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Trusts & Estates Outline

Professor Medlin

Table of Contents

Assignment 1: Policies, Dead Hand Control.......................................................................1

Assignment 2: Ethics, Probate Process................................................................................1
Assignment 3: Intestacy.......................................................................................................3
Assignment 4: Intestacy, Illegitimates, Adopteds................................................................5
Assignment 5: Prohibited Bs, Transfer of Shares................................................................6
Assignment 6: Testacy, Mental Capacity............................................................................9
Assignment 7: Mental Capacity, Fraud.............................................................................11
Assignment 8: Requirements of Execution........................................................................13
Assignment 9: Method of Execution.................................................................................16
Assignment 10: Mistake, Holographic Wills, Conditional Wills......................................17
Assignment 11: Revocation...............................................................................................18
Assignment 12: Dependent Relative Revocation, Revival, Operation of Law..................19
Assignment 13: Integration, Republication, Acts of Independent Significance................22
Assignment 14: Contracts re Succession...........................................................................23
Assignment 15: P-O-D, Joint Interests, Deeds, Gifts of Personalty..................................25
Assignment 16: Planning for Incapacity............................................................................28
Assignment 17: Extrinsic Evidence...................................................................................28
Assignment 18: Lapse, Anti-Lapse....................................................................................29
Assignment 19: Ademption, Abatement, Satisfaction.......................................................30
Assignment 20: Homestead, Support, Dower, Elective Share...........................................32
Assignment 21: Trusts Introduction...................................................................................34
Assignment 22: Creation, Intent, Property........................................................................35
Assignment 23: Testamentary, Revocable.........................................................................36
Assignment 24: Pour-over.................................................................................................38
Assignment 25: Discretionary, Creditor’s Rights..............................................................39
Assignment 26: Modification, Termination.......................................................................41
Assignment 27: Charitable Trusts......................................................................................43
Assignment 28: Cy pres.....................................................................................................43
Assignment 29: Powers of Appointment...........................................................................44
Assignment 31: Future Interests........................................................................................46
Assignment 33: Class Gifts, Class closing........................................................................49
Assignment 34: Rule against Perpetuities..........................................................................51
Trusts & Estates Outline

Trusts & Estates Outline

Assignment 1: Policies, Dead Hand Control

Shapira (Decedent’s will says son must marry Jewish woman to inherit $)
o P arg: condition violates right to marry (14th Amendment)
o Ct. distinguishes: issue here is not right to marry but right to restrict devise
o Ct was trying to draw the line b/w what it is permissible for the “Dead Hand” to
control and what it is not permissible for the “Dead Hand” to control
o Rule: No right to inherit.
o Rule: Total restraint on marriage is contrary to public policy.
o Rule: Partial restraint on marriage, imposing a reasonable condition, is valid.
o Rule: Cts won’t enforce a condition/restriction in a will if it is illegal, deleterious
to a family member, etc.; e.g. – if the father’s will said that his son would only
inherit if he divorced his Jewish wife, then the ct probably wouldn’t enforce it

Cts. usually won’t allow devise w/ conditions b/c dead person doesn’t suffer the
consequences and can’t change the dead person’s mind.

Assignment 2: Ethics, Probate Process

In malpractice case, there are usually two causes of action:
1. Tort (Negligence)
2. Breach of K

Simpson (Lawyer screws up will by leaving an ambiguous term; Bs sue him; tries
to assert privity defense)
o Rule: Drafting atty had duty of reasonable care to intended Bs (who were 3rd
parties) when drafting T’s will; intended Bs are the only ones who will have
any interest in suing the atty b/c the client is now dead
This is the exception to the privity defense.
Foreseeability is the real issue.
o In this case, atty’s notes used as extrinsic evidence to show that T had
different intent. Should we stop notetaking? Perhaps attys should be more
cautious when taking notes.
o Task of the Probate Court: determine the intent of T as expressed in the
language of the will
Ct. distinguishes construed intent from actual intent; ruled that probate ct
was trying to construe the testator’s intent and this is not what they should
be doing
PC can’t review extrinsic evidence???

Hotz v. Minyard (Family lawyer in conundrum when brother and sister begin feud;
Conflicts of Interest problem)

Trusts & Estates Outline

o This case illustrates the problem of representing multiple parties in same

o Ethics rules do not provide much bright line guidance for transactional
I.e. Rules don’t say when not to represent H & W in same transaction
Problem: expensive for H & W to have separate lawyers
Conflict arises when representation of one causes impairment in ability to
represent the other

Permissible Conflict of Interest:

1. Reasonably believe that you can adequately represent both
2. Disclose to the clients the possible problems
3. Obtain the clients informed consent

Confidentiality: keep confidential what the client tells you and what you learn from
your representation of the client

Ethical confidentiality ≠ evidentiary confidentiality

Problem: H & W come to you for will drafting. After initial meeting in which
reciprocal wills are drafted, H calls you and changes his will to exclude W from ½
of his estate, giving it to his mistress. What do you do?

Answer: Best solution is to withdraw from representation of both.

To avoid the situation in the problem above, give both clients an engagement
letter at the beginning of the representation; the letter should say either “I agree
to not tell H what W says, and vice versa” or “I agree that all info given to me
from either H or W can be disclosed to the other party;” 2nd way is probably the
best way to do this; engagement letter should also include something saying that
if there is a conflict of interest then you will withdraw from representing both H
and W

Two Approaches:
1. Priestly: get permission to keep confidential info obtained from one person
w/o disclosing to the other
2. Civ: All info is open, free disclosure to the other

Upon completion of estate plan, send termination letter which officially signifies
the end of the engagement. This ensures that the estate planner does not owe a
continuing duty to the client

SCPC § 1-201: gives the general definitions in the SCPC

Trusts & Estates Outline

Assignment 3: Intestacy

Intestacy: deals w/ property of a person who either dies w/o a will, when the
beneficiary or beneficiaries of a will predecease the testator, or when a will does
not effectively dispose of all of the testator’s property (happens a lot when a will
doesn’t contain a residuary clause, although this is actually known as partial

Rule: if person dies intestate, then the statute of descent and distribution governs
Personal Property: governed by decedent’s domicile
Real Property: governed by state in which it is located

Probate Property: passes by will or intestacy

Non-probate Property: does not pass by will or intestacy
Examples: life insurance, joint tenancy w/ right of survivorship

Table of Consanguinity (p. 92 text)

Two ways to measure closeness of relationship:
1. Parentela Method: estate passes first to decedent’s issue; if none, then to
decedent’s parent’s issue; if none, then to grandparents’ issue, then to
great-grandparents’ issue, etc. until heirs found
2. Degree-of-relationship Method: estate passes to closest of kin, counting
degrees of kinship

Policy: try to avoid inheritance by remote heirs (“laughing heirs”) when creating
intestacy statute

SCPC § 2-101 to 2-109

South Carolina’s intestacy statute (beginning on p.42 of Supplement)
If there is no surviving issue, spouse gets entire intestate estate; if there is
surviving issue, spouse gets ½ of the intestate estate

Trusts & Estates Outline

Distinction b/w representation under old and new Probate Code:


C1 (1/2) C2 (1/2)
dead dead

GC1 (1/4) GC2 (1/4) GC3 (1/2)

Figure 1: Old Code used Strict Per Stirpes

Strict Per Stirpes divides at every generational level whether there is a living heir
in the level or not.


C1 (1/2) C2 (1/2)
dead dead

GC1 (1/3) GC2 (1/3) GC3 (1/3)

Figure 2: New Codes uses Modern Per Stirpes

Modern Per Stirpes divides at the generational level only if there is a living heir. If
no living heir is present, then representation is used only to bring the surviving
descendents of deceased descendents up to the level where a descendent is
alive; see pp.82-83 of Supp

Both versions of the per stirpes method are on pp.74 & 75 of textbook; also see
pp.78 & 79 and SCPC § 62-2-103

Trusts & Estates Outline

Assignment 4: Intestacy, Illegitimates, Adopteds

Half-bloods: siblings who share one parent but not both

Treated as whole-blood under the Probate Code § 2-107

Afterborn Heirs
SCPC §2-108: Issue of the decedent (but no other persons) conceived b/f the
decedent’s death but born w/in 10 months thereafter inherit as if they were born
during the lifetime of the decedent; doesn’t address the possibility of in vitro kids
or things of that nature

Adoption Rule: Adopted child treated as natural child for inheritance purposes.
Once adopted, adopted child doesn’t take through natural parents § 2-109
Step-child Adoption Exception: adopted step-child can inherit from his
natural relatives, but the natural relatives (who gave up their rights to the
step-parent) can’t inherit from him.

Stranger to Adoption Rule: the way this rule operates is that if A wills gift to his
sister’s children, S’s adopted children are not included b/c A is a “stranger” to the

Progress of law:
1. CL: illegitimates can’t inherit
2. Then, illegitimates can inherit through mom.
3. Then, illegitimates can inherit through dad if paternity is proven.

Legitimizing Factors:
1. most common example: parents marry after the child is born; can be
legitimized even if the parents attempted to marry and failed for some
2. § 2-109: follows modern trend by allowing inheritance from mother and
from putative father if proven by adjudication1 (not by acknowledgment);
adjudication must be commenced b/f the father dies, w/in 8 months of the
father’s death, or 6 months after the initial; illegitimate child has the burden
of proof of proving that the testator is his/her biological father; must show
this by a preponderance of the evidence; the burden is increased if the
illegitimate child waits until after the father dies to initiate legal
proceedings but the statute doesn’t say by how much; a putative father
may not inherit from a deceased illegitimate child unless he has openly
acknowledged the child as his own and provided support for the child

In SC, family court has jurisdiction to determine paternity. Usu. paternity is proven by DNA evidence.

Trusts & Estates Outline

Guardian: takes care of personal/physical needs of someone who can’t (like

minor child or incapacitated person); a parent is automatically the guardian of
their minor children unless guardianship is terminated by a ct

Conservator2: takes care of property or financial affairs of someone who can’t

(like minor child or incapacitated person); a parent is not automatically the
conservator of their minor children
Example of use: Litigation by minor. Need conservator to receive
settlement or damages award.

Uniform Gifts to Minors Act

Vehicle to transfer property to minors w/o conservator; the transferee must
choose a custodian who is to make certain decisions regarding the acct;
custodian is not a trustee but is a fiduciary
UGMA adult age is 21

Assignment 5: Prohibited Bs, Transfer of Shares

Prohibited Bs

In re Estate of Mahoney (W kills H. Heirs are W and H’s parents.)

o Issue: Can killer inherit from their victim’s estate?
o Holding: Legal title passes to the killer but killer is constructive trustee for heir
or next of kin of the decedent.
o Rationale: legally correct w/ an equitable twist.
o Exceptions:
Doesn’t apply if killer insane.
Doesn’t apply to property the killer already has a vested interest in.
o For rule purposes,
Murder ≈ voluntary manslaughter
Voluntary manslaughter ≠ involuntary manslaughter

SCPC § 2-803
Rule applies for testacy, intestacy, and non-probate transfers; the “slayer”
is treated as having pre-deceased the victim so they will not take
Murder and voluntary manslaughter fall under 2-803; involuntary
manslaughter does not
Conviction is conclusive proof on the civil side
o Rationale: Criminal burden of proof greater than civil burden.
However, if there is anything else going on (e.g. – guilty plea, nolo
contendre, verdict of not guilty, etc) then the facts have to be re-litigated in
a civil trial and the burden of proof is preponderance of the evidence
Subsection (g) deals with murder-suicide scenario; here, the killer is
viewed as having predeceased the victim if they die w/in 120 hrs after
Usu. court appointed.

Trusts & Estates Outline

feloniously and intentionally killing the decedent; killer cannot inherit from
the victim but the victim does still inherit from the killer

Transfer of Shares

o If the person you expect to die intestate is still living, then you are only an
expectant heir or “heir apparent”
o Heir apparent has expectancy (not a legal interest); heir apparent may not
take for 2 reasons: the person you expect to inherit from creates or amends a
will that cuts you out or you predecease that person
o Expectancy is non-transferable
Exception: K to transfer expectancy
 May be enforceable in equity
 Must be fair

o Example: Son gives up inheritance for $ now.
o This is enforceable.

o A partial release: rather than giving up all rights, the expected heir is charged
w the transfer
o Def: A gift that the intestate intends to be offset against death time transfers.
o § 2-110: need writing to prove advancement
o Hotchpot: method by which the advancement is accounted for in the estate
and then distributed (not a requirement to participate)
o Example of Hotchpot:
I advances $30 to C1. I dies with a probate estate of $120

Advancement Hotchpot End

C1 30 120 (PE) 20
C2 0 + 30 (advance.) 50
C3 0 =150 50

o What if advancement is greater than the expected heir’s share? Must refund.
o What if “advanced” child predeceases parent? The advancement is deducted
from the shares of such child’s descendants if other children of parent
o CL Burden: child has to establish that gift was absolute, not an advancement
o Modern Burden: gift presumed not an advancement unless other intent shown
o Waiver: other expected heirs can waive the requirement that the
advancement go into the hotchpot

The analog concept to testacy is satisfaction.

