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ESTATE PLAN BY DEFAULT-THE LAW OF INTESTATE SUCCESSION.

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Presentation on theme: "ESTATE PLAN BY DEFAULT-THE LAW OF INTESTATE SUCCESSION."— Presentation transcript:

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2 ESTATE PLAN BY DEFAULT-THE LAW OF INTESTATE SUCCESSION

3 SHARE OF INTESTATE’S SPOUSE Under the Common Law Dower Curtesy Uniform Probate Code Iowa Probate Code

4 JANUS V. TARASEWICZ

5 Simultaneous Death Problem #1, Page 85 Does the UPC 120 hour rule, solve the problem created by the “no sufficient evidence rule” of the UPC.

6 SHARES OF INTESTATE’S CHILDREN SHARE OF CHILDREN Uniform Probate Code Iowa Code

7 SHARES OF INTESTATE’S MORE REMOTE DESCENDANTS (Grandchildren, great-grandchildren, etc. CHILDREN vs. ISSUE (Descendants) Immediate Offspring More remote descendants PER CAPITA DISTRIBUTION PER STIRPES DISTRIBUTION

8 A’s Family Tree A BCED

9 A’s Growing Family Tree A BCED gb2gb1gb3

10 A’s More Growing Family Tree A BCED gb2gb1gb3gc

11 A’s More Growing Family Tree A BCED gb2gb1gb3gcgd1gd2

12 A’s Whole Family Tree A BCED gb2gb1gb3gcgd1gd2ge

13 A’s Whole Family Tree A gb2gb1gb3gcgd1gd2ge

14 A’s Family Tree Children, Grandchildren and More Remote Descendants All issue survive: B, C and D take 1/3 each

15 A’s Family Tree Children, Grandchildren and More Remote Descendants B, C and D predecease A Under UPC: E through K take 1/7 each In Iowa: E and F take 1/6 G, H and I take 1/9 J and K take 1/6

16 A’s Family Tree Children, Grandchildren and More Remote Descendants B, C, D, F and J predecease A. Under the UPC: E, G, H, I and K take 1/7 M, N O and P take 1/14 (2/28) In Iowa: E takes 1/6 M, N and O take 1/18 G, H, and I take 1/9 J and K take 1/6

17 A’s Family Tree Children, Grandchildren and More Remote Descendants B, C, F, G, H, I, J and K predecease A Under the UPC: E takes 1/3 M, N, O and P take 1/6 (2/12) In Iowa: E takes ¼ M, N and O take 1/12 P takes 1/2

18 Negating Inheritance

19 Shares of Intestate’s Ancestors and Collaterals Civil law consanquinity, page 92 Parentelic method: Parents Their Descendants Whole Blood Half Blood

20 F SF I M BA F and M have Child A and Child I M and F divorce or F dies. Then M marries SF; they have Child B I dies. A takes ½ from F, and ¼ from M B takes ¼ from M HALF-BLOOD INHERITANCE 1/2

21 Shares of Intestate’s Ancestors and Collaterals Parents and their issue Grandparents and their issue Great-grandparents and their issue (Iowa but not UPC) Issue of intestate’s deceased spouse Collateral Relatives The Iowa Early “Escheat” Rule

22 The Meaning of Children Adopted Children Legally Adopted Equitable (virtual) adoption Children born out-of-wedlock Inheritance from mother Inheritance from father

23 The Meaning of Children Posthumous Children Conceived before death Coitus Post-death implantation of embryo created before death with decedent’s egg or sperm Conceived after death Post-death conception using decedent’s sperm or egg Post-death implantation of embryo created before death with decedent’s egg or sperm

24 HALL vs. VALLANDINGHAM

25 Adopted Children Take from adopting parents Do not take from biological parents Step-parent adoption exception

26 Step-Parent Adoption Exception DadMom Child

27 Step-Parent Adoption Exception DadMom Child

28 Step-Parent Adoption Exception DadMom Child Dad #2

29 Step-Parent Adoption Exception DadMom Child Dad #2 Adoption

30 Step-Parent Adoption Exception Dad Grandma Mom Child Dad #2 Adoption

31 Adopted Children For purposes of intestate succession Under the will of: The adopter Third persons E.g., T wills property to A for life, then to A’s children

32 New Reproductive Technologies Children born to married persons with use of artificial insemination Husband as donor Stranger as donor Surrogacy Inheritance from contracting parents Inheritance from biological parents Inheritance from birth mother

33 Adopted Adults For intestacy purposes Under will of third party

34 O’Neal v. Wilkes Facts, holding, and critique Equitable (or virtual) adoption Requirements Promise to adopt Holding out Inheritance from: Promisor Others “Adopted child”

35 Biological Child (Once known as Child- Born-Out-of-Wedlock or Illegitimate) Inherit from Mother And through Inherit from Father And through? Proof issues: Evidence proving paternity available during father’s lifetime General and notorious recognition Recognition in writing Should there be a distinction? Would a distinction be constitutional?

