17.2 Decedents' Estates, Wills Formalities & Trusts Administration
Key Takeaways
- Intestate succession distributes property not disposed of by a valid will; descendants take under one of three systems: Strict Per Stirpes (root at child generation), Modern Per Stirpes / Per Capita with Representation (root at first generation with living members), or Per Capita at Each Generation (UPC: pooled shares divided equally at each subsequent generation).
- Valid execution under the Statute of Wills requires a signed writing by the testator in the presence of two competent, attesting witnesses; holographic wills (valid in UPC and modern states) require material provisions and signature in the testator's handwriting without attestation.
- Wills may be revoked by physical act with revocatory intent, by subsequent inconsistent instrument, or by operation of law (divorce revokes all provisions in favor of a former spouse under UPC § 2-804); anti-lapse statutes save gifts to predeceasing close relatives who leave surviving issue.
- A valid private express trust requires: a settlor with capacity, present intent to create a trust, a definite trustee with active duties, identifiable trust property (res), ascertainable beneficiaries (not required for charitable trusts), and a valid legal purpose.
- Trustees owe strict fiduciary duties: the Duty of Loyalty (governed by the 'no further inquiry' rule prohibiting self-dealing), the Duty of Care and Prudence under the Uniform Prudent Investor Act (UPIA portfolio approach and diversification), and the Duty of Impartiality between income and principal beneficiaries.
17.2 Decedents' Estates, Wills Formalities & Trusts Administration
Wills, Estates, and Trusts is one of the most frequently tested subject areas on the Multistate Essay Examination (MEE). Questions routinely test the interaction between statutory probate codes—such as the Uniform Probate Code (UPC)—and fiduciary principles governing trusts under the Uniform Trust Code (UTC) and the Uniform Prudent Investor Act (UPIA).
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| DECEDENTS' ESTATES & TRUSTS ROADMAP |
| |
| 1. INTESTACY & SURVIVING SPOUSE: |
| - Distribution schemes: Strict Per Stirpes vs. Modern vs. UPC Pooling. |
| - Surviving Spouse Share & Elective Share (Forced Share). |
| |
| 2. WILL FORMATION & REVOCATION: |
| - Formalities: Writing, Testator Signature, 2 Attesting Witnesses. |
| - Holographic Wills (Material Provisions in Hand). |
| - Revocation: Physical Act, Subsequent Instrument, Operation of Law. |
| |
| 3. WILL INTERPRETATION & BENEFICIARY CHANGES: |
| - Anti-Lapse Statutes & Substitute Takers. |
| - Ademption by Extinction & Abatement Hierarchy. |
| |
| 4. TRUST CREATION & FIDUCIARY ADMINISTRATION: |
| - Six Core Elements (Settlor, Intent, Trustee, Res, Beneficiary, Purp).|
| - Spendthrift Clauses & Creditor Exceptions. |
| - Fiduciary Duties: Loyalty (No Further Inquiry), Prudence (UPIA), |
| and Impartiality (UPAIA). |
| - Termination: Claflin Doctrine & Cy Pres for Charitable Trusts. |
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1. Intestate Succession
When a decedent dies without a valid will (or the will fails to dispose of all estate assets), the probate estate passes through intestate succession.
Surviving Spouse Share
- UPC Rule: The surviving spouse inherits the entire intestate estate if all surviving descendants of the decedent are also descendants of the surviving spouse, and the surviving spouse has no other surviving descendants.
- Spouse + Non-Spousal Descendants: If the decedent leaves surviving descendants who are not descendants of the surviving spouse, the surviving spouse typically receives a fixed statutory amount (e.g., $150,000 or $225,000 under the UPC) plus 50% of the remaining balance.
