Wills and TrustsProf. Gillett

I. Introduction to Estate PlanningA. The power to transmit property at death

1. Wills, testaments, rights of inheritance, and successions are all created by law and can be limited, condition or abolished by legislatures

2. Hodel v. Irvinga. Congress passed law limiting rights of inheritance to Indian lands in order

to prevent fractional interests from passingb. The S.Ct. found that the statute was unconst. B/c it did away with the right

to pass property to heirs. (Abolished the rights of descent and devise)c. S.Ct. looked to 3 factors to determine if it was “taking” of land:

Economic impact= high Interference with reasonable investment backed expectation=none Character of gov’t action=right to pass to heirs is important

d. The statute could have limited the right to pass by intestacy just not by both will and intestacy

B. Transfer of the decedent’s estate1. General definitions

a. Testator = person writing the willb. Testate = die with a willc. Executor = takes care of willd. 2 kinds of gifts:

Devise = real property Bequest = personal property

e. Executor = named in the willf. Administrator = not named in the will; statute creates first order of

preference2. Probate/Non-Probate Property

a. Probate Passes under will or by intestacy statutes Principal reason to probate property is to clear title Can probably limit passing of property in a will by stating that

someone must marry, but probably can’t preclude something from passing b/c someone marries.

In a will, you can require things of grandchildren or other heirs, but probably not spouses

b. Non-Probate

1

Passes through another instrument effective before death Joint tenancy property Life insurance Contract with payable upon death provision Interests in trust

Advantages of a revocable trust If person becomes incompetent, then trustee can manage

property Much easier to distribute property to beneficiaries No attorney fees Not public documents Saves probating on land in other states

Disadvantages Attorney’s charge more More administrative costs Must file income tax returns for trust More difficult to deal with property during life Will not save on taxes

3. Process of Probatea. Admit to probateb. Certain persons can contest

58 O.S. § 41: Proceedings on contest Must file written notice as to reasons for contest Can allege the following issues of fact: competence of

decedent, freedom from duress, etc., proper execution and attesting, an other questions substantially affecting the validity of the will

58 O.S. § 61: Causes for contesting a will after probate any person can contest the validity of a will within 3 months of

the date the will was admitted to probate must allege either: discovery of a will dated later than the one

in probate, some jurisdictional fact was lacking, that the testator was not competent, was under duress, menace, fraud or undue influence or that the will was not properly executed and attested

c. appoint representative; this person will: Collect assets Inventory property File inventory with the court Conserve assets for distribution Pay the debts Pay taxes (they become personally liable for estate and income

taxes) Account to court and make distribution

4. Duties of attorney in drafting a willa. Simpson v. Calivas

2

Action brought against atty who drafted father’s will I: does atty. have a duty to intended beneficiaries? H: yes, based on foreseeability of the injury, not on the privity of

relationship Contestant must show that the atty negligently failed to effectuate the

testator’s intent as expressed to him Most of the time, the court is bound by the “4 corners of the will” unless

the will is ambiguous, then extrinsic evidence (except the clearest example) may be used

Judgment of probate court did not create estoppel b/c true intent of testator was not decided

b. Hotz v. Minyard Father writes 2 wills and requests that atty only show 1st will to

daughter (who is also client of atty) Daughter beings suit for breach of fiduciary duty b/c atty did not

show her the correct will when she asked to view will Court said that b/c of “special confidence” relationship, atty owed

her a duty to correctly represent the will

II. Intestacy: An estate plan by defaultA. Basic Scheme

1. the law of domicle governs personal property2. the law of location govern all real property3. Numbers to remember

$675, 000 = amount you can give w/o estate taxes $675,000 = amount you can give to descendants w/o state taxes This amount is the gross amount, which includes things that do not pass through

probate (life insurance) $10,000 = amount that you can give per year, per beneficiary w/o incurring

federal gift taxes4. 84 O.S. § 213(B): (p.45 in supp.) governs who gets what if person dies intestate

§ 213(B)(1): applies when the decedent leaves a surviving spouse § 213(B)(2): applies when there is no surviving spouse and tells what property

goes to others after spouse’s share5. Joint industry property:

Property given to you by your parents is separate, unless it is commingled or it can no longer be traced back to the gift

All property acquired during marriage is joint Upon death, W gets ½ of JIP that H has (not ½ of what the total is) Things, such as joint tenancy property, that pass outside of probate, don’t count

towards the ½ B. Share of surviving spouse

1. If marriage is invalid then, not spouse, but if divorce is pending, you are still spouse

3

2. Spouse must survive decedent and the person whose claim depends upon survivorship must show it by a preponderance of the evidence In Okla. the Uniform Simultaneous Death Act means that if there is no sufficient

evidence of survivorship, the spouse is deemed to predecease. The USDA, requires survivorship of 5 days now; Okla. has yet to change the law Janus v. Tarasewicz: Mom of H tried to claim that death was simultaneous so

that she would inherit W’s share of H’s estate; Here, W’s dad must show that W survived H in order to get her share 2 standards can be used to determine death: irreversible cessation of

circulatory and respiratory functions or a brain death standard Ct. here applied both and found that b/c functions of W resumed on their

own after H was dead, she had survived.C. Shares of Descendants

1. children and issue of children take remainder after spouse’s portion is set aside2. Issue of children “represent” the dead child and take their share; 2 ways to

divide: Strict per stirpes: divide property into as many shares as there are living

children of the designated person and deceased children who have descendants living (always divides at child level)

