Estate of Duke – Open The Floodgates!

The California Supreme Court ruled in Estate of Duke (2015) 2015 Cal.Lexis 5119, that a will may be reformed if clear and convincing extrinsic evidence shows a mistake in the expression of the testator’s intent, even if there is no ambiguity in the instrument.  This is a pretty significant change from existing law, whiclawbooks2h barred admission of extrinsic evidence if there was no ambiguity in the instrument.  The Supreme Court said “the categorical bar on reformation of wills is not justified.”  Does this mean that the “floodgates of litigation” will be opened now that any document can be challenged?  The Supreme Court didn’t think so, and in any event said “fear of additional burdens is not an adequate reason to deny relief that would serve the paramount purpose of distributing property in accordance with the testator’s intent.”

The story starts in 1984 with Irving Duke’s holographic will.  He left his estate to his wife Beatrice, and in the event that he and Beatrice died “at the same moment,” then his estate was to be distributed equally to the City of Hope and the Jewish National Fund.  The will said nothing about what was to happen if Beatrice died before Irving.

“An unambiguous will may be reformed to conform to the testator’s intent if clear and convincing evidence establishes that the will contains a mistake in he testator’s expression of intent at the time the will was drafted, and also establishes the testator’s actual specific intent at the time the will was drafted.”

So guess what happened?  Beatrice died in 2002.  Five years later, in 2007, Irving died, having not changed his will.  He was not married and had no children.  City of Hope and the Jewish National Fund petitioned for probate of Iriving’s will.  Irving’s nephews filed a petition to determine entitlement to the estate.  They argued that the will called for the gifts to the charities only in the event that Irving and Beatrice died simultaneously, and since that didn’t happen, the charities get nothing.  They also argued that because the will was silent on what happens if Irving outlives Beatrice, Irving’ s estate goes to his intestate heirs, (i.e., the nephews).

The charities were not giving up so easily.  They sought to introduce evidence that Irving intended that his estate go to the charities in the event that he outlived his wife, and that he did not intend his estate to go to his intestate heirs. They argued that Irving’s failure to provide for disposition of his estate in this event was a mistake, and that the will should be reformed to comport with what the evidence showed was his intent.

The trial court had none of this.  They ruled that the will was unambiguous (and, by implication, that the failure to provide for a disposition in the event Irving outlived Beatrice did not create an ambiguity), and that California law is clear that extrinsic evidence is not allowed to show the testator’s intent when the will is unambiguous.  The charities appealed, and the court of appeals affirmed the trial court, but noted that “[i]t is difficult to imagine that after leaving specific gifts to the charities in the names and memories of beloved family members, Irving intended them to take effect only in the event that he and his wife died ‘at the same moment.'”  Nevertheless, the court of appeal ruled that since the will itself was unambiguous, extrinsic evidence could not be considered.

The California Supreme Court reversed the court of appeals, and held that it was now time to change the law and allow the consideration of extrinsic evidence of the testator’s intent to reform a mistake in a will even if the will was unambiguous.  The court held that a will that is unambiguous “may be reformed to conform to the testator’s intent if clear and convincing evidence establishes that the will contains a mistake in the testator’s expression of intent at the time the will was drafted, and also establishes the testator’s actual specific intent at the time the will was drafted.”

Clear and convincing evidence is a hefty burden of proof.  While there may very well be more litigation that takes advantage of this law, or at least more people meeting with lawyers to see if they have a case, the high burden of proof needed to reform an unambiguous will may very well serve to slow those floodgates.

Estate of Duke – Open The Floodgates!

Basics of Estate Planning in the Post-ATRA World at Bar Association of San Francisco on June 24

I’ll be presenting at the Bar Association of San Francisco on Wednesday, June 24, 2015 from Noon to 1:30.  The topic will be “The Basics of Estate Planning in the Post-ATRA World.”BASF Logo

The American Taxpayer Relief Act of 2012 has effectively repealed the estate tax for all but the wealthiest Americans.  I’ll be talking about ATRA and how it has changed the techniques used by estate planners.

Click here to view the BASF website and register.  This presentation is also available as a webcast.

Looking forward to seeing you in person, or online!

