Posts Tagged ‘simple will’

We Are Creeping Up On a Quarter Century Here

JANUARY 4, 2016 VOLUME 23 NUMBER 1

Note the “Volume” number above. Is it even possible that we’ve been doing this for 23 years?

In that time, a number of topics have been perennially popular. We see a lot of internet traffic, and get a lot of questions or comments, when we write about:

Of all those topics (we now have an archive of well over a thousand weekly newsletter articles), which is our favorite? That’s easy: the one you read, gain something from, and have a follow-up question about.

So what’s your question? We won’t try to give individualized legal advice, but maybe we can help you with a relevant legal principle, or perhaps we can elucidate some of your alternatives. We will often tell you that the right answer is “consult an attorney,” but maybe you can get to the attorney’s office as a better-informed client.

Oh, and Happy New Year.

The Myth of the Simple Will

JUNE 15, 2015 VOLUME 22 NUMBER 22

“I don’t want anything complicated,” said our new client. “I just want a simple will.”

For almost four decades, we’ve been waiting for the client who wants a complicated will. We’re still waiting.

We hear the “I only want a simple will” request often. What clients really mean, of course, is “I want a cheap will.” That is, they don’t want to pay a lot for the legal advice or preparation of elaborate documents.

Our favorite variation is the client who wants a simple will, then tells us their assets are straightforward and their family situation ordinary. You know — the half-interest in a summer cabin in another state, the oil and gas interests in two other states and the closely-held family corporation that is worth somewhere between $1,000 and $10,000,000. And family situation? You know — one child has a developmental disability, another a drinking problem and the third is married to a spendthrift. But we’re just going to disinherit one, split things between the other two and trust them to work everything out.

We send a questionnaire to our prospective estate planning clients, so that we can figure out at least some of the possible issues during our first meeting — which is much more productive if we have the information at hand. Clients sometimes show up without having filled out the questionnaire, since they aren’t sure they want to hire us (hah! who wouldn’t want to hire us?) and they don’t want to go through the trouble of collecting information. More dangerous, though, are the clients who intentionally leave some of their assets off the questionnaire — in a misguided attempt, we suspect, to minimize the cost of their estate planning. That’s a little like not mentioning to the dentist that you have a persistent and painful temperature sensitivity on one tooth, hoping that it won’t need any expensive work.

Why do we even care about what assets you own? Isn’t it because we can charge you more if we know how wealthy you are?

No.

We need to know about your assets to figure out whether you have an estate tax issue. Are you pretty sure you aren’t worth the $5 million that is required before federal estate tax concerns? OK — but what about state estate taxes? Though Arizona doesn’t have one, the state where you have that summer cabin might impose one. And have you added in the face value of your life insurance policies? Also the trust your grandfather left for you, which you don’t think of as “yours”? Also the possible inheritance from your parents? Those questions are all on the questionnaire, so that we can discuss them with you.

One of the principal questions we are going to talk about with you is whether you should have a living trust. Don’t worry — we’re not going to order you to do anything. But we do want to be able to give you a realistic estimate of the cost of probating your estate, and what you might reasonably do to avoid or minimize that cost. Without good information, we can’t give you either estimate.

There are real costs associated with choosing a “simple” will. We want to be able to estimate those for you, so that you can make informed decisions. By the end of our initial conversation, we will almost certainly be able to give you a flat-fee estimate of the cost of preparing your estate plan, with at least a couple variations for you to consider. Then you can decide how much simplicity you can afford.

How often do our clients end up with what might be called a simple will? If we get to define “simple,” our estimate is about half the time — or perhaps slightly less often than that. But even clients with those simple wills also have financial powers of attorney, health care powers of attorney (with living will provisions) and an instruction letter; the entire product of our representation will almost always amount to at least a dozen pages of lawyer language. We’ll also provide a translation/guide to the documents, and we are very interested in helping you to understand the options, your choices and the documents themselves; we don’t charge more for answering questions, and we like to get the opportunity.

A word about flat fees: almost all of our estate planning is done on a “flat-fee” basis. We will quote you a fee in our initial consultation, and that’s what we will charge. Do you need four drafts and extensive revisions? No additional cost. Do you love the first draft, and need no changes? Great — we got it right. But we don’t reduce our fee for doing a good job on the first pass, either. We think that arrangement makes it easy and comfortable for both of us. You get as many appointments, revisions and discussions as you need. We get the comfort of knowing that we heard all your concerns and questions, and that we’ve had an opportunity to address everything.