Modern per stirpes: divide shares at level where descendants are still living; Okla. uses this

3. Disinheritance In order to disinherit a child, you must dispose of ALL of your property;

otherwise the remainder will pass by intestacy to that childD. Shares of Ancestors and Collaterals

1. Collateral kindred = persons related by blood but not descendants or ancestors 1st line collaterals = descendants of deceased’s parents (excluding

deceased and his issue), i.e. deceased’s siblings 2nd line collaterals = descendants of deceased’s grandparents (excluding

deceased’s parents and their issue), i.e. deceased’s aunts and uncles If there are no 2nd line, then two schemes are used: parentelic, which

distributes it back through grandparents; and, degree-of-kinship, which counts steps for each generation and the closest one gets it (chart on p.92 of book). Okla. uses the degree-of-kinship system

E. Relationships by half-blood1. 84 O.S. § 222: half and whole siblings inherit equally, UNLESS there are

specific items which came from ancestor (applies mainly to real estate)

F. Transfers to Children

4

1. Posthumous children 84 O.S. § 228: considered living at the death of their parent; see also 10 O.S. § 2 for presumption that children born 10 months after death of parent are presumed to be that parents child

2. Adopted children 10 O.S. § 7505.65: can inherit through and from adoptive parents; natural parent can’t inherit from a child who has been adopted, but in Okla. an adopted child can still inherit from natural parents as well as from adoptive parents (minority rule) Hall v. Vallandingham

Brother of children’s natural father dies I: can they take b/c they’ve been adopted by their step-father? H: court here says no b/c statute allowed inheritance from and

through adoptive parents This case would be different in Okla.

3. If child is born out of wedlock, most states allow inheritance with proof of paternity; 84 O.S. § 215 (p. 46) provides that the father/child relationship must be

established during father’s life4. Adopting an adult child usually works for purposes of inheritance and prevents

will contests by family members for gifts given in will to persons not in family5. Advancements 84 O.S. § 223-227(p. 47): all advancements given during the

life of the decedent count against that child’s share after death. The amount of the advancement is added to the total estate and then the

estate is divided into equal shares; the advancement is subtracted from that child’s share

If advancement is more than the value of the estate, the child doesn’t get anything, but no refund is required

The gift is measured by the value at the time that it was given, except that the donor can place his or her own value on it (not required to be reasonable)

Child has the burden of establishing that the gift was not an advancement, but was just a gift

6. Transfer of expectancy Living persons only have heir apparents These persons have an expectancy, not a property interest However, purported transfers for adequate consideration may be enforceable

in a court of equity 7. Managing a minor’s property

A custodianship or trust can be established by will if parents are alive Guardianship: costly b/c actions require court approval, only the income

from the estate can be used Custodianship: transferred to person as custodian for minor’s benefit,

fiduciary duties apply, and good for small gifts Trust: gives property to minor at a set age and can be controlled If you have children, the best thing to do is to write a will naming a guardian

and establishing a trust for your children In Okla., you can transfer to an UGMA but you can’t establish a trust (????)

G. Bars to Succession

5

1. In re Estate of Mahoney W was convicted of manslaughter The probate court awarded the estate to H’s parents on the theory that the

slayer predeceases the spouse I: may widow convicted of manslaughter inherit estate Without a statute on point, courts will normally do 1 of the following:

Legal title still passes to and remains with the slayer No passing of legal title b/c person should not profit from own

wrong doing (estate goes to other heirs) Legal title to slayer as a constructive trust and property must be

conveyed to heirs or next of kin This court held that intent was not a requirement, so voluntary manslaughter

is the same as murder2. Note that b/c slayer is deemed to have predeceased, issue of the slayer can still

take inheritance3. If property is held in joint tenancy, the deceased person’s share will pass to heirs4. 84 O.S. § 231 (p.47): requires conviction, except for proceeds of life insurance

policy; the statute suggests that estate will pass to other heirs5. If person is acquitted in criminal case, the court can still look to see if spouse

could be guilty by preponderance of the evidence 6. If convicted, it can be relitigated in civil court for the insurance proceeds; must

claim that the person feloniously, intentionally, and unjustly took the lifeH. Disclaimer

1. You generally have 9 months2. Person disclaiming is treated as having predeceased and therefore pays no

transfer taxes3. It helps to avoid creditors, but it does not prevent federal tax liens from being

collected4. Troy v. Hart

Man is in nursing home and is on Medicaid His sister dies and the other sister has him sign a disclaimer to his share of

the estate Law requires that if your financial situation changes while you are on

assistance, you must notify them I: could he disclaim his share? H: yes, but it is treated as if he accepted for purposes of qualifying for

benefits, so he gets kicked off Here, man was dead so his estate was responsible for paying back money to

gov’t In Okla. it is a crime to get rid of your assets in order to qualify for

assistance 84 O.S. § 22-31 and 60 O.S. § 751, et seq. (gifts)