Trusts & Estates Outline

Uniform Simultaneous Death Act (SCPC §§62-1-501, et seq)

• Applies when we can’t determine whether the beneficiary predeceased the
testator or vice versa; applies to testacies, intestacies, and non-probate
• In a simultaneous death situation (e.g. – plane crash), we presume that
the beneficiary predeceased the testator
• When you have 2 people who are beneficiaries under each other’s wills
(e.g. – husband and wife die in a plane crash) , you assume that husband
predeceases wife for the purposes of wife’s will and that wife predeceases
husband for the purposes of husband’s will
• Purpose: to have estate pass to alternative living Bs (avoids the property
simply transferring back to the estate)

o Def: a renunciation of a gift
Recognized by CL or statute that a recipient of a gift, received during
grantee’s life or at grantee’s death, may refuse to accept, either in whole
or in part
o Operation: a legal disclaimant is treated as never owning the gift
o Danger: disclaimant cannot control where the property goes, so if a
beneficiary goes thru w/ disclaimer, it is definitely an excellent idea to know
where the property is gonna go; failure to properly advise a client on the effect
of a disclaimer  malpractice
o Practical Reason for Disclaimers:
Tax (§ 2518 of IRS Code)
 Transfer tax on gifts
 Estate planners look at avoiding tax
 Every donative nonexempt gift is taxable
• Marital gifts and charitable gifts are exempt
Avoid creditors
o Practical Advice: when disclaiming, need to consult both tax & property issues
SCPC § 2-801 for property
IRC § 2518 for tax

Pate v. Ford (SC case in Supp)

o Facts: A mother’s will creates two trusts.
Trust 1: C1 is life beneficiary, then to GCs
Trust 2: C2 is life beneficiary, then to GCs
When C1 or C2 die, their share goes into a community pot that will be split
evenly amongst ALL the then living GCs
C1 has children and C2 doesn’t at the time of their mother’s death, so C1
disclaims and his children get his share.
o Issue: Was the disclaimer effective in accelerating the remainder interest?
o Holding: Yes, the disclaimer was effective in accelerating the remainder

Trusts & Estates Outline

o Rationale: Disclaimers are guided by § 2-801. A life interest is disclaimable; a

beneficiary may disclaim; disclaimant is treated as if predeceased the
decedent; therefore, the interest devolves on the remainderman
o State of Disclaimer Law in SC: disclaimer must satisfy property and tax law
US Sup Ct decision on disclaimer
o Facts: disclaimant disclaims to avoid federal tax lien
o Holding: can’t do
o Rationale: Right to disclaim is itself a right to which the lien can attach
o HYPO: Disclaimant, while treated as deceased for purposes of the gift is still
treated as living for purposes of dividing the gift; e.g. – a woman dies w/ 1 son
who is living (C1) and another who predeceased her (C2); C1 has 2 children
(GC1 & GC2) and C2 has one kid (GC3); C1 believes that he could disclaim
the inheritance and all GCs could receive 1/3 of the estate; however, since C1
is treated as alive for purposes of dividing the estate, C2’s kid will get ½ of the
estate and C1’s children will get ¼ each (See chart on next pg)
Rationale: Can’t manipulate the rules of representation by disclaimer. § 2-103
and 2-106.


C2 (1/2)
C1 (1/2)

GC1 (1/4) GC2 (1/4) GC3 (1/2)

§ 2-114: deals w/ deadbeat parent taking from their deceased child, give probate
judge wide discretion

Assignment 6: Testacy, Mental Capacity

Elements of Mental Capacity:

1. Ability to know what you own
2. Ability to know who property would go to (“natural objects of your bounty”)
3. Ability to know you are making a will

What is the standard? Ability to know not actual knowledge

o Incompetency under conservatorship ≠ incapacity to make will

Trusts & Estates Outline

o Capacity to make will less than competency to make K or gift

o Capacity to make will greater than capacity to marry

Rationale for Mental Capacity Requirement:

1. will should represent T’s intent
2. protect T’s family
3. protect T from exploitation
4. legitimacy from rational decisions

In re Estate of Wright (testimony from multiple Ws that Wright was crazy and
frequently acted erratically)
1. Ct ruled that Wright was competent to make a will; he may have been
eccentric but he met the three prongs of the test; also the Ws in this case
all stood to gain something if Wright was deemed incompetent and
therefore the will invalid

In re Strittmater (NOW member hates men and wills estate to NOW)

o Will contested by cousins.
o This is more of an insane delusion case b/c it dealt w/ whether her hatred of
men was an insane delusion or not; she may have had a valid reason for
hating men which would mean that this is not an insane delusion at all
o Judge sets aside the will likely b/c he disagrees w/ T’s feminist views but
holds that she has an “insane delusion”

Chronic Incapacity
o Burden shifts to proponent who must show that the will was executed during a
lucid moment

Insane Delusion
o Def: false conception of reality to which the T adheres against all evidence &
reason to the contrary
o SC: not clear that insane delusion is a separate ground to attack a will
o Majority Rule: not reasonable according to the facts; person attacking the will
must prove the insane delusion and they must prove that there is a nexus b/w
the insane delusion and the will that they are challenging

In re Honigman (H thinks W is unfaithful so he cuts her out of his will)

1. Ct found no basis for H’s insane delusion and overturned his will
2. When this case was decided, the overturning of H’s will didn’t do much;
it only gave his wife a remainder in property that she would’ve only had
a life estate in under the will; however, in today’s world, overturning H’s
will would have had disastrous effects on his estate

Trusts & Estates Outline

Assignment 7: Mental Capacity, Fraud

Undue Influence
o Def: coercion or coercing someone to do what he doesn’t desire
o Test:
Look at coercion
Look at testator (Susceptible to coercion?)
Look at perpetrator (Motive, Opportunity, and Intention to coerce?)
Look at disposition itself (Is disposition a result of the coercion?)
Then weigh
o The law is malleable in this area and is fact specific.
o Burden of proof: on contestant
Proof may be entirely circumstantial/inferential

Estate of Lakatosh (p.159 in textbook is a classic example of undue influence)

Lipper v. Weslow (T disinherits her son’s widow and kids, gives to C2 and C3)
o See chart next page
o Problems:
Sophie’s son is drafting atty, B, and Independent Executor. This certainly
has the appearance of undue influence; he also had a large amount of
contact w/ his mother and he received a larger sum of $ than anyone else
under the will that he drafted
Additionally, there is evidence that Sophie didn’t read the will before
B didn’t get along with his half-brother and hated his half-bro’s widow,
which perhaps gives him a motive to disinherit the GCs.
Ct ruled that, although there were many suspicious circumstances
surrounding the creation of the will, there was no undue influence here

Trusts & Estates Outline

Sophie Block (marries below)

H1 H2 H3
(dead) (dead) (dead)

(dead) C2 (∆) C3 (∆

GC1 (π)

GC 2 (π)

GC 3 (π)

Figure 3: the parties in Lipper v. Weslow

No-Contest Clause
o Majority Rule: enforceable unless probable cause for contest
o § 3-905: codifies enforceability of no-contest clauses
unenforceable if probable cause exists for contest
o Cts. can avoid enforcement by saying not a contest by some other issue
Precaution: get declaratory judgment on whether contest will trigger the

Bequest to Attys
o Presumption of undue influence when atty drafter receives legacy
Rebut w/ clear and convincing evidence
o May be unethical

In re Will of Moses (T wills to atty-lover)

o Sister attacks on grounds of undue influence.
o T and atty-B had two relationships: a/c relationship and personal romantic
o Ct. indicates that undue influence is possible where atty isn’t the drafter.
o Issue: was presumption overcome by independent counsel?
o Holding: No, b/c independent counsel gave no substantive advice but merely
was scrivener; it appears that the ct really didn’t approve of the relationship or
atty-B’s behavior; the reasons they gave for holding the will invalid were pretty
o Dissent:

Trusts & Estates Outline

focuses on T’s competency (T was competent although she was an

alcoholic), evidence that atty-B had no knowledge of the will’s existence,
and witness testimony of 3rd party atty

o Two Types:
Fraud in the inducement: occurs when a person misrepresents facts
thereby causing the testator to execute a will to include particular
provisions in the wrongdoer’s favor or to refrain from executing or revoking
a will
Fraud in the execution: misrepresents character or contents of the
instrument signed by T, which does not in fact carry out T’s intent
Duress: category created by textbook authors that is somewhere b/w
undue influence and fraud
o Test:
T deceived
By misrepresentation
But for misrepresentation T wouldn’t have done what was done
o Misrepresentation:
Intent to deceive
Purpose: influence the testamentary disposition

Tortious Interference w/ Expectancy

o Hot topic in estate planning
o Focus not on mental capacity of T but on action of perpetrator
o Elements: the interference involved conduct tortious in itself, such as fraud,
duress, or undue influence; theory cannot be used when it is based on the
testator’s mental incapacity
o Goal: seeks to recover tort damages from a 3rd party for tortious interference
Atty fees & Punitives may be recoverable
o Not available in SC
But Court of Appeals says it looks like recognized economic torts
o Other Js
Can’t bring until probate actions exhausted
Res judicata, collateral estoppel issues may arise

Assignment 8: Requirements of Execution

§ 2-502
o Requirements for a Valid will (assuming T is mentally competent)
Signed by Testator or Proxy
 Proxy Requirements:
• In T’s presence
• At T’s direction

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Signed by 2 Witnesses
 Witness Requirements: W must observe
• Signing or
• Acknowledgement of signature or
• Acknowledgement of will
 Three Functions of Ws
• Observe
• Sign
• Testify that T is mentally competent (CL gloss)
o Problems w/ § 2-502
No timing requirement
W doesn’t have to know what he is observing
No simultaneity requirement

Rationale for Execution Requirement:

1. To Protect T’s intent: it’s a lot harder to perpetrate a fraud w/ a lot of
people w/o that fraud being discovered
2. Evidentiary Function: some of the requirements increase reliability of proof
3. Channeling Function: compliance w/ requirements ensures enforceability
and is judicially efficient, therefore it encourages people to go to an atty to
get their wills made
4. Ritualistic: demonstrates the importance and seriousness of making a will
to the person having the will made

In re Groffman (W unhappy w/ H’s will so contests based on execution)

o Rule: Will not valid unless
Signed by T at end or foot
Acknowledged by two Ws present at same time (SC statute doesn’t
require this but it is still a good idea to do)
o Paradoxical Result: very reqs calculated to ensure intent actually defeat T’s
intent; judge said that he had no doubt in his mind that the will reflected the
intent of the testator but still held the will invalid b/c he was bound by
Rationale: allow this anomaly b/c long-term benefit outweighs short-term

Burden of Proof: on contestant as to execution reqs and mental capacity

Witness Presence
o Two Tests:
Line of Sight Test: W doesn’t have to actually see creation of the will, but
must be able to see it
 Blind Man Exception

Trusts & Estates Outline

Conscious Presence Test: W must comprehend that T is signing through

sight, hearing, or general consciousness of events
o Any mark on the will intended to be the W’s signature is considered the W’s
signature and a W can sign a will by proxy also
o SC Law
§ 2-502: only mentions presence when speaking of proxy but implicitly
requires presence for observation of the will signing
SC CL gloss suggests we use Conscious Presence Test

§ 2-504: Disinterested Witnesses

o General Rule: W must be credible (this is fact specific inquiry)
o Presumption: interested W not credible b/c will profit from testimony
o § 2-504 operates as a purging statute by removing the interest of the
interested W, thereby making him a disinterested W; it takes away the gift to
the W in the will
Rationale: the will is valid by making the interested W a disinterested W by
taking away the gift. This ensures that T’s intent is carried out as fully as
o Application: Compare the interested W’s share under intestacy w/ his testate
share. Take away the profits (the amount of testate share that exceeds the
intestate share) and W becomes disinterested.
Ex. 1: Will gives 1000 to IW. IW intestate share is 1000. Therefore, IW is
Ex. 2: Will gives 1000 to IW. IW intestate share is 500. Therefore, IW is
purged of 500 to make him DW.
Ex. 3: Will gives 1000 to IW. IW intestate share is 0. Therefore, IW is
purged of entire 1000 to make him DW.
o Purging does not apply to appointed positions (Executor, Trustee, etc.).