Even a short, inexpensive will is not simple. It is a profound document, and it isn’t even possible to figure out what it ought to say until we’ve talked through some of the issues.

Oh, and whether your estate plan is simple or complex, inexpensive or less inexpensive, it needs to be reviewed and (probably) revised every five years or so. But that’s a different concern we need to grapple with.

DIY Wills — Another Example Showing Why You Should Hire a Lawyer

OCTOBER 6, 2014 VOLUME 21 NUMBER 36

We occasionally relate stories about people who have prepared their own wills without the help of competent professional advisers (like, for a primary example, a qualified attorney). When we do, we intend to make several points:

  1. The cost of getting a lawyer to prepare your will (and trust, and powers of attorney) is probably quite a bit less than the contest after your death might cost. Of course, disgruntled heirs can file contests of lawyer-prepared wills, too — but the odds are lower, the likelihood of success much lower, and the family friction lessened when a lawyer is involved in preparing the will.
  2. Do-it-yourself wills might accomplish exactly what the signer intended, but it’s often hard to tell — the likelihood of ambiguity or miscommunication is much higher when no professional is involved.
  3. Even though a self-prepared will might ultimately be successful, it can take years, costs tens of thousands of dollars (occasionally more) and destroy family relationships — all bad results that you can mitigate by getting your estate plan prepared by someone who knows what she or he is doing.

All of this should be considered against a reality: will contests are rare. They are much rarer, in fact, than people usually suspect. Despite popular literature, even wills that are arguably defective are more likely to be honored than challenged.

That is all by way of background to this week’s story. We are going to ask you to play Probate Judge, so pay attention. Let’s start, as the Judge often does, with the document itself. Here is the entire text of Bruce Morrison’s will (we’ve changed only the names):

On this date 7-18-2011 – I am here with my neighbor of over 30 years – [Bruce Morrison] – I am here to write down his last “will” – He is in good spirits, alert and sound of mind. On this date Bruce has asked me to write down the desires he has in regards to his earthly possessions. “I Bruce Morrison do will all my earthly possessions to my daughter Betty Harrison that lives in California, she can do with them what she likes.”

[signed] Toni Robertson 7/18/2011

[signed] Richard Robertson 7/18/2011

[signed] Bruce Morrison 7/18/2011

Bruce died two months later. He left two daughters — Betty (the daughter mentioned in the will) and Randi (who is not mentioned at all). Randi filed a probate petition for a determination of intestacy — arguing that Bruce died without a valid will. Betty countered that his will was valid, that she had been left his entire estate, and that Randi should receive nothing.

As the will contest developed, a number of additional facts were laid out:

  1. The night the will was signed, Bruce had just been released from the hospital after a series of tests. At the time he signed he may not have known it yet, but he was terminally ill with (as yet) undiagnosed cancer. He had been prescribed — and was taking — the painkiller hydrocodone, which can also affect competence, attention and understanding.
  2. Bruce’s hand was shaking too much to write out the will himself. He asked his friend Toni to write out the will for him, and she later testified that he dictated the part that begins “I Bruce Morrison do will…”. The entire document, however, is in her handwriting, not his.
  3. The sequence of signatures was that Bruce signed first, then Toni. Then Toni suggested that her husband should also witness the will — he had been in another room during the writing and signing. Richard came into the room with Bruce and Toni, and asked “So, Toni wrote your will; did she sign it too?” Bruce responded “no, that’s my shaky handwriting.” Richard then signed above Bruce’s signature, next to his wife’s.
  4. Although both Randi and Betty agreed that Betty was indeed Bruce’s daughter, he was not listed as her father on Betty’s birth certificate.

Both Randi and Betty asked the Montana probate judge hearing the case to grant summary judgment on the basis of the evidence they had collected. In such a ruling, no actual trial is conducted — the parties simply argue that there is no interpretation of the available evidence under which the other side could prevail.

Betty argued that the will was properly executed and reflected Bruce’s wishes. She pointed out that she was not involved in its execution, and that there was no real dispute about Bruce being her father.

Randi, on the other hand, pointed out that Bruce was taking heavy medications that would make him susceptible to undue influence. The fact that he had not been listed on Betty’s birth certificate made it unclear who would be “the natural objects of his bounty,” according to Randi. She also argued that the fact that Bruce signed when one of his witnesses was out of the room made the will invalid — and that his statement (“no, that’s my shaky handwriting”) should not be admitted to prove the validity of the will because it would be hearsay.