III. Wills: Capacity and ContestsA. Mental Capacity: why require? Reasons usually given:

6

1. Will should represent the true desires of the testator2. Mentally incompetent persons are usually not regarded as “persons” under the law3. Protection of the decedent’s family4. Protects persons from exploitation5. Assures persons that their “sane” desires will be carried out6. Public acceptance requires laws to be legitimate, which can’t exist unless decisions

are reasoned7. Protects society from irrational acts

B. Test of mental capacity1. Must have ability to know:

The nature and extent of property The persons who are the natural objects of bounty The disposition they are making How these elements relate so as to form an orderly plan of the disposition of

property2. Requires only a window of sanity in which will was written3. The person trying to set aside has the burden of proving insanity4. Persons under a conservatorship can still make a will, but in Okla. it requires a

judge’s signature 84 O.S. § 41 (p. 37)5. Note too that the standard of mental capacity is lower to get married than it is to make

a will6. Drafting a will for someone who is incompetent is a breach of duty

There is a strong argument that you are not in a position to decide person’s mental capacity, but if you are in doubt document evidence, consider getting a medical opinion and have another person in your office sit in on all meetings with client

Using a video camera is probably not a good idea b/c people tend to act differently in front of them anyway

C. Insane Delusion1. Only parts affected by the delusion will be set aside

Defined as: an idea that the testator adheres to despite evidence to the contrary2. In re Honigman

H left the minimum amount to w b/c he thought that she was having an affair The person objecting to the will must present evidence of testator’s mind and

proponent must show basis for the delusion It only requires that the delusions MIGHT have affected the distribution

3. Delusion v. Mistake Mistakes are correctable if testator knows the truth Court usually will not reform or invalidate a will b/c of mistake Example: testator mistakenly believes that her son is dead and she leaves all her

estate to her daughter in will; if the son is really alive, the will is still valid

D. Undue Influence1. Factors to consider:

Were they susceptible

7

Did the influencer have the disposition and was there an opportunity to influence The disposition of the property was a result of that influence

2. Lipper v. Weslow Grandmother disinherited child of deceased son They claimed that the other son, who drafted the will, exercised undue influence

over her Test: whether such control was exercised over the mind as to overcome her free

agency and fee will and to substitute the will of another The court here said that the will should stand as written, but this is a questionable

result3. Burdens of Proof: the rule that is often applied is that where a person in a confidential

relationship receives the bulk of the testator’s property from a testator of weakened intellect, the burden shifts to the person occupying the confidential relationship to prove the absence of undue influence

4. Only portions of the will that are affected will be tossed out unless the contest in b/c of mental capacity, then the whole will is tossed out

5. If there is a question as to why someone is left out, it is better to just put a letter in your file, rather than in the will; wills become public documents and you can still liable someone in your will

6. No-contest clauses are usually enforced unless the person contesting has probable cause. However, in Okla. they are usually upheld regardless

7. Anyone who would benefit from the contest can challenge a will8. If undue influence affects a pre-residual gift, the bequest passes to other heirs.

In Okla., the part set aside still passes through laws of intestacy, so if a child exercise undue influence, he may still be able to inherit

9. Bequests to Attorneys Courts will look at: confidential relationship and participation in the drafting This creates the presumption of undue influence which shifts the burden to atty to

show that there was none

8

RPC 1.8 : can’t prepare a will giving a gift to yourself unless you are related to the person that you are preparing the will for; this includes gifts to persons that the lawyer is related to as parent, child, sibling or spouse

In re Moses Woman had will prepared by another atty and gave her estate to her

boyfriend who was also her atty. There was no evidence that he knew of the will at all The boyfriend was required to show that she had received “independent

advice” in the drafting of the will Court said she did not b/c the atty writing the will only asked a few

questions The burden shifted to boyfriend b/c it was easy to show the confidential

relationship In Okla. it would not have shifted b/c you are required to show the

relationship AND participation in the drafting10. If there is a high risk of undue influence:

Discuss possibilities and realties of disinheriting heirs Discuss out of presence of potential influencer Write a letter explaining they are favoring non-related persons Tell witnesses Have them write memo to you and make sure that the specific instances they ste

to are accurateE. Fraud

1. Occurs when the testator is deceived and does that which they would normally not do (if other reasons for the bequest exist, it often won’t be set aside) Must be a false statement Of material fact That deceived the testator and caused he or she to act

2. Must be done with both the intent to deceive and the purpose of influencing the disposition

3. Court can probate the will and then impose a constructive trust4. Okla. follows the majority test which is: would will have been changed BUT FOR

the fraud? (proof of this is hard)5. 2 types of fraud;

fraud in the inducement fraud in the execution

6. If the whole will is revoked, the 1st will is valid again (revocation clause in 2nd will gets revoked too)

7. Latham v. Father Divine Cousins of deceased claim that Father Divine prevented Mary from revoking her

1st will and drafting a 2nd which would have named them as beneficiaries

9

There was also a separate will contest filed by her heirs in which Father Divine’s share was reduced, but the cousins were not heirs so they could not take in that suit. Fraud can be claimed even if you don’t have standing in probate court.

