustee was contrary to the testator’s intent and could not be justified solely by the consent of the beneficiaries

Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.

August 17, 2015 in New Cases, Trusts | Permalink | Comments (0)

Sunday, August 16, 2015

Equitable Adoption Deemed Relevant Only If The Decedent Dies Intestate

GavelA grandniece filed a caveat to her great-aunt’s will, alleging that she had been equitably adopted after the will was made. The probate court admitted the will to probate, but held that the grandniece was entitled to an intestate share as a child under state law which revokes a will on the testator’s marriage, the birth of a child to the testator, or the testator’s adoption of a child, to the extent necessary to give the child or spouse an intestate share. In Johnson v. Rogers, the Supreme Court of Georgia affirmed admission of the will to probate but reversed the award of the intestate share, holding that the doctrine of equitable (or virtual) adoption is relevant only when the alleged adoptive parent dies intestate.

Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.


August 16, 2015 in New Cases, Wills | Permalink | Comments (0)

Saturday, August 15, 2015

Purported Contract To Devise Does Not Prevent Admission Of The Will To Probate

GavelIn the case of In re Estate of Attea, the decedent was a member of a Roman Catholic religious order and had taken a vow of poverty. Pursuant to that vow, she executed a will leaving all of her property to the order. Three years after execution of the will, the decedent was involved in a motor vehicle accident in which she was severely injured and received a substantial settlement. Twelve years after the accident, the decedent executed a new will leaving her estate to her relatives, the order, and other Roman Catholic charitable institutions. The order moved for summary judgment denying probate on the grounds that the will violated the vow of poverty the decedent had taken. All other parties opposed the motion. The court denied summary judgment, holding that the alleged contract had no effect on the validity of the will.

Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.

August 15, 2015 in New Cases, Wills | Permalink | Comments (0)

Friday, August 14, 2015

Qualified Beneficiaries Of Revocable Trust Are Entitled To Information For Period Before The Settlor’s Death

GavelThe settlor created a revocable trust for the benefit of all of his children with the two children of his second marriage as trustees. After the settlor’s death, the non-trustee beneficiaries learned that $1.8 million had been transferred out of the trust in the eighteen months before the settlor’s death. They began a proceeding to require the trustees to give them information on the transfers, such as whether the settlor had initiated them. The trial court granted summary judgment to the trustees because state law provides that while the settlor of a revocable trust is alive “beneficiaries other than the settlor have no right to receive notice, information or reports” from the trustees. In Tseng v. Tseng 352 P.3d 74 (Or. Ct. App. 2015), the intermediate appellate court reversed, holding that the statutory prohibition applies only while the settlor is alive and that after the settlor’s death, the qualified beneficiaries are entitled to information necessary to protect their interests which in this case was information on whether the settlor made, approved, or ratified the transfers.

Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.

August 14, 2015 in Estate Planning - Generally, New Cases, Trusts | Permalink | Comments (0)

Wednesday, August 12, 2015

California Supreme Court Makes Big Change For Will Contests

Gavel 2In Estate of Duke, the California Supreme Court changed the rules for altering a will after the death of the testator. Before Duke, only an ambiguous will could be amended by the court using extrinsic facts. Now a court may alter an unambiguous will if there is clear and convincing evidence that the testator had specific intent to make a bequest that mistakenly omitted when the document was drafted and executed. This change, as the court noted, puts wills construction on the same level as trusts which, in California, have long been alterable using extrinsic evidence. The court expressed doubt the change will provoke a torrent of lawsuits because suits are usually based on the size of the estate rather than availability of legal routes to challenge a gift. Going forward, the results of this change will be watched nationwide as other states potentially consider a similar change.

See Ryan D. Cunningham & Allonn E. Levy, Duke Blazes a New Trail in Estate Law, Wealth Management, August 11, 2015.

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

August 12, 2015 in Estate Administration, Estate Planning - Generally, New Cases | Permalink | Comments (0)

Tuesday, August 11, 2015

Florida Slayer Statute Does Not Disinherit Descendents Of A Murderer But Undue Influence Might

HandcuffsNarcy Novack was convicted of the murder of her husband Ben, as well as his mother, to ensure her daughter from a previous marriage would inherit instead of two cousins of Ben. However, the cousins challenged the will in court arguing that the slayer statute prevented Narcy's family from inheriting since it would indirectly benefit Narcy and, in addition, that she exercised under influence over him to change his will. The trial court rejected both of these arguments and the case was appealed.