Doctrine of Substantial Compliance (Ranney case)

o Although not properly executed the will is treated as so if there is substantial
compliance w/ the regs; ct requires clear & convincing evidence of T’s intent
o A rule of function: use to remove procedural peccadilloes as bar to probate

Dispensing Power (Hall case)

o Statutory analog to the CL Doctrine of Substantial Compliance
o Operation: gives court power to validate a doc T intended to be a will even
though formalities not complied with; still need clear and convincing evidence
of intent
o Professor Langbein argues that dispensing power is preferable to substantial
compliance b/c “ courts read in their substantial compliance doctrine a near-
miss standard, ignoring the central issue of whether T’s conduct evidenced
testamentary intent”

§ 2-505: Choice of Law

Trusts & Estates Outline

o Either/or Test: will valid if

executed in compliance w/ § 2-502 at time of execution or T’s death or
execution complies w/ law of
 situs of execution;
 domicile of T at time of execution
 domicile of T at death
o SC: whatever T intends as his signature is his signature
o Some states have requirement that signature be at foot or end of doc

o Def: declaration of T that the will is his; disclosure of will contents to Ws
o SC: no publication req

Will does not have to be dated nor does it have to be on paper.

Assignment 9: Method of Execution

§ 2-503: Self-proving Affidavits and Attestation Clauses

o Deals w/ later proof not w/ execution
o Rationale: once we have an executed will, it can be proven before death by
going before a public official
o Subsection (a) is a one step process where the will and self proving affidavits
are executed at the same time
o Subsection (b) is a two step process where the self proving affidavits are
executed after the will; can occur on the same day just has to be after the will
Attested will can be self-proved after execution by:
 Acknowledgement by T before notary,
 W testimony, or
 W affidavit before notary (self-proving affidavit)
o Attestation Clause: clause included in the will that says the Ws witnessed
certain things during the execution of the will; this is signed by the Ws; it is
most likely malpractice not to include an attestation clause

Steps in Execution and Supervising Tips

1. Advise the client
2. Note potential hang-ups
3. Draft will
4. Send draft to T for review
5. Make sure T understands the will
6. Have T and Ws sign/initial & date each page
7. Make sure pages are consecutive
8. Self-proving affidavit/Attestation Clause
9. Make sure Ws present during entire execution ceremony

Trusts & Estates Outline

Avoiding a Will Contest

1. Have DWs who know T
2. Make sure T is mentally competent (send to doctor)
a. Pro: Doctor testimony given more weight
b. Con: Exam can be used to infer incompetence
3. Videotape the ceremony
a. Pro: compelling statement
b. Con: T may not look competent

Assignment 10: Mistake, Holographic Wills, Conditional Wills

o Two Types:
Mistake in the execution (3 Kinds)
 Something is in the will that T didn’t intend to be in the will
 T excluded something that he meant to include
 There is a mistake as to the entire document itself meaning that the
document is not T’s will
Mistake in the inducement (e.g. – T leaves nothing to her son b/c she
believes he is dead but he really is not dead)
o Mistake cases depend on ct’s willingness to admit extrinsic evidence, but
most cts reluctant to do so.
Construction Stage: cts likely to use extrinsic evidence to fix mistake
Qualification/Validation Stage: cts not likely to use extrinsic evidence
 Main Determinations: mental capacity and proper execution
 Exception: if T makes mistake in signing will, then ct will use extrinsic
o Rule: Cts only refuse to probate a will if the mistake goes to the will itself.

Holographic Wills
o Def: a will handwritten by T and signed by T
o No Ws required
Rationale: Ws substituted by T’s handwriting
o SC doesn’t recognize holographic wills (unless already declared valid by
another state)
o What about pre-printed forms?
Intent of T still controls
Rule: If pre-printed language is mere surplusage, then the will is

Conditional Wills
o Meant to be valid only if a certain condition occurs
o Rule: not valid if truly conditional
o Rule: valid if not truly conditional

Trusts & Estates Outline

o Distinguish b/w valid will w/ internal conditions

Assignment 11: Revocation

o 2 Ways to Revoke
Subsequent writing executed w/ testamentary formalities
 Can be total or partial revocation
 Can expressly revoke or revoke by inconsistency
Physical Act
 Burn, tear, cancel, obliterate, destroy
 T must intend to revoke
 Proxy allowed if T is present and directs
 Destruction of original will leads to presumption that T destroyed all
duplicates as well
 Thompson v. Royall case: T revoked will by having atty write “I
revoke” on the will and atty kept copy as a memo; the words didn’t
touch any other written part of the will; ct held that this was not a
revocation b/c the subsequent writings were not executed according to
statute, and b/c they didn’t in any way physically obliterate, mutilate,
deface, or cancel any written parts of the will; this holding probably
only applies to cancellation but not any of the other physical acts

Revocation by Inconsistency
o Rule: if subsequent will doesn’t expressly revoke but makes a complete
disposition of T’s property, then presumed to revoke prior will by
inconsistency; if subsequent will doesn’t make complete disposition, then
presume the subsequent will is not revocation but a codicil4.

Lost Will
o Presumption: presume that lost will was destroyed by T w/ intent to revoke
o Rebut by
Proving that will properly executed
Prove that T didn’t destroy the will5
o Lost will probated if contents proved by clear and convincing evidence
Burden of proof is on the proponent of the lost will
Proof: copy, drafting secretary

Should attys keep the original will?

o Pros:
Certain availability

An amendment to the will.
Very difficult to prove.

Trusts & Estates Outline

Ensure proper revocation

$ on the probate side more profitable than on estate planning side
o Cons:
May prevent revocation
Avoid escrow violations
No notification of client’s death
Attys should most likely only keep a copy of the will and not the original

Duplicate Original Wills

o How do we know if the will is a duplicate original? Use language “This is a
duplicate original.” But there is really no benefit to using a duplicate original.

Assignment 12: Dependent Relative Revocation, Revival, Operation of Law

Dependent Relative Revocation

o Def: if T revokes on mistaken assumption of law or fact, the revocation is
ineffective if T would not have revoked had he known the truth
o Analysis6:
Is revocation valid?
If revocation was made by mistake, what is T’s true intent?
 Possible factor: familial relationship, friendship, causes
 Ironically, must use extrinsic evidence
o If revoked will is closer to T’s intent, then it becomes valid; if intestacy is
closer to T’s intent, then T becomes intestate
o DRR is CL rule, not statutory
o Medlin Rule: DRR applies only when there is a physical act revocation

o Only possible fact pattern: Will 1  Will 2 revokes Will 1  T revokes Will 2:
Is Will 1 revived?
o Views:
English View: Will 1 not revoked until Will 2 takes effect (at T’s death).
Therefore, Will 1 is “revived.”
Majority View: Will 1 revived if T intended; shown thru extrinsic evidence
Minority View: No revival unless testamentary formalities satisfied.
o § 2-508: Revival if clear, cogent & convincing evidence; there is a
presumption against revival
o Hypo: Will 1  Will 1 revoked Will 2  Will 2 revoked: Is Will 1 revived?
A: No
Rule: Revival doesn’t apply when there is no relationship b/w Will 1 and 2.
Will 1 must be revoked by Will 2 for revival to take effect.
o Hypo: Will 1  Will 1 revoked T going to execute Will 2 but dies: Is Will 1
A: Maybe
Must use extrinsic evidence in this analysis.

Trusts & Estates Outline

Rule: DRR applies if W1 is closer to the testamentary scheme of W2 than

o White v. Wilbanks (SC case)
Will 1 is revoked by Will 2; T dies; SCPC becomes effective after T dies;
can’t find Will 2; there is only a copy; if we can’t find the original, then we
assume that the original was destroyed as an act of revocation; this is a
rebuttable presumption but it is very hard to prove
The general rule everywhere is that the law in effect at the date of death
controls the inheritants’ rights over property as to who owns what
There was not enough evidence to overcome the presumption that Will 2
had been revoked
B/f the SCPC, there was a presumption that Will 1 is revived as valid;
under the SCPC, this presumption is reversed and it is presumed that Will
1 is not revived as valid unless there is clear, cogent, and convincing
evidence to the contrary, so T dies intestate
The Ct of App gets the right result for the wrong reason; SC Sup Ct gets
the wrong result for the wrong reason
The SC Sup Ct ignored lots of law to the contrary and applied the statutory
rule against the presumption of revival; they applied the new rules to a
case where a guy died b/f they were in effect; their decision took a long
history of one set of owners of property and replaced them w/ another; this
could’ve been disastrous from a property law standpoint
The SC Sup Ct continued to make this mistake over and over again
A committee later took the word “instrument” out of (b)(5) hoping the SC
cts would quit interpreting the statute that way
Ct of App has issued subsequent decision suggesting they finally got the
law right

Revocation by Operation of Law

First Situation: § 2-507: Revocation by divorce statute

o Rule of Construction, not Rule of Law; creates a presumption
o Hypo: H & W  H Will in favor of W H & W divorce  H dies: Does W get
share of will proceeds?
A: No
o Presumption: divorce ≈ disinherit spouse of share and appointments
Rebutted if will says otherwise
o Rationale: even if divorce is amicable, property division occurs during divorce
o Problem Period: § 2-507 doesn’t apply while divorce is pending
o Problem Application: doesn’t apply to non-probate transfers. See § 7-114.
Hypo: H & W  H Will & Life Insurance in favor of W H & W divorce 
H dies: what result?
 A: W can’t get probate assets. § 2-507. W can get Life Insurance
proceeds. § 7-114. H’s estate may have malpractice action.
Second Situation: §2-301: The Omitted Spouse

Trusts & Estates Outline

o Hypo: T has will  T marries S  T dies survived by S: what result?

o § 2-301: revokes will to extent necessary to give omitted spouse an intestate
share (at least ½); applies to CL spouses too but they have a stricter time limit
as to how long they can wait b/f they present their claim
o Distinguish b/w omitted spouse share and elective share:
Omitted spouse share applies to omitted spouses. There are exceptions to
§ 2-301.
Elective share applies to every surviving spouse. There are no exceptions
to the elective share.
Problem: § 2-301 and Elective Share have different time limits.
 Solution: Plead in the alternative to ensure time doesn’t run on you
o Hypo: T dating G  T will leaves house/car to G  T & G marry  T dies
w/o issue: What result?
A: G gets entire estate.
Rationale: While the devisees argue that § 2-301 applies and that G only
gets house and car. G argues that the will was not made “in contemplation
of marriage.” Ct. agrees w/ G and gives her the whole estate.
CL Gloss: need “contemplation of marriage” for § 2-301 to apply
o Three Situations where § 2-301 doesn’t apply:
If T provides for spouse in will “in contemplation of marriage”
Intentional Omission § 2-301(a)(1); cannot do this for elective share
Non-probate Transfer in lieu of omitted spouse’s portion of estate § 2-

Third Situation: Pretermitted Children

o Hypo: T makes will  Afterborn Child  T hasn’t changed will  T dies:
What result?
o § 2-302: revokes will to the extent necessary to give child intestate share
o Four Situations where § 2-302 doesn’t apply:
If T provides for afterborn child in his will
 Drafting Tip: Use class terminology
Intentional Omission § 2-302(a)(1)
Non-probate transfer in lieu of share § 2-302(a)(3)
If T has children at time of execution but gives substantial share to spouse
§ 2-302(a)(2)
 Caution!: If H & W don’t have children at time of will and then have
afterborn children, the afterborn may get ½ of estate through intestacy
 Solution:
• Discuss possibility and ramification of afterborn children w/ the
childless couple
• Then make sure afterborn children are intentionally disinherited.
 Additional Problem: Original will is read as of date of codicil so
afterborn child will not be considered afterborn if codicil subsequently

Trusts & Estates Outline

Testamentary Libel: new tort, can include rationale for disinheritance, be careful

Assignment 13: Integration, Republication, Acts of Independent


o Def: all papers intended to be part of the will and present at the time of
execution are integrated into the will
o Problems:
Pages not physically connected
No internal coherence
Staple removed
Different font type
Did we revoke will entirely by substituting a page?

