KEEPING CURRENT P R O B AT E CASES ADEMPTION: Specific gift adeems but reformation is possible. Spouses created a trust ending on the death of both, at which time the trustee is to distribute “all” of the stock in a private bank and all stock in a publicly traded corporation to the children of one spouse. The remainder of the trust property would go to the children of the other spouse. Before termination of the trust, the bank redeemed its stock and the trust received cash. In Connery v. Shea, 259 A.3d 118 (Me. 2021), the Maine high court affirmed a motion for summary judgment based on ademption of the gift of the bank stock. The court held that because the constructional rules applicable to wills also apply to trusts, the word “all” made the gift equivalent to a specific bequest in a will and remanded to consider reforming the trust to reflect the settlor’s intent. ADOPTION: Adopted-out descendant is included in an ancestor’s class gift made before the adoption. The settlor’s great-grandchild was adopted by a stepsibling after the parent lost custody of the great-grandchild. In Murphy v, Shehan, 633 S.W.3d 350 (Ky. Ct. App. 2021), the Kentucky intermediate appellate court affirmed the lower court holding that the adopted person was still a descendant of the settlor and therefore remained as a beneficiary of the trust. This is because the adoption did not end the biological relationship to the family before the adoption.
Keeping Current—Probate Editor: Prof. Gerry W. Beyer, Texas Tech University School of Law, Lubbock, TX 79409, gwb@ ProfessorBeyer.com. Contributors: Claire G. Hargrove, Paula Moore, Kerri G. Nipp, Prof. William P. LaPiana, and Jake W. Villanueva.
Keeping Current—Probate offers a look at selected recent cases, tax rulings and regulations, literature, and legislation. The editors of Probate & Property welcome suggestions and contributions from readers.
ADOPTION: Blanket prohibition on appointment to adopted persons violates public policy. An inter vivos trust created a testamentary general power of appointment in the life income beneficiary. Many years after the beneficiary adopted the beneficiary’s stepchildren, the settlor amended the trust to prohibit the exercise of the power of appointment for the benefit of anyone adopted by another person or such person’s issue or ancestors. In Todd v. Hilliard Lyons Tr. Co., LLC as Tr. Under Will of Todd, 633 S.W.3d 342 (Ky. Ct. App. 2021), the Kentucky intermediate appellate court reversed the trial court’s grant of summary judgment for the trustee enforcing the restriction. The court held that it violated the public policy embodied in the statutory requirement in Ky. Rev. Stat. Ann. § 199.520(2) that adopted children be treated the same as “biological children” of the adoptive parent. FAMILY ALLOWANCE: The surviving spouse is entitled to a family allowance although the decedent was not survived by minor children. In In re Est. of Dowdy, 2021 COA 136, 2021 WL 5114690, the Colorado intermediate appellate court held that the family allowance under Colo. Rev. Stat. § 15-11-404 (identical to UPC § 2-404) for the surviving spouse and minor children, whom the decedent was
obligated to support, must be paid to a surviving spouse even though the decedent was not survived by minor children. HOLOGRAPHIC WILLS: A holographic will is invalid because it was not signed at the end. The decedent’s validly executed will was without effect because it devised the entire estate to decedent’s spouse, who predeceased. Three documents in the decedent’s handwriting were found after the decedent’s death; the decedent signed all three at the tops of the pages. In Willett v. Estate of Vesselle, 629 S.W.3d 20 (Ky. Ct. App. 2021), the Kentucky intermediate appellate court reversed the trial court’s finding that the will and the handwritten documents were a valid will and codicils. The court held that the will was without effect because the spouse had predeceased and that the documents were not valid testamentary instruments because they were not “subscribed at the end or close of the writing” as required by Ky. Rev. Stat. Ann. § 446.060. OPERATING AGREEMENT: Provision in limited liability company’s operating agreement purporting to transfer a member’s interest on death was invalid as testamentary substitute. In Potter v. Potter, 252 A.3d 17 (Md. Ct. Spec. App. 2018), the court held that a provision in an LLC operating agreement providing that, on the owner’s death, the owner’s interest would pass to the owner’s surviving spouse created an invalid testamentary substitute. The Maryland Court of Appeals recently granted certiorari. Potter v. Potter, 476 Md. 238 (2021). SPOUSAL ALLOWANCE: The statutory spousal allowance must be satisfied first from the probate estate passing to spouse. The surviving spouse claimed the statutory
Published in Probate & Property, Volume 36, No 2 © 2022 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
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March/April 2022
