DECEDENT’S ESTATES OUTLINE
1. THE POWER TO TRANSMIT PROPERTY AT DEATH
a. The American law of succession, both probate and nonprobate, is organized around the principle of
freedom of disposition
b. Succession: Governs the way property moves from generation to generation
c. Shapira v. Union National Bank: Will conditioned his son’s inheritance upon his marrying a
Jewish girl within seven years of the father’s death.
i. Rule: Restraints on a second marriage is valid and enforceable if 1 of two things
exists:
1. The restraint is placed by the deceased spouse on the surviving spouse
2. Or if it passes the reasonableness test
ii. Court noted that T’s goal was to keep his inheritance in the Jewish community
d. RULE: Provisions intended to disrupt family relationships are not allowed.
e. Prevailing rule**: a restraint unreasonably limits the transferee’s opportunity to marry if a marriage
permitted by the restraint is not likely to occur.
f. In considering the possibilities for orderly successions, 3 options stand out:
i. Forced Succession: The decedent’s property could pass by simple rule of mandatory or
forced succession, such as primogeniture or to the spouse, children, or other dependents, or
if the decedent has no dependents, then the property would escheat to the state
ii. Freedom of Disposition: The decedent’s property could pass in accordance with the
decedent’s declared wishes if they are reliably preserved, or if not, then in accordance with a
default system of succession that tracks the probable intent of typical decedents
iii. Confiscation by the State: The decedent’s property could be confiscated by the state on
the theory that the decedent’s property rights terminate on death.
g. McCorkle: T is permitted to leave his estate to a hate group in the U.S. because it does not violate
public policy
h. Rule: Property cannot be destroyed at death, even in accordance with the a will
i. Rule: Generally, in order to contest a rule or will you must have standing.
j. How much are you required to leave to your spouse?
i. AZ: you are required to leave to your spouse 37,000 dollars of your estate. If they do not
have a spouse, this 37,000 goes to the surviving children. The rest you can do whatever you
want with.
k. The federal estate tax states that the first 5,490,000 of my will is not subject to federal estate tax. The
rest is subject to 40 percent.
l. Hodel v. Irving: Congress passed a statute providing that land owned by the Sioux would not pass
by intestacy or devise, but instead would escheat to the Tribe.
i. Rule: Under the 5th Amendment, the ability to transmit property at death is a
constitutionally-protected property interest that the government cannot totally abrogate.
ii. A state can abolish taking by intestacy or by devise, but not both.
m. Shaw Family Archives Ltd. v. CMG Worldwife, Ince: Decedent has no testamentary capacity to
devise property rights she did not own at the time of her death.
2. BASIC PROBATE; BASIC ADMINISTRATION
a. Testate: his or her probate estate will go through the valid will the decedent has created
b. Intestate: If a decedent dies without a last will testament, he or she has “died intestate”
c. Devisee: individual who is entitled to receive property under a will
d. Personal Representative: Individual or corporate entity. Whether they die intestate or testate,
someone who is charged with probating the estate. A fiduciary who collects and inventories the
property of D, manages and protects the property during the administration of the estate, processes
the claims of creditors and files federal and state tax returns, and distributes the property to those
entitled.
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e. Executor: If a D dies testate and in her will names the person who is to execute the will and
administer the probate estate, such personal representative is usually called an executor.
f. Administrator: If the will does not name an executor, the named executor is unable or unwilling to
serve, or D dies intestate, the court will name a personal rep called administrator.
i. Selected from statutory list usually in following order:
ii. Surviving spouse, children, parents, siblings, and creditors
g. Probate Property: Property that passes through probate under decedents’ will or by intestacy
h. Non-Probate Property: Property that passes outside probate under an instrument other than a will.
Most property passes outside of probate! Commonly includes:
i. Joint Tenancy with Right of Survivorship Property (both real and personal): Under joint
tenancy, decedents’ interest vanishes and survivor has whole property. Survivor must simply
file death certificate to perfect title. Bank and brokerage accounts, mutual funds, and real
estate typically held in joint tenancy.
1. If my will says that H is not to have one cent, but I hold my house with him under
joint tenancy, it goes to him anyway.
ii. Community Property with Right of Survivorship: Applies to both personal property and
real property. The only owners can be a legally married H and W.
iii. Tenants in common: Each owner owns a share of the property. Unlike in a joint tenancy,
these shares can be of unequal size, and can be freely transferred to other owners in life and
via will.
iv. Life insurance: company pays on receipt of death certificate of insured.
v. Contracts with Payable-on-Death Provisions: Includes such things as pension plans, taxdeferred investment plans (IRAs, 401(k)s, brokerage accounts). File death certificate to
collect.
vi. Interests in trust: property held in a testamentary trust created under decedent’s will passes
through probate, but property put in an inter vivos trust during decedents’ life does not. Inter
vivos trust has displaced testamentary as preferred type of trust.
vii. Multi-Party Bank Account: Account owned by two individuals; upon death of one,
account goes outside probate to survivor. ARS 14-6101
viii. Trust: Whether trust is revocable or irrevocable, it is property that passes outside of probate.
ix. Beneficiary Deed: Allows form of ownership of real property in which nothing passes until
death of owner of property; passes to surviving beneficiaries. A.R.S. § 33-405
x. *NOTE: Distribution of non-probate property does not involve a court proceeding, but is
done in accordance with terms of controlling contract, trust, or deed.
Someone dies, primary issue is whether a probate is necessary. What is in the probate estate? Was the
decedent married or single?
i. Determination of what is and what is not part of the probate estate depends on marriage status.
i. Married: If married, included in the probate estate is ½ of the community property
plus all of the D’s separate property, excluding non-probate transfers.
ii. A.R.S. § 25-211: In Arizona, community property is all property acquired by a H or W
after the date of marriage, except for property acquired by gift, devise, or descent.
Community property stops upon filing and service of petition for dissolution of marriage.
iii. A.R.S. § 25-213: In Arizona, separate property includes all property acquired by either
spouse prior to the marriage, property acquired during the marriage by gift, devise, or
descent, any rents, profits, dividends, interests, or increases in separate property, and any
property acquired by either spouse after the filing/service of divorce.
j. Probate performs three core functions:
i. Provides evidence of transfer of title to the new owners, making the property marketable again
ii. Protects creditors by providing a procedure for payment of D’s debts
iii. It distributes D’s property to those intended after D’s creditors are paid
k. Formal Probate: Notice probate. A litigated judicial determination after notice to interested parties.
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l.
Informal Probate: (preference: less expensive) ex parte probate. No notice given. Representative
petitions for appointment. Petition must contain information about Decedent and the name/address
of spouse, children, or other heirs, and if a will is involved, the devisees.
m. Universal succession: The heirs or the residuary devisees step into the shoes of D at the D’s death,
taking the D’s title and assuming all the D’s liabilities and the obligation of paying legacies according
to the D’s will.
3. PROFESSIONAL RESPONSIBILITY
a. AZ Statute §14-5652
i. A) Absent an express agreement to the contrary, the performance by an attorney of legal
services for a fiduciary, settlor or testator does not by itself establish a duty in
contract or tort or otherwise to any third party. For the purposes of this subsection, third
party does not apply to the personal representative, settlor or testator.
ii. B) An attorney who acts as a personal representative or trustee shall disclose to all adult persons
who have an interest in the estate or trust the names of any person who has an interest in
that estate or trust to whom the attorney is currently rendering or has in the past rendered
legal services. The attorney must make this disclosure in writing within a reasonable time after
learning that a client or former client has an interest in the estate or trust. The representation
of an interested person by that attorney is not grounds for removing the attorney as the
personal representative or trustee unless the attorney is unable to perform the fiduciary
duties as personal representative or trustee without violating the attorney's ethical
responsibilities to the client or former client.
b. Simpson v. Calivas Lawyer’s owe duty of reasonable care to intended beneficiaries and have
standing to sue them.
i. L can foresee injury to the intended beneficiary and L’s actions affect the success of the C’s
testamentary scheme. Despite the fact that there is no privity between a L and an intended
beneficiary, obvious foreseeability
ii. AZ DISTINCTION: A.R.S. § 14-5652: Prescribes a different rule! In Arizona, Simpson
would not come out the same. Ls have no duty to a third party unless there was an express
agreement to the contrary, but this is unlikely. PR could step into the testator’s shoes, in
which case the L would owe the PR a duty, but here, the son could not do that.
c. A v. B: A lawyer may disclose confidential information about one client to another client if
the matter is an exceptional case with a compelling reason for disclosure.
i. The husband’s deliberate omission of his child constitutes fraud giving the law firm the
power to disclose the information. Competing ethical rules 1.6 and 1.4
d. In re Estate of Fogelman: there is a fiduciary duty of fair dealing for all parties which include all
the parties that have an interest in the estate, including creditors. Note: the personal representative
has a fiduciary duty to beneficiaries, but should inform the beneficiaries that they should obtain
separate counsel.
4. INTESTACY
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A. BASICS
● Intestacy governs distribution of an intestate decedent’s probate property
● Generally speaking, the law of the state where a decedent was domiciled at death governs the disposition of
the decedent’s personal property, and the law of the state where the decedent’s real property is located
governs the disposition of real property.
● TERMS: A person who dies with a will is said to die testate. The probate property of such a person is
distributed in accordance with the terms of the person’s will. The persons who would inherit the property of
A, a living person, if A died within the next hour, are A’s heirs apparent. A living person does not have heirs. A
person named in a will is a devisee, legatee, or beneficiary, not an heir
● ARS §14-3805: Order of Distribution: 1) attorneys 2) statutory allowances 3) creditors.
§14-2101 Intestate estate; modification by will
A. Any part of a decedent's estate not effectively disposed of by will passes by intestate succession to the
decedent's heirs as prescribed in this chapter, except as modified by the decedent's will.
B. A decedent by will may expressly exclude or limit the right of a person or class to succeed to property of
the decedent that passes by intestate succession. If that person or a member of that class survives the decedent,
the share of the decedent's intestate estate to which that person or class would have succeeded passes as if that
person or each member of that class had disclaimed that person's intestate share.
B. What is included in the probate estate?
1. First issue: Is there a surviving spouse?
a. If yes, the probate estate is half of the community property and all of the deceased spouses separate
property. See comm vs. separate. Note: Exclude property in non-probate form.
a. If decedent was single – just look for property titled in the person’s name.
2. Second issue: Are the statutory allowances satisfied?
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a.
b.
c.
d.
e.
f.
Come out of the probate estate
Attorneys fees and administrator’s expenses get paid FIRST.
Statutory allowances and above all have priority over creditors
Statutory allowances apply to the decedents who where domiciled in the state of AZ
These statutory allowances cannot be defeated by a will.
The statutory allowances go to the surviving spouse, if no surviving spouse, to minor and dependent
children. There are offset provisions for all of them if the surviving spouse is receiving non-probate
property or part of the estate through intestacy, dollar for dollar.
g. Statutory Allowances (Total of three = 37,000 dollars) In order:
i. 1) ARS 14-2402 Homestead Allowance - $18,000 (nothing to do with a house)
ii. 2) ARS 14-2403 Exempt Property Allowance – (not more than $7,000, payable in kind
first (stuff), any deficiency is made up in cash.
1. Includes furniture, furnishing, appliances, automobiles
iii. 3) ARS 14-2404 Family Allowance - $12,000 (in practice), $1,000 a month for 12 months
can be paid without court approval.
h. Note: Nothing has to be left to an adult child.
3. Third issue: Did the person die with or without a will?
a. Intestacy occurs in three ways:
i. (1) Person dies without a valid will,
ii. (2) Person has a valid last will and testament but it is not effective to dispose of all the
probate estate, or
iii. (3) The valid last will itself invokes the intestacy rules.
b. What law applies? – If the person is domiciled in Arizona and dies here, his or her personal
property, tangible and intangible. With respect to real property, real property is governed by the state
where it is located.
4. NOTES:
a. Under AZ, we don’t give consideration to the length of marriage and the value of the probate estate
b. AZ does not recognize CL marriages that were contracted for as CL marriages
c. What happens if you have a couple and they are legally married and they file for divorce, but
before the divorce is final, one spouse dies?
i. Issue: Is the surviving one still considered a surviving spouse? YES
d. What rights do unmarried cohabitants have?
i. Zero. Would only be through express or implied contract
C. Share of Surviving Spouse
§14-2102 Intestate share of surviving spouse
The following part of the intestate estate, as to both separate property and the one-half of community property
that belongs to the decedent, passes to the surviving spouse:
1. If there is no surviving issue or if there are surviving issue all of whom are issue of the surviving spouse
also, the entire intestate estate.
2. If there are surviving issue one or more of whom are not issue of the surviving spouse, one-half of the intestate
separate property and no interest in the one-half of the community property that belonged to the decedent.
ARS 25-111 (Definition of Marriage) – if the marriage is valid where it was made then it is valid in Arizona. If one
of the spouses is not legally divorced from prior spouse, than the marriage is not valid. If it is a valid common law
marriage, where it was contractor for, Arizona will recognize it as valid. If the marriage is contracted in Arizona,
Arizona does not recognize common law marriage. Surviving cohabitants have 0 rights, unless there is an explicit
contract. Until the marriage is actually terminated, the surviving spouse is the surviving spouse for intestacy
purposes.
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Example problem: H and W have two children together, and each has one child from prior marriage. H dies
intestate. In probate estate, ½ of the community property is $500,000 and separate property is $100,000. Under 142102(2), W gets only ½ of separate property, which is $50,000 (instead of $600,000). Remaining $550,000 passes to
decedent’s descendants by representation, and not the child of W, who isn’t H’s child.
D. Simultaneous Death
§14-2104 Heirs; surviving of decedent; time requirement; presumption; exception
A. A person who does not survive the decedent by at least one hundred twenty hours is deemed to have
predeceased the decedent for purposes of homestead allowance, exempt property and intestate succession, and
the decedent's heirs are determined accordingly.
B. If it is not established by clear and convincing evidence that a person who would otherwise be an heir
survived the decedent by at least one hundred twenty hours, it is deemed that the individual failed to survive for
the required period.
C. This section does not apply if its application would result in a taking of intestate estate by the state under section
14-2105.
Janus v. Tarasewicz (Cyanide laced Tylenol) – question was whether there was sufficient evidence to show that
the wife survived the spouse, in this jurisdiction, only a preponderance of the evidence was needed. Note: In
Arizona the standard of proof is clear and convincing evidence of survivorship.
E. Concepts of Representation
● In all jurisdictions, after the spouse’s share is set aside, children of D take the remainder, to the exclusion of
everyone else. When one of the children has predeceased the D, then his children step into his shoes and
take by representation.
● Sons- and daughters-in-law are excluded as intestate successors in virtually all states.
● Order in Arizona: (1) descendants by representation, (2) parents, (3) siblings or descendants by
representation (nieces and nephews), (4) grandparents or descendants by representation (aunts and uncles),
(5) escheat. ARS 14-2103
3 methods for creating shares:
1. English per stirpes: shares are created equally for the nearest generation to the deceased, one share for
each living descendant at that level and for each deceased descendant that has surviving descendants. (Does
not apply to intestacy in Arizona but could be applied through a will ARS § 14-2709(b)).
2. Modern Per Stirpes: the distribution of shares are created at the first level of descendants at which there
are surviving descendants. One share is created at that level for each surviving and deceased individuals at
that level with surviving descendants.
3. Per Capita at Each Generation (1990 UPC, ARS 2-206(B)
a. Method is same as last: We go to the generation nearest to the decedent that has one or more
surviving member. Distinction: The shares for the deceased members… Same as modern per
stirpes, but the shares for each deceased member who has surviving descendants are combined and
then split per capita with the next generation.
b. Ex: D has C1, C2, C3. C1 has G1, G2, and G3. C2 has C4. C3 and G5.
i. (C3 survives): C3 gets 1/3
ii. C1 and C2 get 1/3 added equals 2/3, divide that by 4, you get 1/6. The four children
(excluding G5) all get 1.6
14-2103 Heirs other than surviving spouse; share in estate
Any part of the intestate estate not passing to the decedent's surviving spouse under section 14-2102 or the entire
intestate estate if there is no surviving spouse passes in the following order to the following persons who
survive the decedent:
1. To the decedent's descendants by representation.
2. If there is no surviving descendant, to the decedent's parents equally if both survive or to the surviving parent.
3. If there is no surviving descendant or parent, to the descendants of the decedent's parents or either of them
by representation.
