Posts Tagged ‘Uniform Probate Code’

The iWill — Might It Be the Future of Probate and Estate Planning?

FEBRUARY 24, 2014 VOLUME 21 NUMBER 8

News reached us this month of a November, 2013, probate court order in Australia admitting an unusual will to probate, and it made us wonder if we should anticipate a digital future for estate planning. An Australian probate decision would have to be pretty unusual to get noticed around the world, but this one qualifies. The judge in Brisbane determined that the decedent’s last will was valid — though it was only on his iPhone.

Karter Yu committed suicide in September of 2011. Shortly before his death he created a number of documents on his iPhone, most of which were apparently farewell letters. One, however, looked very much like a will. It began with “This is the last Will and Testament of Karter Yu,” and it contained all of the provisions that one would expect to see in a will. It named an executor (what we in Arizona would call a personal representative), it included his address, and it gave directions for the distribution of his property. In the space where one might expect to see a signature on a printed document, Mr. Yu had typed his name, added the date and listed his address again for identification.

Queensland probate law, like Arizona’s (and most U.S. states’ laws), is descended from English common law. The old common law approach was clear: a will, to be valid, must be signed by the testator (the legal term for a person making a will) and witnessed by two individuals — and it must clearly indicate that it is intended to dispose of property at death of the signer. There may be additional details required in individual cases, and there are sometimes a handful of exceptions, but those remain the basic rules for making a valid will in most jurisdictions operating under English common law principles.

In Queensland, however, there is a relatively new variation. A document that does not meet the formal will requirements may still be admitted as the decedent’s will if:

  1. It exists as a document — and that includes any computer file stored on disc, tape or otherwise, provided that it can be produced or reproduced (i.e.: printed, or copied, or presumably even e-mailed), and
  2. It states the testamentary intentions of the decedent, and
  3. There is sufficient evidence that the decedent intended the document to be his or her will.

Looking at Mr. Yu’s iPhone document, the probate judge in Brisbane had no trouble determining that all three conditions were met. The will was admitted to probate, and his nominated executor appointed to administer his estate. Re: Yu, November 6, 2013.

This result might seem surprising to an Arizona probate judge — or lawyer — but was not necessarily a major extension in Australia. Just a year earlier, in a somewhat similar case, a New South Wales probate judge had admitted a word processing document to probate in Yazbek v. Yazbek, June 1, 2012. The decedent’s parents (who would have taken his estate if he had no will) insisted that he must have printed and signed the will document, then destroyed it — effectively revoking it as his will. The probate court found otherwise, and the unprinted document was admitted as the decedent’s last will.

Is a similar trend likely to develop in Arizona? Not likely, or at least not any time soon. Arizona’s probate law still adheres to the old English requirement: a valid will must be on paper (well, we suppose it could be on another medium — but it would have to be printed out), signed by the testator and witnessed. One notable exception, the “holographic” will, need not be witnessed — but it must be in the handwriting of the testator.

There is, though, a larger trend toward liberalizing the requirements for validity of wills. The National Conference of Commissioners on Uniform State Laws (NCCUSL) has developed and promoted the Uniform Probate Code — in fact, Arizona was one of the first states to adopt the UPC, in 1973. Though the UPC has been adopted in only a handful of states, it has been tinkered with regularly; the general trend in that tinkering has been to make it easier to approve questioned documents. The current (2011) version of the UPC permits the probate court to admit a “document or writing” that doesn’t comply with the requirements of English common law if there is clear and convincing evidence that the decedent had wanted the document or writing to be a will, a revocation, an amendment or a revival of a previous will.

Arizona has updated much of its version of the Uniform Probate Code, but not this provision (which, if you’re curious, is section 5-203 of the 2011 UPC). A handful of states have adopted the current version. Would Mr. Yu’s “iWill” be admissible in those states? It’s hard to be certain, but probably not — not because the idea would be unimaginable but because it’s likely that the file on the iPhone would not be characterized as a “document or writing.” But as public thinking about computer and internet files continues to evolve, you might reasonably expect that to change.

What does this mean for someone who wants to create a will on his or her iPhone? Don’t try it. The only thing certain is that you will assure the beneficiaries of your estate a high legal bill for the proceedings to determine what it means. Print the thing out, sign it before witnesses, and have them sign it, too. Better yet, hire someone who knows how to make sure your will is valid — like a lawyer — to prepare the will and supervise its execution.