Problem here is that the court was asked to decide about a will that was never written

For equity reasons the court imposed a constructive trust8. Fraud actions will not expire as soon as will contest

F. Tortious Interference with Expectancy1. Involves conduct such as fraud, duress, or undue influence2. Requires proof that BUT FOR the interference the person would have inherited

something3. Some courts require you to exhaust all remedies in probate court first, which could

still bar other suits.4. Usually not a problem if there is a no contest clause b/c tortuous interference is not

considered a contest

IV. Wills: Formalities and FormsA. Execution of Wills

1. Attested wills

10

43 O.S. § 55 p. 40 requirements Signed at end Signed in front if /acknowledged/to by witnesses Must declare that it is a will 2 witnesses must sign in testator’s presence If you add language in (a) or (b) it becomes self-proving (no witnesses

required, but still must be singed by testator) In re Goffman

W contests the way that the will divides property and seeks to have it thrown out as invalid for failing to comply with the Statute of Wills

The witnesses did not sign in the presence of one another and the testator’s signature was not acknowledged to both of them at the same time

Statute of Wills requires: signed/acknowledged in front of witnesses, both be present at the same time, and they must sign in front of the testator

H: both witnesses must see the signature and acknowledge it at the same time

In Okla. under 84 O.S. § 55, there is not a requirement that both witnesses acknowledge the signature at the same time (Goffman will would be valid)

Reasons for formalities of the Statute of Wills Ritual = impresses upon testator the significance of his actions Evidentiary = increases reliability of proof in court Protective = protects testator from undue influence

Requirement of “presence” has different meanings 84 O.S. § 55 (1), (2) and (4) Line of sight = can the testator see the witness and the fact that they are

signing the will Conscious presence = more liberal and is probably the test in Okla.; asks

whether the testator could tell that the witnesses was signing the will through the use of sight, hearing or general consciousness of events

Order of signing Testator signs first Witnesses do not have to sign at the same time or in the presence of one

another, but must sign in the presence of the testator (not valid if signed after testator’s death)

If person can no longer sign their name, signing a symbol such as an “X” will be valid

Someone can also sign of behalf of the testator; make sure that the testator’s name is signed and then put “by …” according to 84 O.S. § 56, the person signing for the testator should also be a witnesses to the will

You can help someone sign his or her name, but it looks better if they ask for help before you help them

A rubber stamp is not valid

What is the end of the will? Two tests” physical end or the logical end (used in Okla.)

11

If changes are added later, sign those to in order to make sure that hey are valid; if they are witnessed too then there is no problem, if they are dated and signed then they would become holographic

The original will can still be valid even if the changes are thrown out In Okla. there is a publication requirement which means that the witnesses must

know that they are signing a will Must have competent witnesses (they can’t be beneficiaries to the will unless

there are two others who sign who are not) Estate of Parsons: disclaiming your share does not make you a

disinterested witnesses b/c the disclaimer relates back only to the point of when you got the gift, not to the signing of the will

The will is still admitted to probate, the gift to the interested party is thrown out and the witnesses is not prevented from taking by intestacy or by a previous will

84 O.S. § 143 84 O.S. § 144: possible that this only applies to INTESTATE heirs

2. Self-proving wills 84 O.S. § 55 1st way =Execute in accordance with statute (acknowledge) 2nd way = special attestation clause (include in all wills)

3. Safeguarding wills Concern that it is solicitation of business Always give the client the option of taking the will with them The burden is high to probate a will that is lost and the presumption is that it was

revoked There is also the option of depositing the will with the court 84 O.S. § 81 and 82 In re Pavlinko’s Estate

W and H signed the wrong wills Attempt to probate H’s will Court says that there are too many changes that would have to be made, so

it is not admitted to probate Doesn’t meet the requirement of being signed at the end by the testator In Okla., Elias might be able to use 84 O.S. § 174 and would also have a

claim of malpractice against the atty Other courts have looked at this same problem and have taken both wills

into account to determine testamentary intent and found the wills valid Testamentary intent

Intend to dispose of property Disposition is to be upon death This is the document to accomplish that objective

4. Holographic wills 84 O.S. § 54

12

Requirements Dated with the day, month and year Signed (anywhere) ENTIRELY written by the testator

Easy to change Requires testamentary intent The only reason for the statute of wills that is satisfied here is the evidentiary

requirement In re Estate of Johnson

Testator had filled in a pre-printed will form with certain handwritten provisions

Was not witnessed at the end Court held that you must show that the hand writing expressed intent so

this will was not valid In Okla.: no question that it would be invalid b/c a HW must be

ENTIRELY in the testator’s handwriting Kimmel’s Estate

Father wrote a letter to his sons and gave them his property “if anything should happen to me’

Court held that these were words of disposition and they were determined to me “if I die”

The fact that the father was sick was viewed as an inducement for making the will

B. Revocation of wills1. Revocation by Writing or Physical Act

If revoking in writing: Must be executed with same formalities as required by the Statute of Wills If it is a Holographic revocation, no witnesses are required If it is a typed revocation, must be witnessed

Physical act: Destroying Obliterating Burning 84 O.S. § 101, 102 you must have necessary intent if the will was destroyed by someone else, it must be done the presence of

the testator and 2 witnesses must show it was done at the direction of the testator and the fact of the injury or destruction

the intent requirement can be shown through a change in circumstances A written revocation is the safest way If the will is not properly revoked, it is admitted to probate Harrison v. Bird

Testator orders the atty to destroy her will and he rips it into 4 pieces and mails them to her.