4. If there is no surviving descendant, parent or descendant of a parent, but the decedent is survived by one or more
grandparents or descendants of grandparents, half of the estate passes to the decedent's paternal grandparents
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equally if both survive or to the surviving paternal grandparent or the descendants of the decedent's paternal
grandparents or either of them if both are deceased with the descendants taking by representation. The other half
passes to the decedent's maternal relatives in the same manner. If there is no surviving grandparent or descendant
of a grandparent on either the paternal or the maternal side, the entire estate passes to the decedent's relatives
on the other side in the same manner as the half.
14-2105. Unclaimed estate; passage to state
If no one is qualified to claim the estate under this article, the intestate estate passes to the state
§14-2106 Passing of estate by representation; assigning of shares; definitions
A. If under section 14-2103, paragraph 1 all or part of a decedent's intestate estate passes by representation to the
decedent's descendants, that estate is divided into as many equal shares as there are surviving descendants
in the generation nearest to the decedent that contains one or more surviving descendants and to deceased
descendants in the same generation who left any surviving descendants. Each surviving descendant in the
nearest generation is allocated one share. Any remaining shares are combined and then divided in the same manner
among the surviving descendants of the deceased descendants as if the surviving descendants who were allocated a
share and their surviving descendants had predeceased the decedent.
B. If under section 14-2103, paragraph 3 or 4 all or part of a decedent's intestate estate passes by representation to
the descendants of either of the decedent's deceased parents or to the descendants of either of the decedent's
deceased paternal or maternal grandparents, all or part of the estate is divided into as many equal shares as
there are surviving descendants in the generation nearest the deceased parents or either of them, or the
deceased grandparents or either of them, that contains one or more surviving descendants and to deceased
descendants in the same generation who left any surviving descendants. Each surviving descendant in the nearest
generation is allocated one share. Any remaining shares are combined and then divided in the same manner among
the surviving descendants of the deceased descendants as if the surviving descendants who were allocated a share
and their surviving descendants had predeceased the decedent.
C. For the purposes of this section:
1. "Deceased descendant", "deceased parent" or "deceased grandparent" means a descendant, parent or
grandparent who either predeceased the decedent or is deemed to have predeceased the decedent under section 142104.
2. "Surviving descendant" means a descendant who neither predeceased the decedent nor is deemed to have
predeceased the decedent under section 14-2104.
F. Transfers to Children
1. Adopted Children
14-2114. Parent and child relationship; intestate succession; adopted children
A. Except as provided in subsections B and C of this section, for the purposes of intestate succession, a person is
the child of that person's natural parents, regardless of their marital status. If this issue is in dispute the court
shall establish that relationship under title 25, chapter 6, article 1.
B. An adopted person is the child of that person's adopting parent or parents and not of the natural
parents. Adoption of a child by the spouse of either natural parent has no effect on the relationship between the
child and that natural parent or on the right of the child or a descendant of the child to inherit from or
through the other natural parent.
C. Inheritance from or through a child by either natural parent or the natural parent's kindred is precluded unless
that natural parent has openly treated the child as a natural child and has not refused to support the child.
Hall v. Vallandingham (formal adoption): Maryland adopted child has no right to inherit from the estate of the
natural parent who dies intestate, so the child has no right to inherit through the natural parent by way of
representation. NOT THE RULE IN AZ
● AZ: The children would win under AZ law. Statute 14-2114 Subsection B states that adoption of a child by
the spouse of either natural parent has no effect on the right of the child or a descendant of the child to
inherit from or through the other natural parent.
2. Adult Adoption
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Adult Adoption ARS § 14-8101 – allows for adult adoption if the adoptee is over the age of 18 but under the age
of 21 (no relationship needed). If over the age of 21, there is a required relationship (step child, niece, nephew,
cousin, or grandchild). Downside to adult adoption is that they usually cannot be undone, could set aside for fraud.
Minary v. Citizens Fidelity Bank & Trust Co.: Adoption of an adult for the purpose of bringing that person
under the provisions of a preexisting testamentary instrument, when he clearly was not intended to be so covered,
should not be permitted.
● Under AZ 8101, the case would come out the same because it was not a valid adoption.
3. Equitable or Virtual Adoption
O’Neal v. Wilkes: Because baby’s relative had no authority to contract for her adoption when she gave him
to Cook, the adoption was not properly contracted for, and was invalid. Probably NOT case in AZ.
● In Arizona, equitable/virtual adoption applies when there is a legal technical infirmity to an
otherwise legal adoption or there is an unperformed contract of adoption. In equitable adoption,
the child can inherit from the parents but the parents cannot inherit from the child.
o An oral agreement to adopt A between H and W and A’s genetic parents is inferred if H and W take
baby A into their home and raise A as their child.
o Adoptive parents are estopped from denying that a formal adoption took place.
o Only applies when someone dies intestate.
o Essential for a contract for adoption is that it be made between persons competent to contract for
the disposition of the child.
● Becker thinks the girl would have won here, and that it wouldn’t be taken away on a technicality.
4. Posthumous Children
§14-2108 After-born heirs; requirements
A child in gestation at a particular time is treated as living at that time if the child lives at least one hundred
twenty hours after its birth.
Woodward: 3 considerations: 1. Best interest of the children, 2. Administrative efficiency, 3. Consent by the
deceased to have children born after death. In this jurisdiction the court held ok. Note: In Arizona, children
conceived after decedent’s death are not considered heirs for the purposes of intestacy.
In re Martin B: : If the governing instrument is silent, posthumous children conceived through in vitro
fertilization with the consent of the parent are treated as part of their father’s family for all purposes.
● This would come out the same under 14-2108
5. Advancements to Children
If a child wishes to share in the intestate distribution of a deceased parent’s estate, the child must permit
the administrator to include in the determination of the distributive shares the value of any property that
the decedent, while living, gave the child by way of advancement.
● Inter vivos transfer, if a loan the amount could be taken out of the inheritance. If a gift, usually not taken
into account.
● Loan: a loan is considered a value interest, a promissory note (in writing). ARS 14-2110, the debt is charged
against the intestate share of the debtor. But, if the debtor fails to survive the decedent, the debt is NOT
charged against the debtor’s descendants, unless express agreement.
● Gift: general rule is that a gift is not taken into account. However, if considered an advancement then it
could be held against the inheritance. ARS 14-2109, in Arizona there has to be a writing in order to show
the gift was intended to be an advancement and can be made by the heir or the decedent. If the heir predeceases the decedent the advancement is not taking into account unless there is an expressed provision in
the will to count it against the heir’s descendants.
● Hotchpot: Probate estate + advancements to all descendants. Then divide that among the heirs and
then take out the individual advancements. All the heirs that received an advancement have to agree to the
hotchpot. (If one child received a large advancement they would not agree and they would not receive
anything from the intestate estate)
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o EX: A dies, children B, C, and D. 50,000 in probate estate . A had given B an advancement of 10k.
50 plus 10k = 60k now in probate estate. Each child gets 20k, but since B already got 10k, he only
gets a remaining 10k
§ 14-2109 Advancements of property during lifetime; effect on distribution of estate
A. If a person dies intestate as to all or a portion of that person's estate, property the decedent gave during the
decedent's lifetime to a person who, at the decedent's death, is an heir is treated as an advancement against the heir's
intestate share only if the decedent declared in a contemporaneous writing or the heir acknowledged in writing
that the gift is an advancement or if the decedent's contemporaneous writing or the heir's written
acknowledgment otherwise indicates that the gift is to be taken into account in computing the division and
distribution of the decedent's intestate estate.
B. For the purposes of this section, property advanced during the decedent's lifetime is valued as of the time the
heir came into possession or enjoyment of the property or as of the time of the decedent's death, whichever
first occurs.
C. If the recipient of the property fails to survive the decedent the property is not taken into account in
computing the division and distribution of the decedent's intestate estate unless the decedent's contemporaneous
writing provides otherwise.
14-2110 Debts owed to a decedent; effect on distribution of estate
A debt owed to a decedent is not charged against the intestate share of any person except the debtor. If the
debtor fails to survive the decedent, the debt is not taken into account in computing the intestate share of the
debtor's descendants.
6. Guardianships, Conservatorships, and Custodianships
We are concerned about protecting the children and the children’s inherited property when parents die.
● Wills should provide a parenting statement to instruct caretakers.
● Attorney and parents should tell who they nominated.
Guardian of the Person: Person who has responsibility for the minor child’s care and custody. As long as one
parent is living and competent, that parent is the natural guardian. If parents die and wills don’t designate a
guardian, the court will appoint a guardian, usually from among nearest relatives. ARS 5104. If child is old enough
(14) they can have a say in their preference, Guardianship terminates when minor reaches age of majority, dies, or
is adopted.
● What happens if the guardian of a child dies with a spouse? Unless the spouse is a natural parent of the
child, does not become the legal guardian. Look for other natural guardian or relatives
● ARS-5104: Delegation of authority statute. It allows a parent to donate temporary authority with respect to
his or her child to another person
Guardian of the Property: GP does not have a title to the ward’s property and cannot change investments without
a court order. Guardian has duty of preserving specific property and delivering it to him at age 18, unless court
approves a sale, lease, or mortgage. Guardian can ordinarily use only the interest from the property to support the
ward; needs approval to use principal. Strict court supervision of the guardian’s act is burdensome, timeconsuming, and expensive. Bad option!
Conservatorship: Given title as trustee to the property, as well as investment powers similar to those of trustees.
Appointment and court-supervision still required, but conservator has far more flexible powers than a guardian, and
only one trip to the courthouse annually for an accounting may be necessary. More streamlined administration of
estate, higher net return on assets, more flexibility in investments, and greater chance of meeting the financial needs
of the child. Terminates when minor reaches 18 or dies.
Custodianship: Devise or gift may be made to “X as custodian for minor under the state Uniform Transfers to
Minors Act,” thereby incorporating the provisions of the state’s uniform act and eliminating the necessity of
drafting a trust instrument. Creation very simple. Custodian required to transfer property to minor on attainment
of age 18 or 21. Custodian has right to manage and invest property, but is a fiduciary and is subject to the standard
of care. Good for small amounts, but trust better for large amounts.
Trusteeship: Most flexible, best arrangement. Donor can tailor trust specifically to family circumstances and
donor’s particular desires. Trust can postpone possession until donor thinks child is competent, unlike guardianship
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or conservatorship. Can also postpone possession entirely, requiring that some or even all of the property remain
in trust for generations. Well-designed estate plans provide for a contingent trust in the event that there is a minor
beneficiary, perhaps because a named adult beneficiary predeceases the testator, leaving a minor child as substitute
taker.
5. BARS TO SUCCESSION
● Where a party who otherwise is entitled to take from a D kills the D, the equitable principle that one should
not profit from one’s own wrongdoings argues against permitting the killer from taking.
● Estate will pass as if the slayer disclaimed their share. Statute 14-2803 covers anything and everything
(in out of probate estate) that you could receive from the victim.
● Concerned with unjust enrichment. Well drafted statute covers probate and non probate property
In re Estate of Mahoney (slayer issue) – While legal title to the decedent’s property passes to the slayer,
equity holds the slayer to be a constructive trustee for the heirs or next of kin of the decedent.
● Court here also held that voluntary manslaughter would bar but not involuntary manslaughter.
● Would come out same under AZ 14-2803
ARS 14-2803 Slayer Statute – if a person “feloniously and intentionally” kills someone they are not entitled to their
intestate share or testate share of the property.
● (B)(2) If the individuals held property in joint tenancy with right of survivorship or community property, it
is a severance of the joint tenancy and changes it to a tenancy in common.
● If an individual does not have mental capacity, the slayer statute will not apply.
● If children of the slayer were to take as a result of the slaying, likely in Arizona the descendants would
not be punished by the slayers actions and would receive their inheritance.
● Cannot opt out of slayer rules through will by testator
ARS § 46-456 Duty to Vulnerable Adult – financial exploitation of a vulnerable adult can be a forfeiture of
inheritance. Requires a position of trust and confidence to a vulnerable adult.
ARS § 14-10001 – 10018 Disclaimer of Property Interests – individuals can disclaim a gift (including a devise). A
disclaimer is treated as if they predeceased the decedent, that means the disclaimer is not considered to have given a gift to
their descendants and then back.
● Except, disclaimed property goes straight down to descendants, ARS 14-10006, the amounts are not
combined and then divided evenly as they usually would be if all children died and leave grandchildren.
(YOU HAVE 9 MONTH PERIOD TO DISCLAIM)
● Disclaimer usually frustrates a creditors interest, but not a federal tax lien.
● No disclaimer statutes lets the disclaimant choose to whom the property passes.
ARS § 14-2804 Divorces Spouse – a divorced spouse is essentially barred to receiving anything from the divorced
deceased spouse if the marriage is dissolved after the making of the will.
6. EXEXUCTION OF WILLS
Attested wills: prepared by an attorney: (have to be attested)
14-2502. Execution; witnessed wills; holographic wills
A. Except as provided in §§ 14-2503, 2506, and 2513, a will shall be:
1. In writing (CANNOT BE ELECTRONIC, typed okay)
2. Signed by the T or in T’s name by some other individual in T’s conscious presence and by T’s
direction.
3. Signed by at least two people, each of whom signed within a reasonable time after that person
witnessed either (1) the signing of the will as described in paragraph 2 or (2) the T’s
acknowledgment of that signature or (3) acknowledgment of the will.
B. Intent that the document constitute the T’s will can be established by extrinsic evidence, including, for
holographic wills under § 14-2503, portions of the document that are not in the T’s handwriting.
Wills Act: The Probate Code of every states includes a provision called the Wills Act which prescribes rules for
making a valid will. AZ has adopted the UPC.
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Four Function of Will Formalities:
1. Cautionary function: Were the statements of the transferor deliberately intended to effectuate a transfer?
2. Protective function from fraud or undue influence, through the use of witnesses,
3. Evidentiary function: Required to be in writing, signed by the testator, signed by the witnesses
4. Procedural/channeling function: We have these requirements for a will which allows the court to take a
look at whether they were followed to determine if there was a valid
Requirements for an attested will in AZ (STRICT COMPLIANCE)
1. Need to be in writing
a. Needs to be in a form that can be observed by the human eye (has to be on paper???)
b. Does not have to be in English
2. Needs to be signed by the testator, or there needs to be a proxy signature
a. Signed by the testator (Could nickname, initials, stamps, whatever the testator intended to
authenticate the will)
b. Proxy signature: Signed in the testator’s name, at the testator’s direction, and in the testator’s
conscious presence (Proxy should sign also)
3. Two Witnesses
4. The witness must be competent at the time of signing (14-2505)
5. The witnesses must sign the will
6. The witnesses have to witness 1 of 3 things:
a. The testator signing his or her will
b. The testator acknowledging that this is his or her last will
c. The testator acknowledging that this is his or her signature
i. ** AZ does not require that the witnesses be present at the same time. The witnesses do not
have to witness the same thing.
ii. There is no requirement that the testator sign at the end of his or her will, as there is in other
states
iii. Minimal requirements for the execution of a will in AZ
EXAMPLE: Assume you have a testator, and she signs a will at her house, and she brings to your neighbor to sign
as witness acknowledging it was her will, brings to other neighbor, has him acknowledge the signature. Assuming all
other requirements are met, this is a valid will
In Re Groffman: English court required strict compliance and both witnesses to be present at the same time when
witnessing the will. AZ: There was a valid will here. AZ does not have the same time requirement.
Stevens v. Casdorph: Two attesting witnesses never actually saw the decedent sign his will.
● RULE: A decedent’s signature must be in the presence of two competent witnesses, both of whom
acknowledge the decedent’s signature in the presence of each other.
● How would this case come out in Arizona? Comes out the same, despite the fact AZ has minimal
requirements. Did not fulfill one of the three things.
The Meaning of “Presence”
• Line of sight: The testator does not actually have to see the witness sign but must be able to see them were
the testator to look
• Conscious Presence Test: The witness is in the presence of the testator, through sight, hearing, or general
consciousness of events, comprehends that the witness is in the act of signing
Order of Signing: In general, the testator must sign or acknowledge the will before the witnesses attest.