Republication by Codicil
o Def: will treated as reexecuted as of the date of the codicil, whether or not the
codicil expressly republishes the prior will
o Must have a valid will for republication to happen
o Two views:
Narrow: can republish on a currently valid will
Broad: can republish any will that was at one time valid but currently is not
SC View: unclear
o Hypo: Will 1  Will 2 revokes Will 1  Codicil to Will 1: What result?
A: Will 1 is reexecuted and Will 2 revoked by implication.

Distinguish b/w Integration and Republication:

o Integration applies to incorporate docs not validly executed
o Republication applies to prior validly executed will

Incorporation by Reference
o Allows you to make an earlier document that never had testamentary validity
part of a will
o § 2-509: To incorporate a doc into the will:
writing must exist prior to execution
language in will shows intent to incorporate the writing
language describes the writing sufficiently to identify
o Clark v. Greenhalge: T’s will references a “memorandum”; memo was made
after execution of T’s will; however, T executed a codicil to her will later and
the memo was in existence then; Ct held that the memo was valid since it
was incorporated by the codicil

Acts of Independent Significance

Trusts & Estates Outline

o Def: when the 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 is upheld under Doctrine of Acts of Independent Significance
o § 2-511
o Effect:
Nontestamentary act becomes part of will
Nontestamentary act construes the will
o Rationale: Pragmatic recognition that actions in life affect testamentary
o Usually involves identification of property or Bs
o Property Hypo: A intends to give ’82 Saab to B. A executes will giving car to
B. A sells Saab and buys Porsche. A dies. What result:
A: Using the Doctrine of Acts of Independent Significance, B gets
Reach same result by using rule of construction that will speaks as of date
of death.
o Bs Hypo: E’s will says “$10,000 to employees who’ve been w/ me for more
than 10 years”

§ 2-512: Separate Writing identifying bequest of tangible property

o Allows for incorporation of a list or memo created after the execution of a will
or codicil
o Requirements:
T’s handwriting or signed by T
Must refer to the memo or list
o Should dispose of residual tangible personal property in the will
o Gives effect to writing disposing of tangible personal property
o Excludes cash, cash like instruments, real estate, stock, docs of title as
defined under UCC, or property used in a trade or bus
o Includes personal property (jewelry, cars, furnishings, etc.)
o Rationale:
Personal property may be more important b/c of sentimental value rather
than for its monetary value
Efficient b/c doesn’t require new will for each change
o Must put clause in will that if memo isn’t found w/in X number of days then
presume there isn’t one

Assignment 14: Contracts re Succession

• Questions to ask H & W that are making wills together or at same time:
confidentiality questions, do they already have a will in existence, who do they
want to remember or leave their property to, what happens if your #1
beneficiary predeceases you, your #2 beneficiary predeceases you, etc
• Never make a joint will for a couple

Trusts & Estates Outline

Basic Types of Ks re Succession:

1. K to make will
a. Hypo: K b/w T and F in which T gives house to F and F cares for T.
T dies but his will doesn’t give F the house. What remedy does F
have? Under equity F gets house.
2. K not to revoke will
a. Hypo: H & W have joint & mutual wills. W dies. H changes will and
dies. What result? K law applies and H will have to perform.
b. Seldom used b/c it is unilaterally rescindable
3. K to die intestate

Ks in this T&E world are not a good idea b/c the majority rule is that K is
unilaterally rescindable by revoking the will as long as H & W alive.

SC Minority Rule: unilateral rescission if notice given to the other party

Technical Problem: H can survive W and still honor K not to revoke. However, H
can circumvent the will and K by giving away his estate or setting up an
intervivos trust. What remedy? Unclear b/c, once given away, property can be
difficult to trace.

Hypo: H & W have K not to rescind; they have children; W dies; H gets
remarried and predeceases 2nd W who now has an elective share; do the
children of H & W1 who take under the K win or does W2 win? The ct says that
W2 wins for public policy reasons

§2-701: Ks concerning succession

• Need some kind of writing to prove a K; what constitutes that writing is
fairly broad
• No presumption of a K regarding joint/mutual wills
• If a K was entered into b/f 7/1/87, then the K could be an oral K and still be
valid; to determine if this section applies we look at the date the K was
entered into

Consideration Requirement
o K law requires exchange of consideration
o General Rule: Moral obligation not sufficient consideration to make K

The Consideration Requirement in SC

o Chapman v. C&S: moral obligation is enforceable
o Rule: Once part-performance of K to make will, then will must be made and
promise enforced. Can enforce K to will while T alive and can enjoin T.
o Can make promissory estoppel argument.
o State of SC Law: very liberal in granting remedies to potential devisees

Trusts & Estates Outline

Assignment 15: P-O-D, Joint Interests, Deeds, Gifts of Personalty

Hypo: T wants to leave $ to sister b/c W is independently wealthy and healthy.

But T only wants the $ to pass to his sister at his death b/c she is a spendthrift.
How do we do it? The goals here are to have control (by T) and make the
transfer non-probate.

o Payable to one or more persons on request during their lifetimes,
and, upon the deaths of all of them, to one or more POD payees
Joint Account
Trust Account
Insurance Policy § 6-201
Partnership Agreement w/ POD provision

§ 6-101 et seq (p. 65 of supp.)

Insurance Policy
o Two Factors in ins. policy
Risk Factor  Term Life Insurance
Risk + Investment  Whole Life
o Ways for ins. policy to proceed to probate:
B is estate
B predeceases policyholder
• Wilhoit: Mrs. Wilhoit made a K w/ an ins company for a POD acct; the B of
her will is suing the 3rd party B of the POD K; the $ in the POD acct was
originally her husband’s LI policy; when he died she made a K w/ the ins
company that they would hold the $, pay her interest, and she could collect
the $ whenever she demanded it; ct ruled that this is not an ins policy but
more like a bank acct b/c there is no risk involved; also ruled that the 3rd party
B of the K doesn’t take b/c the K is a testamentary transfer and it wasn’t
executed w/ the proper formalities

Partnership Agreements
• Estate of Hillowitz: Deceased was a partner in an investment club; provision
in the partnership agreement that gives his portion to his wife when he died;
ct ruled this is a valid non-probate transfer and his wife shall enjoy the same
rights as her husband did

Trusts & Estates Outline

Nontestamentary Transfer
o Takes place effectively at death but there is a transfer of some interest during
o Transferor retains control thru right to revoke or cancel
o Distinguish from Testamentary Transfer
Passes only at death
Passes through probate
o Examples: Ins. policy, Revocable trusts, etc.

Multi-Party Accounts
o Types:
True Joint Tenancy Account: both can draw + survivorship rights; each
party can only w/draw proportionately to what the deposited; Franklin v.
Anna Nat’l Bank (p.342 in textbook)
 Lifetime Rights: If A, B, and C all put in $10,000 and the way the acct
is setup shows that only one signature is required to take out any $
and C goes and takes out $20,000, then A and B will have an action
against C b/c he took out more than his share; the bank is not liable to
A and B b/c they are not the watchdog of the acct; however, if A, B,
and C had an agreement, which the bank knew about, that more than
1 signature was required to take out any $ and the bank allowed C to
take out $20,000 w/o requiring another signature, then they would be
liable to A and B for allowing C to do that
 Deathtime Rights: there is a right of survivorship; this means that if A
dies, then his share will pass equally to B and C; it doesn’t matter
whether B and C put the same amt into the acct or not; this means that
if A put in $10K, B put in $20K, and C put in $5K and A dies, then B
and C still get $5K apiece even though they didn’t put in the same amt;
next, B dies which means that his entire share then goes to C; when C
dies, the acct will be dispersed under C’s will; you can override the
survivorship of your joint acct up to the amt you contributed; this
means that if A wants his $10K to go to his daughter, then he can
provide for that in his will
POD Account disguised as Joint: one party has no withdrawal right but
has survivorship rights
Agency Account:
 Power to withdraw / no survivorship rights
 Proceeds at death to depositor’s estate
Trust Account
o Rights:
Amongst parties
 While alive
 When account holders
w/ Bank
• §6-106 says that these are non-testamentary transfers

Trusts & Estates Outline

Joint Account
10 5 10 5
A can’t take out more than 10
Bank not liable for overwithdrawal, unless there is evidence that they
should’ve known better

What if A dies? His amount is split equally among the account holders.

Current 5 10 5
Add A’s Amount 3.3 3.3 3.3
New Amount 8.3 13.3 8.3
Go through same process if B and C die.
If D dies last, the entire 30 goes to his estate.

Rule: Account holder can override right of survivorship in will, giving his net
contribution to someone else (§ 6-104(e)).

POD Acct v. Trust Acct

POD Acct Trust Acct
Tier 1 Original Payee Trustee
Tier 2 POD Payee B
Rule: Tier 2 gets when Tier 1 dies.
Rule: If Tier 2 members predecease Tier 1, split among remaining Tier 1
Tier 1 members, while alive, have right of w/drawal up to the amt they put
When a member of Tier 1 dies, there is a right of survivorship; but, unlike
joint accts, this right cannot be overridden by a will
Once the last member of Tier 1 dies, the members of Tier 2 get to split up
what’s left
Once we get to Tier 2, it is no longer treated as a joint acct but as a
tenancy in common; this means that if one of the members of Tier 2 dies,
their share is transferred according to their will and does not go to the
surviving beneficiaries
Bank’s liability is the same as w/ a joint acct

Totten Trust
o Def: A savings account trust that is:
If not revoked  POD
New B can be named

Trusts & Estates Outline

Joint Tenancy
o Operation: When JT1 dies, JT2 owns absolutely.
o CL Theory: decedent’s interest vanishes at death. Therefore, no probate
necessary b/c interest passes.
o Avoids cost & delay of probate
o Three Factors:
Creation of JT  equal interests upon creation
 Irrevocable
JT not devisable
Creditor rights: must seize during JT’s life

Assignment 16: Planning for Incapacity

Conservator: ct appointed guardian of property and economic interests

Elder Law: estate planning + health care issues (MedicAid)

Dealing w/ incapacitated person:

o Agency Law applies
Problem: agent’s power derives from principal
Solution: Durable POA
 Lasts through incapacity to death
 Termination: At any time if principal is competent
 Written instrument requirement
SC: allows Durable POA if executed w/ testamentary formalities and is
Rule: Atty-in-fact can’t change will.
 But can give gifts. (IRS may not allow however)

Health Care Issues

o Statutory way to plan in advance:
Living wills
Health Care POA (no recording requirement)
If T does both, agent can’t contradict living will
o Federal Law: every hospital that receives federal funds is required to ask
patient if he has an advanced health care directive
o “Do Not Resuscitate” Order
obtainable only from doctor
Problem: emergency personnel don’t find
o Uniform Determination of Death Act
No breathing = death
No brain functions = death

Assignment 17: Extrinsic Evidence

Trusts & Estates Outline

Hypo: T wills to “brother.” T dies. T has brother, half-brother, and step-brother.

Who’s a brother?

Patent Ambiguity: uncertainty that appears on the face of the will; e.g. – “I leave
½ my estate to A, ½ my estate to B, and ½ my estate to C.”
Latent Ambiguity: uncertainty not on its face but disclosed by some collateral fact

Two Rules:
1. Plain Meaning (Old) Rule: can’t use extrinsic evidence to disturb plain
meaning; Mahoney v. Grainger – atty uses word “heirs” instead of
“cousins” which is a patent ambiguity; T’s aunt takes b/c she is only “heir”;
ct rules that aunt alone shall take b/c even though this is contrary to T’s
intent, they are bound by plain meaning on face of the will; classic
example of strict adherence to plain meaning rule
2. Modern Rule (SC): can use extrinsic evidence to find and resolve

Exceptions to Plain Meaning Rule

o Falsa demonstratio non nocet (false description does not vitiate): this
happens when the will accidentally bequeaths a piece of property that the
testator doesn’t own; the testator actually means another piece of property
but has the wrong address in his will (Arnheiter case; latent ambiguity)
o Personal usage exception: this occurs when the testator ambiguously or
erroneously describes a person who is to take under their will; e.g. – the use
of the word “bros” to refer to friends of yours or something of that nature
(Gibbs case; latent ambiguity)

Modern (SC) Analysis:

1. Determine ambiguity using extrinsic evidence
2. Resolve ambiguity using extrinsic evidence

Trend w/ respect to latent ambiguities is that you can use extrinsic evidence to
show that they exist, and you can use extrinsic evidence to resolve it; Cts are
more willing to resolve patent ambiguities using extrinsic evidence w/ the
exception of when the testator leaves a blank in their will; Cts more willing to
allow extrinsic evidence at the construction stage than at the validation stage.

