June 27th, 2012

Testamentary capacity is a continuum.  Somewhere along the line, a testator slips from having the requisite capacity to execute a will to not having it.  Where that line falls, however, is the subject of much litigation.

In Deroy v. Estate of Baron, the Appellate Court of Connecticut helped clarify that line under Connecticut law.

A trial court had ruled that a testator lacked the capacity to make a will based on a neurologist’s report about the testator that stated:  ”Given her cognitive impairments, it is unlikely that she would be able to make fully informed, thoughtful judgments regarding complex financial issues.”

This, however, was the wrong standard to apply. (more…)

June 25th, 2012

Courts repeatedly remind us of the necessity to be very explicit with the language in our trust instruments.  With some very narrow exceptions, the clear, unambiguous language of the instrument controls.  This is sometimes referred to as being bound by the four corners of the instrument.

Our latest reminder of the need to remove all assumptions, ambiguity, or inconsistencies from estate planning documents comes to us from Ohio in WesBanco, Inc. v. Blair.  Here, we had the son of the decedent claiming that the decedent’s will revoked or amended his trust thereby eliminating the decedent’s allegedly estranged girlfriend as a beneficiary under the trust.  The son claimed that the decedent had reserved the right to amend or revoke the trust and he did so when he executed his will.

Seems that if the decedent and girlfriend had a falling out and they were no longer living together, the decedent probably wouldn’t have wanted her to take under the trust.  The Ohio appellate court, however, determined that the trust was unaffected by the decedent’s will all because of a lack of express language in the estate planning documents.  So, what could have been stated more expressly? (more…)

June 20th, 2012

We often see litigation over the inheritance rights of children adopted into a family.  But what about the converse?  What about the inheritance rights of children adopted out of a family?

In In the Matter of the Cecilia Kincaid Gift Trust for George, the Supreme Court of Montana considered this question under Montana law. (more…)

June 18th, 2012

Some personal representatives take the position that they’ll either distribute all or none of the estate.  Other personal representatives are willing to make a partial distribution of estate assets only if each beneficiary gets an equal partial distribution.  Both situations can be maddening to a beneficiary who just wants to receive something from an estate rather than watch it sit in probate for years until there’s some liquidity.

Often, the personal representative’s justification for not making a partial distribution is illiquidity of estate assets.  Where real property is involved, the current real estate market compounds the problem of illiquid estate assets.  So, what’s a personal representative to do?  A recent opinion out of Missouri gives personal representatives in that state some guidance. (more…)

June 13th, 2012

Bill and Vieve Gore founded a manufacturing company best known for its GORE-TEX fabric.  Having become considerably wealthy with more wealth anticipated, they undertook efforts to transfer that wealth without incurring significant estate taxes.  Through this process, they signed two separate trust instruments during 1972 – the “May Instrument” and the “October Instrument” – both purporting to transfer the same property into the “Pokeberry Trust.”

One of their daughters claimed that the early May instrument controlled, while the other four children claimed that Bill and Vieve never intended for the May Instrument to be final and enforceable.  Litigation ensued . . . (more…)

June 11th, 2012

In an attempt to provide certainty to property rights, the Utah Legislature included in the Utah Probate Code a provision that limits certain proceedings where neither an heir nor a creditor has requested the administration of an estate within three years of the decedent’s death (Utah Code 75-3-107).

In In the Matter of the Estate of Eleanor Strand, a party alleged that this limitation extended to the ability of the probate court to appoint a personal representative of an intestate estate more than three years after the decedent’s death.  Not so, said the Utah Court of Appeals, and here’s why. (more…)

June 6th, 2012

If you’re not familiar with Florida Statute 744.331, there’s been some historical controversy about the role of the ‘examining committee’ established under the statute.  For our purposes, in short, after a petition to determine incapacity is filed, an examining committee of three people is formed to make a determination of whether the alleged incapacitated person is actually incapacitated. 

A trial court in Florida recently found the statute to be unconstitutional.  Let’s see why. (more…)

June 4th, 2012

At the heart of many an undue influence case is the confidential relationship.  Under the law of many jurisdictions, it’s a game-changer – it can shift burdens and create presumptions.  But, proving a confidential relationship is often very fact intensive.

In Mangarelli v. Snyder, a New Jersey appellate court gives us a short, sweet lesson on facts sufficient to establish a confidential relationship under New Jersey law. (more…)