Category Archives: Trusts & Estates
Oct 29, 2013 William LaPianaTrusts & Estates
In his latest article, Incomplete Wills, Professor Adam Hirsch undertakes an elaborate analysis of the law governing the disposition of the portion of the testator’s probate estate undisposed of by the testator’s will. The breadth and depth of the research on which the article rests is formidable indeed. Although at first thought one might quarrel with the author’s assertion that the examination and classification of reported cases is a form of empirical research, he is candid about the limitations of the technique and his use of the cases is really quite traditional: they are illustrations of the great variety of circumstances in which the courts have considered real problems, in this instance, those caused by incomplete wills. And this use of the illustrations that the cases provide is the message of the article. Because wills are incomplete for many reasons, all of which are to some degree unintentional, the usually bright line rules that govern, exemplified by the closely related treatment of these topics in Restatement (Third) of Property (Wills and Donative Transfers) and the Uniform Probate Code (UPC), often give results that to varying degrees are out of sync with what we can learn of testators’ intentions.
Prof. Hirsch first discusses negative wills at great length, asking under what circumstances express disinheritance should be effective to supplant the intestacy statute in the event of a partial intestacy (providing along the way a complete discussion of current American law on the subject). With appropriate noting of the limitations of the data, he attempts to classify the reported cases according to the reason for disinheriting a family member by means of a negative will. The most we can conclude from this effort is that “the data suggest a substantial scattering of testamentary motives.” That fact, in turn, leads to the conclusion that neither the traditional refusal to honor negative wills nor their blanket approval by the modern view exemplified by the Restatement and the UPC is the best way to go. He suggests instead a close inquiry into the motives for making a negative will. The legislature will need to create a presumption about the testator’s intent to create a negative will or not, a presumption which for now will be arbitrary but in the future will be refined in light of cases decided under the new rule of ascertaining testator intent. Continue reading "Filling in the Blanks"
Sep 30, 2013 Anne-Marie RhodesTrusts & Estates
Professor David Horton argues that testation is a form of expressive speech that may raise Constitutional concerns. In doing so, he reminds us of a basic reality—a will that disposes of property is also the will of an individual speaking to his or her family, friends, and community. Legal trends that emphasize efficiency over the testator’s individual voice are troubling.
Horton begins by examining three traditional analogies used by courts in deciding trust and estates cases—property, contract, and corporate law. In describing each analogy, Horton notes that none of these is spot on, there is an ill fit associated with each. This provides the intellectual space for other theories and perspectives, including speech. Horton acknowledges that his conceptualization of testation as Constitutional speech is also not a perfect fit; nevertheless it offers an intriguing lens through which to view some difficult cases and doctrines. Continue reading "To Praise Testator’s Speech"
Aug 13, 2013 Alyssa DiRussoTrusts & Estates
Adam Chodorow, Death and Taxes and Zombies, 98 Iowa L. Rev. 1207 (2013), available at SSRN.
Taxes and brains—or rather, braaaaaaains—have always gone well together, but never quite like this. The income tax and the estate tax present intricate mechanisms for levying assessments on the living and the dead. In Death and Taxes and Zombies, Professor Chodorow turns his attention to the middle of this Venn diagram: the undead. The article reveals that Congress and the IRS have utterly failed to address this topic, creating significant uncertainty as to how the tax laws would apply in the event of a zombie apocalypse.
The article leads the reader through a series of ordinary tax and legal scenarios and applies them to extraordinary circumstances. How do states address the question of what it means to be legally dead? When does federal law trump state law for purposes of determining whether an inheritance has passed? What constitutes taxable income? What are relevant valuation dates when property is transferred, and how are the basis rules applied in the context of transfers from a decedent? What are the loopholes in the estate tax and the income tax? And more important, how do these rules apply to zombies? Continue reading "Taxes and Brains"
Jul 10, 2013 Stewart SterkTrusts & Estates
Intestate succession law has traditionally been directed toward accomplishing two objectives: effectuating the likely intent of intestate decedents and minimizing administrative costs. Within the so-called “traditional” family, those objectives are rarely at odds. As a result, intestate succession law has traditionally been relatively simple: the decedent’s property is distributed to the decedent’s spouse and issue, and the only areas of controversy surround how much the spouse should take, and whether distribution to issue should be per stirpes, per capita, or by the UPC’s more refined “by representation” scheme.