Of course if you’re an Android user, everything is different. Just kidding.

Draft Will Is Almost (But Not Quite) Admitted to Probate

SEPTEMBER 20, 2010 VOLUME 17 NUMBER 29
There is a lot of mythology, misunderstanding and just plain confusion about wills and probate. Sometimes the reported cases don’t help clarify what makes a will valid, when it is subject to challenge or even what might be a will.

The general rule is clear, and ancient. The Parliament of England adopted the Statute of Wills in 1540, and a version of its requirements can still be found in every U.S. state. One of the most important principles from the Statute of Wills: a valid will must be in writing, and must be signed by two witnesses. That is still the law in most common law jurisdictions, and it is certainly the law in Arizona.

But wait. Perhaps you have heard about “holographic” wills; they do not have to be witnessed at all. The basic rule in states which permit holographic wills (Arizona is one) is that the material provisions must be in the handwriting of the person, and signed. You can see those rules might amount to a lawyer’s field day — what are “material provisions,” and how are courts supposed to interpret the incomplete or even contradictory provisions of a handwritten document?

Then there are “nuncupative” wills. They are not permitted in Arizona at all, but some states allow them. They are oral statements of the wishes of someone on their deathbed. In states recognizing nuncupative wills, they may be limited to items of personal property like jewelry, small amounts of cash or even items with no economic value. You might (depending on which state you are living — and dying — in) be able to say “I want my dad’s pocket watch to go to Harry” but not “I want Harry to have my $100,000 T-Bill.”

The Uniform Probate Code, promulgated by the National Conference of Commissioners on Uniform State Laws (NCCUSL) and adopted in 19 states (including Arizona) provides some new ways to let people express their wishes — and, arguably, to increase legal fees in some cases. Under recent amendments to the Uniform act, a will that is unsigned or not signed properly could still be a valid document if it can be shown by clear and convincing evidence that the individual intended it to be treated as a will. We should stop a moment to point out that although Arizona adopted the Uniform Probate Code back in 1973, the more recent revisions have not been adopted. Arizona still requires all wills (except holographic wills) to be witnessed by two people.

When might the new section of the Uniform Probate Code be useful? How about the sad case of Louise Macool, who died in New Jersey in 2008?

Mrs. Macool’s husband of forty years had died just a month before she made an appointment to see her long-time lawyer. She brought along a handwritten note to tell the lawyer what she wanted. Her old will left everything to her late husband’s seven children equally (she had no children of her own, but had helped raise his children). Her note said, cryptically, “get the same as the family Macool gets — Niece — Mary Rescigno” and some other changes she wanted to discuss.

Mrs. Macool explained the note to her lawyer. She wanted to add her niece, Mary Rescigno, to her will, along with another niece. While she was still in his office, the lawyer picked up his dictation equipment and dictated a will for her review and signature. Then she left the office to go to lunch; she would make an appointment to review the will after her attorney’s staff had transcribed it and he had a chance to review it for accuracy.

Sadly, Mrs. Macool never saw the draft will. Within the hour after she left her lawyer’s office she died.

The lawyer’s staff prepared the draft will, apparently not knowing of Mrs. Macool’s death. Relying on the Uniform Probate Code language, Ms. Rescigno then asked the probate court to admit the unsigned document as Mrs. Macool’s last will.

The probate court heard a day of testimony and argument, then declined to admit the draft document as a will. The probate judge agreed that Mrs. Macool’s intent in meeting with the lawyer was to change her will to include Ms. Rescigno, but decided that some sort of signature was required on the document.

The New Jersey appellate court agreed with the result, but not the reasoning. Requiring a signature on the document would make it essentially a duplication of the holographic will provisions, ruled the appellate judges. Mrs. Macool’s draft will could be admitted to probate if she had had a chance to review it and indicate that it reflected her wishes. Her handwritten notes, meanwhile, did not amount to a holographic will — they would need her signature.

The trial judge had declined to admit the draft document to probate as Mrs. Macool’s will, but he had agreed that Ms. Rescigno’s lawyer should be paid from Mrs. Macool’s estate. New Jersey’s probate rules expressly authorize payment of attorney’s fees for someone who “had reasonable cause” for even a failed contest. Ms. Rescigno’s lawyers had submitted bills totaling $34,433; the probate judge had cited his personal “policy reasons” in reducing the fee by about 15%.