The pieces are not found in the personal papers after her death

13

Cousin files copy of the first will, which names her as a beneficiary

Even if the will was not properly revoked by the atty. b/c it was not found in the testator’s possession, there is a presumption of revocation

Cousin offered insufficient proof to rebut this presumption

In Okla. 84 O.S. § 101: to revoke there must be 2 witnesses and it must destroyed in the testator’s presence

If you copy the will, always copy it prior to the signing so that the signatures do not appear on the copy

The is b/c destruction of the duplicate would then revoke the original as well2. Probating lost wills 58 O.S. § 81 and 82 p.7

But it is very hard to show that the will was in existence at the testator’s death and that it was fraudulently destroyed

3. Thompson v. Royall Testator attempted to revoke her will by having her atty and a witness write on the

back that it was revoke but was to serve as a memo for future will; she then signed the attempted revocation

In Okla. under 84 O.S. § 101, it would not be a revocation b/c it is not in the handwriting of the testator

The court here hold that it was not destroyed b/c there were no marks of lines through the will

4. Partial revocation These are valid in Okla. 84 O.S. § 101 and 103 Makes it very easy to commit fraud Partial revocation will increase the residuary gift, not any of the gifts to other

beneficiaries. 5. Dependent Relative Revocation (DRR)

Must show 3 things Attempted revocation Ineffective disposition Testator’s intent: choose b/t 2 alternatives

Carter v. First untied Church of Albany Facts: 1963 will was found and portions of it had been marked through Evidence showed that testator intended to changer her will but never

executed a new will W/o the application of DRR, the revocation would be final W/DRR: the attempted revocation and the new disposition must be done

at the same time to show that they were connected Here, we can’t tell but the court says that there is a presumption that they

were done at the same time b/c the 2 documents were found together 2 alternatives: restore 1st will or pass through intestacy 1st will stands b/c it is closer to the testator’s intent

Courts have set limits on DRR: it only applies when there is an alternative plan that fails or where there is a mistake in the terms of the revoking instrument or if the mistake is established by clear and convincing evidence (must be apparent

14

from the face of the will that “but for” the mistake, the will would not have been changed

Under DRR in Okla., the statute says that the 2 alternatives don’t matter and that the revocation isn’t valid (regardless of the intent) 84 O.S. § 103.

To get around this, you would argue that it was 2 different acts Revocation was independent of new disposition and therefore § 103 would

not apply Estate of Alburn

Testator revoked KW with the expectation that her MW would be revived Apply DRR: attempt to revoke (destruction of KW), ineffective

disposition (failure of MW to revive) and what was her intent Intent was probably closer to KW will since the provisions of that will and

the MW were essentially the same Revival of prior will

States fall into 3 categories: will #1 is not revoked unless will #2 is in effect at death, will #2 legally revokes will #1 when executed and upon revocation of will #2, will #1 is revived if there is intent to revive (the 3rd group says that there will #1 must be re-executed)

In Okla., there is a “no revival” statute which says that once will #2 is executed, will #1 is dead and can’t be automatically revived 84 O.S. § 106; the result in the above case would be that the physical revocation would not revive the will, but if there had been a written revocation of the KW with a statement saying the intent was to revive the MW, it would work

6. Revocation by operation of law Divorce 84 O.S. § 114

Former spouse is treated as predeasing Look also at 15 O.S. § 178, which revoked spousal provisions on other

documents; b/c ERISA it probably does not include retirement plans Marriage

If the will is not changed, W takes intestate share in most states In Okla., it is a forced share which is ½ of JIP 84 O.S. § 44

Birth In Okla., if not in will gets intestate share 84 O.S. § 131 If you want to disinherit, you must say so If you want to cover all children equally in the will, you should say

something about any children that you now have or will have in the future

C. Components of a Will1. Integration of Wills

15

All papers present at the time of execution which were intended to be part of the will, are integrated into the will

Cases arise when the pages of a will are not physically connected and there is no internal coherence or where these is evidence that staple has been removed and the will stapled again or where one page is typed in a different font

Presumption in favor of integration ad the burden is on the contesting party to disprove

2. Republication by Codicil Will is treated as reexecuted (republished) as of the date of the codicil Can apply only to wills that were validly executed prior to the codicil If testator writes a codicil to 1st will and does not revoke 2nd will, 2nd will is treated

as revoked by implication Revoked wills: may be revived by codicil if testator intended Ineffective will: generally not allowed to republish an invalid will; Okla. is

probably in the minority and will allow this. See Johnson v. Johnson A codicil can be revoked without revoking the underlying will

3. Incorporation by reference Any writing in existence when a will is executed may be incorporated by

reference if the language of the will manifests this intent and describes the writing sufficiently to permit its identification

Elements: Writing must be in existence at time of executing will Writing must be clearly identified in will Writing must be the one referred to in the will (reasonable certainty) The intent to incorporate document in will must appear on the face of the

will (no extrinsic evidence) Attested and Holographic Incorporation: a type written provision of will can be

included in a holographic will by reference or vice-versa Clark v. Greenhalge

Testator’s will referred to a memo which would devise her personal property

A memo was in existence when the will was executed but the testator then began to keep bequests in a notebook too

The gift in question was written in the notebook in a nurse’s handwriting so it is not a holographic codicil

Court holds that b/c the notebook was in existence when the codicils to the will were validly executed, it is incorporated by reference (will was republished at the time of the codicils)

Smith v. Grayson Court held that the letter found in a safe deposit box was incorporated by

reference even though the letter had a different date than the one referred to in the will

Since the letter was dated prior to the codicil, it was in existence at the time of republication by the codicil

Johnson v. Johnson Typewritten will was not validly executed However, the holographic portion at the bottom was

16

The Court held that the holographic will was an effective codicil and that codicil republished the will.

