Bar Review: Trusts and Estates

Perhaps the most dreaded topic that can show up on the MEE (Multistate Essay Exam) is the topic of Trusts. At least that was true in 2008, when I sat for the Bar Exam. I’ll never forget the hubub that resulted after the morning essay portion of the exam. It was palpable! Back then, Trusts had just been tested on the February exam and past analysis of Bar trends stated that Trusts is never tested twice in a row.

Sooooooo…all of us were thrilled! We would not have to deal with bar review, trusts and estates, black-sheepthis black sheep subject. Whew! What a relief!

Until that morning when we opened our test. There it was. In all its confounded glory. A whopper of a Trusts question.

The room of course was largely silent. But you could almost FEEL a groan as 1000’s of students briefly looked over the questions and the realization sunk in. There’s a Trusts question! Many of us did not put much effort into studying this subject because “they said” it wouldn’t be on the exam.

G R O A N…

During the lunch break it was all ANYONE could talk about. It ticked bar review, trusts and estates, whiningme off more than a little. I DID NOT want to infect my psyche with all the babble and negativity just before walking into the afternoon portion of the exam. That is suicide. I had to get my food as quickly as possible and isolate myself in a corner with my headset blaring to get away from all the lamenting and whining. Even worse were the know-it-alls bragging that they nailed it. UGH!

I present you with this cautionary tale to urge you not to trust in the trends. The bar examiners are unpredictable. I personally believe that they chuckle at mixing it up so that it baffles students at the time of the exam. Who can keep their wits about them? Who bar review, trusts and estates, boomwill keep it together? Who will sink into despair and blow it?

Don’t be one of the people who gets sucked into despair. If anything unexpected happens, suck it up. Continue to focus on the task ahead, not behind, and you will do well.

Wills and Estates

Start by studying Wills and Estates. Intestate succession must be discussed if there is no Will after a person dies. It’s important to know what share is divided among the decedent’s relatives, including spouse, children, (adopted or otherwise), and any other relatives.

If there is a Will, it must meet the execution requirements of a valid will. It must be executed according to the governing law, and must comply with the law of domicile. Included in the question of validity are the understanding the rules surrounding foreign wills, and holographic wills.

What is the Will Comprised Of?

You will further need to asses what documents actually make up the Will. The issues to look for here are integration of papers into the Will, incorporation by reference, facts of independent significance, and pour-over wills.

Integration

There are two elements used to determine if a certain document should be integrated into a Will. These elements are:

  • Intent of the Decedent
    • It must be found that the decedent intended that a particular document to be a part of his/her will.
  • Presence
    • The document in question must have been present at the signing of the Will.

Incorporation by Reference

If a document is not integrated, there may be a question as to whether it should be incorporated by reference. This occurs when a decedent states something like “I leave $100,000 to the grantee named on the deed to XXX building.”

OK. Great. Now what? The decedent did not name the person directly. So we must look to the deed to XXX and see whose name appears on it. That document now enters probate, as it is necessary in order to carry out the decedent’s wishes.

There are four requirements for a document to be incorporated by reference:

  • It must be a document or a writing;
  • The document must have been in existence when the Will was executed;
  • The document must be clearly identified in the Will; and
  • Decedent must have intended to incorporate the document into the Will

Facts of Independent Significance

This comes up when the testator puts a clause in her Will that references something outside of the four corners of the document. For example: “I leave $5000 to my church.” Well, the Will does not state which church she goes to. What to do!? This is when we look outside of the Will to determine what she meant.
bar review, trusts and estates, church
Always ask yourself this question. Would this fact have existed even if a Will was never written? In the church example, the answer is yes. The testator went to a specific church. That is just a fact. Of course, in a will scenario we would have to introduce extrinsic evidence proving which church she belonged to, and such evidence is admissible to “fill in the blanks” left in a Will.

Pour-Over Wills

This is another problem that arises in interpretation of a Will. If a testator states that he wants his money to go to the trustee of a inter-vivos trust, to be distributed according to the terms of the trust, this is a Pour-Over Will. Think of the money pouring over to the trustee, and then pouring over to the beneficiaries to whom the trustee distributes the money.

The problem here should be obvious. Who is the Trustee? Who are the beneficiaries? The Will does not state this information, so we must again go outside of the four corners of the paper to find out. The basic problem here is that we want to abide by the Statute of Wills. We can’t just admit parole evidence willy-nilly. So we must abide by rules as to what can be “added” to the Will.

There are three ways to validate this pour-over provision:

  • Incorporation by Reference
  • Independent Significance
  • Uniform Testamentary Additions to Trusts Act (UTATA)

Wills and Estates is a complex subject, and these are just a few of the basics you will need to know.

Trusts

Trusts is another complex topic. You must know Trust classifications, which are Revocable, Irrevocable, Testamentary, Pour-Over, and Charitable. The creation of a valid trust requires trust res, a beneficiary, and a trustee.

The powers and duties of a trustee are subject to:

  • Prudent person rule
  • Duty of care
  • Duty of loyalty
  • Duty to act impartially
  • Principal and income allocations

Additionally, it is important to know about future interests and Trust construction issues.

As I’ve said, both Trusts, Wills and Estates are complex topics that cannot be given complete coverage in this article. You must grab yourself a great outline and start memorizing. I would suggest that for this one, you start with an extensive outline so your understanding is complete. Then, as you commit the rules to memory, reduce it down. And down. And down.

It might be a good idea to create flash cards once you have these subjects reduced as much as possible. You need to have a good working knowledge of the basics. The more law you can spit out in your essay, the more points you pick up!

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