36 Posthumous Children Children conceived before intestate’s death Children conceived after intestate’s death Massachusetts and New Jersey cases

37 Hecht vs. Superior Court

38 Advancements Common law rule Purpose of rule Creation of the hodgepot

39 Parent has $450,000 Parent gives $50,000 to Child A Parent dies with $400,000 and three children, A, B and C Court determines transfer to A was an advancement Hodgepot $400,000 (probate estate 50,000 (advancement $450,000 /3== $150,000 From $400,000 Probate Estate: A gets $100,000 and each of B and C gets $150,000

40 Advancements Problems with the rule Statutory solutions UPC Iowa Code Problem, page 131

41 Problem 136

42 Bars to Succession Homicide Disclaimer

43 Homicide Should slayer be barred? If slayer should be barred, Is slayer deemed to have predeceased victim? Does slayer hold as constructive trustee? In Re Estate of Mahoney

44 Homicide Iowa Code (1) Effects of Criminal conviction Criminal acquittal

45 Disclaimer Common law rules Intestacy Wills Reasons to permit Tax savings Defeat creditors claims

46 Disclaimer Statutory rules Federal law I.R.C Iowa Code

47 Problem and Cases Troy v. Hart What are the facts of this case? Was the disclaimer motivated by a desire to “swindle” Medicaid. Was the disclaimer valid? Can Medicaid get reimbursed? Should Medicaid be reimbursed? Problem, page 150

48 Iowa Code (1) A person who intentionally and unjustifiably causes or procures the death of another shall not receive any property, benefit, or other interest by reason of the death as an heir, distributee, beneficiary, appointee, or in any other capacity whether the property, benefit, or other interest passed under any form of title registration, testamentary or nontestamentary instrument, intestacy, renunciation, or any other circumstance. The property, benefit, or other interest shall pass as if the person causing death died before the decedent.

49 Iowa Code When the owner of property transfers it as an advancement to a person who would be an heir of such transferor were the latter to die at that time, and the transferor dies intestate, then the property thus advanced shall be counted toward the share of the transferee in the estate, (which for this purpose only shall be increased by the value of the advancement at the time the advancement was made). The transferee shall have no liability to the estate for such part, if any, of the advancement as may be in excess of the transferee's share in the estate as thus determined. Every gratuitous inter vivos transfer is presumed to be an absolute gift, and not an advancement. Such presumption is rebuttable.

50 Section If the decedent dies intestate leaving a surviving spouse and leaving no issue or leaving issue all of whom are the issue of the surviving spouse, the surviving spouse shall receive the following share: 1. All the value of all the legal or equitable estates in real property possessed by the decedent at any time during the marriage, which have not been sold on execution or by other judicial sale, and to which the surviving spouse has made no relinquishment of right. 2. All personal property that, at the time of death, was, in the hands of the decedent as the head of a family, exempt from execution. 3. All other personal property of the decedent which is not necessary for the payment of debts and charges. IC

51 SECTION If the decedent dies intestate leaving a surviving spouse and leaving issue some of whom are not the issue of the surviving spouse, the surviving spouse shall receive the following share: 1. One-half in value of all the legal or equitable estates in real property possessed by the decedent at any time during the marriage, which have not been sold on execution or by other judicial sale, and to which the surviving spouse has made no relinquishment of right. 2. All [exempt] personal property. 3. One-half of all other personal property of the decedent which is not necessary for the payment of debts and charges. 4. If the property received by the surviving spouse under subsections 1, 2 and 3 of this section is not equal in value to the sum of fifty thousand dollars, then so much additional of any remaining homestead interest and of the remaining real and personal property of the decedent that is subject to payment of debts and charges against the decedent's estate, after payment of the debts and charges, even to the extent of the whole of the net estate, as necessary to make the amount of fifty thousand dollars.