This is the minority view; most states hold that only validly executed will can be republished

Court should have used incorporation by reference to validate the typed portion

4. Acts of independent significance If beneficiary or property designations are identified by acts or events that have a

lifetime motive and significance apart from their effect on the will, the gift will be upheld under this doctrine

If testator signs a document which alters the disposition of property under the will but the document does not conform with the statute of wills, ask if the testator did something to change the testamentary disposition; if yes, it probably is not independent

D. Contract relating to wills1. A person may enter into a contract to make a will or a contract not to revoke a will.

Contract law, not the law of wills applies. If party dies leaving a will not complying with the contract, the will is probated but the contract beneficiary is entitled to enforce the contract by having a constructive trust impressed for his benefit upon the estate or devisees of defaulting party. Court may also apply quantum meruit

2. Oral contracts: must be proven by clear and convincing evidence3. Remedies: not remedy until after death unless it was for a devise of real estate; the

statute of limitations will begin to run at death; claims are filed as if the person is a creditor of the breaching party

4. Consideration: contracts to make wills or not to revoke wills must be supported by consideration; Promise to marry and take care of someone is not consideration; Promise of future gift is not consideration; promise to take care of someone that you are not married to is consideration.

5. The will is still valid even if the contract to make it is not

6. Contracts not to revoke Three types:

Joint will: one instrument executed by 2 or more persons as the will of both. When 1st spouse dies, will is probated; probated again when 2nd

17

spouse dies; will is revocable prior to the death of the 1st spouse; after 1st spouse’s death it becomes irrevocable and unenforceable

Mutual wills: separate wills that contain mutual provisions Joint and mutual wills: joint will that devises in accordance with a

contract; one spouse usually agrees not to revoke without the knowledge and consent of the other spouse; presumption is that joint and mutual wills are not contractual

Rules for revocation Notice is required Alteration before death: if not notice is given but the one who revokes

dies first, there is no problem b/c the survivor is not held to the contract Alteration after death: if not notice is given, and the one who revokes

does not die first, the court will enforce the contract on the estate of the surviving spouse

Example: H gives W notice that he is changing will; H makes new will but W does not; W is still held to terms of will upon her death unless she revises it.

Example: If H changes will w/o notice to W and he dies 1st, no remedy; if W dies 1st the contract will be enforced.

Via v. Putnam H did not change is mutual will with ex-W prior to death 2nd W claimed spousal share after his death 2nd W’s forced share should take priority over a will made pursuant to a

contract but in Okla. a surviving spouse’s rights are inferior to those of creditors

V. Will Substitutes: Nonprobate transfersA. Contracts with POD provisions

1. Common law rule: POD designations are not valid unless they comply with the statute of wills b/c they are testamentary instruments.

18

2. Okla. Rule 6 O.S. § 901-902: POD accounts are valid despite their testamentary nature if they are expressly designated as POD. Donor can withdraw funds up to death. Donee can withdraw from account. POD accounts are not subject to gift tax b/c they are not present transfers.

3. Wilhoit v.. Peoples Life Insurance W received life insurance proceeds and then returned it to the company to be put

on deposit with them She designated that it go to Robert Owens upon her death but in her will stated

that it should go to Robert Wilhoit Separate agreement means so this was not insurance policy and since it was not

executed in accordance with the statute of wills it is not valid Follows rule still applied in some states: POD not valid unless it is insurance

policy4. Estate of Hillowitz

H was a partner in an investment club which paid w his portion when he died Executor claims it should pass with estate Court says that the partnership agreement was valid, so the transfer doesn’t have

to comply with the Statute of Wills5. Cook v. Equitable Life Assurance Society

H had policy naming 1st W beneficiary They divorce and he marries 2nd W When he dies, she tries to claim that H’s will changes the beneficiary on the

policy Court says that it must be changed in accordance with the terms of the policy, not

valid if just done in the will The rule protects life insurance companies and allows beneficiary to receive

payment quickly 3 exceptions:

wavier of contractual requirements by insurance company and new certificate has been issued with new beneficiary

if contractual requirements are beyond insured’s control (can’t literally comply with requirements)

if insured dies before modification takes effect Note that life insurance policy designation is not revoked by divorce; except in

Okla. see 15 O.S. § 178: which revokes by statute; however, it does not apply to policies written prior to the statute and changing it by will is still not effective; note sure how this effects retirement plans b/c ERISA won’t allow it but does ERISA preempt state law?

