Wills, Trusts & Estates Prof Blog

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

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Friday, October 24, 2014

Michigan's Cottage Transfer Statute Broadened

LawA new law in Michigan has expanded the state's law on from to whom can a cottage transfer occur without the property taxes being uncapped. The statute was signed into law on October 9, 2014, and not only expands the list of individuals that are considered a transferee, but also added trusts and inheritance vehicles, such as a will or through intestacy, to the definition of a transferor. The new law will be in effect in 2015 and will apply to transfers made on December 31, 2014 or later.

See Christopher J. Caldwell, Laura E. Radle, New Law Effective in 2015 is an Important Win for Cottage Owners, JD Supra, Oct. 23, 2014.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

October 24, 2014 in Estate Planning - Generally, New Legislation, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Thursday, October 23, 2014

Essential California Guardianship Clauses

Guardianship

One of the most important things you can do for your children is ensure they will be taken care of after you are gone.  This can be effectuated by a written will.  However, if you do not write your will properly, the binding legal document can be powerless.  For those who live in California, it is essential to take some of the state’s guardianship laws into consideration while creating your will.  Some of the laws are as follows:

  • Name a temporary guardian and an alternate temporary guardian. This is an important consideration especially for those who have chosen permanent guardians who live far away.  Without a temporary guardian, your children may spend their first days without parents with strangers.
  • Name a permanent guardian and an alternate. Including an alternate guardian will ensure that if something happens to your primary choice, your children will still be placed with someone you are comfortable with.
  • Explain why you have chosen your guardians. In California, the court system can determine who gets guardianship of your children.  Thus, the more information you include about why you have made this choice for your kids, the more likely the court will comply with your wishes.
  • Include special instructions. While you cannot watch a guardians every move, you can leave them with general wishes or guidelines, especially regarding your family’s culture, religion, values or ethics.  

See Janet Brewer, 5 Guardianship Clauses You Need in Your California Will, Probate, Trusts, and Estate Law Blog, Oct. 17, 2014. 

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

October 23, 2014 in Estate Administration, Estate Planning - Generally, Guardianship, Wills | Permalink | Comments (0) | TrackBack (0)

Wednesday, October 22, 2014

Avoid These Estate Planning Errors

Estate-plan

While many people fail to plan for death, even those who make the effort to plan their estates often neglect to follow through or update their plans as changes occur in their lives.  So that your estate plan may remain a valuable asset for you and your heirs, avoid these common mistakes:

  • Thinking the state will handle everything. It is a common misconception to think that trusts are for the wealthy and you have covered your bases with a will.  However, with a will, your estate may have to go through a public probate process and can be expensive.  If you have a trust, it eliminates the probate process for assets and ensures privacy.
  • Your work is done after a trust is created. Many people forget to fund their revocable trust.  The trust does not exist unless it holds assets. 
  • Settling and forgetting. This means that clients will often set up their estate planning documents and rarely look at them again.  Life changes and your needs, as well as your children’s, may be different.  Thus, updating a will is crucial.
  • Your assets will follow your trust or will. Beneficiary forms govern retirement accounts and insurance policies; the assets do not flow through your trust or will.  Whomever you designated as your beneficiary will get the money when you die.
  • Not considering your children’s needs. Each child can be different, and there may be times to treat them differently when it comes to disbursing their inheritance.

See Barry Glassman, Trust Bust: Steer Clear of the 8 Biggest Estate-Planning Mistakes, CNBC, Oct. 22, 2014.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

October 22, 2014 in Estate Administration, Estate Planning - Generally, Non-Probate Assets, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Monday, October 20, 2014

R&B Singer's Estate Goes to Widow

Pendergrass

Suburban Philadelphia Orphans’ Court Judge Stanley Ott decided that the widow of R&B singer Teddy Pendergrass will retain control over his estate after rejecting a will submitted by the singer’s son.  The judge stated that a will dated in May 2009 and submitted by Theodore “Ted” Pendergrass II was “fraudulent” and called his testimony, “wholly lacking in credibility.” 

Contrastingly, the judge found testimony by the singer’s wife, Joan, and other witnesses “highly” credible and ruled the will dated in March 2009 giving Joan Pendergrass most of the estate will stand.

Pendergrass’ son “respectfully disagrees with the court’s ruling and is considering an appeal.”

See Associated Press, Judge Rules Teddy Pendergrass’ Widow To Retain Control Over Estate, The Huffington Post, Oct. 16, 2014.

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) for bringing this article to my attention.  

October 20, 2014 in Estate Administration, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0) | TrackBack (0)

Mean Wills

Last will and testament

While Shakespeare is known for his literary brilliance, his will was a rather mean document.  In it, he did not refer to his wife by name and all he bequeathed to her was his “second-best bed.” 

What kind of message was he trying to send in his will?  Clearly, a mean one.  This sentiment could have been excluded from Shakespeare’s permanent legacy, as it tarnishes the image of his works.

The idea behind mean wills does not just stop with Shakespeare.  A recent will contained this provision, “If we’re not divorced by the time I die, make sure she gets nothing.  She already gone through all my money.”  When this man died and his will was probated, this paragraph went on the courthouse record and everyone—including his children—could see it. 

What is the point of including these seemingly mean spirited provisions?  Some people are trying to be funny.  For example, “To my nephew John, who made sure I knew he expected to be named in my will: ‘Hello John.’” 