1. Interested Witnesses and Purging Statutes
Purging statute: an interested party can be a W, and the will will stand, but the interested W won’t take anything in
excess of what he/she would have received in intestacy (could be nothing)
● Arizona does not have one! We allow an interested W to sign, though that is not good practice, and you
should not do it in case the will is probated in a state that does have a purging statute
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Estate of Morea: The requirement that a witness have nothing to gain by admission of the will to probate
is met if the witness receives less from the will than he or she would receive if the will were not admitted to
probate.
● It would come the same in Arizona because the signing of a will by an interested witness does not invalidate
the will or any provision of it (14-2505b).
Notes for in practice:
The statutory minimum for the signing of a will
• Signature by testator, Signature by witness #1, Signature by witness #2
If someone puts their name in a blank space on a will, that does not count as a witness signature if it was done
before the testator signed.
● A codicil is a change to a will and is a will itself (needs to meet all of the requirements).
● *Witness can sign a will (including a codicil) after the testator’s death if it is considered within a
“reasonable time” of witnessing, the signature or attestation of signature, will, etc.
● Video wills are not valid, has to be in writing, signed, and witnessed.
But in practice we want more than that
• Declaring that this is my last will and testament. I am over 18 and free of undue influence
• Combined testimonium attestation clause: The testator reciting that he is she or signing will.. but also the
witnesses saying the same thing
• Self-proven affidavit (2504, Part A and Part B). You cannot challenge a signature if there is a self-proven
affidavit
• You should only do one original and never more than one
2. Ad hoc Relief from Strict compliance
In re Pavlinko’s Estate: court did not allow for the probate of the will signed by the wrong spouse.
• AZ: Becker says it would allow to be probated. It is intended by clear and convincing evidence that this was
Pavol’s will.
In Re Snide: similar facts as Pavlinko, but the court here said the intent of the parties was clear and so they
reformed the wills that were signed to allow for probate. Same in AZ.
Two ways to fix the switched wills error:
1) Cure an execution defect: Probate the will that the T intended to sign but did not
a. Obvious difficulty is that the instrument was not signed by the decedent
2) Reformation: Probate the will that the T actually signed and reform its terms to comply with what he
wanted
3. Substantial Compliance – a judicial doctrine. Ask if the non-compliant document reflects T’s intent and
does the form sufficiently conform to meet the purposes of the Wills Act. Began/died in NJ
4. Harmless Error: Court may excuse noncompliance with the statutory formalities if there is clear
and convincing evidence that the testator intended the document to be his will.
a. If a document otherwise intended to be the testator’s will does not satisfy the requirements of a will,
the court will still recognize the will if the mistakes taken by the testator are harmless.
b. Court looks at three factors
i. Will must be in writing (Inexcusable)
ii. Signature requirement of the testator (Second hardest requirement to alleviate)
iii. Signature by the witnesses (Most common error)
c. **Arizona has not enacted harmless error. But many states do have harmless error doctrine, so
argue that another state’s law applies
In Re Estate of Hall: court applied harmless error doctrine. *Never do joint will.
In re Estate of Sky Dancer – “affidavits” of signature stapled to a typed document, not considered a valid will,
affidavits had been signed a year prior to the date of the typed document.
In re Macool: In order for the harmless error doctrine to apply, the proponent must show, by clear and convincing
evidence, that:
1) The decedent actually reviewed the document in question and
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2) Thereafter gave his or her consent to the writing.
• Absent either one of these two elements, a trier of fact can only speculate as to whether the proposed
writing accurately reflects the decedent’s final testamentary wishes.
Ehrlich – copy not signed of original noted the original was sent to the executor, it was clear the testator created.
A. HOLOGRAPHIC WILLS
14-2502. Execution; witnessed wills; holographic wills
B. Intent that the document constitute the T’s will can be established by extrinsic evidence, including, for
holographic wills under § 14-2503, portions of the document that are not in the T’s handwriting.
14-2503. Holographic will
A will that does not comply with § 14-2502 is valid as a holographic will, whether or not witnessed, if the
signature and the material provisions are in the handwriting of the T.
● Do not have to be attested, however, the material provisions have to be in the hand writing of the testator.
● At a minimum, the names of the beneficiaries and the property they are to receive under the will are
material provisions.
● Originally the entire document had to be in the testator’s hand writing, subsequently it was material
provisions, and then material portions.
● Some states require a date on the holographic will, not in Arizona.
● In Arizona the testator has to sign the document and it has to be in their hand writing, no proxy signature.
● Holographic wills can be changed by the testator at any time, without having to resign.
● If an individual has an attested will, there can be a holographic codicil to that attested will (sometimes
handwriting by the testator on the original will, depends on if the language expresses testamentary intent and
is signed by the testator).
o Testamentary intent: the desire for the disposition of property upon death.
● 14-2501 still applies: Person must be of sound mind and 18 years of age
In re Kimmel’s Estate: A letter can be a valid holographic will, as can one of a variety of other documents.
Shows that a will does not have to be a formal document!
● Letter to son saying “if anything happens to me” was sufficient to establish testamentary intent.
● Signing “Father” was ok because that was his customary signing at the end of these letters.
B. Conditional Wills: if person has a holographic will and says, I am going on a trip and if I don’t come back I
want whatever, courts have upheld the will even after they came back, the statement was just the motivation
for creating a will, not an antecedent prerequisite. RULE IN AZ.
C. Preprinted Will Forms: If a T writes her will by hand on a typed preprinted will form, but fails to have the
form properly attested, the instrument fails as a formal will. Whether the instrument can be probated as a
holographic will depends on how much of the instrument is in the T’s handwriting.
In Re Estate of Gonzalez: Gonzalez prepared his own will by filling in the blanks on a preprinted form.
● AZ: printed portions of a will form can be incorporated into a holographic will where the trial court
finds a testamentary intent, considering all of the evidence.
● Some courts, including Arizona, look to the preprinted language and the handwriting to determine the
context of the handwritten words. In Arizona, a person who handwrote his wishes on a preprinted will
form has effectuated a valid holographic will because his testamentary intent is clear.
● Note: A will could both be considered a holographic will and an attested will, particularly if the state has a
harmless error rule.
D. Signature and Handwriting in Holographic Wills
a. Some states require that there is a full date on the document, but Arizona does not.
b. There is no time requirement for a holographic will. You don’t have to sit down/do it all at once.
c. In almost all states, the holographic will may be signed at the end, the beginning, or somewhere in the
middle. But, if it is not signed at the end, there may be doubt about whether the T intended his name to
be a signature.
d. Initials count as a signature; almost anything counts. Smiley faces don’t count.
E. Problem with Holographic Wills: No Residuary Clause
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Residuary Clause refers to a clause in a will that disposes of any estate property that remains after satisfaction of
all other gifts.
In re Krokowsky (Ariz. 1995) Facts: T’’s holographic will left her home and netsukes to her friend and
investments to her sister, who predeceased her. She expressly disinherited her niece and nephew.
• Holding: The language, “my netsukes are the property of Mary Brown. Her acts of caring and devotion
have entitled her to many things I value,” cannot be construed as a residuary clause. Thus, the residue went
to her niece and nephew.
• AZ: Would not come out this way today! §14-2101(B) allows the T to expressly limit the right of a person
to succeed to property that passes by intestate succession.
o Here, the residue passed by intestate succession because it wasn’t provided for, and went to niece
and nephew. Would be different today—would pass as if Niece and nephew had disclaimed their
share.
G. Codicils
Codicil: Same requirements as attested or holographic will.
CODICIL: A supplement or addition to a will, not necessarily disposing of the entire estate but modifying,
explaining, or otherwise qualifying the will in some way. When admitted to probate, the codicil becomes part of the
will.
Ex. Will 1 is attested, but T wants to make changes, so he writes a holographic/attested codicil.
• If you have an attested will, T could write on the will and if the writings are signed, it could rise to the level
of a valid holographic will or codicil.
• If Will 1 is holographic and T adds a holographic codicil, the will may not have to be resigned (because no
time limit on creating a holographic will and no attestation requirement).
In re Estate of Kuralt: Formal will executed, no mention of Montana property to P. Then P introduced a letter
from T stating that he would make sure his L had her inherit the place. Court upheld.
• Becker: No question in his mind that this letter would not be considered a holographic will in Arizona. T
already knew how to make a valid holographic will. Plus there was no present testamentary intent because
he wrote that he would have the L come, but he had not yet.
Not valid holographic codicil if someone scratches out a name and writes in another’s name (on an
attested will or holographic will?)
• This is nothing. Even if you put your initials behind it, that isn’t enough to rise to the level of being a valid
holographic codicil because there isn’t enough handwriting. You must rewrite the entire devise.
• But, by striking the name, you have partially revoked the will under §14-2507.
• Most likely, money would fall into the residue and neither the person written in/struck out would get it.
• See §14-2507(D)!
§14-2504. Self-proved wills; sample form; signature requirements
A. A will may be simultaneously executed, attested and made self-proved by its acknowledgment by the testator and
by affidavits of the witnesses if the acknowledgment and affidavits are made before an officer authorized to
administer oaths under the laws of the state in which execution occurs and are evidenced by the officer's
certificate, under official seal, in substantially the following form
(SEE BOOK FOR SAMPLE)
§14-2505. Witnesses; requirements
1) A person who is generally competent to be a W may act as a W to a will.
2) The signing of a will by an interested W does not invalidate the will or any provision of it.
14-2506. Execution; choice of law – very broad choice of law statute!
A written will is valid if executed in compliance with §14-2502 or if its execution complies with the law at the
time of execution of the place where the will is executed, or of the law of the place where at the time of
execution or at the time of death the T is domiciled, has a place of abode or is a national.
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Wills, Codicils, and Inconsistency Example:
In 2007, Testator executes a will that gives all her property to A. In 2012, Testator executes a will that gives
her diamond ring to B and her car to C.
(a) In 2013, Testator dies. Even if the 2012 will makes no reference to the 2007 will, the 2012 will is treated as a
codicil and both are entitled to probate. B gets the diamond ring, C gets the Car, and A gets all the rest
(remainder) of the property.
(b) In 2012, Testator destroys the 2012 codicil with the intention of revoking it. Testator later dies. The 2007
will is admitted to probate. Revocation of a codicil does not revoke the will. The codicil was not for the
entire probate estate.
(c) Testator destroys the 2007 will with the intention of revoking it. Neither can be admitted to probate. The
physical revocation of the will revokes all of the codicils too.
7. REVOCATION OF WILLS: keep in mind the difference between attested and holographic wills
ARS § 14-2507: a will (attested or holographic) can be revoked, in whole or in part by:
1) A new will that in whole or in part, expressly or through inconsistency
2) By physical act on the will by the testator with intent or done by someone at the direction of the testator in
his/her conscious presence.
3) Preferred way is through a subsequent instrument that revokes prior instruments.
A. SUBSEQUENT INSTRUMENT
Modern view: (And AZ) A complete disposition of the testator’s estates = a presumption of revoking the prior will
by inconsistency
• **IF the subsequent will does not make a complete disposition of the testator’s estate, it is instead viewed as
a codicil, and any property not disposed of under it is disposed in accordance with the prior will
• Note: A revocation of a codicil, is not a revocation of the first will, if there is a revocation of the original
will, it is considered to revoke all subsequent codicils to the will.
Exordium Clause: identifies the testator and has the testamentary intent, then says, “I hereby revoke all prior wills
and codicils.”
PRACTICAL LOOK:
A) Deals with Will #1 and Will #2 that makes a complete disposition of the estate.
a. If testator revokes a subsequent will that revoked a previous will, the previous will #1 remains
revoked until it is revived.
i. Revived if it is evident from the circumstances or testator’s declarations that the testator
intended the previous will to take effect as executed.
ii. Burden of proof is on the person seeking revival.
B) Deals with Will #1 and Will #2 is a codicil
a. If a testator has a will, then executed a codicil that partially revokes the previous will. Then testator
revokes the codicil. The partially revoked portion of the previous will #1 is now revived.
i. Unless it is evident from the circumstances or testator’s declarations that the testator did not
intend that part to be revived.
ii. Burden of proof is on those seeking non-revival.
Example: In 2013, Testator dies. Testator has one heir: H. Testator’s safety deposit box contains three documents,
all duly signed and witnessed:
1. A will executed in 2003 devising all of Testator’s property to A.
2. A will executed in 2010 devising all of Testator’s property to B.
3. A document executed in 2011 reading: “I hereby revoke my 2010 will.”
→ Under these facts, the property will pass by intestacy. In order to revive will #1, there would have to be
something in the 2011 document that says the testator wanted Will #1 to be valid.
B. Revocation by physical act
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4 Requirements:
1) Testator has to have capacity (being of sound mind),
2) The testator must intend to revoke the will by physical act.
3) A physical act, burning, tearing canceling, etc. or all or part of the will.
4) All three elements must exist at the same time.
Proxy Revocation: 3rd Party performing the Revocatory action on the will by the testator’s (1) direction and (2) in
the presence of the testator.
Thompson v. Royall: cancellation statement was on the back, not the will itself.
• RULE: If written words are to be used for the purpose of revoking a will, they must be so placed on
the will as to physically affect the written portion; merely writing on blank parts of the paper is not
enough.
• Arizona: §14-2507(A)(2) says that “canceling is a revocatory act on the will whether or not the burn, tear, or
cancellation touched any words on the will.” Thus, the issue would be whether the paper backing is “on the will.”
Could go either way, but Becker doesn’t think it is revoked. He would argue harmless error, delayed
attestation substantial compliance.
In re Estate of Stoker: A will that is defective in form may be admitted to probate if the proponent of the will
establishes by clear and convincing evidence that, at the time the testator signed the will, the testator intended
the document to constitute his or her will.
• Would come out the same. Express revocation. 14-2507
C. Mistake: If the act of revocation was performed on the wrong document due to wrongdoing or mistake, a
constructive trust may be imposed or the devisees of the will in favor of the persons who would have
taken had the will been revoked.
a. Constructive trust: Equitable remedy, the person who is designated the trustee has one duty that he
must follow: Transfer the property to the beneficiary
D. Partial Revocations
a. Permissible under 2507(A)(2): Destroying the will or any part of it
i. Strikes: Strikes are partial revocations, and striking of a name of devisee, amount, or entire
devise is valid as a partial revocation by physical act.
E. Proxy Revocations: okay in Arizona. Must be done in T’s conscious presence and at his direction.
F. Lost and Missing Wills (Presumption of Physical Act Revocation)
Harrison v. Bird – there is a presumption that if the last person to have the will was the testator, and the
will cannot be found, it is presumed to have been destroyed and this presumption has to be overcome by
the proponent of the will.
• Note: If there are multiple originals, any revocation of one, revokes the others (should not make multiple
originals).
G. Same ARS § 14-3415 – Presumption of destruction of will if it was last in the possession of the testator and
cannot be found. Note: Just because someone else has access to the will, is not enough to overcome the
presumption.
H. When was there a revocation of the will? Not when it was tore into pieces because T was not the one to tear it.
It was only revoked when the will could not found.
Note: If on a will someone’s name as a specific devisee has a line struck through it, in Arizona, this is a physical act
and the presumption of partial revocation applies. If in a jurisdiction that does not allow for partial revocation by
physical act the person would still take. If the original will was a holographic will, the testator can make changes to
it, add to, or subtract from at any time.
SEE PROBLEMS PAGE 229 (Look at #11 in class notes)
I. Revocation by Operation of Law – does not revoke the entire will, just a/some devises.
• ARS § 14-2301: Omitted Spouse when a testator made a will prior to marriage devising property to a
charity and then marries, the wife takes by operation of law.
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•
•
•
•
•
•
ARS § 14-2804: Divorce when someone gets a divorce after a will that gave the former spouse property,
the former spouse does not take by operation of law.
ARS § 14-2302: Omitted Child If a testator makes a will with two kids and then has a third kid, the third
kid will take by operation of law.
ARS 14-2603: Predeceased Devisee: if there are devises to friends, if the friend pre-deceases the testator,
the devise is taken away by operation of law. (ARS 14-2603, Substitute Gift, allows for certain deceased
devisees with surviving dependents to take (Grandparents, step-children, or descendants of grand-parents).