In her recent article, however, Professor Susan Gary identifies the growing complexity in intestate succession law. That complexity is a response to increasing recognition that intestate succession statutes designed for the traditional family often frustrate the intent of decedents whose family is not traditional. To deal with non-traditional families, Professor Gary notes that a number of states have attempted to bring domestic partners, children born through assisted reproduction, stepchildren, and even informally adopted children within the intestate succession scheme, and cites a variety of scholarship supporting this expansion. Similarly, she identifies statutory provisions designed to disinherit intestate heirs when it would appear that the decedent would not want those heirs to take; in addition to slayer statutes, she discusses cases of child or spousal abandonment, and cases of elder abuse. These refinements of more traditional intestate succession statutes presumably increase the number of cases in which intestate succession doctrines effectuate the intent of intestate decedents, but, as Professor Gary observes, they are not perfect; they do not anticipate all of the circumstances in which a decedent might want to vary the most common patterns of distribution. Continue reading "Rules or Standards For Intestate Succession?"
Jun 11, 2013 Phyllis SmithTrusts & Estates
When I read the title there were three questions that came to mind right away. First, I was curious how to determine the type of abuse that would serve as a presumptive bar. Next, I was curious how this presumptive bar would apply to wills and/or other forms of inheritance. Finally, I wondered what mechanism would be in place to prevent this proposal from being used to usurp a woman’s decision to transfer her own property the way she desires.
Professor Spivak answers the first question by proposing a presumptive bar to inheritance to an abusive spouse because it provides an opportunity to expand existing laws. The existing laws already provide a presumptive bar to inheritance to perpetrators of elder and child abuse of the decedent. Including spousal abuse as a barrier to inheritance sends the message that spousal abuse is just as an important public policy stance to deny an unjust enrichment to abusers as the others categories of abuse. As a policy matter I agree that perpetrators of spousal abuse should not be permitted to inherit in cases where systemic abuse exists. As a practical matter I envisioned this would be tougher to regulate because there are different types of abuse and how should abuse be defined for this limited purpose. Continue reading "Should a History of Spousal Abuse Serve As A Presumptive Bar To Inheritance?"
Apr 7, 2013 Paula MonopoliTrusts & Estates
Kelly, Daniel B., Toward Economic Analysis of the Uniform Probate Code, 45 Univ. of Mich. J. of Law Reform 855 (2012), available at SSRN.
In his article, Toward Economic Analysis of the Uniform Probate Code, Dan Kelly fills a significant gap in the inheritance law literature. As he notes, a number of scholars have brought the lens of economic analysis to bear on trusts but few, if any, have taken a comprehensive look at intestacy and wills using the tools of economic analysis. Kelly takes on this task and the result is an important contribution to the field.
Kelly begins by tracing the important historical move from formalism to a functional view of inheritance law and gives the reader a succinct synopsis of the work of important inheritance law scholars like John Langbein and Larry Waggoner. He then describes the work of a younger generation of scholars like Rob Sitkoff, who has brought empiricism to trust law in particular. This literature summary is helpful in identifying the scholarly gap in the area of intestacy and wills, i.e., succession law. Continue reading "Succession Law Through an Economic Lens"
Mar 4, 2013 Solangel MaldonadoTrusts & Estates
In their forthcoming article, Torts and Estates: Remedying Wrongful Interference with Inheritance, John C.P. Goldberg and Robert H. Sitkoff illustrate the potential pitfalls of recognizing causes of action without any awareness or consideration of how other areas of law deal with claims arising out of similar facts. They argue that courts’ relatively recent recognition of the tort of wrongful interference with an expected inheritance is ill-conceived for two reasons. First, it is unnecessary given the remedies available under inheritance law—a will contest or action for restitution by way of constructive trust. Second, it conflicts with specialized inheritance law doctrines and procedures (such as inferences, presumptions, and burden shifting schemes, higher evidentiary standards, bench trials, and short statutes of limitations) developed to address the evidentiary challenges raised when the only person who can conclusively clarify or confirm his donative wishes is dead. A disappointed expectant beneficiary who brings a claim for tortious interference with an expected inheritance will have fewer procedural hurdles to clear because courts have rejected or ignored the rules and procedures that apply to will contests and restitution claims. A tort plaintiff may also recover substantial damages—including nonpecuniary and punitive damages—remedies that are unavailable in a will contest or action for restitution.
Goldberg and Sitkoff further argue that interference with expected inheritance claims are problematic conceptually. Since a donor’s wishes are the guiding principle of inheritance law, a disappointed expectant beneficiary has no independent right to the donor’s property absent the donor’s exercise of his freedom of disposition. As such, when a disappointed expectant beneficiary brings a wrongful interference with an expected inheritance claim, she is suing to vindicate the donor’s right to freedom of disposition rather than her own rights. However, as every first year law student knows, a tort plaintiff cannot recover for a wrong done to another person. She can only sue for a wrong done to her. Of course, we suspect that a disappointed expectant beneficiary doesn’t sue only (or primarily) to vindicate the donor’s freedom of disposition but to secure her interest in the property. While that may be the case, Goldberg and Sitkoff point out that the law cannot recognize her interest in the decedent’s property independent of decedent’s wishes because such interest would directly conflict with decedent’s freedom of disposition. Continue reading "Tort Law Meets Inheritance Law"
Jan 28, 2013 Jeffrey CooperTrusts & Estates
Lawrence W. Waggoner,
From Here to Eternity: The Folly of Perpetual Trusts, Univ. of Michigan Public Law Working Paper no. 259,
available on SSRN.