B. Multiple Party Bank Accounts1. There are 3 types of multiple party back accounts and whether the court will hold that

it was a testamentary gift often depends upon what type of account it is

19

True joint account: becomes property of the survivor after death, both parties have access to the account during their lives and these accounts are considered PRESENT TRANSFERS

Okla. Statute 60 O.S. §74: either party can w/d funs but creditors can only reach that portion of account to which that depositor has contributed. In Okla., it can’t be created unless expressly provided for in the language

If 2 names are on the signature card and both had access during life, a presumption exists that the account was a true joint account; party contesting must prove by clear and convincing evidence

Payable on death account: Only the contributor has access during life and the beneficiary gets funds upon death;

They are dealt with as a contract b/t the bank and the person Okla. Statute 6 O.S. § 901, 902 Beneficiary must be changed on account, not in will If beneficiary dies first, it passes pursuant to their will

Agency or convenience accounts: durable power of attorney; no present intent to make a gift and no intent that 2nd party will take at death

2. Joint safety deposit boxes: most states do not recognize them as being held in joint tenancy b/c of the possibility of fraud

3. Totten trust: 15 O.S. 902: function like a POD: “A” deposits money into account in the name of “A as trustee for B”; goes to B at A’s death

4. Franklin v. Anna National Bank of Anna Man put care taker on account with him Court said his intent of making it a convenience account would control and she

does not get the money when he diesC. Joint tenancies

1. gives joint tenants equal interest2. no power to devise share3. Creditor may seize joint tenant’s interest during life; at death, it vanishes there is

nothing for them to reach4. Intent to create a joint tenancy is a present transfer and is not subject to the statute of

wills5. can’t be changed by will (reduces certainty)

D. Revocable Trusts1. Okla. has a presumption that trusts are revocable unless otherwise stated2. In Okla., Property can be deeded to either the trust or the trustee

20

3. If trust is irrevocable: probably considered a gift so there is gift tax; no estate tax if set-up right; there are income tax consequences

4. If revocable: no gift tax, estate is fully taxed at creator’s death; income tax is taxed to creator

5. Farkas v. Wiiliams Creator purchased stock as trustee for EE Court said that b/c he gave up right to total control of the stock, he had created a

trust Farkas retained the power to sell and was still subject to requirements of the trust Had good evidence of intent

6. In re Estate and Trust of Pilafas Creator established trust with specific provision for revocation The original trust left out 3 of his children and then he told attorney to change it

but it was not changed before his death Creator also had a pour-over will which placed other assets into the trust when he

died Both the will and the trust where in the testator’s possession at his death and can’t

be found Presumption that will was revoked so assets not already in the trust do not pour-

over, but the trust is still valid b/c it was not revoked in accordance with the specific provision

7. State Street Bank v. Reiser Bank made personal loan to creator of trust and did not realize that the assets that

he claimed to own were actually owned by the trust When he dies, everything is in the trust 2 arguments:

integrated estate plan with trust and will: trustee not required to pay debts, trust assets can be reached only during creator’s life if it is a revocable trust (if irrevocable, can only get the income)

creditors can reach assets which could be payable to creator Creditors can reach the assets here b/c the power to revoke ended at death Probably would be different if the only asset was the life insurance policy which

was payable to the trust

8. Pour-over wills Will that transfers residue to trust that was established during life (trust must be

funded during life)

21

Different from a testamentary trust: they are not funded until death and the court directs the will’s executor to fund the trust and the trust is subject to court supervision forever; with an inter vivos trust, no court action or supervision is required

Pour-over wills are easy to administer and provide secrecy b/c trusts are not public documents

Because they are testamentary in nature, you must look to 2 other doctrines to avoid having to comply with the Statute of Wills:

Incorporation by reference: a pour-over mentions the existence of a trust and thus incorporates it by reference; the problem is that the trust must be in existence at the time of the will and anytime that the trust is amended, the will must be too;

Acts of independent significance: requires that some assets be transferred during life of creator

Differences: independent significance requires that the inter vivos trust have assets transferred to it during life; incorporation requires that the trust be in existence when the will is executed

Solution found in the statute: 84 O.S. § 301, which provides that a devise or bequest from a will into a trust is valid if:

The gift in the will is valid The trust is identified in the will and its terms are set forth in a writing

other than the will and that is executed before or simultaneously with the will or the trust was created by a valid will of a 3rd person who predeceased the testator.

A pour-over trust is valid whether funded or unfounded Amendments may be made to trust after execution or even after the

testator’s death, but property shall only be administered in accordance with amendments made before the death of the settlor unless the trust expressly provides for amendments after death

The testator or a 3rd party may make amendments Amendments may be made by any means provided for in trust including

oral amendments

9. Use of revocable trusts in estate planning Consequences and advantages during creator’s life

Property management by a fiduciary Clarify title by keeping marital property separate A revocable trust has no income or gift tax benefits over a properly drafted

will Dealing with potential of becoming incompetent

22

Consequences and advantages at creator’s death Costs: avoid probate with revocable inter vivos trust Delays: trust assets are available immediately Creditors: creditors can almost always reach trust assets and personal

assets Investments: during the probate process, the decedent’s estate can have a

trustee invest property rather than an administrator Publicity: wills are public, trusts are not Out-of-state property: avoid ancillary probate Forced share: a trustor may not eliminate forced share by placing property

in a trust Testamentary trusts: avoid restrictions in and expenses of testamentary

trusts and allows foreign corporations to serve as trustee Uncertainty: the law of revocable trusts in not as certain as that of wills Will contests: avoidance of will contests b/c it is more difficult to

establish undue influence and fraud in a trust Controlling surviving spouse’s share: a trust is an alternative to a

contractual will and allows for control of spouse’s assets at time of creator’s death

