Wills, Trusts & Estates Prof Blog

Article on Formal Requirements for Matrimonial Agreements and Testaments in a Comparative Perspective

Samuel Fulli-Lemaire recently posted an Article entitled, Formal Requirements for Matrimonial Agreements and Testaments in a Comparative Perspective, Wills, Trusts, & Estate Law eJournal (2017). Provided below is an abstract of the Article:

A significant number of recent studies have dealt with property relations between spouses and succession law from a comparative perspective. In both cases, formalism is a salient issue whenever private autonomy comes into play. This paper deals successively with marital agreements and testaments, the two acts to which most of the issues relate. As far as marital agreements are concerned, the various comparative studies that have been conducted reveal that formal requirements vary widely from one jurisdiction to another. However, this observation must be qualified by taking into account the scope of review exercised by courts over the agreement at the time of the divorce or litigation: often relaxed formal requirements are balanced by broad judicial review. Regarding testaments, a wide-ranging study reveals a steady ebb of formalism across all jurisdictions. Remarkably, it affects all kinds of testaments, and this trend may be further reinforced by a shift towards "property rights, interests and assets created or transferred otherwise than by succession", since part of their appeal is their greater flexibility when it comes to formal requirements.

Death of World's Richest Woman Shakes Cosmetics Giant

Billionaire Liliane Bettencourt, heiress to the L’Oreal empire, died last Thursday at the age of 94. Her passing signals a possible shift in L’Oreal ownership as a 43-year-old agreement between Nestlé, the company’s second-largest shareholder behind the Bettencourt family, is set to expire in the next six months. At the end of this term, either party may increase their current holdings in the company. L’Oreal is currently viewed as a willing and able buyer of Nestlé’s shares and may choose to use a 9% holding in Sanofi, a drug maker, to fund the purchase. Such a move has the potential to force L’Oreal to make a takeover bid under French law.

See Sarah White & Sudip Kar-Gupta, Death of World's Richest Woman Shakes Cosmetics Giant, Financial Advisor, September 22, 2017.

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

Want to make that inherited Roth IRA last longer? Here’s how...

It can be difficult to resist the temptation to cash out an inherited Roth IRA, but stalwartness in the face of becoming flush with cash can be beneficial. Taking advantage of current provisions and “stretching” the account may decrease tax liabilities and improve overall fund usefulness. Inherited Roth IRAs have different tax implications for beneficiaries relative to the original owners in that the distributions are tax-free. If a beneficiary does not immediately need money, he or she can take the required minimum distributions and leave the remaining assets in the account to continue growing. Over time, the result is a larger pool of tax-free funds that can be saved and used later.

See Dan Moisand, Want to make that inherited Roth IRA last longer? Here’s how, MarketWatch, September 22, 2017.

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

Trump GOP Tax Reform Framework Calls for Estate Tax Repeal

In its current form, the federal estate tax applies to estates valued at over $5.49 million. The tax is considered draconian by many, as assets in excess of the $5.49 million threshold are subject to a 40% tax. Couples may combine their exemptions and are able to shield up to $11 million from the tax. The generation-skipping tax (GST) applies to transfers of wealth that pass over a generation during life or upon death. A grandmother giving a gift to a grandchild would be an example where the tax applies.

The Trump Administration’s most recent framework for tax reform includes proposals for repeal of the GST and the estate tax. The plan also calls for the repeal of the alternative minimum tax, the elimination of itemized deductions and personal exemptions, and reductions to the top individual and corporate tax rates. Though repeal and tax reform is far from a certainty, those opposed to the death tax are optimistic. The Family Business Coalition is “all in” for the repeal of the estate and GST taxes believing that their elimination would boost the economy and spur job creation.

See Ashlea Ebeling, Trump GOP Tax Reform Framework Calls for Estate Tax Repeal, Forbes, September 27, 2017.

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

Article on The Rise of Trust Decanting in the United States

Robert H. Sitkoff recently posted an Article entitled, The Rise of Trust Decanting in the United States, Wills, Trusts, & Estate Law eJournal (2017). Provided below is an abstract of the Article:

In a trust decanting, a trustee who under the terms of a trust (the first trust) has a discretionary power over distribution uses that power to distribute the trust property to a new trust (the second trust) with updated provisions, leaving behind the sediment of the first trust’s stale provisions. This article canvasses the rise of trust decanting in American trust practice, taking notice of its common law origins, its contrast with traditional American doctrine on trust modification and termination, the proliferation of state trust decanting statutes, and several areas of doctrinal divergence across the states.

 

JPMorgan Ordered to Pay More Than $4 Billion To Widow and Family

Max Hopper, a former American Airline executive, is credited with pioneering an innovative reservation system for the massive airline. When he died in 2010 without a will, his estate was valued at more than $19 million. JPMorgan Chase & Co. was charged with independently and impartially dividing and distributing Hopper’s assets between the appropriate beneficiaries. Instead, the bank took an egregious amount of time to release interests in furnishings, jewelry, art, and the 900 bottles of wine and 6,700 golf putters left in the estate.