One of the notable current developments in modern estate planning is that of the dynasty trust, a device for passing family wealth though the generations without the imposition of estate, gift or generation-skipping tax along the way. Fueled by the combination of clients seeking a measure of immortality, state legislatures seeking to attract trust business, and lawyers and trust companies seeking to secure a “client” that will last for generations, the device has become a must-consider technique for wealthy Americans.
Professor Lawrence Waggoner does not think dynasty trusts represent good public policy, a theme he has addressed in many of his earlier writings. However, his argument in this piece is slightly different. Addressing his remarks not only to state legislatures, but to those clients considering implementing a dynasty trust, he contends that dynasty trusts may not serve any useful interest for the very clients clamoring to establish them. His argument takes two major forms. First, utilizing some mathematical modeling, he illustrates how the passage of time dramatically multiplies the number of eligible trust beneficiaries of a hypothetical dynasty trust and dramatically dilutes their genetic relationship to the individual who originally establish the trust. For example, Prof. Waggoner calculates that some 325 years after its inception, a typical dynasty trust might have over 100,000 beneficiaries, and after 450 years might have well over one million such beneficiaries. Continue reading "Rethinking Perpetual Trusts"
Nov 9, 2012 Camille DavidsonTrusts & Estates
McKen Carrington & Christopher Ogolla,
Fame, Family Feuds, Lack of Estate Planning, and Ethical Misconduct in the Administration of the Billion-Dollar Legacy of Bob Marley, 4
Est. Plan. & Community Prop. L. J. 53 (2012), available at
bepress.
Fame, Family Feuds, Lack of Estate Planning, and Ethical Misconduct in the Administration of the Billion-Dollar Legacy of Bob Marley reads like a fact pattern for a law school final examination. In the article, Professors McKen Carrington and Christopher Ogolla discuss the controversy surrounding the estate of Robert Nesta “Bob” Marley. Famed reggae icon and Rastafarian Marley died intestate in 1981 with an estate valued at approximately 30 million dollars at the time of his death. Although Carrington and Ogolla focus on Jamaican law, the issues they highlight extend far beyond Jamaica and provide a backdrop for discussing several issues important in the administration of a decedent’s estate. With respect to the administration of Marley’s estate, those issues included adopted children, out of wedlock children, intellectual property rights, fiduciary obligations of a trustee, ethical obligations of an attorney, and choice of law issues. Further, there were allegations of forgery and fraud. Carrington and Ogolla merely scratch the surface with each of these topics. I would love to see them expand on several of the topics they highlight. Real life stories make great topics for writing and teaching in the area of decedents’ estates.
One of the first issues addressed in the paper is who should be included in Marley’s family. The article provides a brief section on the Marley family structure. Although Marley was survived by a spouse, Rita and the three children born to their marital union, he was also survived by two children of Rita that he had adopted and six other children that he had fathered with other women while he was married to Rita. I would have liked for the authors to have included a little more detail about the Marley family. Continue reading "Estate Planning Makes Business Sense for Non-Traditional Families"
Oct 12, 2012 Phyllis SmithJotwellTrusts & Estates
Gerry W. Beyer,
Will Contests – Prediction and Prevention, 4
Estate Planning & Cmty. Prop. Law J. 1 (2011),
available at SSRN.
Gerry W. Beyer’s Will Contests-Prediction and Prevention starts with a discussion of reasons to anticipate a will contest. He points out society has come to accept nontraditional families as a societal norm and yet the likelihood of a will contest increases when a decedent makes bequests that pass outside of what we define as a traditional family. Thus, for example, from a planning standpoint the best option for a testator involved in a same-sex relationship is to create a will because the intestacy laws will not make provision for the surviving partner. The article points out that even when the testator plans in advance, the likelihood of this will being challenged by a blood relative is much higher than when bequests are made to traditional family members.
Professor Beyer points out that historically, no-contest clauses have been used as a weapon to deal with the potential threat of a will contest. Even so, Professor Beyer points out that no-contest clauses are becoming less reliable as a deterrent because enforceability may be called into question. With that in mind, Professor Beyer offers an alternative solution — an incentive not to contest the will: In exchange for not challenging the will for a period of 2 years after the date of death, the beneficiary would receive a gift. Such a provision may be especially valuable for states where no-contest clauses are not enforceable. Continue reading "The Anatomy of a Will Contest"