In Fiel v. Hoffmanthe court of appeals held that the plain language of the statute only caused the murderer to be considered predeceased and did not affect the ability of a family member of the murderer from inheriting. The fact that the beneficiary is a descendent of the murderer without a blood relationship to the victim does alter the analysis as was claimed by the plaintiffs. However, the court held that the trial court improperly dismissed the undue influence claim and remanded the case for a determination if Novack was coerced into changing his will by Narcy.

Special thanks to Professor Naomi Cahn for bringing this case to my attention.

August 11, 2015 in New Cases, Wills | Permalink | Comments (0)

Monday, August 10, 2015

Newtown Victim’s Families Are Suing Estate Of Gunman’s Mother

Sandy hookUnder a proposed settlement the families of the Sandy Hook Elementary School shooting victims would split the $1.5 million estate of the shooter’s mother, Nancy Lanza.  The suit against the estate alleges that Nancy Lanza failed to properly secure the Bushmaster AR-15 rifle that she owned.  The $1.5 million would come from Nancy Lanza’s homeowners insurance, and each of the 16 families would get $94,000 under the settlement.  Joshua Koskoff, a lawyer for the families, has stated that he and other attorneys are representing the families for free.  There is also a pending lawsuit against the gun maker Remington that alleges that the Bushmaster AR-15 rifle should not have been sold for civilian use.

See Dave Collins, Proposal: Families of Newtown victims would split $1.5M from estate of gunman's mother, Associated Press, August 5, 2015. 

August 10, 2015 in Current Affairs, Estate Planning - Generally, New Cases | Permalink | Comments (0)

Tuesday, August 4, 2015

Mississippi Requires Willful Conduct To Trigger Slayer Statute

Handcuffed PersonOne day, upset that his mother was leaving, John Armstrong took a mallet and attacked his mother which resulted in her death. He confessed to the killing and, as a result, saw his siblings seek to exclude him from his mothers will under the Mississippi Slayer Statute. However, Armstrong is a diagnosed schizophrenic which created a question whether his act satisfied the "willful" mental state required in the statute. The trial court declared, based on his confession and other evidence, that he willfully caused the death of his mother and was excluded from inheriting.
In In re Estate of Armstrong, the Mississippi Supreme Court held the willfulness requirement in the statute was not satisfied if Armstrong's mental state at the time of the murder precluded him from controlling his own actions. The court relied on precedents when manslaughter plea bargains were held not to show a willful intent to kill without additional evidence to support a finding that the person caused the death intentionally. The case was remanded to the trial court to determine if Armstrong had the proper mental status at the time of the homicide with the court adding that "all evidence which will throw light on the issue.. is competent and admissible."
Special thanks to Brandon Dixon for bringing this case to my attention.

August 4, 2015 in New Cases, Wills | Permalink | Comments (0)

Girl Adopted By Stepfather Entitled to Biological Father's Retirement Plan

GavelWhen Austin Hardy died, he left behind a retirement plan that was administered by his employer but did not have a named death beneficiary. As a result, his employer followed the plan's procedure and transferred the proceeds to Hardy's biological daughter. However, Hardy's sisters challenged the distribution arguing that since his daughter had been adopted by her stepfather, she was no longer his child under the plan rules.

In Lubin v. AT&T Ret. Savings Plan, the district court ruled that the distribution was proper since the plan guidelines call for any surviving child, be it biological or adopted, to inherit if no surviving spouse or partner existed. The sister's argument that the daughter being adopted stripped her of her child status was not supported by any authority and would require reading words into an express agreement that was unambiguous. This case serves as an reminder that the holder of a retirement account should always name a beneficiary, as well as keeping the name up to date, in order to prevent grasping relations from claiming inheritance rights that were never intended to be theirs.
Special thanks to Naomi Cahn for bringing this case to my attention.

August 4, 2015 in Estate Administration, New Cases, Non-Probate Assets | Permalink | Comments (1)

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, 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)