Wills, Trusts & Estates Prof Blog

CLE on Current Developments in Estate and Tax Planning 2019

The National Business Institute is holding a webcast entitled, Current Developments in Estate and Tax Planning 2019, on Thursday, December 5, 2019 at 12:00 p.m. to 1:30 p.m. Provided below is a description of the event.

Why You Should Attend

Do you want to provide your estate planning clients with the best possible advice going into the new year? Are you up-to-date on the most significant developments to have come out of 2019? Set aside just 90 minutes to gain valuable insights on emerging trends in estate and tax planning, and learn how the newest cases, IRS guidance, and proposed regulations will impact your practice and your clients’ estate plans.

What You Will Learn

The faculty, all Fellows of The American College of Trust and Estate Counsel and highly-experienced estate and tax planning practitioners, anticipate discussing:

• Inflation adjustments
• IRS Priority Guidance Plan
• Court decisions of significance, including: Kress, Jones, Dieringer, Kaestner / Fielding
• Presidential candidate proposals
• SECURE Act
• Anti-clawback regulations
• Estate and gift tax proposed legislation
• Uniform basis PLRs
• PLR on §1041 & grantor trusts
• Regulations on 170 SALT limitation workaround
• IRS Chief Counsel Advice on high/low trading prices

Additional breaking topics may be added as we get closer to the date of the program.

All registrants will receive a set of downloadable course materials to accompany the program.

Who Should Attend

Estate planners and other related professionals will benefit from this CLE on estate and tax planning developments jointly offered by the ALI CLE and ACTEC.

Article on Fixed Intentions: Wills, Living Wills, and End-of-Life Decision Making

Jane B. Baron recently published an Article entitled, Fixed Intentions: Wills, Living Wills, and End-of-Life Decision Making, Elder Law eJournal (2019). Provided below is an abstract of the Article. 

Contemporary trusts and estates law is built on the premise that individuals can and should have fixed intentions with respect to the disposition of their property at death. These intentions can and should be fixed in a written document, and that document can and should be fixed against other outside evidence of intention. Experience with end-of-life health care decision making gives reason to question these premises. In the health care context, intentions have proven to be fluid, and the documents purporting to record individuals’ wishes have often proved unreliable.

This paper examines the implications for wills of the literature on end-of-life health care decision making. Advance health care directives and property wills are alike pre-commitments, attempts in the present to bind the future, but studies in the end-of-life health care decision making context show there are serious issues with this process. Individuals simply do not care to decide about post-competency treatment, those who do make such decisions often change their minds, and cognitive biases operate to limit individuals’ ability to predict accurately in the present what they will want in the future. Many of these issues arise also in the context of end-of-life property decision making and unsettle many of wills law’s fundamental premises about intention.

The final part of the paper suggests avenues for further empirical study and explores the practical significance of this potential research for estates law, particularly the potential to displace the vision of the estates attorney as a passive scrivener who simply asks what the client wants and writes it down. It may be that the wishes expressed in a will may be formed in response to, and shaped by, the attorney’s questions rather than being brought out by those questions. The paper concludes by asking whether there might be a way to honor fluid intentions in the property context that does not destroy the utility of testamentary documents as a safe harbor.

Cars Singer Ric Ocasek Cuts Supermodel Wife Paulina Porizkova Out of Will

Cars' front man Ric Ocasek, 75, passed away in September while recovering from a recent surgery and was found by his estranged wife, Paulina Porizkova, when she was bringing him coffee. Though this act is undeniably sweet, the two were in the middle of a divorce after being married for 28 years. Citing this, Ocasek laid out in his will that his wife was not to receive any portion of his estate, “Even if I should die before our divorce is final … Paulina is not entitled to any elective share … because she has abandoned me.”

A filing listed with Ocasek’s will show that his assets include $5 million in “copyrights," just $100,000 in tangible personal property and $15,000 in cash. This amount may seem low for a rock legend, but the copyrights were not detailed, and there may more stashed away in trusts to protect his privacy. 

His wife was not the only one that appeared to get the short end of the stick - two of his six sons also were not designated as beneficiaries. But they may have been compensated in other ways, either before his death or through a trust. 