OK, acting Probate Judge — it’s time for your ruling. Is the purported will of Bruce Morrison valid? Does his daughter Randi receive any share of his estate?

The Montana probate judge’s ruling: the will was valid and effective. The possibility of undue influence is not the same thing as evidence that there really was such influence, and Randi had produced no affirmative evidence in that regard. And the statement of Bruce confirming his signature was not hearsay, but acknowledgment that he was adopting the will as his own.

Randi appealed, and the Montana Supreme Court affirmed the probate judge’s ruling. The state’s high court agreed that Bruce’s declaration that he had signed the will was not hearsay, since it was not being introduced to prove the truth of what he said but instead to show that he had declared the will to be his. Randi’s arguments about undue influence would not suffice to create a dispute in the absence of real evidence. In Re Mead, September 30, 2014.

In this case Bruce’s real wishes seem to have been carried out, but that doesn’t change our main point: there was unnecessary cost, delay and friction occasioned by having a friend write out a one-sentence will and signing under challenging circumstances. Maybe Bruce simply didn’t have time to get his will prepared by a professional, but his estate — and his favored daughter Betty — would have been better served if he had found the time. Maybe he felt like it was an emergency and he needed to get something done that July evening, but the next day he could have — and should have — called a lawyer’s office to make an appointment on the first available date to get the job done right.

Why Do I Have To Complete That Darned Questionnaire?

MAY 31, 2010  VOLUME 17, NUMBER 18
You have made your appointment to discuss estate planning. Our office has sent you a reminder letter, an explanation of what will happen when you get here, a map with parking instructions — and an 8-page questionnaire, asking for all sorts of details about your family, your assets and your wishes. Why do we make you do all that work just to have an initial estate planning appointment? Because of William Bruinsma.

Mr. Bruinsma lived in a subsidized senior housing facility in Massachusetts. He visited his lawyer in 1993 and asked for help in preparing a “simple will.” He was very secretive, and did not want to tell his lawyer about his assets. He did insist that he didn’t want to spend too much money in legal fees, and he wanted his will to be simple.

Estate planning lawyers are very familiar with the type of client. In fact, no estate planning attorney we know has ever heard a client ask for a “complicated” will — everyone thinks their wills should be simple.

What Mr. Bruinsma wanted sounded simple enough. He wanted the income from his assets (whatever they might be) to go to his sister and his long-time friend. After both of them died, the remaining money should go to a group of charities. The simple will his lawyer prepared was just two pages long.

Five years later Mr. Bruinsma died, and it turned out that his estate was about $1.7 million. The will was so simple that his estate did not qualify for a charitable deduction — meaning his estate would pay about $466,733 in federal and state estate taxes that could have been easily avoided if the lawyer had known he needed to prepare a slightly more complex will.

Was that the result Mr. Bruinsma wanted? If he had known that the investment of a few hundred dollars during his life could have dramatically increased the income stream to his sister and friend, would he have made the investment? We will never know, because his lawyer did not know to ask those questions — Mr. Bruinsma had not provided enough information to allow the lawyer to give comprehensive legal advice.

Admittedly, the facts in Mr. Bruinsma’s case are relatively extreme. OK, you’re right — the same thing would not happen today and in Arizona, because there is no federal or Arizona state estate tax in place. But our point is still valid: if we do not have a fairly complete picture of your assets, your family and your intentions, we will not be able to prepare a good will, whether or not it is a simple will. Besides, the estate tax might just return next year at the $1 million level, in which case an Arizona version of Mr. Bruinsma would be making only a $350,000 mistake.

And now you know: if you really want to surprise your estate planning lawyer, just sit down in the first conference and insist that what you are hoping for is a complex will.

Incidentally, the charities in Mr. Bruinsma’s simple will ultimately joined forces with the sister, the friend and even the state Attorney General to ask the courts to reform the will so that the estate tax effect could be eliminated. After spending, presumably, thousands of dollars in legal fees to seek that result, they were all turned down by the Supreme Judicial Court of Massachusetts (the state’s highest court). That court ruled that there is no law permitting reformation of a will to correct an alleged error on the part of the person signing the will. Mr. Bruinsma’s secrecy — and his thrift — ended up costing nearly half a million dollars. Pellegrini v. Breitenbach, May 25, 2010.

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