Medlin Rule: cts should be just as willing to allow extrinsic evidence to fix patent
ambiguities as they are to fix latent ambiguities.

Assignment 18: Lapse7, Anti-Lapse

What happens when B dies before T?

Hypo: Will
1. Car to F (dies)
Lapse means a gift fails b/c the B predeceases T.

Trusts & Estates Outline

2. House to S
3. Residue to Y & Z What result?

General Rule: If B dies before T, then devise lapses (or fails).

1. Specific/General Devise: if lapses, devise  residue
2. Residuary Clause: if lapses, residue  heirs of T by intestacy
3. Class Gift: if class member dies before T  apportion amongst remaining
class members
4. Void Devise: if devisee dead at execution  devise is void
Figure 4: CL Lapse

Anti-Lapse8 Process (See Attached Hypo at the end of the outline)

1. B predeceases T
2. Is there an express substitute in the will? If not, apply § 2-603 (SC Anti-
Lapse Statute)
3. § 2-603 Requirements
a. R must be in great-grandparent parentela
b. R must have issue
c. No words of survivorship in the devise
4. If § 2-603 anti-lapse statute doesn’t apply, apply § 2-604.
a. If non-residuary devise fails, it goes into residue.
b. Subsection (b): if residuary is devised to 2 or more persons and
the share of one of the residuaries fails for some reason, his share
passes to the residuary devisee or to the residuary devisees in
proportion to their interest in the residue
5. If will specifically states that §2-603 doesn’t apply, then it will not apply; it
is a statute of construction
6. Summary: if a pre-residuary devise fails, then it passes to the residuary; if
a residuary devise fails, then it passes according to §2-603 or, if that fails,
the intestacy laws; if a residuary fails partially, then it passes to the other

§ 7-113: anti-lapse applies to trusts

Class Gifts
o Classic Rule: must be alive on T’s death to be part of class
o However, § 2-603 applies anti-lapse to class gifts. Problem may arise in that §
2-603 suggests that anti-lapse applies even if B dies before date of execution.
o If a class member dies, the survivors divide.

Assignment 19: Ademption, Abatement, Satisfaction


Operation: substitute Bs (not lapse prevention)

Trusts & Estates Outline

o Hypo: T wills car to A, rest to B. T sells car. T dies. What result as to A? A

gets nothing because his gift of car is adeemed.
o Applies only to specific devises (a specific asset).
o Doesn’t apply to general devise (a general benefit like $)
o Doesn’t apply to demonstrative devise (general legacy payable from specific

§ 2-605: deals with accretion in specific devise

Hypo: T wills B some stock. The stock value grows.
 If accretion caused by normal rise in value, the accretion remains with
the specific devise.
 If accretion caused by T buying more shares, the specific devisee not
entitled to the accretion.

§ 2-606: Nonademption of specific devises in certain cases; unpaid proceeds of

sale; condemnation or insurance; sale by conservator
a. Paragraph (a): if T disposes of property that is specifically devised and
there is $ still owing on that disposition, then the specific devisee is
entitled to whatever $ is still owing on that devise (think of the Tiger
Woods golf clubs example from class)
b. Paragraph (b): same situation as (a) w/ one extra tweak; if the
conservator of T disposes of property that is specifically devised, then the
specific devisee is entitled to all the $ from that disposition

What if conversion occurs through Durable POA? Unclear

o Theories:
§ 2-606(b) should apply when agent acts for principal
§ 2-606(b) should apply only if principal is incompetent

Differences in form vs. differences in substance

1. T devises “Bank Acct 12345” to B; later moves $ from one bank to
another; cts will probably see this as difference in form b/c bank accts
are the same as far as the $ is concerned which means B will inherit
the new bank acct
2. Same as above but T later removes $ and buys IBM stock w/ it; ct will
probably see this as a change in substance and the gift will adeem

o Hypo: see attached hypo
o Abatement problem arises when estate has insufficient funds to pay debts
and all devises; some devises must be abated or reduced.
o § 3-902: Order of Abatement
Property not disposed of by will
Residuary Devise
General Devise
Specific Devise

Trusts & Estates Outline

o After ordering, apportion and reset the scheme.

o § 2-610: if T gives a gift to a devisee during his life and intends for this to be a
satisfaction, then it reduces what the devisee takes under the will; very similar
to advancement under intestacy

Exoneration of Liens
o Issue: does devised property subject to lien come w/ or w/o the lien?
o § 2-607: specific devises pass subject to lien (rebuttable presumption)

Assignment 20: Homestead, Support, Dower, Elective Share

Homestead—not on exam

Two marital property systems:

1. Separate Property (CL): separate owners unless joint owners
2. Community Property: equal undivided shares
a. Operation: deceased spouse has power over ½
b. Elective Share prevents disinheriting of at-home spouse
c. Exception: pre-marriage property remains separate

o Schemes to Support Surviving Spouse:
Social Security
Private Pension Plans
Homestead: secures family home to SS & minor children free of creditor
Personal Property Set-Aside: homestead concept applied to personal
Family Allowance: for maintenance and support (may have fixed period)
Dower: life estate in 1/3 land
 Attaches to all land owned by H; not extinguished after sale of land 
to extinguish need signatures of H & W to be free of dower; have been
found unconstitutional

Elective Share
o § 2-201 to 2-207
guarantees SS 1/3 probate estate (excluding non-probate transfers); this
doesn’t include funeral costs, administration costs, etc
SC anomaly: 1/3 elective share if 1/3 property transferred in trust in way
that obtains the federal estate tax marital deduction
SS defined in § 2-802
o Hypo: H has $600K probate estate (PE); wills house (worth $80K) to W, rest
to D. What result?
Testamentary analog to advancement by intestacy.

Trusts & Estates Outline

PE = 600,000
PE times1/3 = Gross Elective Share (GES)
GES – Offset = Net Elective Share (NES) (200,000 – 80,000 = 120,000)
o SC doesn’t have true elective share b/c even if surviving spouse disclaims he
is treated as if he received the devise
o To avoid elective share: minimize probate estate by non-testamentary
Life estate w/ remainder
Insurance policy
Multi-party Bank Account
Revocable Trust
o Seifert: South Carolina Supreme Court holds that revocable trust is illusory
transfer b/c right to revoke is ultimate power over property
Court overlooks fact that revocable trust universally recognized as a valid
non-testamentary transfer despite right to revoke.
Legislature fixes by enacting § 7-112 which re-confirms that revocable
trust is a valid non-testamentary transfer
Dreher case had similar facts and came after §7-112; ct held the same
thing as in Seifert, but on different grounds; Ct of App even quoted an
article Medlin had written, which stood in direct contradiction to its opinion
o To avoid elective share in SC after Seifert:
Irrevocable transfer
Revocable transfer other than revocable trust (w/ disclaimer to client)
Life Estate in 1/3 PE w/ remainder
o Hypo: H wills to W life estate in 1/3 property, rest to D. What result?
PE = 600,000
D gets 400,000 outright and remainder in 200,000
W gets L/E in 200,000
 § 2-207: L/E valued as full 200,000. Why? To get the federal estate tax
marital deduction.
 H retains control
 H cheats W out of value
 H still satisfies the elective share
o § 2-203: Who can exercise the elective share:
Surviving Spouse
Atty-in-fact for SS
Ct order for incompetent SS
o When to exercise the elective share:
§ 2-203: during SS lifetime
o § 2-205: Requirements for making elective share claim; must notify personal
atty or personal representative of estate by mail
o Problem: what if SS presents claim and dies during adjudication? Right
treated as if vested when filed and estate can proceed.

Trusts & Estates Outline

o Rationale for elective share:

Reward SS for economic benefits
Prevent SS from becoming ward of the state
o § 2-204: Waiver
can waive in whole or part
can waive before or after marriage
can waive b/f or after the death of the spouse
can only be waived by a signed writing after full and fair disclosure;
there are issues over whether there is a full and fair disclosure of what the
party is actually waiving their rights to and over whether there is a full and
fair disclosure of the rights that a party is waiving; also a question of
whether both parties need their own attys present when reviewing the
prenup (remember De Lorean case)
no consideration required
no K required

Assignment 21: Trusts10 Introduction

Legal Trustee
Equitable Beneficiary

Figure 5: The Trust

The Trust’s distinguishing feature is the division of legal and equitable title; one
reason for using the trust is privacy; this is b/c the beneficiary doesn’t have to be
entered into the public records

The Players in a Trust:

o Settlor: creator of the trust
o Trustee: carries all the responsibility11 (if accepts)
Legal title holder
Fiduciary duty to B
Subject to personal liability
If no trustee  no failure of trust b/c ct will appoint trustee

Private Express Trust: a trust gratuitously created for the benefit of individual Bs.
Responsibilities include: preserve property, income to B, duty of fairness to B(s), duty to keep separate
trust property from personal property, duty of accounting

Trusts & Estates Outline

Duty of loyalty: Trustee must administer the trust solely in the interest of
the Bs; self dealing is sharply limited and often prohibited
Duty of prudence: under this duty the trustee is held to an objective
standard of care
Subsidiary Duties/Rules: the duty of impartiality b/w classes of Bs such as
income Bs and remaindermen; the duty to keep trust property separate
from their own property; the duty to inform and account to the Bs
o Beneficiary: benefits from the trust
Equitable title holder
Has personal claim against Trustee; Trustee’s personal creditors cannot
touch the trust property
If no B  trust fails

General Rule: one person can’t be both trustee and beneficiary. Why? No
division of legal and equitable title means no trust.

Settlor Trustee Beneficiary

M A A  not valid trust

M A&X A&X  valid trust

§ 7-603
A A A&X  valid trust

Trust Creation Methods:

1. Declaration of Trust: settlor is the trustee
a. An inter vivos trust (SOF applies)
b. No delivery or deed required
c. Need Settlor’s manifest intent
d. If real property, SOF requires written instrument
e. §7-401(a)(2) – must be a written declaration signed by the owner of
property that the owner holds identifiable property as trustee
2. Deed of Trust: settlor transfers to another trustee
a. An inter vivos trust (SOF applies)
b. Need Settlor’s intent
c. Delivery required
3. Testamentary Trust
a. Statute of Wills applies

Assignment 22: Creation, Intent, Property

Trusts that arise by operation of law:

Trusts & Estates Outline

1. Resulting Trust: arises when express trust fails (e.g. – B dies) or makes an
incomplete disposition; if no alternative disposition trust fails; Trustee must
convey trust property back to settlor or settlor’s estate
2. Purchase Money Resulting Trust: arises when one person pays the
purchase price for property and causes title to the property to be taken in
the name of another person who is not the natural object of the bounty of
the purchaser
a. Hypo: O owns Blackacre. A pays O $1,000 for Blackacre; the deed
conveying Blackacre names B as grantee. What result?
i. If B (recipient of property) is object of A (purchaser) bounty
 gift to B
ii. If B not an object of A’s bounty ≠ gift to B
b. SOF doesn’t apply
3. Constructive Trust: flexible remedy imposed to prevent unjust enrichment
a. Operation: If legal title holder can’t retain beneficial interest in good
conscience, equity converts him into a trustee.
b. Constructive Trustee has duty to convey
c. Requirements to impose constructive trust:
i. Confidential/fiduciary relationship
ii. Express/implied promise by transferee
iii. Transfer in reliance on promise
iv. Unjust enrichment

Trust Property

Brainard v. Commissioner
o Rule: no trust if no trust property.
o Rule: expectancy can’t be subject matter of trust.
o Rule: trust property + intent must be concurrent to have trust.

Speelman v. Pascal (gift of unrealized movie rights)

o Rule for creating trust of future profits: must manifest intent + have means to
create future profits (e.g. – trust that is a gift of land that settlor does not yet
own is not enforceable trust but a gift of movie rights and future profits from
them is enforceable b/c the “tree” already exists)
Analogy: tree bearing fruit; in some states, you can create a trust that gifts
only the “fruit” as long as the settlor can prove that he owns the “tree”

Assignment 23: Testamentary, Revocable

Oral Inter Vivos Trust of Land

Hypo: O orally trusts property to X, income to A, then to B. SOF prevents

enforcement. Who gets the property?
o Old Rule: X keeps property.
o Modern Rule: Constructive trust imposed on X if

Trusts & Estates Outline

Fraud/duress by X
Confidential relationship
Transfer in anticipation of death

Hieble v. Hieble (Mother gives land to Son on condition that will re-convey; M
believes she might die of cancer soon)
o Facts: the agreement b/w M and S in effect operates as a trust
o S arg: SOF requires writing
Problem w/ S arg: can’t use SOF to perpetrate fraud
o Ct. imposes constructive trust as remedy.