Yet sometimes it goes beyond laughter, and is just hurtful.  “To my daughter, I leave $1.00 for the kindness and love she has never shown me.” 

It is impossible to reconcile a relationship like this after the person has died.  A mean will just leaves bitter thoughts and hurt feelings, which may not be worth it.  Sometimes meanness and sarcasm are best left buried. 

See George, Mean Wills Don’t Ever Mean Well, Fox + Mattson, P.C., Oct. 16, 2014.

October 20, 2014 in Estate Administration, Estate Planning - Generally, Humor, Wills | Permalink | Comments (0) | TrackBack (0)

Saturday, October 18, 2014

National Estate Planning Awareness Week

CLE Photo

October 19 – 25 is National Estate Planning Awareness week and the ABA Section of Real Property, Trust and Estate Law is inviting everyone to get involved.  On Thursday, October 23 at 1 p.m., RPTE will host a free webinar entitled, Estate Planning: How to Get Going and Why Not to Do It Yourself.  Here is why you should attend:

Statistical studies show that 55% of Americans die without a will or estate plan.  This free program informs the non-lawyer public how to start estate planning (wills, powers of attorney and trusts) by providing a set of practical first steps.  Our panel of lawyer and trust officer experts will also explain why simply signing a will or power of attorney with a “do it yourself” plan may actually be worse than doing nothing, costing a “special needs” family member the loss of government benefits or resulting in an ex-spouse inheriting assets. The program is intended for the general public and does not require a background in the law of wills or trusts or tax.

October 18, 2014 in Conferences & CLE, Estate Planning - Generally, Wills | Permalink | Comments (1) | TrackBack (0)

Friday, October 17, 2014

Warring Over Wills

Disputes

Leo Tolstoy once wrote, “Happy families are all alike; every unhappy family is unhappy in its own way.”  Yet when it comes to wills and estates, the woes may echo one another. 

Although these battles are the exception rather than the rule, how do you avoid family warring?  Some experts say there is no “one-size-fits all approach” that will ensure harmony when you die.  “Things like family trusts, putting business assets in different companies and having an up-to-date will are very important because if you don’t do those things you can leave a real mess behind which can be very expensive to sort out and money can go to people who you may not have wanted to benefit.”

If property has been gifted before death, it cannot be the subject of dispute.  Thus, when sizeable assets are at stake, a lot of planning is needed.  A discretionary trust may be an ideal mechanism to facilitate this change if it is set up properly. In establishing a trust, one must anticipate where control of the business will lie, and put that in a letter of wishes.  “This generally isn’t a legally binding document, it’s generally informal … in conjunction with a well structured trust, a letter of wishes can be a very useful thing to guide all those who are involved, including family members.”  This may not be a remedy to keep relatives from going head to head, however, consulting your family and communicating your wishes to them before you die can help forestall any problems. 

See Hamish Fletcher, Families at War: When Wills Go Sour, The New Zealand Herald, Oct. 17, 2014.

October 17, 2014 in Estate Administration, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Widowed Woman Allegedly Defrauded by Doctor

Last will and testament

In a Manhattan civil suit, an esteemed New York doctor is charged with maliciously gaining control of his wealthy widowed patient’s estate.  Helen Spears, the friend of the victim, filed the lawsuit and claims that the physician wrote himself into his patient’s will, stripping her of a multimillion-dollar inheritance. 

Spears contends that the doctor broke the law by doubling as both a primary care doctor and power of attorney.  Spears says that her 102-year-old friend is frail, vulnerable, and is unable to walk on her own, and would consequently want a judge to appoint her a guardian. 

See Alexandra Klausner, Top NYC Doctor Accused of Trying to Take Over Wealthy 102-Year-Old Widowed Patient’s Multimillion-Dollar Estate, Daily Mail, Oct. 16, 2014.

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

Wednesday, October 15, 2014

New Case: In re Estate of Qualls

Gavel2Gifts violated terms of power of attorney requiring the agent to respect terms of the principal’s will in making gifts.  A power of attorney granted the agent, who was one of three beneficiaries of principal’s will, the authority to make gifts including to the agent but required that any gifts respect the terms of principal’s will.  The agent sold the principal’s home and deposited the proceeds in a payable on death account of which the agent and one of the two other will beneficiaries were the beneficiaries.  After the principal’s death, the third beneficiary of the will began a proceeding to have the sale proceeds returned to the estate.  The beneficiary prevailed and the Missouri intermediate appellate court affirmed, finding that the opening of the payable on death account was the making of a gift even though the principal was the owner of the account and that opening the account exceeded the agent’s authority because doing so dramatically decreased the interest of the third beneficiary of the principal’s will. In re Estate of Qualls, 436 S.W.3d 743 (Mo. Ct. App. 2014).

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

October 15, 2014 in Estate Administration, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0) | TrackBack (0)

Tuesday, October 14, 2014

Mississippi Court Rules on No Contest Clause

WillAction brought with probable cause and in good faith did not violate no contest clause. In a case of first impression, the Mississippi Supreme Court held that a no contest clause in a will requiring forfeiture by a beneficiary who contests the admission of the will to probate cannot be enforced against a beneficiary who brings a contest in good faith and with probable cause, even though the clause itself includes language purporting to make it applicable whether or not the beneficiary acts in good faith with probable cause. Parker v. Benoist, No. 2012–CA–02010–SCT, 2014 WL 4243763 (Miss. Aug. 28, 2014).

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

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