Even though her lawyers had been unsuccessful the appellate court approved of the payment to Ms. Rescigno’s counsel. In fact, they reversed the probate judge’s reduction of the claimed fees. According to the appellate court, there was no indication that the hourly rates were unreasonable our out of line with prevailing rates, or that the claimed hours were not actually worked. In Re Probate of Alleged Will of Macool, September 16, 2010.

Conservator May Be Able To Act As Successor Trustee

AUGUST 16, 2010 VOLUME 17 NUMBER 26
Let’s say you have created a revocable living trust, and you have named yourself as trustee. You also name your two children as successor trustees, to act together upon your death or incapacity. Two years later you become incapacitated; because of a dispute between your two children about who should handle assets outside the trust, the probate court names a local bank as your conservator. Now who handles your trust — the bank, or your children?

Before we answer that question, let us complicate it. You are also the beneficiary of a trust set up by your late husband — and you are trustee of that trust, as well. About half of the assets the two of you owned are included in each of the two trusts. Your husband’s trust names you as trustee (now that he is deceased) and names the two children as successor trustees if anything should happen to you. Does your conservator have any authority over that trust?

Those were precisely the questions faced by a probate judge in South Dakota when Evelyn Didier became incapacitated. The bank appointed as her conservator asked the court to clarify that it had control over both trusts as well as Ms. Didier’s non-trust assets. The judge agreed, and Ms. Didier’s daughter Barbara Didier-Stager appealed.

Court appointment of a conservator does not amount to appointment of a successor trustee, argued Ms. Didier’s daughter. In fact, appointment of a conservator proves the incapacity that triggers a change in trustees — resulting in the son and daughter taking over as successor trustee of their mother’s trust. As to their father’s trust, the successor trustee provisions are triggered by the conservatorship in the same way — though our simplified version of the facts described above fails to clarify that the successor trustees of that trust were actually Ms. Didier-Stager and another local bank — different from the bank acting as Ms. Didier’s conservator.

South Dakota, like Arizona, has adopted the Uniform Probate Code — though South Dakota’s version has been updated more recently and is more current. The Code includes provisions about guardianship and conservatorship (though now those sections have been set aside as a separate uniform law, the Uniform Guardianship and Protective Proceedings Act). Those uniform laws permit the judge in a conservatorship proceeding to enter orders related to the protected person’s estate plan.

So, reasoned the South Dakota court, the probate court could permit Ms. Didier’s conservator to do anything that Ms. Didier herself could have done before becoming incapacitated. Her own trust was revocable and amendable — if she had wanted to do so, she could have changed the successor trustee at any time. She could have named the bank that was ultimately appointed as her conservator. Consequently, the court could allow her conservator to assume the powers of successor trustee over that trust.

The late Mr. Didiers trust was a different matter, however. Ms. Didier herself did not have the power to change the trustee, and so her conservator could not exercise that power on her behalf. That trust would have to be dealt with separately, and the Supreme Court ordered the case remanded to the probate judge to determine what to do about Mr. Didier’s trust. Conservatorship of Didier, June 30, 2010.

Does this mean that Mr. Didier’s successor trustees automatically take over, instead of Mrs. Didier’s conservator? Probably not. Other provisions of the Probate Code give the probate judge authority over trust administration, and if it appears that there is some reason not to allow the named successors to become trustee there will presumably be an order to that effect. But it does change the discussion from a choice between blindly following the document or giving Mrs. Didier’s conservator power to do anything she could do. Instead, the probate court will have to determine which approach is most consistent with the trust, with proper administration, and with the best interests of the trust’s beneficiaries.

The Uniform law actually goes quite a bit further today than the 1974 version originally adopted in Arizona (though Arizona has updated portions of the law several times). Reviewing the statute in the context of the Didier case highlights some of the changes. Among the powers given to conservators by the “new” Code (as adopted in South Dakota, for instance) is the power to “make, amend, or revoke the protected person’s will.” (See Section 411(a)(7) of the Uniform Guardianship and Protective Proceedings Act.) Court approval is required, but the very notion of a conservator changing the protected person’s estate plan might strike some as dangerous.