Pappas v. Pappas
o Facts: similar facts as Heible except the reason is to avoid creditors
o Ct. doesn’t impose constructive trust b/c “unclean hands.” So S gets the land,
but not a good result b/c S rewarded for helping Dad cheat.
o Best remedy: let creditors take

Oral Trust for Disposition at Death

Olliffe v. Wells (will devises residue to W with instruction to discretely distribute

according to T’s wishes)
o Rule: indefinite will  resulting trust
o More rules:
Setting up trust doesn’t impair rights of heirs.
If trust not set up  property to devisee
If lawful trust set up  benefits Bs
If unlawful trust set up  resulting trust  heirs

Secret Will Semi-secret Will

Hypo: A & B share charitable Hypo: Same facts as last, but A’s will
inclination. A tells B will devise estate shows intent to create trust. What
to B if will distribute to charities. A dies. result?
B fights to keep. What result?
Result: Use extrinsic evidence to make Result: No extrinsic evidence needed.
sure no fraud. Constructive trust Trust fails b/c indefinite; Trustee must
imposed. return $ to Settlor’s estate

Revocable Trusts
o §7-601: mental capacity to make a revocable trust is same as that to make a
will; mental capacity to make an irrevocable trust is much higher
o Presumption:
SC CL: trust presumed irrevocable unless right to revoke reserved
SCPC §7-602: presumption completely reversed; inter vivos trust is now
presumed revocable

Trusts & Estates Outline

Uniform Trust Code: trust presumed revocable unless expressly

o Revocable Trusts provide us w/ flexibility and privacy; settlor is often
beneficiary and trustee for life; can also avoid probate fees but not a big deal
in SC b/c probate fees are cheap
o Power to amend ≈ power to revoke
o Universal Rule: revocable trust is a valid non-testamentary transfer.
Seifert is the only case (wrongly) holding otherwise.

o Holding: revocable trust is valid non-testamentary transfer.

o CL Rule: if trust specifies revocation method, must follow the method
o §7-602 of SCPC says that substantial compliance w/ revocation method is
o If no exclusive method stated, several ways to revoke
Revoke by later valid testamentary document (will or codicil); must be
clear and convincing evidence
If something other than valid testamentary document is used to revoke,
then it must be in writing, delivered to the trustee, and must be proven by
clear and convincing evidence

Other SCPC Revocable Trust Provisions

o §7-603: As long as trust is revocable, Trustee only owes duties to the settlor
o §7-605: Rule of “no contest clauses” for wills applies to revocable trusts
o §7-606: Same anti-lapse provision for wills applies to revocable trusts
o §7-607: Same revocation by divorce procedure for wills applies to revocable

Also, unlike wills we do not need the original revocable trust document for the
revocable trust to be valid

Assignment 24: Pour-over

Pour-over Will
o Concept: when will takes effect it calls for transferring the assets into a trust
o Goal: simplify and unify estate administration
Allows for flexibility and the T can have someone else manage her
property if she doesn’t wanna do it
Avoids publicity (will is publicized in probate, trust is private)
o § 2-510: allows pour-over
No trust property need be in the trust if the trust is part of a pour-over12
Provides that a trust can be a beneficiary under a will
This is the exception to the general rule in most jurisdictions.

Trusts & Estates Outline

If trust is in existence b/f or at the same time the will is executed, then trust
is absolutely valid
Trust viewed as “property container”
 Funded Scenario: Inter Vivos trust (w/ property). Then pour-over will
executed. T dies. What result? Will funds pour over into the trust.
 Concurrent Scenario: Inter Vivos trust (w/o property) and pour-over will
executed at the same time. T dies. What result? Will funds pour over
into empty container.
 Questionable Scenario: Inter Vivos trust (w/o property). Then pour-over
will executed. T dies. What result? Unclear.
• Args: Incorporation by Reference, Constructive Trust
Trust can be revocable, irrevocable, amendable (which is the same thing
as revocable).
 Problem: what if trust is revoked? Then no “property container” exists,
so the will needs to have an alternate disposition or partial intestacy
Not a method by which to escape transfer/estate taxes, creditor claims, or
elective share/pretermitted child share/omitted spouse’s share

Pour-over Theories:
1. Incorporation by Reference: trust must exist at time of will execution
a. No amendments allowed
2. Independent Significance: trust must have some property transferred to it
during life
a. Amendments allowed

Assignment 25: Discretionary, Creditor’s Rights

o Two Types:
Creditor of Settlor
Creditor of B
o Creditor of Settlor
Creditor can stand in the shoes of debtor once attached if revocable trust
In an irrevocable trust, the settlor relinquishes all rights that he may have,
therefore, his creditors cannot get to the trust property (SCPC §7-505:
creditors can reach irrevocable trust property if a settlor is also a
beneficiary of that irrevocable trust, but only to the extent of the settlor’s
beneficial interest in the trust property)
If Settlor dies, right to revoke doesn’t exist, therefore (depending on the
jurisdiction one of the following rules applies); State Street Bank v. Reiser
 Creditor can still reach the trust property (SCPC §7-505: creditors of
settlors can reach revocable trust property after the settlor’s death)
 Creditor can’t reach the trust property b/c right to revoke is terminated

Trusts & Estates Outline

o Creditor of B
Creditors can reach if no restriction on B
To avoid creditors use Spendthrift Provision which prevents
voluntary/involuntary alienation of property
 CL Exceptions:
• Child support
• Alimony
• Necessities; not allowed by all cts (e.g. – landlord who is owed rent
can attach their interest in the trust)
• Taxes
• Torts victims; this was not allowed by all cts
 Rule: Settlor can’t create spendthrift trust in his own favor to avoid
creditors13 (Re FN 13: these states allow self-settled trusts to avoid
creditors and the settlor cannot be held in contempt of ct b/c, unlike the
Cayman Islands example, he trusts the banks of AK and DE so he is
not a trustee)

South Carolina Spendthrift Rule (§7-502 and §7-503)

o Rule: spendthrift provision works against income interest but not principal
interest14(I don’t have this rule anywhere in my notes but it may be true)
o To be valid, a spendthrift provision must restrain both voluntary and
involuntary transfer of B’s interest in the trust
o Hypo: S trust gives income interest to K, principal interest P. What can
creditors reach?
K’s creditors can’t attach his income interest
P’s creditors can attach the principal interest (by standing in P’s shoes:
can get only if P can get)
o Under §7-503, only exception to Spendthrift Provision is child support; and
not even this can but thru a special needs trust

Forfeiture Clause
o Operation: If B tries to alienate or B’s creditors try to attach, then B loses his
interest and the interest goes to an alternate B.
o Distinguish from spendthrift b/c B loses interest

Discretionary Trusts (§7-504)

o Mandatory Trust: trustee must distribute all income
o Discretionary Trust: trustee has discretion over distribution of income,
principal, or both
Trustee has due diligence responsibility
Operation: Bs have no interest until trustee makes a decision  only then
do Bs have an alienable interest

Not the rule in Alaska and Delaware.
In most states the spendthrift works against both the income and principal interest.

Trusts & Estates Outline

Since B has no alienable interest until Trustee makes a decision, their

creditors don’t have an alienable interest until then either
If Bs have special needs discretionary trusts can be used to avoid
disqualification of government benefits (this will occur if the trust states
that the $ will be used for purposes other than those which the govt can
provide, e.g. – healthcare)
o Trust Code tweak: discretionary trust is subject to child support claims but
only if the trustee breached the good faith standard

Support Trusts
o Trustee determines level of support
o To be a support trust, there must be a connection b/w support
o Providers of necessities can get at trust property as creditors of Bs but no
other creditors can
o Rule: Settlor can’t create support trust in his own favor in order to avoid his
o Can combine spendthrift provision w/ support trust

Assignment 26: Modification, Termination

Modification/Termination (Under CL)

o Distinguish b/w dispositive and administrative provisions:
o Administrative Provision: management of the funds (usu. giving Trustee
Amendability: only if reasonable necessity
Hypo: F creates trust with income to family. Then interstate highway will
be built across the land, making it more valuable as commercial real
estate. Trustee wants to sell the land, invest the sale proceeds, thereby
increasing income. What result? Ct. will allow modification because deals
with administrative provision.
o Dispositive Provision: who gets what & when?
Most important part of the trust
Amendability: only if
 Settlor and Bs consent or
 If Settlor is dead, (1) Bs consent and (2) all material purposes are
 Ct can construe the document to allow certain types of modifications
(this is more about construction than modification)
 “Family Settlement Agreement”; cts don’t want families fighting so they
will allow a trust to be modified to prevent that; sometimes it is
necessary to create a family dispute to get a trust modified
Problems w/ “Settlor is Dead” Test:
 What is a “material purpose”? Look at Settlor’s intent
 Can be difficult to get all Bs consent b/c some Bs may not be

Trusts & Estates Outline

• Potential Solutions:
♦ Guardian ad litem to represent unborn and/or minor Bs; problem
is that Bs can sue the guardian ad litem when they come of age
if the guardian made a poor decision
♦ Doctrine of Virtual Representation: known, adult Bs can consent
on behalf of unknown and/or minor Bs
 Policy: known, adult Bs already have an identity of interest in
the trust
 Problem: when the unborn and/or minor Bs reach
adulthood, they can argue that they didn’t consent and
wouldn’t have consented to what the representative did
o Types of Trusts that can’t be terminated:
Spendthrift Trust
B not specified until specified age
Discretionary Trust
Support Trust

Modification/Termination (Under SCPC §7-410 – 7-418

o §7-411
Paragraphs (a) and (b) repeat the common law rules w/ one little tweak;
requires ct approval to amend a trust either thru settlor’s and Bs’ consent
or Bs’ consent and material purposes have been achieved
Paragraph (d) says that a ct can approve modification in either of the 2
ways mentioned just above even if not all of the Bs consent; opens up the
possibility that the ct can approve a modification over the outright
objection of a B
o §7-412
Says that a ct can amend the administrative OR dispositive provisions b/c
there has been a change of circumstances
Under CL, cts could only do this w/ regard to administrative provisions
o §7-414
Idea is that if a trust gets too small, then it won’t make economic sense to
try and continue administering it
Paragraph (a) allows a trustee to terminate a trust if it has less than $100K
in it
Paragraph (b) allows the ct to modify or terminate a trust or to remove a
trustee if it determines that the value of the trust has become too low
o §7-415
Ct can reform a trust if there is clear and convincing evidence that there
has been a mistake of fact or law
Reform means that the terms of the trust are not being altered; the
document is simply being fixed to reflect the settlor’s intent
This is arguably not a taxable event
o §7-416
Ct can modify the terms of a trust to satisfy tax objectives

Trusts & Estates Outline

In some cases, the IRS will not recognize the modification as having
corrected the tax issue
o §7-417
The trustee can divide and combine trusts if he doesn’t affect the rights of
the beneficiaries
E.g. – H and W create trusts w/ identical provisions; they both die; trustee
can combine both trusts b/c it becomes easier to administer
Can help w/ generation skipping transfer tax

Assignment 27: Charitable Trusts

Charitable Trusts
o Why people create charitable trusts:
Promote charity
Tax Incentives (Estate planners need to know property-tax law interplay)
o To create charitable trust must be for:
Benefit of society (not individual Bs)
 Must be an indefinite group that is large enough
• Exception: Send X to med school on condition that X work in your
city. (real benefit is to the community)
Charitable Purposes (§7-405):
 Relief of poverty
 Advance education
 Advance religion
 Promote health, literary, scientific, or “beneficial” purposes
 Governmental/municipal purposes
 Catch-all: other purposes the accomplishment of which is beneficial to
the community
o Exempt from RAP
o Rule: Can’t create charitable trust whose goal is contrary to law or public
o Rule: Can’t create trust that perpetually funds a political party

Shenandoah v. Taylor (charitable trusts to all 1st, 2nd, 3rd graders on Easter and
o Ct. held gift not for advancement of education b/c kids will not use the money
for education; not for poverty b/c all kids get it, not just poor kids
o Ct. draws line b/w beneficent and charitable giving, holding this case to be
o This is a minority case; most cts bend backwards to find a charitable trust

Assignment 28: Cy pres

Modification of Charitable Trusts

Trusts & Estates Outline

o Two ways to modify charitable trusts:

Cy pres: modify specific dispositive provision but still satisfy general
 When to use: when specific purpose becomes impossible,
 Cannot use Cy pres to validate an otherwise defective charitable trust
Equitable/Administrative Deviation: modify administrative provision
 Can have same effect as Cy pres
 SC: doesn’t follow Cy pres but has equitable deviation (§7-413)

Hotz v. Minyard (charitable trust w/ discriminatory purpose)

o Issue: Is state enforcement of discriminatory trust unconstitutional?
o Holding: Yes, but ct will allow modification to make it a non-discriminatory
o Rule: private individual can discriminate
o Rule: State can’t discriminate
o Also SC example about the guy who wanted to provide housing for White
Presbyterians only

SC Trust Code Provisions

o §7-405
Paragraph (a) lays out what are charitable purposes as mentioned above
Paragraph (b) says that a ct can choose a charitable purpose or B that is
consistent w/ settlor’s intentions; this only occurs when the trust doesn’t
specifically state this
o §7-408
Allows for a Pet Trust that can provide for animals that are alive or
currently in gestation
o §7-409
Allows a non-charitable, but beneficent trust that can continue as long as
RAP allows
You can have some non-charitable trusts that aren’t subject to RAP; e.g. –
a trust for maintenance of a grave or memorial
o §7-413
Allows equitable deviation
Paragraph (b) says that if there is a provision in a charitable trust that
would result in distribution of the trust property to a non-charitable
beneficiary, then it prevails over the power of the ct, under paragraph (a),
to modify or terminate the trust ONLY IF,, when the provision takes effect,
the trust property is to revert to the settlor and the settlor is still living, or it
defeats the rule against perpetuities

Assignment 29: Powers of Appointment15

See p. 84 of the Supplement for Medlin’s outline on powers of appointment.