Misconduct: if the devisee is engaged in misconduct against the testator, slayer (ARS § 14-2803) or elder
abuse (ARS § 46-456)
Edemption by Extinction: if specifically devised property is no longer in the possession of the testator at
the time of death, that devise goes away.
Note: Increase in value of property, even if it creates a disproportion between family members is not cause
for a revocation by operation of law, if there is a falling out between friends, that is not enough for a
revocation by operation of law.
J. Dependent Relative Revocation (DRR)
Defined: If the T purports to revoke his will upon a mistaken assumption of law or fact, the revocation is
ineffective if the T would not have revoked his will had he known the truth.
• Underlying theory is that the T lacks true revocatory intent because of mistaken belief.
• Typically involves situation where T destroys his will under belief that the new will is valid, but in fact, for
some reason the new will is invalid.
• **If the court finds that the T would not have destroyed his old will had he known the new will was
ineffective, the court, applying DRR, will disregard the revocation and probate the original,
destroyed prior will.
• Note: a devisee does not have to be the legal name if they are able to be identified.
PROBLEMS SEE PAGE 231, your notes, and AT outline
K. Revival
In re Estate of Alburn: T executed Milwaukee will in 1955. She executed Kankakee will in 1959. She tore up
Kankakee will to revoke it. Kankakee will revoked the Milwaukee will. But, T destroyed the Kankakee will
believing it would revive the Milwaukee will! What she really wanted was the Milwaukee will.
• H: Court would only let in the Kanakee will under DRR
● AZ: DIFFERENT. 14-2509A This would come in
● Revival: When T revokes Will 1 by writing Will 2, but then destroys Will 2, the presumption is that both 1
and 2 are revoked, but there is an ability to prove that the T wants Will 1 to go into effect. Thus, Will 1 will
remain revoked unless proponent of Will 1 can prove otherwise.
PROBLEMS IN AT OUTLINE
8. COMPONENTS OF A WILL
Despite formal requirements of transfer, it is possible for documents and acts lacking testamentary formalities to have
the effect of determining who takes what property belonging to the T.
Two doctrines permit extrinsic evidence to resolve identify persons or property:
1) Doctrine of incorporation by reference
2) Doctrine of acts of independent significance
A. Integration of Wills
Defined: Under the doctrine of integration, all papers that are present at the time of the execution and are intended
to be part of the will are treated as part of the will. T’s intent must be apparent. Rigsby
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In re Estate of Rigsby – two sheets with page numbers, first signed, second initialed, only first page was
considered the will, not clear that 2nd page was supposed to be integrated.
B. Republication by Codicil:
a. A codicil can say, “I am republishing my previous will except for the things noted in this codicil,”
and then the will is republished the date of the codicil, only if it is going to further the testator’s
intent.
- Example: Testator has Will #1. Testator executes Will #2 which says, “I hereby revoke all prior wills and
codicils.” Thus, Will #2 revokes Will #1. Then, Testator executes a codicil which says, “I hereby am
republishing Will #1.”
o Republication by Codicil causes Will #1 to become valid and have life as of the date of the
Codicil, thereby eliminating Will #2.
o Completely invalidates Will #2
o MUST FURTHER THE INTENT OF THE TESTATOR! NO STATUTE
o In order for it to work, Will #1 had to be valid at some point****
INCORPORATION BY REFERENCE: A doctrine under the law of wills which, under the proper circumstances,
allows a properly executed will to include in its provisions a document not executed as a will that contains
testamentary dispositions.
INTEGRATION OF WILLS: A doctrine of wills which allows all papers present at the execution and intended to
be a part of the will to become part of the executed will.
C. Incorporation by Reference
Incorporation by reference allows for a writing that was in existence but not present at the time of execution and that was
not itself executed with testamentary formalities to be absorbed into the testator’s will.
14-2510 Incorporating outside document into a will; requirements
A testator may incorporate a written document into the testator's will by reference if the following
requirements are met:
1. The document exists at the time the testator executes the will (or maybe republication of will by codicil)
2. The will's language manifests the testator's intent to incorporate this document.
3. The will's language describes the document with enough specificity to allow its identification.
Clark v. Greenhalge: although the document in question was not in existence at the time of the execution of the
original will, there were subsequent codicils that republished the will and the document was in existence at that time.
• If it was in existence at the time of the execution of the will (or republication of the will by codicil!) and
is identified by clear and satisfactory proof as the paper referred to therein.
REPUBLISH A WILL: The act of reestablishing the validity of a previously executed will; this is accomplished by
repeating the required formalities for a will or codicil (republication by codicil).
NOTE: If there is an incorporation by reference properly under 14-2510, the T cannot later strike out names by
devisee. In order to change it you would have to revoke the will
• If you have a doc that has been incorporated by reference, and T later strikes out the names and signs it, this
is still not considered a holographic codicil.
D. Tangible Personal Property Lists: Lists can be made after the will
ARS § 14-2513 Tangible Personal Property Separate List – a separate list describing personal property can be
done at any time, as long as it is signed by the testator or in the testator’s handwriting and the will refers to a
tangible personal property list. Does not apply to stocks or securities. There is no limit to the value of tangible
personal property in Arizona, unlike Cali.
ARS 14-2513C. The writing may be:
1. Referred to as one to be in existence at the time of the testator's death.
2. Prepared before or after the execution of the will.
3. Altered by the testator after its preparation.
4. A writing that has no significance apart from its effect on the dispositions made by the will.
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E. Acts of Independent Significance (Facts)
a. Doctrine permits extrinsic evidence to identify the will beneficiaries or property passing under the
will.
b. If 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 will be upheld under the doctrine of acts
of independent significance.
14-2512. Disposition of property by reference to acts of independent significance
A will may dispose of property by reference to acts, such as the execution or revocation of another person's will,
that have significance apart from their effect on the dispositions made by the will whether they occur before or after
the execution of the will or before or after the testator's death.
• EXAMPLE: my son is to receive the contents of my house, $100 to each person who is employee at death.
The selling/buying of property and putting it in the house are independent acts of significance and son is
entitled to what’s in the house at time of death. Fired two days before death? Nada
• Content Gift (I give the contents of my house, drawer, safety deposit box) – if house, takes tangible
property, not intangible property (stocks). If drawer, court will look to see if it was locked or not, if not,
possible bad conduct. If safety deposit box, takes both tangible and intangible property.
Example: “I devise my contents to my daughter.”
• Daughter gets what the contents are at time of death (not time of will execution.)
• Contents are tangible property. Stock certificates are not tangible property. Automobiles are part of
“contents” if garage is attached to the house (they are not part of contents if the garage is separate from the
house). Cash is included in contents.
• Note: stock can’t be contents of a house, but could be taken if contents of a specific drawer.
• **Precatory Language Fails – I wish, I recommend, I would like, I suggest, it would be nice, the use of
this precatory language causes the devise to fail because it does not have legal effect.
F. Contracts Relating to Wills
● A person may enter into a contract to make a will or a contract not to revoke a will
o Contract law, not the law of wills, applies
o To enforce the contract, the contract beneficiary must sue under the law of contracts and provide a
valid contract
● If a party to a valid will contract dies leaving a will that does not comply with the terms of the contract, the will is probated
in accordance with the Wills Act, but the contract beneficiary is entitled to a remedy for the breach.
● Usually arrive in premarital or divorce agreements, property settlement
ARS § 44-101 Statute of Fraud: only requires a writing (NO oral contracts) for a devise of property, however ARS
§ 14-2514 (contracts regarding wills) requires more. Two step process, apply the law of wills and then apply the laws
of contracts. The will could breach a contract and the person who was entitled under a contract could become a
creditor to the estate.
Contracts to Make a Will: T contracts with A to leave everything to A at T’s death if A will take care of T for life.
T executes a will leaving her estate to A. T rescinds the contract. Upon T’s death, is A entitled to take under T’s
will?
Contracts Not to Revoke a Will: Typically arises where a H and W have executed joint or mutual wills.
a. Joint will: one instrument executed by two persons as the will of both
b. Mutual wills: separate wills of two or more people that contain mirror-image provisions
14-2514. Contracts regarding wills; requirements; effect
A. After December 31, 1994, a person may enter into a contract to make a will or devise or not to revoke a will or
devise or to die intestate only by:
1. Provisions of a will that state the material provisions of the contract.
2. An express reference in a will to a contract and extrinsic evidence proving the terms of the contract.
3. A writing signed by the decedent evidencing the contract.
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B. The execution of a joint will or mutual wills does not create a presumption of a contract not to revoke the will or
wills.
Keith v. Lulofs: mutual wills between divorced mother and father
• Rule: Reciprocal wills do not create irrevocable contracts unless there is clear and satisfactory
evidence to establish an agreement between the testators.
• The standard in this state was lower than what is in Arizona, so same result in AZ.
• Prof.: should have left property in trust once one of the spouse’s dies.
A postnuptial agreement is a written agreement executed after a couple gets married, or have entered a civil
union, to settle the couple's affairs and assets in the event of a separation or divorce
9. WILLS: CAPACITY AND CONTESTS:
14-2501. Who may make a will
A person who is eighteen years of age or older and who is of sound mind may make a will.
• Applies to attested and holographic wills.
• Each state has its own way for testing testamentary capacity, but there is no statute
Mental Capacity the testator must be capable of knowing and understanding in a general way: (If missing any one
of these four, they lack testamentary capacity) TC = capacity to make a will
1. The nature and extent of his or her property
2. The natural objects of his or her bounty (usually heirs at law)
3. The disposition that he or she is making of that property, and must also be capable of
4. Relating these elements to one another and forming an orderly desire regarding the disposition of the
property.
NOTE*: Test of culpability, not actual knowledge. Testamentary capacity is looked at when the will is
executed. The capacity to make a contract or give an inter vivos gift is higher than testamentary capacity, but the
capacity to marry is lower than testamentary capacity. A guardian or conservator being appointed does not
automatically mean the testator does not have testamentary capacity.
In re Wright’s Estate: testamentary capacity cannot be destroyed by showing a few isolated acts, foibles,
idiosyncrasies, moral or mental irregularities or departures from the normal unless they directly bear upon
and have influence over the testamentary capacity.
• ARS 14-3407: presumption of a testamentary capacity. Burden shifts to the contestant of the will to prove
by preponderance of evidence that T did not have the appropriate testamentary capacity.
Wilson v. Lane: the law does not withhold the aged, the feeble, the weak-minded, the capricious, the right to make
a will, provided such person has a decided and rational desire as to the disposition of his property.
NOTES: Unable to live on her own did not mean she did not have TC to make a will. MORE: T is not required to
have a perfect memory, is not required to not be able to know all decedent’s estate terms or the tax provisions of
wills. TC at the time of execution, once due execution shown, burden shift.
A. CHECKLIST for SETTING Aside a Will:
1. Does the person have testamentary capacity?
2. Is the person suffering from an insane delusion?
3. Was the will the product of undue influence?
4. Was the will the product of duress or fraud?
B. Insane Delusion: Extravagant belief to which a person adheres against evidence, argument, and reason. A
belief in facts that do not exist and no rational person would believe to exist. If only portion of will is
attributed to insane delusion, only that is set aside. 4 Elements:
1. The person has a mistaken belief as to the existence of a “fact” (includes occurrence or morals)
2. It must effect the will (induce to make a will or part of a will)
3. The insane delusion cannot be based on evidence. There can be no factual basis for the conclusion
4. It is not correctable by any evidence.
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Two Broad Categories of Insane Delusions:
1. Beliefs regarding hostility from natural objects of bounty
2. Beliefs regarding misconduct by natural objects of testator’s bounty
Note: Eccentricities does not equal an insane delusion. Insane delusion needs to be separated from ill will,
discrimination, etc. There can be an interval of lucidity and if the will is made during that time, there will not be held
to be an insane delusion for the purposes of the will.
In re Strittmater’s Estate (National Woman’s Party) – Not a great case, the natural objects of the testator’s
bounty is arguably the person or thing that is receiving under the will.
• Court here held insane delusion because the testator hated men.
Breeden v. Stone: T had testamentary capacity, even though there was evidence of alcohol and cocaine and a
delusion, the holographic will showed capacity and the delusion did not affect the will.
The tests for sound mind and insane delusion are not mutually exclusive:
● A testator has the capacity to make a will if he or she is of sound mind and has no insane delusions
that materially affect the will.
Killen : insane delusion when the testator thought her caretakers, which were also her family members, were trying
to poison her.
C. Undue Influence: When is the will no longer the product of the testator but the product of the person
exerting undue influence? Keep in mind, favor of disposition and there is always some influence.
Definition of undue influence in AZ: Uses power or control to make the testator’s own desires conform to his or
her own so that the testator does what they want. 8 Factors for Undue Influence: (Do not need all 8)
1. Fraudulent representations by the person allegedly exercising undue influence
2. Was the will hastily executed, did the person help the testator make a new will quickly after the testator
expressed a desire to change the will?
3. Secrecy, was the execution of the will concealed?
4. Procurement, did the person in question actively assist in the procuring of the will. Did they schedule
the appointment, drive the testator, pay for the services?
5. Inconsistency, is the new will inconsistent with a prior will or if no prior will, inconsistent with how
property would pass through intestacy.
6. Is this an unnatural or unjust gift? Are the provisions of the will reasonable or unreasonable?
7. Susceptible to influence, looking at dependency on third parties, use of drugs, does the testator have a
history of being susceptible?
8. Was the person in question in a confidential relationship with the testator? Three categories of
confidential relationships:
a. Fiduciary (attorney/client, agent under financial POA),
b. Reliant (Dr./Patient, Financial/spiritual advisor, special trust/confidence in another),
c. Dominant-Subservient (Hired care givers/feeble testators, friends and neighbors).
ARS § 14-2712(E): A governing instrument is presumed to be the product of undue influence if either:
1. A person who had a confidential relationship to the creator of the governing instrument was active in
procuring its creation and execution and is a principal beneficiary of the governing instrument.
2. The preparer of the governing instrument or the preparer's spouse or parents or the issue of the preparer's
spouse or parents is a principal beneficiary of the governing instrument
3 factors that create a presumption of undue influence (Facts and circumstances analysis):
1. Confidential relationship
2. Active in procurement
3. Principal beneficiary (First in line to receive) APPLIES TO TRUST
BURDEN: If contestants can prove these three factors, burden shifts to the person alleged to express undue
influence, then when the court is assessing whether there is undue influence, the court looks at the 8 factors
14-1311. Standard of proof and burden of persuasion
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Except as otherwise provided in this title, the standard of proof required in a judicial proceeding brought
pursuant to this title is the preponderance of evidence. Parties have the ultimate burden of persuasion as to matters
with respect to which they have the initial burden of proof.
Estate of Lakatosh: power of attorney, left all of estate to attorney, woman was helpless and elderly, court held
undue influence. 3 factors met (In AZ too)
• A confidential relationship exists when one person has reposed a special confidence in another so
that the parties do not deal with each other on equal terms, either because of overmastering dominance on one
side, or weakness, dependence, or justifiable trust on the other.
• AZ: The existence of a power of attorney is a clear indication of a confidential relationship.
TEST DISTINCTION: Testamentary capacity refers to a person’s mental state at the time a will is prepared
and executed, which is a question of status. Undue influence consists of actions by a third party, and is a
question of conduct.
In re Estate of Reid: Cupit (D) was adopted by Reid, made the beneficiary of her estate, and received a deed
conveying Reid’s real estate to him. Judge set aside will, adoption, and real estate transaction because of undue
influence, would come out same in AZ 14-212E.
Lipper (Son next door) –no undue influence, there was sufficient statements from third parties of testator’s intent
to leave out the surviving spouse and descendants of predeceased son.
• No evidence of procurement. Also contestants must also prove that the will resulted from the D
substituting his mind and will for that of the T.
Note: Do not include an explanatory statement for why a disposition is made in a will, there is something called
testamentary libel (dead doesn’t mean still subject to a will). Put in separate document.
PR: L should give special care if the proposed gift to the lawyer or a related person is disproportionately large in
relation to the gift the client proposes to make others who are equally related.
ARS § 14-2517 No Contest Clause: if the contestant contests a clause, the no contest clause is unenforceable if
there is probable cause to bring the action. Just asks whether an attorney would say the contestant has a cause of
action.