Guardian Not Permitted To Maintain Divorce Proceeding

SEPTEMBER 29, 2003 VOLUME 11, NUMBER 13

The guardian of an incapacitated adult is often said to have all the powers that a parent would have over an unemancipated minor child. That legalism, however, fails to give much guidance about any limitations on the guardian’s power. For example: can a guardian pursue a divorce proceeding for his or her ward?

Some definition of terms is in order. Many states (particularly those in the east) continue to use the old-fashioned distinction between “guardian of the person” and “guardian of the estate.” The former, generally speaking, has authority over the ward’s living arrangements and medical care; the latter has control over the ward’s finances.

A handful of states (notably California) use the terms “conservator of the person” and “conservator of the estate,” with the same effect but a different title. Most of the eighteen states adopting the Uniform Probate Code and a few other states have adopted the terms “guardian of the person” and “conservator of the estate.” All that leads to a certain lack of clarity in the use of the term “guardian” without more explanation.

Like Arizona, Montana has adopted the Uniform Probate Code. When Judy Deck was appointed as guardian and conservator for her father George Everett Denowh in Billings, the title and powers were similar to those she might have been given in Arizona.

Shortly after the initial appointment, Mr. Denowh filed a divorce action to end his five-year marriage to Agnes Denowh. Mrs. Denowh objected, arguing that her husband was not competent to seek the divorce, and Judy Deck sought to intervene, as guardian, to finish the divorce. The trial judge allowed her to take over her father’s divorce action as guardian.

Mrs. Denowh appealed, insisting that a guardian does not have the power to maintain a divorce action. The Montana Supreme Court agreed, ruling that there are some things that are simply too personal for a guardian to do for her ward. The state high court struck an ironic note—the power of a parent over an unemancipated minor (the Uniform Probate Code’s formulation of the relationship) can never include the power to divorce, since marriage “emancipates” a child. Marriage of Denowh, September 11, 2003.

As the Montana court notes in its opinion, Arizona is one of a half-dozen states that has ruled exactly the opposite. Under a 1993 case, an Arizona guardian does have the power to file for divorce, or to maintain a divorce action brought by the ward. It probably, however, requires appointment of a conservator to resolve property division issues.

“Simultaneous Death” Laws In Conflict For Insurance Payout

SEPTEMBER 3, 2001 VOLUME 9, NUMBER 10

Sometimes when the legislature adopts a new statute, no one notices that it conflicts with an existing law. While those conflicts usually get discovered and resolved, they can sometimes create real confusion in real cases.

Consider the tragic case of the Craig family. William and Diane Craig and Micah, William’s son from a former marriage, were all killed in a head-on automobile collision near Prescott, Arizona, in 1999. An off-duty police officer witnessed the crash and tried to assist, but without success.

When the police officer first approached the Craigs’ vehicle he heard moans coming from Diane Craig. He quickly determined that both William and Micah Craig were dead; ten minutes later it was clear that Diane Craig had died.

William had two life insurance policies, totaling almost $700,000 in benefits. Both policies named his wife Diane as beneficiary and neither named an alternate. In the event that his first beneficiary did not survive him both policies provided that the proceeds would go to his daughter from the former marriage, Chanda Craig.

Arizona, like many states, has adopted a provision of the Uniform Probate Code to avoid problems just like the one facing the insurance companies in the Craig case. The Arizona law requires a life insurance beneficiary (and indeed any heir) to live at least five days longer than the decedent in order to collect benefits. Mrs. Craig lived no more than a few minutes longer than her husband.

Mrs. Craig’s heirs, however, pointed out an anomaly in Arizona law. Although the Uniform Probate Code provision was adopted in 1974, and later amended to cover a wide variety of non-probate situations (including insurance contracts), no one in the legislature ever noticed or bothered to repeal the prior law dating back to 1954. That earlier version would have required Chanda Craig to show that there was no sufficient evidence that her step-mother died before her father.

The insurance companies filed suit in federal court, asking the judge to direct them as to who should receive the insurance benefits. The federal judge requested the Arizona Supreme Court to determine which law applied to the Craig family tragedy.