Basics of Estate Planning in the Post-ATRA World at Bar Association of San Francisco on June 24

Speaking at PFAC San Mateo Chapter on February 20th

Trust Administration: The First 100 days.  On February 20th from noon to 2:00 p.m. I will be speaking at at the San Mateo chapter of the Professional Fiduciary Association of California, or PFAC.  This is the chapter’s monthly meeting, and is open to chapter members.  You can find out more about PFAC San Mateo chapter here.

Here’s a quick summary of the presentation:

“For most trusts, the first 100 days is when most of the administration work is done.  The fiduciary’s work during this period can lay a foundation for a smooth and efficient administration.  This presentation will provide fiduciaries with the tools they need to get any trust administration started on the right track.”

If you are a member of San Mateo PFAC, I hope to see you on February 20th!

If you are not a member, but this presentation sounds interesting to you, contact me about presenting to your organization.

Speaking at PFAC San Mateo Chapter on February 20th

Still Plugging Away

It has been nearly one year since the launch of Hand & Little, PC, and the two most common questions I get are “how’s it going?” and “what does ‘PC’ stand for?”  I’ll answer both in order.

How It’s Going

It is going better than I could have imagined.  That is a true statement, not a self-serving “Internet Statement.”  The biggest change in adding my name to the door is that people now call me directly.  I’ve been doing this a while now, and it is very gratifying and, frankly, humbling when people call asking to talk with me.  It is an honor and a privilege to serve my clients.  There are more than 100,000 attorneys practicing in California, and every time one of them chooses me to represent them, I am conscious of the fact that it could easily have been someone else they called, and that there is nothing keeping them from doing so even after they hire me.  It is my commitment to my clients to never make them feel like they should have hired someone else.  It is truly a privilege to be of service to you.

What Does “PC” Stand For?

“PC” stands for “Professional Corporation.”  That’s it. Not very exciting.

What to look for in 2015

A big part of my commitment to my clients is in constantly improving the service I provide.  I have been practicing law for nearly 15 years, and I learn something new with every client.  It is a tremendous gift to have chosen a line of work that gives me that opportunity.

Look for more posts consisting of “long form” treatment on this blog, and more use of other platforms like Twitter for the quick sharing of a link or other tidbit that doesn’t require a lot of input from me.

And let me know what you think.  I always am flattered when I get emails and comments on my posts.

Still Plugging Away

Next Speaking Engagement: CEB Basics Conference Sep. 18 & 19

Late notice, I know, but I will be presenting at Continuing Education of the CEB Basics ConferenceBar’s Basics Conference on Thursday, September 18 and Friday September 19 on will and trust drafting.  This is the third annual conference, and it is a great way for the total novice to estate planning to get a great overview.

For details, check out the CEB website.

Hope to see you there!

Next Speaking Engagement: CEB Basics Conference Sep. 18 & 19

Probate Legislation Wiki – Everyone gets a say

California Assemblyman Mike Gatto (D-Los Angeles) has introduced a program for public commentary on proposed legislation called a “wiki-bill.”  The “wiki” concept is intended to tap into the “wisdom of crowds” to provide a solution that is greater than what could be achieved by one person or even a small group (of, say, elected legislators, for example).  Assemblyman Gatto uses the website wikispaces to bring this to the legislative process, and his first subject is probate law.

If creating laws is like watching sausage being made, creating laws by crowdsourcing is, well, even scarier. I looked at the commentary on Assemblyman Gatto’s wiki site for proposed changes to the Probate Code sections regarding disqualification of trustees and beneficiaries, and trustee’s duties to report to beneficiaries.  Several of the contributors were badly misinformed about the laws or their meaning, and did not understand how these particular statutes interact with others in the Probate Code.

Hopefully, the wisdom of the crowd will prevail, and effective legislation will be created (or current legislation will remain the same, if it is determined that it does not need to be changed).  I must admit that I am somewhat skeptical of this innovation.  Time, I suppose will eventually sort out how crowds impact the world, and Assemblyman Gatto does deserve credit for trying something new.  Whether it achieves its purpose is yet to be seen.

Probate Legislation Wiki – Everyone gets a say