D. Duress: When undue influence crosses the line into coercion, it becomes duress.
a. “A donative transfer is procured by duress if the wrongdoer threatened to perform or did
perform a wrongful act that coerced the donor into making a donative transfer that the donor
would not otherwise have made”
Latham v. Father Divine: T left estate to a cult, T expressed desire to revoke, Ds killed T..
• Duress valid for will dispute. Court could impose a constructive trust if it could be shown that there was
duress in the formation of the will, or prevention from executing a new will, or to satisfy justice
CONSTRUCTIVE TRUST: A trust created by a court of equity to recover property from a person who obtains or holds legal title
to that property through fraud, abuse of confidence, or some other unconscionable conduct. PREVENTS UNJUST
ENRICHMENT
E. Fraud: In the inducement and in the procurement. Remedy is constructive trust.
a. Fraud in the execution: a person intentionally misrepresents the character or contents of the
instrument signed by the testator, which does not in fact carry out the testator’s intent (person is
misled concerning contents of document)
b. Fraud in the inducement: a testator is misled. A misrepresentation causes testator to either
execute, revoke, refrain from executing or revoking, or include particular provisions in the
wrongdoer’s favor
c. If the entire will is a product of fraud, it is set aside. If a portion of the will is product of
fraud, the portion is set aside and the rest of the will survives.
5 Elements of Fraud:
1. Statements which are false
2. The person making the statements knows that they are false
3. The statements are material
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4. The statements are made with intent to deceive
5. They effect the will.
Lack of Knowledge: if the testator did not intend the results of the will due to lack of knowledge, the court may
set aside the will.
Schilling – Caretaker not notify brother of T for 6 months of his death.
• To bring an action for tortious interference with an expectancy, a plaintiff must show 1) the
existence of an expectancy, 2) intentional interference with that expectancy through tortious
conduct, 3) causation, and 4) damages.
• In order to bring this cause of action, person has to exhaust other probate remedies. The brother was not
told of the probate, and therefore, he did not have to exhaust those remedies.
ARS § 14-1106: SOL for fraud claims, including this tort, two years after discovery but no more than 5 years after
the fraud.
Note: No specific case on point in Arizona but Becker thinks Arizona would recognize tortious interference
10. Construction of Wills
• Modern rule allows for extrinsic evidence and reformation (unlike traditional rule)
A. Mistake or Ambiguous Language
Maxims of Construction (Rules concerning wills with ambiguous terms)
1. The fact that the testator executed a will, particularly with a residuary clause, demonstrates a testator’s
intent not to die intestate.
2. If several provisions conflict with each other, the provision closest to the signature at the end of the will
takes precedent.
3. A will is to be construed as a whole and not from isolated parts of the will.
4. If a will is subject to two constructions and no evidence of preferring one or the other, the construction
that treats individuals who are equally related to the testator in the most similar manner is preferred.
5. A statement in a will explaining a reason someone is making a will, is merely a statement of an
inducement, and does not make the will contingent upon that event happening.
6. Legal terms in a will are given their specialized meaning unless there is evidence that the testator used
the term in a different manner.
7. Non-legal terms are given their plain and ordinary meaning.
AZ: Patent ambiguity: the will is ambiguous on its face. No extrinsic evidence allowed and the court is confined
to the four corners of the will even if the will fails as a result
Latent ambiguity: manifests itself only when the terms of a will are applied to the facts. Extrinsic evidence
allowed. Two types (Often subjective test)
1. Equivocation: Will clearly describes a person or thing, but two or more persons/things fit that description,
and
2. No person or thing exactly fits that descriptions, but two or more things partially fit
Mahoney v. Grainger: “Heirs at law” was not ambiguous so no extrinsic evidence allowed. Testamentary language
must be ambiguous for court to correct.
Note: Extrinsic evidence is always admissible as to the testator’s intent, and is admissible to determine if the
testator was of sound mind, free from undue influence, duress and the like.
In re Estate of Cole the court did away with the distinction between patent and latent ambiguities.
• Extrinsic evidence is to be used to determine what the testator meant by the words used, not to determine
an intent that cannot be found in the words of the instrument (AZ)
Arnheiter (304 vs. 317) – mere erroneous description of the address number of property devised in will.
• A court has no power to correct or reform a will or change any of the language therein by substituting or
adding words, but may disregard obviously mistaken references when necessary.
In re Gibb’s Estate (Robert J. vs. Robert W.) – If there is clear and convincing evidence to the contrary, we
are going to disregard obvious mistakes of identification such as middle initials, street addresses.
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UPC § 2-805 – not adopted in Arizona yet. The court may reform the term of an instrument, even if unambiguous,
if there is clear and convincing evidence of the testator’s intention and there was a mistake of fact or law in
expression or inducement.
ARS § 14-10415: In regards to trusts, a similar statement as UPC § 2-805. Prof.: Thinks there is a good policy
argument for applying this law to wills as well. **Also, can argue choice of law provision if the testator had an
abode, etc. in a jurisdiction that did adopt UPC § 2-805.
• In Re Estate of Herceg – no beneficiary in the residuary clause, court allowed an affidavit from the
drafting attorney, and evidence of prior wills with beneficiary for residuary listed.
• Note: Clear and convincing evidence should be qualitative and quantitative. A firm belief or conviction
without hesitancy as to the truth of the allegations to be established. The testimony has to be without
confusion with clear recollection of the events. The testimony has to be credible.
11. Construction of Wills: DEATH OF DEVISEE BEFORE TESTATOR
CONCEPT: Devisees have to survive for 120 hrs to take (ARS § 14-2702, set aside if the property would
escheate).
• General rule is a devisee doesn’t survive the T, the devise lapses or fails
• All gifts made by will are subject to a requirement that the devisee survive the T, unless the T specifies
otherwise
• Anti-lapse statutes: act to, under certain circumstances, substitute another beneficiary for the
predeceased devisee. (Almost all states have enacted)
Categories of Devises: Best example: T’s will devises her watch (a specific devise) to A, $10,000 (a general devise)
to B, and the rest of her estate (the residuary devise) to C.
a) Specific devises: A disposition of a specific item of T’s property. specific property and words of
possession and identification (I leave my 2014 Lexus automobile to my son Winston).
b) General Devises: gifts of personal property that cannot be distinguished from other assets of probate
estate. (I leave $100,000 to my son Winston).
c) Demonstrative Devise – T has identified a specific source to pay out a general devise, if that is
insufficient it will be paid out of the probate estate. (I devise $100,000 to be paid out of my IBM stock to
my son Winston).
d) Residuary Devise – what is left over after all of the specific, general, and demonstrative devises and
the cost of the administration of the estate. In a holographic will could say, I leave everything else
instead of saying residuary.
a. If the residuary devise lapses, the heirs of the T take by intestacy.
b. AZ. We have abolished the no residue of the residue rule. If part of the residuary devise does not
work, goes to the remaining members of the residue proportionately.
i. Ex: A: ½, B: ¼, C: ¼, but C predeceases Testator. How is the $ split up?
1. A: 66% (2/3), B: 33%, (1/3)
e) Class Devise: If a devise is to a class of persons, and one member of the class predeceases the T, the
surviving members of the class divide the gift.
a. “To all of my children at death” = class gift. “To my children A, B, and C” = not class gift
f) Void Devise: If a devisee is already dead at the time the will is executed, the devise is void.
g) 14-2601: A will can tell us what will happen in any of these cases and controls. These default rules
In re Estate of Russell : Will left real property to a dog.
• R: That portion of any residuary estate that is the subject of a void gift to one of the residuary
beneficiaries remains undisposed of by the will and passes to the heirs-at-law.
• Will was void b/c left to dog. Prof: Nothing indicates that the devise was to be in equal shares; court is
wrong. Quinn’s argument that it was supposed to go to him alone (to take care of Roxy) was right.
• Note: ARS § 14-2604 – If a gift is void (i.e. to a dog), §14-2604(B) applies. The devise goes to other
residuary devisees 2604(B) gets rid of the residue rule.
o AZ: you are permitted to leave a will for an animal
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o Becker would also argue 2101(B) : Language concerns a negative will
ARS § 14-2603 Substitute Gift, Class Gift Definition – three things required to be applied.
1. There is a required relationship between the testator and the devisee, grandparent, descendants of
grandparents, and step children. (No spouse listed). 2603(A)
2. There is no alternative devise
3. There are no words of survivorship (i.e. “I devise . . . if he survives me.”) 2603(C)
14-2603 creates Substitute Gift for Predeceased Devise:
We will create a substitute gift for a deceased devidevisee if he/she has left descendants.
• Statute changes the common law to give the predeceased devisee’s gift to the devisee’s descendants unless
the T provides otherwise.
• Purpose: T would prefer substitute gift to the devisee’s descendants rather than for the gift to lapse.
• Good drafting avoid application of statute. Always designate a substitute taker.
• If the anti-lapse statute applies (2603), the deceased devisee’s descendants take by representation.
o *An antilapse statute applies to a lapsed devise only if the devisee bears the particular relationship to
the T specified in the statute.
• A will substitute is an inter vivos transfer that avoids probate yet has the effect of passing property at the
donor’s death. Because the transfer is inter vivos, not testamentary, the transfer need not comply with the
formalities for the execution of a will.
Example: I devise $10,000 to brother Herb. Herb survives T by 24 hours and then dies.
• Devise fails under §14-2702(A) because Herb didn’t survive for 120 hours.
• Substitute gift created under 14-2603? Depends.
o Is it a class gift? If so, this doesn’t apply, distributed equally.
o Is there a required relationship (i.e. is Herb a grandparent, a descendant of a grandparent, or a
stepchild?) Yes, brother.
o Is there an alternative devise? No.
o Are there words of survivorship? No.
o Does Herb have descendants?
▪ Yes: It goes to them by representation.
▪ No: No substitute gift and §14-2604 applies, sending it into the residue.
• Example: Same facts as above, except Herb is neighbor. No substitute gift—2604 applies (gift goes into
the residue) instead of 2603 because there is no required relationship.
Routolo v. Tietjen: T executed will leaving ½ of residue to “Hazel, if she survives me.” Hazel predeceased.
• Court held words of survivorship were not enough to frustrate the anti-lapse statute and a substitute gift
was created. AZ: Opposite outcome in Arizona! Words of survivorship preclude substitute gift;
passes into residue.
Dawson v. Yucus: T devised interest in her late husband’s family farm to her two nephews, S and B, intending the
farm to return to her husband’s side of the family.
• Court held no language indicates T intended to create a class gift. Nephews and husband were not in the
required relationship with the testator so the anti-lapse (substitute gift) statute did not apply. No class gift
because the specific devisees were identified.
• Becker disagrees. Clear that T wanted land to go back to H’s side. Becker would have drafted a trust;
otherwise you end up with excessive fracturization.
Note: if a devise says to A, B, C, and D (who all happen to be nephews) not enough to create a class gift. If the
devise says to my nieces and nephews the current class of which consists of A, B, and C. That would create a class
gift. If a class gift, the amounts go to the members of the class that are surviving at the time of testator’s death.
14-2604. Failure of testamentary provision; effect
A. Except as provided in section 14-2603, a devise, other than a residuary devise, that fails for any reason becomes a
part of the residue.
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B. Except as provided in section 14-2603, if the residue is devised to two or more persons, the share of a
residuary devisee that fails for any reason passes to the other residuary devisee or to other residuary
devisees in proportion to the interest of each in the remaining part of the residue.
SEE PAGE 373 FOR DIAGRAM and Class Notes #17 for problems
SE 14-2907 FOR ANIMALS AND TRUSTS.
12. Construction of Wills: CHANGES IN DEVISED PROPERTY
Ademption by Extinction RULE: If T makes a specific devise of property to a devisee and that property
doesn’t exist as of fate of the T’s death, devisee does not take anything.
• Only applies to specific devises, not general or residue
• Identity theory: if a specifically devised item is not in T’s estate, the gift is extinguished
• Intent theory: If the specifically devised item is not in T’s estate, the beneficiary may nonetheless be entitled to the
replacement or cash value of the original item, if the beneficiary can show that this what the T would have wanted.
• Partial ademption by extinction: “I devise my automobiles to my son” if there were 2 cars when this was
written but when Testator dies there’s only one, the son gets 1 car.
In re Estate of Anton (Intent Theory): durable POA sold property on behalf of testator that she had devised in a
will. HELD: Where specific devises are removed from the estate as a result of an involuntary act, the devisee is
entitled only to the proceeds that have not been expended on the support of the T.
• Arizona: Gretchen gets ½ of what remain, Robert gets ½ of what remain, and the woman that took care of
her for years gets nothing.
ARS 14-2606 Right to specific Devise:
• An individual who is entitled to a specific devise is also entitled to unpaid portions of the balance of a
purchase price, a condemnation award unpaid at death, or insurance proceeds unpaid at death (fire or
casualty for the specific property).
• If a conservator or agent under a durable power of attorney sells specifically devised property, the
devisee is entitled to the net sale price. Unless, the testator regains capacity for a year.
ARS § 14-2605 Securities –
• Stock that is devised in a will, if it increases in value, splits, additions as a result of reinvestment, or changes
in stock due to merger, etc. continue to the specific devisee. Note: Cash paid out before testator’s death
does not count.
A. Ademption by satisfaction** (Like an advancement)
• The doctrine of satisfaction may be applicable if a T makes an inter vivos transfer to a devisee after
executing the will./
• Usually applies to general pecuniary devises, not specific bequests (ademption by extinction)
ARS 12-2609 §14-2609. Satisfaction of a devise during the T’s life; requirements; valuation
Property a testator gave to a person while the testator was alive is treated as a satisfaction of a devise in whole or in
part if any of the following requirements are met:
i.
The will provides for deduction of the gift.
ii.
The testator declared in a contemporaneous writing that the gift is in satisfaction of the devise or that
its value is to be deducted from the value of the devise.
iii.
The devisee acknowledged in writing that the gift is in satisfaction of the devise or that its value is to
be deducted from the value of the devise.
iv.
For purposes of partial satisfaction, property given while the testator was alive is valued as of the time the
devisee came into possession or enjoyment of the property or at the testator's death, whichever
occurs first.
• NEED INTENT AND WRITING
• Note: if the devisee predeceases the testator, the satisfaction counts against the deceased’s inheritance. ARS
2109(C)
• Note: changes in value, absent other provisions in the will do not change the will devises.
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Non-exoneration statute ARS § 14-2607: a specific devise is taken subject to any mortgage. A general directive in
a will to pay debts does not overcome this.
B. Abatement (Reduction of Devises)
The problem of abatement arises if an estate lacks sufficient assets to pay the decedent’s debts as well as all devises. In
such circumstances, some devises must be abated or reduced.
ARS 14-3902 Abatement Statute (SEE STATUTE)
• Order of reduction (unless Will provides other order):
o Property not disposed of by will (intestate)
o Residuary devises
o General devises
o Specific are last and are reduced proportionally
- For this purpose, a demonstrative devise will be treated as specific with respect to the value of property, and
will be treated as general with regard to the insufficiency.
- Devise 100k of apple stock, apple stock only worth 50k, specific 50k, general 50k (insufficiency)
- It goes into the specific devise to the extent that the value of the property designated covers the
demonstrative devise. If there is a insufficiency then we treat it as a general devise
Example of Money/Assets in the Estate:
A single (non-married) Testator’s Will provides: “I devise my Turner Painting to A. $100,000 to B. $50,000 to C.
Residue to D.” Testator’s probate estate includes $200,000 in cash and the painting (worth $500,000). Thus, the
Probate estate is $700,000. Administrative expenses of $100,000 are due.
- The administrative expenses are paid by cash. The probate estate is now $600,000.
What if, in the probate estate, there is no cash and only the painting?
- Expenses of administration still need to be satisfied. The Personal Representative will give A the option:
either furnish $100,000 and keep the painting, or the painting will be sold and the proceeds will pay the
administrative expenses with the rest to A.
What if testator is married and the painting was separate property, and it was the only thing in the probate estate? The painting was
devised to A, who is a friend. Testator’s spouse wants their statutory allowances.
- Personal representative will go to the specific devisee, A, and give the same option: A can either furnish the
$ for the statutory allowances or sell the painting.
13. TRUSTS: CHARACTERSTICS AND CREATION
Property that is in a trust created during the life of the testator are non-probate assets.
If there is a testamentary trust created at death under the terms of the will, that requires probate of the will. There
are revocable and irrevocable trusts.