Descendants' Distribution Schemes
When the decedent's estate passes to descendants, jurisdictions apply one of three distribution methods:
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| INTESTATE DISTRIBUTION SCHEMES |
| |
| [ STRICT PER STIRPES ] [ MODERN PER STIRPES ] [ UPC § 2-106 ]|
| (By Right of Representation) (Per Capita w/ Rep) (Per Capita at |
| Each Gen) |
| - Divide into shares at the - Divide into shares at - Divide at |
| CHILDREN generation, the FIRST GENERATION with first level |
| even if NO children survive. LIVING members. with living. |
| - Deceased child's share - Living members take; - Living take; |
| drops down to their issue. deceased shares drop down. DROP SHARES |
| ARE POOLED & |
| DIVIDED |
| EQUALLY |
| AT NEXT LVL. |
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- 1. Strict Per Stirpes (Common Law / Traditional): The estate is divided into equal shares at the first generational level below the decedent (the children), regardless of whether any children are alive. One share is allocated to each living child and one share to each deceased child who left surviving issue.
- 2. Modern Per Stirpes (Per Capita with Representation - Majority): The estate is divided into equal shares at the first generational level with surviving members (e.g., grandchildren if all children are deceased). Each living member at that level receives one share, and the share of each deceased member with surviving descendants drops down to their respective issue.
- 3. Per Capita at Each Generation (UPC § 2-106 - Modern Trend): The initial division occurs at the first generational level with surviving members. Living members take their shares. The remaining shares of all deceased members at that level are combined into a single pool and distributed equally among all surviving descendants at the next generational level. All takers at the same generational tier receive identical amounts.
2. Wills Formalities, Execution & Revocation
Formal Execution Requirements (Statute of Wills)
To execute a valid formal will, the testator must possess testamentary capacity (at least 18 years of age and of sound mind) and satisfy execution formalities:
- Writing: The will must be a tangible written document;
- Signature by Testator: Signed by the testator or by another individual in the testator's conscious presence and at the testator's direction;
- Attestation by Witnesses: Signed by at least two competent witnesses, each of whom witnessed the testator's signature or the testator's acknowledgment of the signature or will.
- Presence Tests: The majority applies the Conscious Presence Test (witnesses are in testator's presence if testator understands they are signing through sight, hearing, or general awareness). The minority Line of Sight Test requires the testator to be capable of seeing the witnesses sign without changing position.
Holographic Wills & Interested Witnesses
- Holographic Wills: An unwitnessed will is valid in UPC jurisdictions and approximately half the states if the material provisions (identifying property and beneficiaries) and the signature are in the testator's own handwriting.
- Interested Witness Rule: At common law, a witness who is also a beneficiary was disqualified. Modern Purging Statutes hold the will valid but purge the interested witness's gift, unless there are two other disinterested witnesses (the supernumerary rule) or the witness would take under intestacy (receiving the lesser of the intestate share or testamentary gift). The UPC completely abolishes the interested witness rule, allowing interested witnesses to inherit without forfeiture.
Revocation of Wills
A valid will may be revoked in whole or in part by three exclusive methods:
- Physical Act: Burning, tearing, canceling, obliterating, or destroying the will with the simultaneous intent to revoke. Under the UPC, physical acts performed on any part of the document revoke the entire will.
- Subsequent Instrument: Executing a subsequent valid will or codicil that expressly revokes the prior will or contains inconsistent provisions (revocation by inconsistency).
- Operation of Law (Divorce): Under UPC § 2-804 and majority rule, a final decree of divorce or annulment automatically revokes all testamentary provisions, fiduciary appointments, and non-probate beneficiary designations in favor of the former spouse. The will is construed as if the former spouse predeceased the testator.
Dependent Relative Revocation (DRR)
Dependent Relative Revocation (DRR) is an equitable doctrine that undoes a testator's revocation of a will when the revocation was premised on a mistake of law or fact regarding the validity of another disposition. If the second disposition fails, courts apply DRR to revive the revoked will if doing so closer matches the testator's probable intent than intestacy.