Ocasek signed the will on Aug. 28, less than a month before his death, and the executor is named as his “friend and business manager,” Mario Testani.

See Priscilla DeGregory and Aaron Feis, Cars Singer Ric Ocasek Cuts Supermodel Wife Paulina Porizkova Out of Will, Page Six, November 7, 2019.

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) and Jim Hartnett, Jr. (Dallas, Texas Probate Attorney) for bringing this article to my attention.

Why Ashton Kutcher is Leaving Nothing to his Kids

Ashton Kutcher and his wife, Mila Kunis, stated recently that they plan to leave their children nothing, instead giving any money they have earned from Hollywood or their investments to charity, including sex-trafficking causes. Kutcher has invested in several tech companies with his venture capital firm A-Grade Investments, so he understands that his children are already living what he believes is a "privileged life." He specifically said that they will not be receiving any trust funds.

Half of people that are destined to receive an inheritance receive $50,000 or less, and 30% will receive between $50,000 and $249,000 according to Federal Reserve data. Completely cutting off children is an unorthodox approach; teaching them positive life-long habits that can contribute to more beneficial payoffs may be more proactive, and could bloom into long-term financial security.

See Mitch Tuchman, Why Ashton Kutcher is Leaving Nothing to his Kids, Market Watch, November 9, 2019.

Special thanks to Lewis Saret (Attorney, Washington, D.C.) for bringing this article to my attention.

Article on Private Land Conservation and Public Policy: Land Trusts, Land Owners, and Conservation Easements

Dominic P. Parker & Walter N. Thurman recently published an Article entitled, Private Land Conservation and Public Policy: Land Trusts, Land Owners, and Conservation Easements, Wills, Trusts, & Estates Law eJournal (2019). Provided below is an abstract of the Article.

We highlight the extraordinary growth in private conservation via land trusts and conservation easements and describe the problems arising from the interplay of public finance and private decisions. We offer a framework for understanding the popularity of easements and land trusts and for evaluating policy reforms aimed at improving their performance. The framework, grounded in institutional and organizational economics in the tradition of Ronald Coase, Oliver Williamson, and Yoram Barzel, focuses on the measurement and monitoring costs faced by public and private stakeholders under current and prospective policy arrangements. We illustrate how the framework can be applied to contemporary debates about the appropriate tax treatment of donated easements, requirements that they be held in perpetuity, and the extent to which government should regulate private land trusts.

Don’t Rely on a Post-It® Note to Amend Your California Trust

Procrastination seems to always invite disaster, and even when something appears to be simple, waiting until the last minute can cause mistakes. A California court had to decide an issue that dealt with procrastination: What happens when a settlor does not fully comply with the trust instrument’s modification procedure, even though it’s highly obvious that he intended to amend his trust?

The California Court of Appeal decided recently in Pena v. Dey (2019) 39 Cal.App.5th 546 that the issue must be faced with strict compliance of the trust's modification procedures, which indicated that any amendment “shall be made by written instrument signed by the settlor and delivered to the trustee.” James Robert Anderson created the trust in 2004, making himself both settlor and trustee. He executed an amendment in 2010, and shortly afterwards was diagnosed with cancer. James called an attorney in early 2014 to amend his trust so as to add Grey Dey, a friend that had been assisting him, as a beneficiary. The attorney told him to send him the trust documents with all necessary changes, and he received the interlineations in March 2014 with a Post-it note, on which James wrote: “Hi Scott, Here they are. First one is 2004. Second is 2008. Enjoy! Best, Rob.” Sadly, James passed away in May before he could review and sign the second amendment.

Margaret Pena, the successor trustee, petitioned the trial court for instructions as to whether the interlineations constituted a valid amendment. The trial court granted the trustee's motion for summary judgement, holding tight to the trust amendment formality requirements. The appellate court affirmed the trial court's decision, finding that the written document itself had not been signed and that the Post-It® Note could not provide for the missing signature line.

See Christopher Miles Kolkey, Don’t Rely on a Post-It® Note to Amend Your California Trust, Trust on Trial, October 28, 2019.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) and Jim Hartnett, Jr. (Dallas, Texas Probate Attorney) for bringing this article to my attention.