E. Planning for incapacity1. power of attorney

good for small to moderate estates durable: only terminates at death; non-durable terminate with the incompetency

of the principal (most states have enacted statutes which allow it to continue) in Okla.: a presumption of validity arises if a durable poser of attorney is

executed with 2 disitnerested witnesses and it is notarize; if these requirements are not met, it may still exist, but must be proved

2. comparing with revocable trusts trust does not cease with death, durable power does courts will appoint a successor trustee; if durable power terminates at death of

agent unless the principal appoints a successor probate is avoided with a trust agent and trustee can both authorize gifts trustees are held to higher standard of care

3. Living will 63 O.S. § 3101 Must have 2 disinterested witnesses Family can still request based on the wishes of the person, but a living will takes

away the burden For stopping of hydration/nutrition, you must have living will, a family member’s

word is not enough

23

VI. Construction of WillsA. Admission of extrinsic evidence

1. Plain-meaning rule: if a document is clear and unambiguous, courts can not look to extrinsic evidence to interpret it; this creates a presumption that is overcome only with strong evidence of another meaning Mahoney v. Grainger

Court held that meaning of “heirs at law” was not ambiguous and therefore no extrinsic evidence could be used to show that the testator intended someone else to get her property

Latent ambiguity of the use of the word “heirs” instead of “heir” b/c she thought her cousins would get her property

Fleming v. Morrison The will was not ambiguous but extrinsic evidence was allowed to show

that there was no intent b/c testator intended will to be a fake Estate of Russell

T dies and leaves a HW which gives everything to her friend and dog, except for 2 gifts to niece

Niece claims that will is void b/c of gift to dog; friend claims that the will means that he should take care of the dog

This is a latent ambiguity b/c you can only tell by looking outside the will that Roxy was a dog

Ct agrees with niece and awards her ½ of the estate (gift to residuary beneficiary is void so it passes to intestate heir)

2. Patent v. Latent ambiguities Patent is clear from the face of the will Latent requires outside information Extrinsic evidence is usually not allowed to show a patent ambiguity, but is

allowed with respect to latent Personal usage exception: if testator referred to someone by another name, the

evidence is admissible to show that the will means someone different than the person with the legal name given

Courts may also consider extrinsic evidence of mistakes in execution (writing error or signed the wrong will)

Mistakes in inducement: extrinsic evidence not usually admitted unless it is apparent from the face of the will and the testator’s intent is clear from the face of the will ( give to nephew b/c thought son was dead)

Okla. rule 84 O.S. § 152: if there is a patent ambiguity, extrinsic evidence (except for testator’s statements) may be admitted; case law extends this to latent ambiguities too

84 O.S. § 174: if there is an imperfect description, mistake or omission in the will the court can allow extrinsic evidence except that it can’t show that the testator had a different intent

24

3. Correcting mistakes Erickson v. Erickson

H made will days before getting married and left property to new W Statute in this case called for revocation upon marriage of all wills in

existence at the time of marriage Court says that extrinsic evidence is not permissible to show intent, but

could admit it to correct a mistake 3 reasons: it is admitted to prove that a will was executed by the testator

in reliance on fraud, undue influence or duress and there is no difference b/t those and innocent misrepresentation, innocent error and drafting errors; innocent misrepresentation which causes will to not reflect the testator’s true intent is treated the same as fraud so you should use extrinsic evidence for both; signing the will only creates a rebuttable presumption

4. Modern rules Latent: extrinsic evidence may always be introduced to show that under the

circumstances of a case, seemingly clear language of a will actually embodies a latent ambiguity

Patent: when uncertainty appears on the face, intent is to be determined by the words; circumstances of the execution may be allowed to show intent (no declarations of testator)

B. Death of Beneficiary Before Death of Testator1. Common law rules

All gifts made by will are subject to a requirement that the devisee survive the testator unless the testator specific otherwise.

Specific or general devise: if it lapses, it falls to the residue Residuary devise: (no residue of the residue rule) if it lapses, heirs take through

intestacy; if it is only one share, that share passes through intestacy Class gift: surviving members split the shares of members who have predeceased

the testator Void devise: same as lapsed gifts

2. Okla. laws Lapse statute 84 O.S. § 177

If devisee dies during the lifetime of the testator, the disposition to him fails unless the will provides otherwise (lapses if will is silent)

Anti-lapse statute 84 O.S. § 142 If a beneficiary predeceases the testator, and that beneficiary is related to

the testator and his lineal descendants, then the gift goes to his descendants

Beneficiary must be related to the testator as a child or any next of kin, beneficiary must leave lineal descendants and there can be no contrary intent expressed in the will

25

3. Cases Allen v. Talley

Testator left property to her living brothers and sisters Only 2 were still living at her death Sister says that words of survivorship prevent the application of the anti-

lapse statute Court says that is correct b/c the word “living” is followed by “share and

share alike” which has no meaning if the anti-lapse statute is applied

26