3. Will Interpretation, Beneficiary Changes & Property Changes
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| WILL CONSTRUCTION DOCTRINES |
| |
| DOCTRINE LEGAL DEFINITION & RULE RESULT IF TRIGGERED |
| ------------------ ------------------------------ -------------------- |
| Anti-Lapse Statute Saves testamentary gift if Predeceased devisee's |
| predeceased beneficiary is a surviving issue take |
| close relative (descendant of the gift by |
| testator/grandparents) + issue. representation. |
| |
| Ademption by Specific devise fails if the Gift fails (Common |
| Extinction specifically identified item is Law Identity Theory); |
| not in estate at death. UPC grants intent/ |
| replacement proceeds. |
| |
| Abatement Order of reduction to satisfy Order: Intestate -> |
| estate debts and creditor Residuary -> General |
| claims against probate assets. -> Specific devises. |
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- Anti-Lapse Statutes: At common law, a gift to a beneficiary who predeceased the testator lapsed and fell into the residuary estate. Anti-lapse statutes save the devise if: (1) the predeceased beneficiary is a covered relative (a grandparent, descendant of a grandparent, or child of the testator), and (2) the beneficiary left surviving issue. The issue takes the gift by representation.
- Ademption by Extinction: Applies exclusively to specific devises (gifts of distinct, identifiable property). Under the traditional Identity Theory, if the specific property is not in the testator's estate at death, the gift is adeemed (extinguished). Under the modern UPC Intent Theory, the beneficiary is entitled to replacement property or outstanding insurance/condemnation proceeds if the testator did not intend ademption.
- Abatement: When estate assets are insufficient to pay debts and satisfy all bequests, gifts abate in the following statutory order: (1) Intestate property, (2) Residuary gifts, (3) General gifts (e.g., cash sums), and (4) Specific and Demonstrative gifts.
- Elective Share of Surviving Spouse: Protects a surviving spouse from disinheritance by granting a statutory right to elect against the will and claim a forced share (typically one-third to one-half) of the decedent's augmented probate and non-probate estate.
4. Trusts Creation, Elements & Spendthrift Protections
An express trust is a fiduciary relationship with respect to property, subjecting the person holding title (the trustee) to equitable duties to deal with the property for the benefit of another (the beneficiary).
Six Mandatory Elements of a Valid Express Private Trust
- Settlor Capacity: The settlor must have the legal capacity to convey property;
- Present Intent: Manifestation of present intent to create a trust (precatory words like "I wish" or "I hope" create a moral obligation, not an enforceable trust);
- Definite Trustee: A trustee with active administrative duties (a trust will not fail for lack of a trustee; the court will appoint one);
- Identifiable Res (Trust Property): Specific, identifiable property held in trust;
- Ascertainable Beneficiaries: Beneficiaries must be definitely ascertainable by the time their interests come into enjoyment (exception: charitable trusts);
- Valid Legal Purpose: The trust purpose cannot be illegal, contrary to public policy, or impossible.
Spendthrift & Discretionary Trusts
- Spendthrift Clause: A valid spendthrift provision expressly restrains both the voluntary and involuntary alienation of a beneficiary's interest. The beneficiary cannot assign their interest, and creditors cannot reach trust assets or compel distributions while in the trustee's hands.
- Creditor Exceptions to Spendthrift Protection: Judgments for (1) child support and spousal support / alimony, (2) claims by the government (taxes), and (3) providers of necessary food, clothing, or medical care can pierce a spendthrift trust and attach distributions.
5. Trustee Powers & Fiduciary Duties
Trustees are held to the highest standard of fiduciary care in equity. The breach of any fiduciary duty renders the trustee personally liable for surcharges and damages.
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| TRUSTEE FIDUCIARY DUTIES MATRIX |
| |
| FIDUCIARY DUTY STANDARD & RULES REMEDIES / ENFORCEMENT|
| ------------------ ------------------------------ -------------------- |
| Duty of Loyalty Absolute prohibition against "No Further Inquiry" |
| SELF-DEALING and conflicts Rule: Good faith and |
| of interest. Trustee cannot fairness are NO |
| buy/sell trust assets to self. defense. Voidable. |
| |
| Duty of Care & Uniform Prudent Investor Act Portfolio Approach; |
| Prudence (UPIA): Trustee must invest Duty to diversify |
| and manage assets as a prudent unless special trust |
| investor considering portfolio. purposes dictate. |
| |
| Duty of Balance interests of INCOME UPAIA / UFIPA: |
| Impartiality beneficiaries (life tenants) Power to adjust or |
| and PRINCIPAL beneficiaries convert to unitrust |
| (remaindermen). for total return. |
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Duty of Loyalty and the "No Further Inquiry" Rule
- The duty of loyalty is the most fundamental duty of a trustee. A trustee must administer the trust solely in the interests of the beneficiaries.