Trusts & Estates Outline

Powers of Appointment
o Def: power conferred by one on another to appoint the person(s) who will
receive an interest or estate in property
o The Players:
Donor: power creator
Donee: has “all power, no duty”
Objects: potential receivers
Appointees: actual receivers
Takers in Default of Appt: persons designated by donor to take if power
not exercised
o Types based on object:
General: donee can give to self or anybody else
 Ex: Adam has P/A to give to “people in Medlin’s T&E class.” This is a
general P/A because I can give to myself (as a member of the class)
 Donee is considered an owner of the property
 Once donee decides where property goes, it is seen as a 2 step
process: from donor, to donee, to appointee(s)
Special: donee can’t give to self; can give to anybody else
 Ex: My mom has P/A to give to “students.” This is a special P/A
because mom isn’t a student, so she can’t appoint to herself.
 Donee is not considered the owner of the property
 Once donee decides who he is giving property to, it is seen as a one
step process: from donor to appointee
o Types based on timing:
Testamentary: exercisable only by will of donee
Presently Exercisable: exercisable during donee’s lifetime
o Donee must abide by donor’s reqs if there are reqs.

Exercise/Non-Exercise of POA
o K to exercise POA
Enforceable if lifetime POA not enforceable for testamentary POA
Can unilaterally “release” or give up POA, even for testamentary transfers
o Deciding when donee has exercised POA
Implied exercise
 By referring to the POA itself (e.g. – donee’s will says I leave
everything to X; the ct may infer that donee meant to exercise POA)
 By referring to the appointive property (e.g. – O gives A POA to
appoint Blackacre; in A’s will it says I give Blackacre to B)
 W/o exercise of POA, the gift makes no sense (e.g. – I give $1 million
to X; I don’t have $1 million unless I exercise the POA so that must be
what I meant to do
 Capture and Blending: only works for general POAs b/c special POAs
cannot become part of donee’s estate; e.g. – Donee of a general
testamentary POA dies; in his will he attempts to give A the POA and
then gives the rest of his estate to B; donor anticipated the possibility

Trusts & Estates Outline

that there may be no exercise so he created a TID; if A is alive, then

there is no problem; if A is predeceases the donee and has living
issue, they may try to argue that they are entitled to A’s share under
Anti-lapse statute but this probably won’t work; the next argument is
gonna be b/w B and the TID; B’s argument will be that, in attempting to
exercise the power, the donee failed and “captured” the POA as part of
his estate which now should go to B
In SC, residuary clause in will cannot exercise the POA
o Possible to appoint by creating a trust?
General: yes
Special: yes, as long as donor didn’t manifest contrary intent
o Can POA be exercised by creating a new POA?
Can create General POA in object of Special POA
Can create Special POA in any donee to appoint to object(s) of original
special POA
o Can the donee exclude objects?
Depends on the donor’s rules
Presumption is yes unless intent otherwise
o Fraud on the power
Appointment by donee of special power to an object w/ ultimate intent to
benefit a non-object
No definitive law as to what should be done

Assignment 30: Future Interests

Linguistic Approach: look at order of language

Classification Focus: right to posses

Distinction b/w present and future interest: possession

o Present interest: possession now
o Future interest: possession later

Present Interests
o FSA: right to possess forever
o Defeasible Fees
Fee Simple Determinable (FSD):
 Words: “for so long as” “while” “during” “until”
 Ex: O to A for so long as USC is a public school.
Fee Simple Subject to a Condition Subsequent (FSSCS)
 Words: “but if”
 Ex: O to A, but if USC stops being a public school, to X
Fee Tail (obsolete)
o Life Estate
Ex: O to A for life

Trusts & Estates Outline

Future Interests

Interests in the transferor Interests in the transferee

Reversion Vested Remainder
Possibility of Reverter Contingent Remainder
Right of entry Executory Interest
Figure 6 : Types of Future Interests

Interests in the transferor

o Ex: O to A for life. What interests? A has L/E. O has reversion.

Possibility of Reverter
o Follows a FSD
o Ex: O to A for so long as USC is a public school. What interests? A has FSD.
O has possibility of reverter b/c if USC stops being a public school the estate
reverts back to O.
o Operation: Once the condition defaults, the reverter automatically takes

Right of Entry
o Follows FSSCS
o Ex: O to A, but if USC stops being a public school, back to O. What interests?
A has FSSCS. O has Right of Entry.
o Operation:
Once the condition defaults, affirmative action is required w/in a
reasonable time to trigger the right of entry.
If O doesn’t act on the right of entry, then O loses that right and A’s

Interests in a transferee
Intro to Remainders:
o Def: a future interest that follows a present interest that expires naturally
o Rule: L/E expires naturally. Therefore, remainder interest follows a L/E.

Vested Remainder
o Two-part Vesting Test:
Is the remainderman known and ascertainable at the effective date of the
grant16? Must be yes
Is there any condition precedent that must be satisfied before remainder
takes possession? Must be no
 Rule: Life tenant’s death is not a condition precedent for vesting

Effective date of the grant ≈ date the grant becomes irrevocable

Trusts & Estates Outline

o Indefeasibly Vested Remainder: Ex: O to A for life, then to B. What interests?

A has L/E. B has VR.
o Vested Remainder Subject to Open (VRSO)
Ex: O to A for life, then to A’s children. (A has C1.) What interests? A has
L/E. C1 has VRSO. “A’s children” is a class that remains open while A is
alive. If A has more children, C1 is subject to partial divestment.
o Vested Remainder Subject to Complete Divestment: Ex: O to A for life, then
to B, but if B fails college, to C. What interests?
A has L/E.
B has VR subject to complete divestment.
C has EI (b/c doesn’t follow a L/E).

Contingent Remainder
o Any remainder that fails the vesting test
o Ex: O to A for life, then if B survives A, to B. What interests?
A has L/E.
B has CR because fails part 2 of vesting test.
O has reversion when he gives away a life estate or a life estate and a
contingent remainder
o Ex: O to A for life, then to whoever is USC’s basketball coach at A’s death;
What interests?
Fails the 1st prong of the test b/c we don’t know who the coach is
A has LE
Coach has a contingent remainder
O retains a reversion (its not likely but theoretically he does)
o Ex: O to A for life, then to USC’s football coach (at A’s death). Assume that A
dies but USC is currently looking for a football coach. What happens?
CL: Need continuous possession for CR to vest  CR destructible.
Reverts to O.
o Alternative Contingent Remainder
Ex: O to A for life, then if B is married to C, to B, but if B not married to C,
to D. What interests?
 A has L/E.
 B & C have ACRs.
 O has reversion. Why? B/c life tenant could forfeit life interest. If A
loses possession before his death (fraud, treason), then the estate
reverts back to O b/c CRs operate only at the life tenant’s death.

Executory Interests
o Def: an interest that follows something other than a L/E
o Ex: O to A, but if USC no longer a public school, then to B. What interests?
A has FSSEI.
B has EI.
Shifting EI
o Ex: O to A for so long as USC is public, then to B. What interests?

Trusts & Estates Outline

A has FSD.
B has EI.
Shifting EI
o Rule: If the future interest follows a FSD, then it is an EI.
o Ex: O to A for life, then 1 year later to B. What interests?
A has L/E.
B has EI.
O has reversion.
Springing EI

Life Tenant Disclaimer

o CL: need continuous possession; life tenant disclaims and vested
remaindermen don’t take immediately b/c vests only upon life tenant’s death.
Reverts to O.
o Modern Disclaimer Statute: acceleration of interest

Assignment 31: Class Gifts, Class closing

 A class gift is a gift to a group of people whose classifications to fit into

the class will be determined at some point in time; at some point in
time we are gonna have to determine who is a member of the class
according to the qualifications that the settlor, grantor, etc has imposed
 Class closing rules are rules of construction; once we close the class,
anyone conceived and born after that date cannot be a class member
 Present Interest Situation: “O’s will grants Blackacre to the children of
A”; a couple of scenarios could arise
• Scenario #1: A could’ve predeceased O; if this has happened the
class is closed physiologically b/c A is the procreator of that class
and now A is dead so there will be no more kids
♦ A has no children, then the gift fails; the class is closed
physiologically and there is no one in it
♦ A has children; the class closes and A’s children will receive the
gift; there will be no more children however
• Scenario #2: A is alive at O’s death; the procreator is still alive and
can still procreate; when the class hasn’t closed physiologically, we
look to the Rule of Convenience
♦ ROC: if, on the first day that someone could demand
possession or enjoyment of the property, we have a class
member who is qualified to do so, then we close the class;
premised on the theory that we wanna close the class as soon
as possible so we can settle the estate
♦ In Scenario #2, if A has a child or children when O dies, then the
class closes as soon as O dies; if we close the class under the
ROC in this case, then any of A’s future children will be cut out
of the grant

Trusts & Estates Outline

♦ The other possibility in Scenario #2 is that A doesn’t have any

children at the time of O’s death (for simplicity assume that A
has never had a child at the time of O’s death); under the ROC,
the class is not closed so we forget about the ROC; now we wait
for the class to close physiologically; the class doesn’t close
until A dies
 Present Interest – Express Survivorship Requirement: “O wills
Blackacre to the children of A who reach 21
• Scenario #1: A predeceases O
♦ A has no living children so gift fails
♦ A has a child or children; they are class members b/c we close
the class at O’s death; let’s assume that A has 2 children, C1
and C2; C1 is 21 and C2 is one yr old; the class closes as of O’s
death; C1’s class status is vested; C2’s class status is
contingent; however, since C2 is already a class member, they
get the chance to try to make the class
• Scenario #2: A is still alive at O’s death
♦ A has no children when O dies so the class isn’t closed
physiologically; we look to the ROC and the class would not be
closed b/c we don’t have anybody who can demand the gift;
anyone born during A’s lifetime will be a member of the class
and when A dies we close the class physiologically; A may have
some kids who are 21 and are vested and may have some kids
who aren’t 21 and are contingent and they get a chance to meet
the class requirements
♦ A has children, one of whom is 21 and the other one is 1; the
class closes b/c of ROC just like above
♦ A has children, one of whom is 11 and the other one is 1; we
can’t close the class b/c neither child can demand possession
b/c neither is 21; under the normal ROC, we would wait until A
dies and close the class physiologically just like if A had no
children at O’s death; some states in this situation, give the
ROC a 2nd chance once one of the kids reaches 21, so on the
day that the first of A’s children reaches 21, the class would
close and all of the children currently in the class would be
considered part of the class but no future kids
 Future Interest: “O wills Blackacre to A for life, then to B’s kids.”
• A predeceases O; this becomes just like a present interest gift to
B’s kids since we won’t have a life tenant; we would just erase A’s
life tenancy
• A lives but B predeceases O; if B predeceases O, the class is
closed as of O’s death; either B already has kids and will never
have anymore or B doesn’t have kids and will never have any at all
• A and B don’t predecease O; we can’t close the class
physiologically so we look to the ROC; on O’s death A is still alive