This lapse led to a lawsuit spearheaded by Hopper’s wife, Jo Hopper, and two stepchildren. A Dallas jury found that the bank’s actions constituted a breach of fiduciary duty and fraud. Most surprising however, is the $4 billion in punitive damages they awarded to the family. In response to the verdict, Jo Hopper stated: "The nation’s largest bank horribly mistreated me and this verdict provides protection to others from being mistreated by banks that think they’re too powerful to be held accountable.”

See Thomas Korosec, JPMorgan Ordered to Pay More Than $4 Billion To Widow and Family, Bloomberg, September 26, 2017.

Special thanks to Cassandra L. Hill, Jim Hillhouse (Professional Legal Marketing (PLM, Inc.), & Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

Prince's 'Purple Rain' Handwritten Notes Hit Auction for Thousands!

Prince was noted as being somewhat of a perfectionist. This trait is readily apparent in the many handwritten editing notes he added to “Purple Rain” and other songs. RR Auction is putting at least nine pages of these notes up for auction and is expecting them to sell for over $12,000.

See Prince's 'Purple Rain' Handwritten Notes Hit Auction for Thousands!, TMZ, September 18, 2017.

Special thanks to Molly Neace, J.D., for bringing this article to my attention. 

Article on Elder Law Issues and Recent Developments 2016-2017

Elizabeth Ruth Carter recently posted an Article entitled, Elder Law Issues and Recent Developments 2016-2017, Wills, Trusts, & Estate Law eJournal (2017). Provided below is an abstract of the Article:

These materials are part of the 2017 LSU Recent Developments CLE. The paper includes recent ethical developments; scam and abuse prevention and reporting; recent developments in mandate and interdiction; recent developments in Louisiana's medical consent law, recent developments in living wills and advance directives; recent developments with anatomical gifts and bodily remains; tax; and recent developments in criminal law.

Special thanks to Robert H. Sitkoff (John L. Gray Professor of Law, Harvard Law School) for bringing this article to my attention.

CLE on Title Law From Start to Finish

The National Business Institute is holding a conference entitled, Title Law From Start to Finish, which will take place on Thursday, October 05, 2017, at the Adam's Mark Buffalo Niagara in Buffalo, NY. Provided below is a description of the event:

Program Description

Confidently Work Through Common Problems

Do you understand the intricacies of real estate closings but feel left out of the loop when title becomes involved in the transaction? Are you able to resolve common title problems and utilize title insurance to your client's full advantage? Don't just rely on other professionals' due diligence; learn to use insurance and other cures to protect against title defects found with comprehensive title searches. This course will teach you the fundamentals of real estate title from examination to litigation. Register today!

• Conduct thorough and accurate title searches by utilizing court decrees, mortgage foreclosures and probate documents.
• Read and interpret land surveys, legal descriptions and plats in order to identify potential problems.
• Take the necessary steps to cure defects in the title so you can keep the transaction flowing.
• Avoid ethical dilemmas such as conflicts of interest during real estate transactions.
• Confidently draft closing letters that protect the buyer from title insurance claims.
• Work with the title insurance company on special issues, including additional coverage and special endorsements.
• Learn how to effectively file and defend title insurance claims.

Who Should Attend

This basic-to-intermediate level seminar is designed for:

• Attorneys
• Title Insurance Agents
• Title and Abstract Professionals
• Paralegals
• Lenders

Course Content

• Title Search and Examination Fundamentals
• How to Read Surveys, Descriptions and Plats
• Best Practices for Curing Title Problems
• The Title Insurance Commitment and Closing Letters
• Proper Usage of Endorsements and Exceptions
• Ethics

Continuing Education Credit

Continuing Legal Education

Credit Hrs State 
CLE 7.20 -  NJ*
CLE 7.00 -  NY*
CLE 6.00 -  PA*

* denotes specialty credits

Waiting for the Other Shoe

At the time of her death in 2009, Victoria Dieringer held the majority of both nonvoting and voting stock in Dieringer Properties Inc. (DPI). DPI managed residential and commercial properties primarily located in the Portland, Oregon area. These stock holdings comprised the bulk of Dieringer’s estate, which she left to a number of charities in trust through a pour-over provision in her will. Dieringer intended for the gifts to these charities to be funded through sale of the corporate stock. DPI redeemed the stock to fund the trust, but did so at substantially reduced rates relative to its reported value. Despite this, the trust executor reported the decedent’s stock at its full value on the estate tax return and sought a charitable deduction reflecting the reported value. The Tax Court held that this was not allowed and assessed a tax deficiency and penalty of over $5 million. The case is on appeal, but it looks as though tumultuous times are ahead for the executor.

See Russell A. Willis III, Waiting for the Other Shoe, taxnotes, September 18, 2017.

Special thanks to Russell A. Willis III, J.D., LL.M., director, The Greystocke Project, for bringing this article to my attention.