- Under the strict "No Further Inquiry" Rule, any transaction involving self-dealing (trustee buying trust property, selling personal property to the trust, or borrowing trust funds) is presumptively voidable by the beneficiaries. The court will not evaluate whether the transaction was fair, reasonable, or conducted in good faith.
Duty of Care and Prudence (UPIA)
- Under the Uniform Prudent Investor Act (UPIA), a trustee must invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust.
- Portfolio Approach: Prudence is evaluated not by looking at individual investments in isolation, but in the context of the trust portfolio as a whole and as part of an overall investment strategy having risk and return objectives reasonably suited to the trust.
- Duty to Diversify: A trustee must diversify the investments of the trust unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversifying.
Trust Modification, Claflin Doctrine & Cy Pres
- Claflin Doctrine: Beneficiaries can compel modification or termination of an irrevocable trust only if: (1) all beneficiaries consent, and (2) modification/termination will not frustrate a material purpose of the settlor (e.g., spendthrift clauses, support trusts, and age-delayed distribution trusts represent material purposes that prevent early termination).
- Cy Pres Doctrine: If a specific charitable purpose of a charitable trust becomes impossible, unlawful, impracticable, or wasteful, the court will apply the cy pres doctrine to redirect the trust property to another charitable purpose that falls within the settlor's general charitable intent.
A testator properly executed a valid will leaving his entire estate 'in equal shares to my brother, my sister, and my best friend.' Three years later, the brother died, leaving two surviving adult children. One year after the brother's death, the testator died without having amended or revoked his will. The testator was survived by his sister, his best friend, and his brother's two children. The applicable jurisdiction has a standard anti-lapse statute covering grandparents and descendants of grandparents. How should the testator's estate be distributed?
A wealthy grandmother established an irrevocable inter vivos trust, funding it with $5 million in municipal bonds and corporate equities. The trust instrument appointed an independent corporate bank as trustee and directed the trustee to 'pay the net income to my grandson for life, and upon his death, distribute the trust principal to my grandson's surviving issue.' The trust contained a valid spendthrift clause prohibiting the voluntary or involuntary transfer of any beneficiary's interest. Five years after the trust was funded, a judgment was entered against the grandson for $50,000 in past-due, court-ordered child support, and a commercial credit card company obtained a $30,000 breach of contract judgment against him. Both the child support obligee and the credit card company petitioned the court to garnish the grandson's trust distributions directly from the trustee. How should the court rule?
A testator executed a valid typed will in 2020 leaving a $100,000 cash bequest to his son and the residue of his estate to his daughter. In 2023, the testator sat at his desk with the original 2020 will, took a thick black marker, and drew heavy cross-out lines across the entire paragraph containing the $100,000 bequest to his son, writing the word 'CANCELED' across that clause with his signature and date underneath. The testator did not make any other marks on the document. The jurisdiction has adopted the Uniform Probate Code (UPC). Following the testator's death, the son claimed he was entitled to the $100,000 bequest. How should the probate court resolve the son's claim?
A settlor created an irrevocable testamentary trust appointing his longtime accountant as sole trustee. The trust corpus consisted of a commercial office building valued at $2 million and $1 million in cash. The trustee managed the office building competently. However, learning that the trust held $1 million in uninvested cash, the trustee purchased a vacant industrial warehouse that the trustee personally owned for $500,000 using trust funds. Three independent real estate appraisers confirmed that the fair market value of the warehouse was actually $650,000 at the time of the sale, meaning the trust obtained an immediate $150,000 benefit below market value. The trust beneficiaries discovered the transaction and brought an action to void the purchase and surcharge the trustee for breach of the duty of loyalty. How should the court rule?