Trusts & Estates Outline

and B is still alive w/ 2 kids, one of whom is 21; the class is not
closed b/c O’s death is not the first day that one of B’s children can
demand possession or enjoyment; the ROC won’t apply until A’s
death or until B dies if B’s death predeceases A
• B has no children as of the time of A’s death but is still alive; we
throw ROC out the door and wait for the class to close

Assignment 32: Rule against Perpetuities

1. RAP and Its Policies

a. Purpose is to promote the marketability of private property
b. This is a rule that says there is a commercially reasonable time that
we will allow unknown owners to exist but beyond that point we
need to know who the owners are
c. Classical Application
i. Stands on the effective date of the grant; looks to see if any
of the interests in the grant leaves a question as to who
owns the property; if there are questions, the rule says “we
have to imagine anything that can happen based on the
facts that exist today to make sure that under every possible
scenario we will remove those questions”
ii. If we cannot assure ourselves that the property will have a
known owner by a commercially reasonable period of time,
then we will say that the offending interests violate the rule
iii. Once we fix the grant then we will know for sure that the
owner will be ascertained w/in the commercially reasonable
amount of time
d. Unresolved Ownership Interests
i. We talk about the vesting of interests
ii. There are 3 interest that we consider not to be vested for
RAP purposes
1. Contingent Remainders
2. Executory Interests
3. Class Gift Subject to Open (vested remainder subject
to partial divestment)
e. Rule Period – w/in 21 years after some life in being (a measuring
life) plus 21 years
i. Who’s the measuring life? To be a measuring life, all you
have to do is be a “life in being” at the effective date of the
ii. It is difficult to ascertain who’s a measuring life when you
have a situation where the grant doesn’t name the
measuring life
f. Examples

Trusts & Estates Outline

i. O in her will says “to my grandchildren who reach 21”; on the

effective date of the grant, O is dead
1. Possibility #1
a. O has no children alive, therefore no
grandchildren alive
b. This is fine under the RAP b/c we know who
owns the property
c. The gift lapses and falls to the residuary
d. We will know on O’s death who owns the
2. Possibility #2
a. O has one child, C1, when O dies
b. C1 can still have grandchildren; but C1 cannot
have children after she dies; we know that any
grandchild born to O thru C1 has to be born in
C1’s lifetime
c. This means that C1 can be a measuring life;
we can say that when C1 dies, we can start the
RAP clock running and that we have 21 yrs for
the gift to vest
d. This gift passes the RAP b/c all of the
grandchildren will already be alive when the 21
yr clock starts running which means that they
can all reach 21 yrs b/f the clock runs out
3. Possibility #3
a. O has no children alive but has one grandchild,
GC1, alive
b. The grandchild herself is her own measuring
life; she will reach 21 w/in her own life or she
will fail to do so
ii. O makes a lifetime transfer via an irrevocable trust that says
“to my grandchildren who reach 21”
1. Possibility #1
a. O has no children or grandchildren alive on the
effective date of the grant
b. This grant fails
c. One scenario is that after O creates this grant,
he has a child, C1; he is hit by a truck and
killed on the way to see C1; at the same time,
every other measuring life on earth is killed for
one reason or another; C1 is not a measuring
life b/c C1 wasn’t in existence on the effective
date of the grant
d. C1 can affect vesting by waiting forty years to
have GC1, who would then take 21 more yrs to

Trusts & Estates Outline

reach age 21; we have violated the rule by 40

2. Possibility #2
a. O’s alive, has C1 who has GC1; GC1 is 20 yrs
b. This grant fails
c. GC1 dies b/f reaching 21; O has C2 after the
effective date of the grant; all the measuring
lives die off which starts the 21 yr RAP running;
C2 can affect vesting in a way that violates the
2. New Examples
a. O’s will to the grandchildren of A when they reach the age of 25
i. If we have no children alive and only grandchildren, then we
don’t violate the rule when the grant takes effect; if they are
alive, then they are measuring lives, so we don’t even need
the extra 21 yrs and since no children are alive, then we
can’t have anymore grandkids
ii. If there are living children (C1), then we have a problem; C1
has GC1 b/f O dies but has GC2 at the end of O’s life; all
measuring lives die when GC2 is born and the 21 yrs start
rolling; GC2 won’t reach age 25 w/in 21 yrs so the gift fails
iii. If there are living children but one GC is 25, then the class
closes at O’s death; this means that all living grandkids are
class members
3. Fine Tuning Examples
a. O wills to A for life, then A’s kids for life, then to A’s grandkids
i. A is 80, infertile, widow, nun, ugly, etc, etc; under the law, A
can still have a child; this means that no matter what the
facts are, A can have C2 born after the effective date of the
grant who will not be a measuring life; every measuring life
dies so the clock starts running; the rule is violated b/c C2
can wait however long after 21 yrs to have a GC and this will
violate the rule so the grant fails
ii. How could we construe this grant (assuming that A is alive at
O’s death) so that it doesn’t violate the rule?
1. We could construe the grant to read “O to A for life, to
A’s kids for their life, then to A’s grandkids who are
alive upon O’s death”
b. O wills to my issue then living when USC stops overcharging
i. If O has no issue living at the time of his death, then nobody
ii. If O has living issue when O dies; let’s say that after O dies,
GC1 is born (this would be O’s issue but is not a measuring
life); then every measuring life dies; the grant fails b/c it

Trusts & Estates Outline

could take longer than 21 yrs for USC to stop overcharging

which would violate the rule
iii. This means that if O has any issue alive, then the grant will
c. O to A for life, then to A’s widow for life, then to A’s issue then living
i. This means that the issue of A who are alive when A’s
widow dies will take under the grant
ii. 1st Scenario: on the effective date of the grant, A’s alive and
so is A’s wife; A has a child (C1); the rule can be violated;
A’s wife isn’t necessarily gonna be A’s widow; A’s widow
could be born after the effective date of the grant; A and his
current wife get a divorce; then A and widow (who is born
after effective date of grant therefore not a measuring life)
get married; A and widow then have a child (C2); A then
dies, as well as everyone who is a measuring life; widow
could live longer than 21 years after the death of all the
measuring lives which means that C2 won’t take w/in 21 yrs;
gift fails under these facts; we could construe this by saying
that O was thinking of A’s current wife when the grant went
into effect and not any potential future wives of A when he
used the term “widow” which means that the gift does not fail
d. O to A’s kids who reach 30
i. A is alive and has C1 who is not 30; after the grant takes
effect, A has C2; all measuring lives die; a violation of the
rule by about 9 yrs
ii. A is alive but at least one of the kids is 30 on the date the
grant takes effect; this means that the class is closed and
limited to A’s kids who are living at the time the grant takes
4. Basic Paradigm (3 steps)
a. Can we create a non-measuring life after the grant takes effect?
b. If so, we then kill off all measuring lives (theoretically, of course)
c. We then see if it will take longer than 21 yrs for the non-measuring
life to take under the grant
5. Gift of a Future Interest Examples
a. O to B for life, then to A’s kids who reach 30
i. B is alive but A is predeceased and has no children; the
remainder fails on the date the grant becomes effective b/c
none of A’s kids will ever reach 30
ii. B is alive but A is dead and has kids; the only kids of A who
will be given a chance to reach 30 and vest will be those that
are currently alive; they will serve as their own measuring
lives; they will reach 30 or die trying
iii. B is alive, A is alive, and has a child who is 30; we don’t
close the class on the effective date of the grant even if B’s
alive b/c B is a measuring life; now we have to do our 3 step

Trusts & Estates Outline

analysis; we kill off all the measuring lives; the grant fails b/c
C2 has to live to 30 which will take longer than 21 yrs
6. What happens when the rule is violated?
a. O to A for life, then to A’s kids who reach 25
i. If A is dead and one kid is 25, then the RAP is not violated;
anything else means that the grant will fail or, at least, not
ii. Lets assume that A is alive and has a living child
1. A has a life estate and C1 has a contingent remainder
2. The part of the grant to A’s kids who reach 25 is
3. We then reclassify as if it reads w/o the stricken
4. It now reads O to A for life; this means that O has a
life estate and O has a reversion
b. O to A for so long as USC overcharges, then to B’s issue then living
i. A has a fee simple determinable; B’s issue has executory
ii. As long as B or any of his issue is alive on the effective date
of the grant, we violate the RAP
iii. The executory interest violates the RAP so it is stricken
iv. Now we have to reclassify the grant as “O to A for so long as
USC overcharges”
v. A still has an FSD and O now has a possibility of reverter
c. O to A, but if USC stops overcharging, to B’s issue then living
i. A has fee simple subject to executory limitation; B’s issue
has an executory interest
ii. The RAP is violated
iii. Everything from “, but for…” is stricken
iv. The grant now reads “O to A”
v. A now has a fee simple absolute
7. RAP doesn’t apply to wholly charitable gifts; these are gifts where all
the interests are charitable interests
8. If there is a split interest where one part is private and one part is
charitable, then we have a problem; private part is probably subject to
9. Ways Around RAP
a. Construe the problem away (as has been noted above several
different times)
b. Some cts have reformed the grants
i. Example
1. O to A for life, then to A’s kids who reach age 25
a. In some jurisdictions the ct may change the
grant to say “O to A for life, then to A’s kids
who reach age 21; this will satisfy the RAP
c. Some jurisdictions take a “wait and see” approach

Trusts & Estates Outline

i. The problem w/ this is how long do we wait and see

d. SC Statutory Rule
i. We first must measure a grant to see if it satisfies the
common law rule; if it does then we satisfy the statutory rule
ii. If it does not satisfy the common law rule, then we wait 90
yrs and see; if the interests all vest w/in 90 yrs then we
satisfy the statutory rule
iii. If we fail the 90 yr vesting test, the statute also says that the
ct can reform the grant
iv. If the grant was effective b/f 7/1/87 and we have to reform it,
then we must reform it to satisfy the common law rule; if the
grant was not effective b/f 7/1/87, then we must reform it to
satisfy the 90 yr statutory rule

T's will provides as follows:

1. "$100,000 to be paid from my 1000 shares of Dave Odom, Inc. to A."

2. "$100,000 each to B and to C."
3. "Rest to D."

On the date of execution, T owned 1000 shares of Dave Odom, Inc. valued at
$100 a share, a house worth $250,000, and bank accounts totaling $2 million.

Two years later, T sold 500 shares of Dave Odom, Inc. for $25,000 ($50 per

One year later, T died. On the date of her death, T's entire probate estate
consisted of 500 shares of Dave Odom, Inc., now worth $10 a share, and bank
accounts worth $100,000.

What do you suppose happened to T's wealth from the date of execution until the
date of death?

She could’ve set up her estate to pass as non-probate gifts; she could’ve
gotten sick; she could’ve made an outright gift; she could’ve lost a lawsuit;
the possibilities are really endless

What do A, B, C, and D take?

Trusts & Estates Outline


1st possibility (A’s demonstrative devise): If this is a demonstrative devise,

then, under §3-902, A will be entitled to the value of the remaining stock
and then a $95,000 general devise from the rest of the estate; if this is the
case, then A takes $5000 from the stock and then you have to split up the
remaining general devises; A gets $95K/$295K which = approximately 32%;
B and C each get approximately 1/3 of the remainder which = approximately

2nd possibility (A’s specific devise): the ct decides that the devise to A is a
specific devise which means that A only gets the stock that’s left; this
means that B and C each take $50,000 b/c the remaining estate would have
to be split 2 ways; D would still get nothing

3rd possibility (A’s general devise): if the ct decides that A had a specific
devise (which is almost impossible), then A, B, and C split the estate up 3
ways; D still gets nothing


A’s argument: this is a specific devise; you would wanna argue this b/c,
under §3-902, specific devises are affected last when the estate is abated;
since the “1000 shares” no longer exists, then ademption comes into play
(this is the downside of a specific devise); under the common law, this
means that there is no substitute for a specific devise that is adeemed; but
how we typically deal w/ specific devises is that if there is anything left of
the specific devise at the time of death, then the specific devisee gets what
remains; this could also be a demonstrative devise which is a hybrid of
general and specific; for purposes of abatement, we treat a demonstrative
devise as a specific devise to the extent that the property exists and we
treat the demonstrative devise as a general devise to the extent that the
property doesn’t exist

B’s and C’s argument: they have a general devise b/c, although T’s will
says they get $100,000 apiece, it doesn’t specify where this money shall
come from w/in the estate; general devises are affected b/f specific devises

D’s argument: this is a residual devise; residuary devises are affected b/f
general devises; D doesn’t get anything no matter what