The Arizona Supreme Court decided that the legislature had simply overlooked the earlier statute when the Uniform Probate Code was adopted, and again each time it was amended thereafter. The Justices declined to attach any importance to the fact that the newer version appears in the Probate Code, while the unchanged original law is found in the Insurance Code; the titles of the respective sections did not demonstrate any particular intent on the legislature’s part. The result: Chanda Craig received the proceeds from her father’s life insurance. Unum Life Insurance Co. v. Craig, July 17, 2001.

Sixteenth Century Statute Reviewed By Colorado Courts

JANUARY 29, 2001 VOLUME 8, NUMBER 31

Under English practice before the sixteenth century there were no standardized requirements for making a valid will. Disposition of a decedent’s property was determined by each court under local rules and customs, and the actual division was therefore unpredictable.

Henry VIII approved Parliament’s “Statute of Wills” in 1540, and the law was further developed in 1677. For the first time a requirement was introduced that all wills be in writing, signed by the decedent and witnessed.

The requirement of a signed, witnessed, writing was adopted in the United States from early days and has held sway for three centuries of Anglo-American law. In a handful of other countries the requirement of witnessing has been relaxed somewhat; Israel and the provinces of Manitoba and South Australia have all permitted wills that do not meet the formal requirements if they can be proven to be the actual wishes of the decedent.

In the United States there has been a national movement to reduce the formal requirements of probate proceedings. The Uniform Probate Code, first promulgated in the early 1970s (and adopted in Arizona in 1973), has been a leading force in relaxing probate and estate planning requirements. In recent years the Uniform Probate Code has even suggested a partial return to the law before Henry VIII and the Statute of Wills.

Colorado was the first U.S. state to adopt the Uniform Probate Code’s new provision on acceptance of wills which do not meet the Statute of Wills standards. The first case testing the meaning of Colorado’s law has now been decided in that state’s courts.

The decedent’s name was Sky Dancer, and her death in December, 1997, was attributed to gunshot wounds. When police investigated they found a four-page typewritten document titled “Last Will and Testament of Sky Dancer” and a two-page affidavit stapled to the longer document. The notarized affidavit was signed by Sky Dancer and two witnesses, and acknowledged that the attached document was her will. Apparently Sky Dancer had signed the affidavit, but not the will, in front of the witnesses and notary.

If Sky Dancer’s “will” was valid, all her property would pass to her companion Lawrence Barnes. If she died without a will, all her property would pass to her mother, Laura J. Fisher. The Colorado courts were required to interpret the meaning of Colorado’s liberalization of the probate law.

Sky Dancer’s “will” was determined to be invalid. The Colorado Court of Appeals reasoned that even under the new standards there must evidence that the decedent intended a particular document to be her will, and Mr. Barnes had not produced enough evidence. Estate of Sky Dancer, October 12, 2000.

Arizona has not yet adopted the revisions to the Uniform Probate Code which would permit unwitnessed wills to be admitted in some circumstances. Even if the law changes it will be important to have two witnesses in nearly every case. While a notary is not required, it can make admission of the will to probate somewhat easier, particularly if the witnesses are unavailable after the death of the will’s signer.

Will Was Not Revoked By Written, Signed “Revokation”

JULY 19, 1999 VOLUME 7, NUMBER 3

Jose C. Martinez lived and died in Belen, New Mexico. Mr. Martinez was the father of ten children, and in 1984 he had signed a will leaving his real estate to two of the children.

In 1995, Mr. Martinez signed a document called “Revokation of Last Will and Testament of Jose Martinez.” This document indicated Mr. Martinez’ intention to revoke the “previous WILL which was exeucted approximately Twelves years ago.” The “Revokation” was also signed by one of his daughters, was notarized and apparently was filed with the Valencia, New Mexico, County Clerk.

Mr. Martinez died two years later. He had executed no new will since 1984, and so the question for the courts was whether the 1984 was still valid, or had been effectively revoked.

After the trial court found that the will had been revoked and that Mr. Martinez’ estate would be divided equally among his ten children, one of his daughters filed an appeal. Interestingly, the daughter who appealed would actually receive less under the will if it was admitted to probate; although she had been named as Personal Representative under the will, she was not one of the two children who would share Mr. Martinez’ real property, which apparently was the bulk of his estate.