A. DEFINITIONS
• Trust: a legal relationship (not an entity)
o The settlor bifurcates property into two interests, one person owns the legal title to the property, the
second person owns the beneficial interest. (Could be the same person).
• Revocable trust: can be changed by the settlor; always inter vivos!
• Irrevocable trust: cannot be changed by settlor (often done as part of a prenup to ensure that if spouse
marries again, his/her future kids and spouse won’t get anything)
• Inter vivos trust: trust created during life; not subject to court supervision
• Testamentary trust: trust created upon death; always irrevocable! Will that establishes this MUST be valid.
Created by will; subject to court supervision
• Declaration of trust: settlor acting as trustee
• Agreement of trust: third party acting as trustee
• Trust income: earnings of the trust (interest)
• Trust principal: property that composes the trust
• Dispositive provisions: describes beneficiaries and their interests in the trust
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•
Administrative provisions: deal with administration of the trust and what the trustee can invest in
B. Parties to a Trust
• Settlor/Trustor/Grantor: person who creates the trust
• Trustee: person who holds legal title to the property (can be individual or corporation)
o Fiduciary: held to a high standard of conduct
o Can be the sole settlor and sole beneficiary because he would only owe duty to self
o If a trust does not have a trustee, the court will appoint a successor trustee
• Beneficiary: person with the equitable interest in the trust
o Beneficiary can have a current interest or a remainder/future interest
o Can have beneficiaries who are required to receive the income
o Can have beneficiaries who aren’t required; discretionary distributions can be made for various
purposes
o
C. CREATION OF A TRUST
A trust can be created during the lifetime of the settlor. This is a non-probate property interest. The property passes
to the beneficiary without any probate. These trusts can be revocable or irrevocable.
• Revocable means the settlor can change it, terminate it, whatever settlor wants.
• If irrevocable, it CANNOT be changed. Not the provisions, beneficiaries, etc.
• A testamentary trust is ALWAYS irrevocable, because the testator is dead.
3 ways to create a trust:
1. Settlor executes a declaration of trust: the settlor declaring "I am acting as trustee for the benefit of
beneficiary."
2. A deed of trust
3. A trust agreement
A trust can be created at death under the terms of a will. (this is called a testamentary trust.)
Methods of Creating a trust – ARS 14-10401: A trust may be created by:
1) Transfer of property to another person as trustee during the settlor's lifetime or by will or other
disposition taking effect on the settlor's death.
2) Declaration by the owner of property that the owner holds identifiable property as trustee.
3) Exercise of a power of appointment in favor of a trustee.
Requirements for Creation – ARS 14-10402(A)
1. Settlor has capacity (Same testamentary capacity as needed to make a will)
2. Settlor intends to make a trust. (does not have to say any particular words --not even trust, trustee,
beneficiary. It just must be clear that settlor intends to divide legal title and beneficiary title between
people.).
a. If no enforceable duties, no trust (even if the word trust is used).
b. Precatory language, “I would like,” does not count.
3. The trust has a definite beneficiary or is:
a. A charitable trust.
b. A trust for the care of an animal, as provided in section 14-10408.
c. A trust for a noncharitable purpose, as provided in section 14-10409.
4. The trustee has duties to perform.
5. The same person is not the sole trustee and sole beneficiary. [otherwise there is merger of the two
separate interest and there would be no trust. (There being subsequent beneficiaries on death satisfies
this issue if the settlor is also the trustee).
B. A beneficiary is definite if the beneficiary can be ascertained now or in the future, subject to any applicable rule
against perpetuities. 14-10402(B)
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C. A power in a trustee or other person to select a beneficiary from an indefinite class is valid. If the power is not
exercised within a reasonable time, the power fails and the property subject to the power passes to the persons who
would have taken the property had the power not been conferred. 14-10402(C)
D. Trusteeship has 4 overlapping functions/duties
1) Custodial function
a. Taking possession and safeguarding property
2) Administrative
a. Preparing annual accounting, keeping records, paying taxes
3) Investment function
a. Investing trust assets
4) Distribution function
a. Making requiring distributions
*Duties of Trustee: Comes from trust document and to the extent not covered, state law also creates duties of
trustee. The starting point of determining the duties is to read the trust. Duties Include:
1. Administer trust according to its terms (Must be familiar with terms of trust)
2. Duty of skill and care:
3. Duty to give notices: (trust says "if trustee does X then they have to provide notice to beneficiaries.)
4. Duty to furnish information and communicate: Becker recommends over-communicate.
5. Duty to account: Generally the duty to account requires an annual accounting on the trustee.
6. Duty not to delegate: especially in regards to acts of judgment or discretion.
7. Duty of loyalty: requires the trustee to administer the trust solely for the benefit of the beneficiaries, and
not to have any personal benefit.
8. Duty to avoid conflicts of interest: duty not to use any of the trust property for his or her personal
benefit. Cannot borrow money from the trust. It is NOT the trustees money, it’s beneficiaries money.
9. Duty not to commingle: the trust property is the trust property. Must be kept separate
10. Duty of impartiality: unless trust says otherwise, trustee must treat all beneficiaries the same.
11. Duty to invest: unless trust document provides otherwise, trustee must invest the trust assets and make
them productive.
12. Duty to enforce and defend claims:
13. Duty of confidentiality:
Powers of Trustee: Empower the trustee to carry out duties. The trust document usually contains the powers,
ARS 14-10815 and 16 if trust is silent as to powers:
• Powers to distribute assets, sometimes mandatory ones and sometimes discretionary for health, education,
maintenance and support.
Creditors: a trustee who is also a beneficiary cannot transfer assets into a trust to shield it from creditors, however,
if a settlor creates the trust and adds to it, the only creditor who can get it is for child support.
Trustee Compensation – some places it is a percentage of the value of the trust paid annually, more commonly it
is just “reasonable compensation” based on a number of factors.
• If you're not careful in acting as a fiduciary, there will be mistakes made, and those mistakes DO NOT
come out of trust. They come out of trustee's pocket.
14-10403. Trusts created in other jurisdictions
A trust not created by will is validly created if its creation complies with the law of the jurisdiction in which the
trust instrument was executed or the law of the jurisdiction in which, at the time of creation, either:
1. The settlor was domiciled, had a place of abode or was a national.
2. A trustee was domiciled or had a place of business.
3. Any trust property was located.
14-10404. Trust purposes
A trust may be created only to the extent that its purposes are lawful, not contrary to public policy and possible to
achieve. A trust and its terms must be for the benefit of its beneficiaries.
14-10405. Charitable purposes; enforcement
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A. A charitable trust may be created for the relief of poverty, the advancement of education, religion or science,
the promotion of health, governmental or municipal purposes or other purposes, the achievement of which is
beneficial to the community, or for the support of one or more organizations that have the purposes prescribed in
this section exclusively.
B. If the terms of a charitable trust do not indicate a particular charitable purpose or beneficiary, the court may
select one or more charitable purposes or beneficiaries. The selection must be consistent with the settlor's
intention to the extent it can be ascertained.
C. The settlor of a charitable trust, among others, may maintain a proceeding to enforce the trust.
14-10406. Creation of trust induced by fraud, duress or undue influence
A trust is void, in whole or in part, to the extent its creation was induced by fraud, duress or undue influence.
Jiminez v. Lee: The words “in trust” need not be used to create a trust so long as the transfer of property is made with the intent to
vest ownership in a third party.
Hebrew University Ass’n v. Nye: Even though property that is the subject of a gift is not actually given away, the
gift is valid so long as the donor divests herself of ownership.
Beneficiary interest in a trust is determined by trust instrument/document. It will layout and provide beneficiary’s
interest.
• Interests are either mandatory or discretionary distributions. Terms that the court will interpret if asked to
do so to enforce terms of trust.
▪ Mandatory - trustee is required to make these distributions to beneficiary.
▪ Discretionary - in the discretion of the trustee: commonly for health, education,
maintenance, are support.
- A well drafted trust will have some additional language concerning beneficial interest.
E. Trust Property
• A trust cannot generally not exist without trust property. A trust can be created without property as long as
property goes into the trust upon death.
• Contingent remainders, lease-hold interests, choses in action, royalties, life insurance policies, or any
interest that is transferable, may be put in a trust.
• Trust distinguished from debt: Trust property must be kept separate from the trustee’s own property
Unthank v. Rippstein: Craft writes letter in which he says that he intends to give Rippstein $200/month for the
next 5 years. Said that he intended to bind his estate to this. Promise to pay $200 a month failed as trust.
• AZ: Becker said this should have been found to be testamentary and a valid holographic will.
o *Testamentary instrument must describe what happens to the property at death.
• Becker would have argued in this case that this was an equitable charge, and therefore the takers of the
residue have the obligation of providing the 200/month to Mrs. Rippstein
Equitable Charge: “I devise $100,000 to Winston for him to give $40,000 to Thatcher,” creates a creditor
relationship, not a trust, but still enforceable.
**Resulting trust: an equitable reversionary interest. (similar to constructive trust) an equitable remedy applies in
two situations:
1. The failure of express trust
2. If one person pays purchase price for property and causes title to the property to be taken in the name of
another person who is not a natural object of the purchaser's bounty.
*NOTE: An expectation or hope of receiving property in the future, or an interest that has not come into existence
or has ceased to exist, cannot be held in trust.
Reversion: A reversion is the interest that is created in the transferor (or, perhaps more precisely, retained by the
transferor) when he transfers an estate that is less than the estate that he had at the time of the transfer. A reversion
can only be created in the transferor. A reversion can never be created in a transferee. (A transferee, however, might
come to own a reversion that previously arose in the transferor.)
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F. Definite Beneficiary and Rule Against Perpetuities
Ascertainable Beneficiaries: A private trust must have one or more ascertainable beneficiaries to whom the trustee
owes fiduciary duties and who can the trustee to account.
Definite Beneficiary – ARS § 14-10402(3) a beneficiary is definite if the beneficiary can be ascertained now or in
the future, subject to any applicable rule against perpetuities. The power to distribute property to an indefinite class
can be given to a trustee.
Rule Against Perpetuities – the rule against perpetuities in Arizona for a trust is 500 years.
• Clark v. Campbell Leaves to her "friends" as her trustees select. Court says this fails.
o AZ Different result. ARS 14-10402: C. A power in a trustee or other person to select a beneficiary
from an indefinite class is valid.
o NOTE: This is a specific devise. And if a specific devise fails it falls into the residue. So the persons
who challenged this are probably the residual devisees.
G. CARE FOR ANIMALS AND CHARITABLE TRUSTS
Charitable Trusts (ARS § 14-10405) – may be created, monitored by the Attorney General of the state.
• Applies to a trust for a broad group of animals, but not a single animal
Trust for Care of Animal (ARS § 14-10408): may be created, amount if too much set aside could be reduced by the court. Can
make one for single animal
• With dogs, Becker generally tries to have one person who cares for the animal, and one person who cares
for the money set aside for the animal. A check and balance system. Same with children.
Non-charitable trust (ARS § 14-10409) – this includes honorary trusts for saying mass, taking care of gravesite,
etc.
In re Searight’s Estate: Trust for an animal. The court here finds that this is an "honorary trust" which are
enforceable AS LONG AS the trustee accepts their position.
Leona Helmsley: Left $4 billion to her charitable organization that cared for dogs. So after her death the mission
statement was changed, and now a lot of the funding goes to helping indigent children.
H. Oral Trusts
• Not in Writing: a trust does not have to be in writing, unlike a will. Only would have to be in writing if
dealing with real property because of the statute of frauds.
Estate of Fournier: asked friends to hold money for him, and to give the money to his sister after he died.
14-10407. Evidence of oral trust
Except as required by a statute other than this chapter, a trust need not be evidenced by a trust instrument, but the
creation of an oral trust shall be established only by clear and convincing evidence and the terms of the
oral trust shall be established by a preponderance of the evidence. If a trust is created by written instrument, it
may be amended or revoked only by written instrument executed by the settlor.
• Hypo: clients ask Becker if, after telling him how they want the TRUST to be created (not will), and they
die prior to him creating the document and them signing it, is this still valid?
o Yes, it is an oral trust. Clear and convincing evidence from attorney’s documents and note
• HYPO: Parent transferring real estate to child, because parent has cancer, and if they die, they do not want
the property to be subject to probate. But she also says that if she recovers, then they will transfer the
money back to her. The children agree. Mom recovers, and then the son refuses to transfer the property
back to his mom.
o You cannot have an oral trust with respect to real property. But the court WILL apply
equitable remedies in certain situations. In the hypo above, the court ordered a constructive
trust upon the son, which required him to transfer the property back to his mom.
• Note: But courts do not apply constructive trusts automatically. It is an equitable remedy, and they do
not apply such remedies when the party has "unclean hands." (Hypo: man transfers property to son,
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lies to the court about his purposes, and when son refuses to transfer the property back, the court refuses to apply
constructive trust because the man committed a fraud on the court.)
G. Secret and Semi-Secret Trusts
Olliffe v. Weels: woman leaves residue of her estate to Wells to "distribute… in his discretion…best calculated to
carry out my wishes which I have expressed to him or may express to him." Semi-secret trust
• SECRET TRUSTS ENFORCEABLE; BUT NOT SEMI-SECRET TRUSTS.
• Semi-secret trust: Not an outright devise. Indicates that it is to be held by a person as trustee.
o Result: A resulting trust in favor of T’s heirs or residuary takers
• Secret trust: A devise, with no indication as to a trust. (these are enforceable)
14. NON-PROBATE TRANSFERS
Revocable Trusts – one document to dispose of all property.
• Joint revocable trusts can be created for spouses, if they have community property, if they have separate
property in addition, separate trusts should be created for each to prevent the conversion of the separate
property into community property. (Unless you want conversion for tax purposes)
• Like the testator of a will, the settler of a revocable trust remains free to amend or to revoke the
trust at any time and for any reason.
o A revocable trust may be created by a deed of trust whereby the settlor transfers to the trustee the
property to be held in trust.
▪ The settlor retains the power to revoke the trust and, as trustee, controls the management of
the property.
• Like a will, a revocable trust can be contested for lack of capacity and undue influence.
EXAMPLE: O declares herself trustee of certain property for the benefit of O for life, and then on O’s death, to
pay the principal to O’s descendants. O retains the power to revoke the trust. Unless O revokes the trust, on O’s
death her descendants will be entitled to the remainder of the trust property independent of any probate
administration of O’s estate.
*POUROVER TRUST: A living trust that is funded by the property in a decedent’s estate.
• O sets up a revocable trust with himself or a third party as trustee. O then executes a will devising his
probate estate to the trustee of that trust
Deed of Trust: Settlor transfers property to the trustee to be held in trust. Allowed w/o wills act formalities.
Declaration of Trust: Settlor declares himself to be the trustee of certain property for his own benefit during life,
w/ remainder to pass according to the terms of the trust. Wills Act formalities not required here either
§14-10602 Revocation or amendment of revocable trust
A. Unless the terms of a trust expressly provide that the trust is irrevocable, a settlor may revoke or amend the
trust subject to any limitations prescribed in the terms of the trust.
C. The settlor may revoke or amend a revocable trust either:
1. By substantial compliance with a method provided in the terms of the trust.
2. If the terms of the trust do not provide a method or the method provided in the terms is not expressly made
exclusive, by either:
(a) A later will or codicil that expressly refers to the trust or specifically devises property that would otherwise
have passed according to the terms of the trust.
(b) Any other writing signed by the settlor manifesting clear and convincing evidence of the settlor's intent.
D. On revocation of a revocable trust, the trustee shall deliver the trust property as the settlor directs.
14-10603. Settlor's powers; powers of withdrawal
A. While a trust is revocable by the settlor, the rights of the beneficiaries are subject to the control of, and the
duties of the trustee are owed exclusively to, the settlor.
14-10604. Limitation on actions contesting validity or revocable trust; distribution of trust property
A. A person may commence a judicial proceeding to contest the validity of a trust that was revocable at the
settlor's death within the earlier of:
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1. One year after the settlor's death.
2. Four months after the trustee sent the person a copy of the trust instrument and a notice informing the person
of the trust's existence, of the trustee's name and address and of the time allowed for commencing a proceeding.