Article on Fusion: Can It Encompass the Trust? An Assessment in Light of the Trusts Bill 2017

Anna Mclean recently published an Article entitled, Fusion: Can It Encompass the Trust? An Assessment in Light of the Trusts Bill 2017, Wills, Trusts, & Estates Law eJournal (2019). Provided below is an abstract of the Article.

This paper applies the fusion debate to the most recent reform of the law of trusts in New Zealand, the Trusts Bill. The fusion debate centres around whether a distinct role for equity is needed, or whether the common law and equity can integrate to form one unitary body of law. It aims to achieve coherence in the law – where equitable and common law doctrines aim to achieve the same objectives, it is incoherent to maintain reference to two distinct sets of rules. The Trusts Bill is analysed in light of this – can equity’s traditional flexibility and conscience-based approach be seen in the Bill and in the wider reform process? These values are often used to differentiate between equity and the common law. This paper argues that the Trusts Bill does take incremental steps towards fusing common law and equity even in relation to the trust, traditionally the heartland of a distinct equitable jurisdiction. Flexibility and conscience-based reasoning do not differentiate the law of trusts as seen in the Trusts Bill from common law doctrines. The shift towards a statutorily-defined framework, the language used throughout the Bill and the underlying rationale behind reform all show incremental steps towards fusion occurring even if complete fusion cannot yet be seen. The future of fusion is left to the courts, but the Trusts Bill shows increasing fusion even in this area of the law is possible.

Book on Wills, Trusts, and Estates: A Contemporary Approach

Lloyd Bonfield, Joanna L. Grossman, and William P. LaPiana recently published a Book entitled, Wills, Trusts, and Estates: A Contemporary Approach, West Academic (2019).  Provided below is a summary of the book.

This casebook is designed to present in a comprehensive yet streamlined fashion the law of Wills, Trusts, and Future Interests to 21st–century law students. It assists the student in developing an understanding of the core legal concepts critical to a grasp of wills, trusts and future interests in a novel format that is clear and easy to understand, while maintaining the intellectual rigor of the subject. The book covers the standard topics, but is organized in an innovative fashion. It begins with an estate planning problem which introduces the student to the craft of the practitioner, providing context for the introduction of substantive law. It then presents the law of wills law by reference to the law governing the testator, the document and the property. Attention is given to non-probate transfers, and in particular, the law of trusts, private and charitable. A model trust instrument is also provided. It concludes with a comprehensive look at future interests and the rule against perpetuities. As with other books in the Interactive Casebook Series, it challenges students to think about issues raised by the cases as they are considered in the opinion through the use of text boxes. The accompanying electronic version allows students immediate access to the full text of cited cases, statutes, articles, and other relevant materials.

CLE on Shielding Estate Plans Against Litigation Webinar: Proactive Steps to Take Now

The Peak Trust Company is presenting a webinar entitled, Shielding Estate Plans Against Litigation Webinar: Proactive Steps to Take Now, on Tuesday, November 12, 2019, from 2:00 p.m. to 3:00 p.m. Provided below is a description of the event.

Litigation relating to estate planning seems to be increasing all over the country, and it is not limited to large estates. Proactive steps can be taken now to drastically reduce the chances of your clients' wishes being challenged. Some of the topics we will cover include:

- Reducing the chances a disgruntled beneficiary will attack your client's estate plan

- Increasing the chances that the estate plan will be successfully defended using discretionary trusts, no-contest clauses, and conditional distributions

- Common litigation scenarios and how to avoid them

- Anticipating challenges based on dementia, lack of mental capacity, and undue influence

- Dealing with beneficiaries’ spouses and divorces

- Protecting against mismanagement by trustees and trust advisors

- Using statements of intent and overcoming adverse presumptions

Article on Why Can’t My Brother-In-Law Bob Be the Executor of My Estate?

Stuart C. Bear recently published an Article entitled, Why Can’t My Brother-In-Law Bob Be the Executor of My Estate?, Wealth Strategies Journal, October 14, 2019. Provided below is the abstract to the Article.

Fiduciary selection is crucial to the success of an estate and disability plan. Even a great plan can go awry if a fiduciary fails to uphold his or her fiduciary duties or fails to follow the terms of the Will or Trust. Add family dynamics to an already stressful situation and things go from bad to worse.