52 SECTION (1) The part of the intestate estate not passing to the surviving spouse, or if there is no surviving spouse, the entire net estate passes as follows: 1. To the issue of the decedent per stirpes. Children Slide Descendant Slide

53 SECTION (2-3) The part of the intestate estate not passing to the surviving spouse, or if there is no surviving spouse, the entire net estate passes as follows: If there is no surviving issue, to the parents of the decedent equally; and if either parent is dead, the portion that would have gone to such deceased parent shall go to the survivor. 3. If there is no person to take under either subsection 1 or 2 of this section, the estate shall be divided and set aside into two equal shares. One share shall be distributed to the issue of the decedent's mother per stirpes and one share shall be distributed to the issue of the decedent's father per stirpes. If there are no surviving issue of one deceased parent, the entire estate passes to the issue of the other deceased parent in accordance with this subsection. Parents

54 Section (4) AND (5) 4. If there is no person to take under subsection 1, 2, or 3 of this section, and the decedent is survived by one or more grandparents or issue of grandparents, half the estate passes to the paternal grandparents, if both survive, or to the surviving paternal grandparent if only one survives. If neither paternal grandparent survives, this half share shall be further divided into two equal subshares. One subshare shall be distributed to the issue of the decedent's paternal grandmother per stirpes and one subshare shall be distributed to the issue of the decedent's paternal grandfather per stirpes. If there are no surviving issue of one deceased paternal grandparent, the entire half share passes to the issue of the other deceased paternal grandparent and their issue in the same manner. The other half of the decedent's estate passes to the maternal grandparents and their issue in the same manner. If there are no surviving grandparents or issue of grandparents on either the paternal or maternal side, the entire estate passes to the decedent's surviving grandparents or their issue on the other side in accordance with this subsection. 5. If there is no person to take under subsection 1,2,3, or 4 of this section, and the decedent is survived by one or more great-grandparents or issue of great- grandparents, the estate passes equally to each set of great-grandparents, or to their issue, if any survive, per stirpes. G-Parents

55 Section (5-6) 5. If there is no person to take under subsection 1, 2, 3, 4, or 5 of this section, the portion uninherited shall go to the issue of the deceased spouse of the intestate, per stirpes. If the intestate has had more than one spouse who died in lawful wedlock, it shall be equally divided between the issue, per stirpes, of those deceased spouses. 6. If there is no person who qualifies under either subsection 1, 2, 3, 4, or 5 of this section, the intestate property shall escheat to the state of Iowa (2-3) (4)

56 Effect of Adoption Iowa Code (1)-(2) 1.Except as provided in subsection 3, a lawful adoption extinguishes the right of intestate succession of an adopted person from and through the adopted person's biological parents. The adopted person inherits from and through the adoptive parents in the same manner as a biological child inherits from and through the child's biological parents. 2. Except as provided in subsection 3, a lawful adoption extinguishes the right of intestate succession of a biological parent from and through the parent's biological child who is adopted. The adoptive parents inherit from and through the adopted person in the same manner as biological parents inherit from and through the parents' biological child. Go To (3)-(4)

57 Step-Parent Adoption Iowa Code (2)-(3) 3. An adoption of a person by the spouse or surviving spouse of a biological parent has no effect on the relationship for inheritance purposes between the adopted person and that biological parent or biological parent's heirs. An adoption of a person by the spouse or surviving spouse of a biological parent after the death of the other biological parent has no effect on the relationship for inheritance purposes between the adopted person and the deceased biological parent's heirs. 4. A person inherits through an adopted person, an adoptive parent, or a biological parent of an adopted person only if the adopted person, adoptive parent, or biological parent of an adopted person would have inherited under subsection 1, 2, or 3. IC 633(1)-(2)

58 Posthumous Children Iowa Code Heirs of an intestate, begotten before the intestate's death but born thereafter, shall inherit as if they had been born in the lifetime of the intestate and had survived the intestate. With this exception, the intestate succession shall be determined by the relationships existing at the time of the death of the intestate.

59 Children Born Out-of- Wedlock Iowa Code & Biological child--inherit from mother Unless the child has been adopted, a biological child shall inherit from the child's biological mother, and she from the child Biological child--inherit from father Unless the child has been adopted, a biological child inherits from the child's biological father if the evidence proving paternity is available during the father's lifetime, or if the child has been recognized by the father as his child; but the recognition must have been general and notorious, or in writing. Under such circumstances, if the recognition has been mutual, and the child has not been adopted, the father may inherit from his biological child.


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