ARS § 14-6101 – revocable trusts, along with many other kinds of transfers of property upon death do not have to
conform to the Wills Act. Summary:
• 1) Authorizes non-probate transfers without accordance with the Wills Act.
• 2) Names all instruments that are considered non-testamentary
• 3) Only requirement = it is in writing (not signed and witnessed)
• Subsection (1) and (3) need to be done at time the interest is created
ARS § 14-10603 – during the lifetime of the settlor, the duties of the trustee are to the settlor alone. Contingent
beneficiaries do not have any interest during the settlor’s life.
• Creditors get paid before heirs
• For unknown creditors, Trustee can publish notice in a newspaper of general circulation in area, once a
week for three consecutive weeks, and this starts the statute of limitations which expires 4 months after first
publication to bring claim.
Moon v. Lesikar: Lesikar sold stock to Woody (D) for the benefit of the S & S Trust (D), and Moon (P) claimed
the price paid for the stock was inadequate.
• RULE A contingent beneficiary of a revocable trust does not have standing to contest the settlor’s
disposition of trust assets
• This case holds that during the lifetime of settlor, the settlor can do whatever he wants to with respect to
the trust, and beneficiaries have no standing.
• This is very similar to ARS 14-10603.
• Upon death of settlor, as long as they have capacity, a remainder beneficiary cannot sue for an accounting or
sue regarding what settlor did or did not do with their property during their lifetime.
Standing: Trustees generally do not have standing to contest a will and it would certainly make no sense for a
trustee named under the will to contest the will that names him (or her). If the trustee did not like the terms of the
trust in the will, the trustee could resign and a successor trustee would be named. As a rule, trustees do not have a
sufficient enough interest in the estate to allow them to challenge the will.
A. REVOKING OR AMENDING A REVOCABLE TRUST
ARS § 14-10602 (Revocation or amendment of revocable trust) – unless a trust says otherwise, it is presumed
that a trust is revocable.
• Married individuals can unilaterally modify what happens to their separate or their share of the community
property.
• The trust can have an exclusive method by which to modify the trust.
• If no exclusive method in the trust, then either by subsequent will or codicil or by any other writing, signed
by the settlor manifesting clear and convincing evidence of the settlor’s intent.
• Note: no specific mention of revocation by physical act. Unclear at this time.
Patterson: A living trust is the functional equivalent of a will, and it is black letter law that a testator has
the complete control to amend, modify, or revoke a will during his lifetime.
● You can revoke a will by physical act, so long as T has capacity and intent; and the act all occurred at the
same time.
B. CREDITORS
ARS § 14-6102 (Creditors can reach trust assets, statute provides method) – non-probate assets can still be
reached by creditors (or to pay statutory allowances) if the probate estate is insufficient.
• Creditors cannot reach certain assets upon death of an individual, like life insurance proceeds, retirement
accounts, real estate as joint tenants with right of survivorship (if no lien proper to death).
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****During the lifetime of the settlor, the property of a revocable trust is subject to claims of the
settlor’s creditors.
Regardless of ARS 14-6102, it is extremely difficult for a creditor to ever reach assets in a trust.
• They have to approach the personal representative and demand a proceeding.
• But if there is no probate, there may be no personal representative. So this cannot occur.
• And even if there is a personal representative must know that the probate estate is insufficient to cover
debts. And in practice, creditors don't know this. So they aren't aware that they will not recover if they can't
recover for unpaid debts.
• If creditor makes claim on personal representative, the personal representative can decline the request for a
proceeding, after which the creditors have to pursue the matter on their own dime.
TIME: Creditors have 2 years to file claim, 4 months if public notice and you notify creditors that you
know of****
Spendthrift Provisions: Most trusts have these so that creditors of Beneficiaries cannot reach Beneficiaries’
interest, and Beneficiary cannot pledge or securitize or transfer his interest.
o “[a] spendthrift provision is valid only if it restrains both voluntary and involuntary transfer of a
beneficiary’s interest.”
o Only exception is creditor with respect to child support
- In AZ, a creditor of a beneficiary cannot force trustee to take money out of trust to satisfy beneficiary’s
creditors. Only creditor that can reach assets in that trust is judgment creditor that has judgment for child
support. As a settlor, I cannot create a trust during my lifetime and put my assets in to protect from
creditors. They can reach that (Revocable or irrevocable). If my parents set up trust for me, creditors
cannot reach.
•
C. Applying the Laws of Wills to Trusts: there is an Arizona statute that says laws for wills should be applied to
trusts which take the place of a will.
ARS § 14-2804 – termination of marriage serves as a revocation of any “governing instrument.” The revocation
applies to anything to the former spouse and any devise to a relative of the former spouse.
1. In practice, do not rely on this statute (It is broader then that same ruling in Clymer)
2. Note: Governing instrument includes trusts, see definition at ARS § 14-1201(22), however, does not apply
to accounts/policies governed by ERISA (Egelhoff)(retirement accounts through employer or work life
insurance policies).
POUR OVER WILL is a testamentary device wherein the writer of a will creates a trust, and decrees in
the will that the property in his or her estate at the time of his or her death shall be distributed to the Trustee.
Practice tips:
In practice, we want to have a recovable trust, and that everything the individual owns passes in accordance with the
terms of the trust.
• Change ownership of property from settlor to trustee.
• Designate the trust as the beneficiary of assets that are in non-probate form (life insurance,
• Or use a pour over will (any property titled in the settlors name alone, the pour over will transfers that
property into the revocable trust). However this still requires probate of the will to get the assets into the
trust.
So in practice, he wants to transfer everything into the trust, or in non-probate form. However, he still uses pour
over will just in case. But ideally the will does not need to be probated because everything has been adequately
added to trust.
How do we transfer real property into a trust in AZ?
• Of these types of deeds, we use a special warranty deed to transfer real property into a revocable trust
in this state, because when someone purchases property in AZ, they almost always, as the buyer, receive a
title insurance policy.
• You want to make sure that title insurance carries over, and using a special warranty deed ensures that the
title insurance is still valid.
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•
•
NEVER use a general warranty or quit claim deed for this purpose.
Title as John R. Becker, as trustee of the Becker Family Trust. Do not title as “Becker Family Trust.”
15. NON-PROBATE TRANSFERS: OTHER PROPERTY INTERESTS
A. Life Insurance (Death Insurance)
1. Overview: The death benefit passes to the beneficiary/beneficiaries; and if that is anybody other than the
decedent's probate estate, then it is considered to be a "non-probate" asset, and is not controlled by
decedent's will. Not usually subject to debts to creditors.
2. The insured enters into contract with life insurance company. Insured sends money annually, and
when insured dies, insurance company sends a death benefit to the beneficiary.
Life insurance is contractual arrangement:
1. Owner of contract (generally referred to as the "insured") enters into a contract with a life insurance
company (referred to as the "insurer") the basis of the contract is:
a. If the insured sends a premium payment to the insurance company (generally on an annual basis)
then the company has promised by contract to pay a death benefit if the insured dies, to the
beneficiary/beneficiaries.
b. Beneficiaries are entitled to a death benefit if the insured dies while the insurance is in place.
Two basic types:
• Term policies: life insurance for a term (generally 1 year) and if the insured dies within that period of time,
then they will pay the benefits to the beneficiary. Most term policies are for a guaranteed time such as 10, 20
or 30 years. So even if the insured develops a terminal illness during the term, the company cannot refuse to
pay the benefit on death if the payments are made.
• Whole life: the premium is higher than term because the insurance company uses part of that premium for
the insurance, and then part of the premium is invested. The point is for the company to keep investing on
an annual basis, and at some point the amount invested becomes enough to pay the premiums for the rest
of insured's life.
L. Retirement Accounts
PENSION: A fixed sum paid regularly to a person (or to the person’s beneficiaries), especially by an employer as a
retirement benefit.
Two basic types of retirement accounts:
1. Qualified:
a. Defined benefit plans: generally a pension
i.
Not common in private employment still common in government employment.
ii.
Eemployee can elect to have a benefit for only their lifetime (which means a higher benefit
for them) but they can choose to have benefit cover spouse (which results in a lower benefit
for both) after the death of both there is nothing that goes to any heirs.
b. *Defined contribution accounts: no specified benefit, instead there is an amount the employer
can contribute on an annual basis, and an amount that they employee can contribute on an annual
basis. This is general a 403-A or a 403-B.
i.
Each employee has his or her own, segregated account. And if it's a 401-A or 403-B, the
participants spouse is required to be the beneficiary, UNLESS the spouse has signed a
waiver.
2. Non-Qualified:
o Individual Retirement Account or IRA: Much in common with a defined contribution plan. The
main difference is that an IRA is governed by the terms of the contract between the account holder
and the custodial institution. Like an insurance policy, includes designation of beneficiaries to
receive the residue in the event of the retiree’s death.
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i. Traditional IRA: individual makes contributions to the account (generally there are
limitations) and once they start taking money out of the account they pay taxes.
ii. Roth IRA: individual receives no income tax deduction for the money they put in, the
amount grows tax free, and everything that they eventually take out is NOT subject to
income tax.
iii. * Under two types of IRA's, spouse is NOT required to be the beneficiary.
iv. Nunneman: you cannot change the beneficiary arrangement of an IRA by simply stating it
in your will. Same in AZ.
M. Change of Beneficiary
Overview: usually has to be changed according to the terms of the life insurance policy, however, under ARS § 142804, termination of marriage would remove divorced spouse by operation of law, if there was an alternative in the
policy, they would take, if not, usually policies have a provision that if no beneficiary, it goes to the estate.
Cook v. Equitable Life Assurance Society: Husband did not change life insurance policy after divorce.
• Arizona follows the majority rule that a beneficiary of a retirement account cannot be changed by a will.
Must go through changing in insurance policy.
• However, IN AZ, under 14-2804, wife would still not take under insurance policy because termination of
marriage precludes going to spouse and his/her children.
EMPLOYEE RETIREMENT INCOME SECURITY ACT: (ERISA: A federal statute that regulates
private pension plans and employee benefit plans.
Egelhoff (ERISA preempts state law) – life insurance and retirement accounts through employer are governed
by ERISA and no revocation of the spouse as beneficiary when there is a divorce.
• A 401(k) and 403(b) require the spouse to be the beneficiary, and are generally governed by ERISA
Becker still sees this issue:
• He has client with huge 401(k), and is married to second spouse. He wants kids to inherit the 401(k) sums,
but he can’t change the beneficiary to the kids UNLESS the spouse signs a waiver to do so.
**When dealing with retirement accounts and divorce, always ask if the statute is governed by ERISA! If
it is, then the money goes to the ex-spouse, if T didn’t clean up mess after divorce.
• ONLY INSTANCE WHERE EX STILL GETS MONEY DESPITE 2804
• 401(k) governed by ERISA; IRAs are not; employer-provided life insurance is.
• When divorce, you usually split the retirement account 50/50 using a QDRO which allows splitting of
account without application of taxes.
N. TYPES OF ACCOUNTS
i.
Joint tenants with right of survivorship:
a. Upon the death of one tenant, the surviving tenant owns the property absolutely.
b. NO COMM PROPERTY, nothing goes in probate estate, each own ½ interest in property
c. If a joint tenant wants someone other than the other joint tenant to take her share at death, she must
sever the joint tenancy during life (by creating an interest for someone else) converting it into a
tenancy in common
d. 4 Unities – Time, Title, Interest, and Possession.
ii.
Community Property with Right of Survivorship: Ownership of property between spouses that has the
benefit of being community property and also has the benefit of right of survivorship.
a. Applies to both real property and personal property that is titled (generally, brokerage accounts,
investment accounts, etc.)
b. Can only be husband and wife.
c. One spouse can’t transfer the real property without consent of the other.
d. Death of one spouse means that the property automatically goes to the other spouse.
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iii.
iv.
v.
vi.
vii.
i. Ex: Spouse 1 has a will that says “I devise my interest in our Community Property with right
of survivorship to my child.” Spouse 1 dies. The provision in the will is not valid with
respect to this property; it will go to surviving spouse.
Tenants in common:
a. A type of shared ownership of property, where each owner owns a share of the property. Unlike in a
joint tenancy, these shares can be of unequal size, and can be freely transferred to other owners
both during life and via a will.
b. *If community property than the other spouse would have had to sign off for the transfer of
interest.
c. Whatever the deceased interest was would be in the probate estate.
*Note: for joint bank accounts, creditors can only reach the contribution of the debtor to the account.
However, a creditor can put a lien on the entire property when owned as joint tenants with right of
survivorship. Joint tenants with right of survivorship is not community property, therefore each spouse
could convey their own interest during lifetime.
A TOD Deed for Real Property
a. Suppose T, the owner of Blackacre, records a deed that purports to convey Blackacre “to T, transfer
on death to A.” T dies intestate, leaving B as her sole heir.
b. During T’s life, the TOD beneficiary has no interest in Blackacre, and T retains the powers to
transfer it to others or to revoke the TOD designation.
POD: open joint account but only with the intent that B receive the balance upon A’s death
a. POD disguised as joint
Agency/Convenience: A opens account with intent that B has power to draw on it during A’s life only for
A’s convenience but for other purposes; won’t receive balance upon death
O. Bank Accounts (MAIN STATUTES FOR NON-PROBATE TRANSFERS)
BECKER FOCUSES ON FOUR STATUTES: 14-6201, 6204, 6211, and 6213
ARS 14-6101 Definitions: describes various property interests, and says they are non-probate property. Which
means they do not have to satisfy wills act formalities.
• Account: a contract of deposit between a depositor and a financial institution and includes a checking
account, savings account, CD and share account.
• Agent: someone authorized to make transactions for the party
• Multiple party account: an account payable on request to one or more of two or more parties, whether or
not a right of survivorship is mentioned
• Sums on deposit means money; balance payable on an account, including interest and dividends earned,
whether or not included in the current balance and any deposit life insurance proceeds added to the account
by reason of death of a party
§14-6202. Application of Article.
Multi-party bank account statutes do not apply to accounts established for partnership, joint venture, or other
business purpose; accounts controlled by one or more persons as agent or trustee for corporation, unincorporated
association or charitable/civic organization; a fiduciary or trust account in which the relationship is
established other than by the terms of the account
14-6203. Types of accounts; existing accounts
B. An account established before or after December 31, 1994, whether in the form prescribed in section 14-6204 or
in any other form, is either a single party account or a multiple party account, with or without the right of
survivorship, and with or without a pay on death designation or designating an agent, within the meaning of this
section and is governed by this section.
**ARS 14-6201, 620/ 6211(A)– parties own account (bank accounts) in proportion to net contributions
unless there is clear and convincing evidence of a different intent.
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If the account has the right of survivorship, the surviving party has control over the whole account,
regardless of lifetime contribution.
• If married, there is a presumption that the contributions were equal (unless there is proof otherwise).
Varnela v. Bernachea: V and B are lovers; B added V to his bank account as a joint tenant with right of
survivorship. After B had a heart attack, she drained the account and put it into her own at the same bank.
• IN AZ, 14-6204/6211 would apply. Thus V would get nothing because B contributed everything.
§14-6211. Ownership of accounts.
(A) SEE ABOVE
(B) A beneficiary in an account having a POD designation has no right to sums on deposit during the lifetime of
any party.
(C) An agent in an account with an agency designation has no beneficial right to sums on deposit.
• Ex. H and W own multiparty account with C as POD designee. If H dies and W changes POD designation
to X, C is out of luck because he has no rights to account!
6212 Summary: Death of party; rights of survivors
• On death of a party, sums on deposit in a multiparty account belong to the surviving party(ies)
• If two or more parties survive . . .
o And one was the surviving spouse of the D: amount to which D was entitled goes to SS
o And none was SS of the D: amount to which D was entitled passes in equal shares!
▪ H puts in $100, W puts in $200, C puts in $500. C dies. H gets $250 and W gets $250.
Now H owns $350 and W owns $450.
14-6213. Alteration of Rights
A. Rights at death under §14-6212 are determined by the type of account at the death of a party. The type
of account may be altered by written notice given by a party to the financial institution to change the type of
account or to stop or vary payment under the terms of the account. The notice shall be signed by a party and
received by the financial institution during het party’s lifetime.
B. A right of survivorship arising from the express terms of the account, §14-6212, or a POD designation
may not be altered by will.