New Mexico (like Arizona and 14 other states) has adopted the Uniform Probate Code. One provision of the Code sets out how a will may be revoked. As adopted in both New Mexico and Arizona, two methods of revocation are permitted. A will can be revoked either by a new will which expressly revokes the previous will (or which is so inconsistent with the previous will as to effectively revoke it), or by “performing a revocatory act on the will….” A “revocatory act” is defined to include “burning, tearing, canceling, obliterating or destroying the will or any part of it.”

Did Mr. Martinez revoke his will when he signed the “Revokation?” Assuming he was competent to do so, it may be assumed that his intention was to revoke the will. But, according to the New Mexico Court of Appeals, his failure to comply with the statute defeated his attempted revocation. The will was admitted to probate despite Mr. Martinez’ signature, and apparent intention, to the contrary. Estate of Martinez, June 8, 1999.

Arizona, since it shares the exact same language on revocation of wills from the Uniform Probate Code, should be expected to reach the same result. But the New Mexico opinion notes that the same result would probably have been reached even before the Uniform Probate Code’s adoption in that state, based on common-law principles regarding will revocation.

Some states, noted the New Mexico court, permit revocation of wills by a writing other than a new will. Usually, however, the revocation must comply with the same execution requirements as a will; in other words, a written revocation still would have to be witnessed by two people. Since Mr. Martinez’ “Revokation” did not meet that standard, it would not have been an effective document under New Mexico’s law even before the adoption of the Uniform Probate Code.

If Mr. Martinez was unable to locate the original of his old will, what could he have done to revoke it? Under the Uniform Probate Code and the law of many states, his only choice would have been to sign a new will which included revocation of the old document.

Guardians Given Power To Seek Mental Health Care For Wards

MAY 10, 1999 VOLUME 6, NUMBER 45

Like many states, Arizona has long recognized two different kinds of guardianship. Most incapacitated wards have a guardian appointed pursuant to the Arizona version of the Uniform Probate Code, which is contained in Title 14 of the Arizona statutes. One of the principal limitations of the usual guardianship proceeding, however, has been that the guardian may not place a mentally ill ward in a psychiatric treatment facility involuntarily.

For the mentally ill, Arizona maintains a separate guardianship proceeding. Familiarly known as “Title 36″ guardianship (after the section of the code where the provisions have been located), this kind of proceeding can give the guardian power to place the ward in a mental hospital. Such mental health guardianships are more expensive and onerous than regular guardianship proceedings, and must be renewed every year.

Last month, the Arizona legislature changed all of that. A new law signed by the governor on April 27 will eliminate the Title 36 (mental health) guardianship option, and give more options to general guardians.

Under the new law, a guardian can be given the power to admit a mentally ill ward to a psychiatric facility without extensive proceedings. If the guardian can file a psychiatrist’s or psychologist’s affidavit indicating the ward needs immediate hospitalization, the court can give authority without a separate commitment proceeding.

Once a ward has been placed in a hospital under the new law, the guardian must give notice to both the ward and the ward’s attorney; either can request a hearing. If the ward requests an immediate hearing, the issue must be before the court within five days of the hospitalization.

Perhaps more importantly, the new law clears up a long-standing concern among guardians. It has previously been unclear whether a guardian has the power to consent to outpatient mental health care and administration of antipsychotic medications. The law now expressly provides that a guardian “may consent to psychiatric and psychological care and treatment, including the administration of psychotropic medications,” so long as the care takes place outside a psychiatric hospital.

An innovative new idea contained in the law may actually give mental health patients more control over their treatment, even when hospitalization is required. The new provision expands the usefulness of health care powers of attorney, which have been officially recognized in Arizona for years. Now health care powers of attorney can expressly permit the agent to authorize mental health treatment, including psychiatric hospitalization. A mental health care power of attorney can even be made irrevocable, if the signer is concerned that he or she might try to revoke the power just when it is most needed. A handful of other states have experimented with mental health care powers of attorney, with mostly good results.

Although not related to psychiatric care, the new law also establishes a mechanism to permit a ward to continue to drive. Under current law, the right to drive is automatically suspended by appointment of a guardian; now the judge establishing the guardianship may direct that the ward’s license not be suspended.

The legislative changes are contained in Senate Bill 1146, which will be effective ninety days after the legislature adjourns. Those interested in a copy can contact FLEMING & CURTI for more information.

©2014 Fleming & Curti, PLC