GENERAL EXAMPLE: Two sisters open a joint account with right of survivorship. Sisters sign an agreement that
says the beneficiary of the account funds upon the death of both of them goes charity.
• If sister 1 dies, sister 2 receives sole ownership. As sole owner, she can change the beneficiary agreement to
whoever she wants. The charity has no recourse to recover at that point, because the sister is sole owner can
do whatever she wants with it.
•
E. MORE STATURES
ARS § 14-2702: the beneficiary has to survive by 120 hours in order to take for all non-probate assets, or
receive a devise. But a document can overide this
Beneficiary Deed – ARS § 33-405 allows real property to be transferred to a beneficiary upon death. They receive
the property subject to all encumbrances against the property. Revocable and changeable by the owner at any
time. Cannot be revoked by a will.
Safety Deposit Box – ARS § 6-1004 all parties have access to a safety deposit box, and on the death of the parent,
the child has access to the box, but the contents do NOT automatically go to the child even though listed as coowner of safe deposit box (No automatic ownership interest)
16. PLANNING FOR INCAPACITY
Overview: who has decisions to make healthcare decisions and who has the ability to take possession of property,
pay incapacitated persons bills, take care of affairs, etc.
A. What happens if individual becomes incapacitated?
a) If individual has not planned ahead of time: (DEFAULTS)
a. For property: Court will appoint a conservator, which is expensive and intrusive.
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i. In order to initiate a conservatorship, someone must petition for the appoint of conservator.
ii. A separate document must also be filed: A notice of compensation. (what the person
seeking to be appointed as conservator expects to receive to compensate them for serving as
conservator.)
iii. Also required to provide an annual accounting to the court as to funds received and spent
(starting balance, all receipts and disimbursements)
b. *NOTE: For health care decisions, requires a guardian (if ARS 36-3231 Surrogate Decision
Maker does not apply). Also expensive and intrusive
c. Court appoints 3 individuals:
i. An attorney for the allegedly incapacitated person
ii. An attorney for the person seeking to be appointed as conservator
iii. An investigator to look into the allegedly incapacitated person need for conservator
iv. May also appoint medical expert to weigh in
d. BURDEN/STANDARD IN AZ: preponderance of evidence that the person is:
i. Unable to manage their personal affairs (due to mental, physical disability; drug use, etc.)
ii. The person has property/funds that will be wasted if conservator is not appointed.
e. If a court believes this standard is met, the person will be appointed as conservator. Then the
person being appointed MUST be bonded (paid out in the amount of property and annual earnings)
(paid out of conservatorship estate.)
b) If individual has planned ahead of time (PREFERABLE)
a. Our first choice is to create a personal trust, and have all property titled to the personal trust. If this
is in place, the trustee can take over without court involvement.
b. Funded revocable trust (BEST OPTION FOR PROPERTY MANAGEMENT)
i. With a fully funded revocable trust, and the settlor is acting as his or her own trustee, and he
or she becomes incapacitated, he or she:
1. Can resign and appoint someone to take over as trustee (w/o court supervision)
2. If they don't resign, then the trust must have a plan in place for what happens if
settlor becomes incapacitated. (ex. A majority of settlors children, or settlors children
unanimously, physician, that make that determination together.)
3. Successor trustee can be appointed by the court
ii. To work, individual’s property must be titled in the trust
1. You can put real property, and tangible personal property. Just not retirement accounts.
Retirement accounts must always be owned in the individual's name. If the individual
becomes incapacitated, then you cover the retirement accounts with a financial
power of attorney.
c. Financial Power of attorney: a document where a document, known as the principal, grants
powers to an agent (a.k.a. attorney in fact---but does not need to be an attorney).
i. FPOA can be durable: meaning it continues beyond the incapacity of a person
ii. Scope: With FPOA, you generally have the choice of when to grant the powers to the agent. It can be
granted when a group of the children, or doctors, etc. vote that it is time. Or it can be signed
as effective immediately, and stored in a safe place.
iii. Spring FPOA: springs into life on incapacity of principal
iv. Requires mechanism to determine incapacity, usually group of relatives
v. Kurellmeyer: The scope of a power of attorney is determined by the principal’s intent when
the power was created.
d. Durable Power of Attorney: unlike ordinary power of attorney, durable power is effective during
the incapacity of the principal until the principal dies. The power can be drafted to be effective only
upon incapacity (springing DPOA) or immediately upon signing. Must have a statement saying that
you intend it to be durable and not regular.
i. Second choice. Its best to make these effective immediately.
ii. These are met with skepticism by banks and other financial institutions
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iii. An agent acting under POA cannot make, amend, or revoke a principal’s will, but he can
create, modify, or revoke a trust if the power to do so is expressly granted in the document.
IN AZ: the language authorizing this power needs to be explicit.
iv. Power ceases upon knowledge that the principal is dead.
v. Specific Witness requirement. Proxy, witnessed, notarized.
C. DURABLE POWER OF ATTORNEY
14-5501. Durable power of attorney; creation; validity
A. A durable power of attorney is a written instrument (no oral POA) by which a principal designates
another person as the principal's agent. The instrument shall contain words that demonstrate the principal's
intent that the authority conferred in the durable power of attorney may be exercised:
1) If the principal is subsequently a person with a disability or incapacitated.
2) Regardless of how much time has elapsed, unless the instrument states a definite termination time.
D. Except as provided in section 28-370, an adult, known as the principal, may designate another adult,
known as the agent, to make financial decisions on the principal's behalf by executing a written power of
attorney that satisfies all of the following requirements:
1. Contains language that clearly indicates that the principal intends to create a power of attorney and clearly
identifies the agent.
2. Is signed or marked by the principal or signed in the principal's name by some other individual in the
principal's conscious presence and at the principal's direction.
3. Is witnessed by a person other than the agent, the agent's spouse, the agent's children or the notary public.
4. Is notarized
14-5502. Effect of lapse of time, disability or incapacity
All acts done by an agent pursuant to a durable power of attorney during any period of disability or incapacity of the
principal have the same effect and inure to the benefit of and bind the principal and the principal's successors in
interest as if the principal were not incapacitated or a person with a disability.
14-5503. Relation of agent to court appointed fiduciary
B. A principal may nominate, by a durable power of attorney, the conservator or the guardian of the principal
for consideration by the court if protective proceedings for the principal or estate are commenced.
14-5504. Revocation; termination; effect; notice
A. The death of a principal who has executed a durable power of attorney does not revoke or terminate the
agency as to the agent or other person who, without actual knowledge of the death of the principal, acts in good
faith under the power. Any action taken in good faith pursuant to this subsection, unless otherwise invalid or
unenforceable, binds successors in interest of the principal.
14-5505. Continuance of durable powers of attorney by affidavit
A. An affidavit executed by the agent under a durable power of attorney stating that the agent did not have at the
time of exercise of the power actual knowledge of the termination of the power by revocation or of the
principal's death creates, in the absence of fraud, a rebuttable presumption of the nonrevocation or
nontermination of the power at that time.
ARS § 14-5506 (Misuse) – if the POA misuses their power (“intimidation or deception in procuring or in
any authority provided by the POA”), they can be liable for treble damages and could be disinherited if they were
to receive a devise.
ARS § 14-10602(E) – by implication, there probably has to be an expressed provision in the power of attorney to allow for the
creation of a trust. Explicit reference, even if allowing an agent to transfer property into a trust, different than the
power to create a trust.
D. Care for the Individual (HEALTH CARE)
OVERVIEW: If a person has not planned ahead of time concerning his healthcare, then we have a choice of statue
dealing with surrogate health care providers
• ARS § 36-3231 Surrogate Decision Makers – medical professionals should look to a medical POA first or
if there is a court appointed guardian, if none, then there is an order of succession for family and then a close
friend.
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Better to create a healthcare power of attorney (36-3221), as well as a living will.
• ARS § 36-3211 Health Care Power of Attorney – appointing an agent to make healthcare decisions. The
doctor will determine when the principal cannot make informed consent any more.
• There are unique requirements for the creation of this document, including limitations on who can be a
witness.
• Within healthcare POA, a living will gets attached to this, and deals with end of life decisions. ("if I
have an incurable injury, disease, etc. or in an irreversible vegetative state, just wants pain medication, and
nothing else.")
o Agent must follow these guidelines in consultation with physicians.
• Part of healthcare POA can include funeral arrangements. Including what is to happen with their body
(person should do this if they want to be cremated.
ARS § 36-3261 Living Will: provides end of life guidance and can make the guidance binding, or make it
guidelines.
46-456. Duty to a vulnerable adult; financial exploitation; civil penalties; exceptions; definitions
A. A person who is in a position of trust and confidence to a vulnerable adult shall use the vulnerable adult's assets
solely for the benefit of the vulnerable adult and not for the benefit of the person who is in the position of
trust and confidence to the vulnerable adult or the person's relatives unless any of the following applies:
1. The superior court gives prior approval of the transaction on a finding that the transaction is for the benefit of
the vulnerable adult.
2. The transaction is specifically authorized in a valid durable power of attorney that is executed by the vulnerable
adult as the principal or in a valid trust instrument that is executed by the vulnerable adult as a settlor.
3. The transaction is required in order to obtain or maintain eligibility for services under title 36, chapter 29.
4. The person in the position of trust and confidence to the vulnerable adult is the vulnerable adult's spouse and the
transaction furthers the interest of the marital community, including applying for benefits pursuant to title 36,
chapter 29 or benefits for supplemental security income, medicare or veterans' administration programs.
17. RIGHTS OF SURVIVING SPOUSE
Community Property: ARS § 25-211 all property acquired during a marriage, except property acquired by
gift, devise (including gifts between spouses), or descent.
• All property acquired during the marriage is presumed to be community property (does not matter who
holds title).
• Determination of community ceases upon filing dissolution of marriage.
ARS § 25-213 (separate property) – property acquired prior to marriage, and gifts, devise, and descent
during marriage, to include increases in value, rents, etc.
ARS 25-214(b) spouses have equal control over community property, some transactions require consent by
both parties, notably the disposition of community real property.
• Note: so long as the two shares are equivalent or equivalent value, you can have Blackacre for one spouse
and Whiteacre for another spouse and both do not have to receive 50% of each (INTEREST?)
*Marriage - ARS § 25-111 – requirements for marriage, in addition, if valid where it was made and the couple
moves to Arizona, it is valid here (includes common law marriage in a jurisdiction where it is accepted). If they
have just lived in Arizona, no common law marriage (not recognized in AZ).
Migrating Couples – coming from separate property state to community property state. Basic rules:
1. Wherever real property is located, the law of that jurisdiction governs that real property.
2. The law of the matrimonial domicile when property is acquired governs that property (i.e. controls the
characterization of that property).
3. The matrimonial domicile at death governs the rights of the surviving spouse.
Note: Because of this, the character of the property remains the same, if separate property in a different state,
separate property in Arizona.
Note: We DO NOT apply quasi community property at death. It ONLY applies at dissolution of marriage.
Questions
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Spouse 1 has a million, Spouse 2 has 9 million. Then move to AZ. What happens to the property?
o A: It remains the same. Just because they move here, the property ownership does not change.
• What happens if they move to AZ and then move?
o Court applies "quasi-community property" and will divide the proeprty equitably, which basically
means they will divide the property into 1/2 shares for each spouse.
• What happens if they move to AZ and spouse 2 dies? What is includable in spouse 2's probate estate?
o 1/2 of community property and all of their separate property. So here, 9 million dollars is includable
because this is spouse 2's separate property, and nothing else.
▪ Because there is no community property yet.
Quasi-community property: property owned by spouse acquired while domiciled elsewhere, which would have been
characterized as community property if the couple had been domiciled in a community property state when the
property was acquired.
- Does not apply to real property situated outside the state
- This Principle of equity APPLIED AT DIVORCE, not death. But surviving spouse will get statutory
allowances.
S1 has $15M and S2 has $10,000. They move from Chicago to Arizona. They are in Arizona for one week. They’re
staying at a resort in Scottsdale. They decide to divorce.
- Apply concept of quasi-community property.
- Would result in $7.5M to each spouse.
Contrast that with same facts, spouse1 has will. Leaves everything to favorite charity, nothing to S2. S1 accidentally
drowns in resort swimming pool. If they divorce, S2 is entitled 7.5M. But if they didn’t divorce, we do not apply
quasi-community at death!!! S2 entitled to his or her statutory allowances.
Practice: Becker almost always takes separate property and converts it to community property. It's beneficial at
death, and if they divorce, it will be quasi community property anyway. Community property also has significant
beneficial tax effects.
STATUTORY ALLOWANCES
Statutory Allowances – applies when the domicile of the decedent is in Arizona, regardless of domicile of
surviving spouse or children.
o **All of these allowances have priority over creditors, but not cost of administration.
o In addition, there is an offset provision for anything received at death by will or non-probate property.
o Surviving sposue is beneficiary of $50,000 life insurance policy. That $50,000 offsets ALL of the
statutory allowances, and the spouse does not collect any of the statutory allowances.
A. ARS § 14-2402 Homestead Allowance - $18,000, to surviving spouse, if none, then to minor and
dependent children divided equally.
B. ARS § 14-2403 Exempt Property Allowance - $7,000 payable in kind first.
C. ARS § 14-2404 Family Allowance - $12,000 in practice unless there is a petition to the court.
Note: These statutory allowances cannot be defeated by a will, but could be waived by the surviving spouse, as
well as his or her interest in the deceased spouse's estates (ARS 14-2207)
•
ANTENUPTIAL AGREEMENT: An agreement made before marriage usually to resolve issues of support and
property division if the marriage ends in divorce or by the death of a spouse.
Spousal Wavier, ARS § 14-2207
A. A surviving spouse may waive the person's homestead allowance, exempt property and family allowance rights
in whole or in part either before or after marriage by a written contract, agreement or waiver that is signed
by the surviving spouse.
• Waiver has to be voluntary and conscionable (definition of unconscionable in the statute).
• The general rule is that both spouses have to represented by counsel, if not, probably will not be upheld.
(Possible exception: regular family law attorney)
• “Voluntarily” means not too close to marriage (invites been sent out), if there are already obligations that
have been made, not considered voluntary agreement. START EARLY
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•
Reece v. Elliott: An antenuptial agreement is valid if a fair disclosure is made of a spouse’s assets and
the other spouse had the opportunity to ask questions and learn the extent of the other’s holdings, even
if he or she did not do so.
A joint and mutual will is insufficient to raise a presumption of contract between Wilma and Hank.
It is very difficult to prove abuse of discretion by a trustee, but bad faith, animus toward the beneficiary, and similar
improper motives will establish abuse.
Heirs are always determined at the time of death….?
With respect to an irrevocable trust, a creditor or assignee of the settlor may reach the maximum amount that can
be distributed to or for the settlor’s benefit.” This is in accordance with the traditional rule. The rule applies
regardless of whether the trust contains a spendthrift provision.
An inter vivos trust of personal property need not be in writing. The statute of frauds requires that a trust of real
property be in writing.
In general, to have standing to challenge a will one must have a direct pecuniary interest in the success of the will
contest.
Revocable trusts may save some probate fees, but no estate taxes
A discretionary trust is one in which the trustee is given discretion to decide who shall receive trust funds or
discretion to decide how much of the trust funds a beneficiary shall receive.
An honorary trust is a trust-like gift that is not intended to benefit the transferee and does not have any specific
beneficiary who can enforce the trust as a gift, but has a specific non-charitable purpose
To be effective as an inter vivos gift, there must be a delivery of the deed to the donee or at least to an agent of the
donee.
14-3801. Notice to creditors
A. Unless notice has already been given under this section, at the time of appointment a personal representative
shall publish a notice to creditors once a week for three successive weeks in a newspaper of general
circulation in the county announcing the appointment and the personal representative's address and notifying
creditors of the estate to present their claims within four months after the date of the first publication of the
notice or be forever barred.
B. A personal representative shall give written notice by mail or other delivery to all known creditors,
notifying the creditors of the personal representative's appointment. The notice shall also notify all known
creditors to present the creditor's claim within four months after the published notice, if notice is given as
provided in subsection A, or within sixty days after the mailing or other delivery of the notice, whichever is
later, or be forever barred. A written notice shall be the notice described in subsection A or a similar notice.
C. The personal representative is not liable to a creditor or to a successor of the decedent for giving or failing
to give notice under this section.
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