A survey recently conducted by the website Rocket Lawyer reveals that 57% of all adults in the US do not have either a will or a trust in place. That’s actually a better result than most surveys previously conducted which show as much as 70% of the adult population have no estate planning documents in place.
Other interesting findings from the Rocket Lawyer survey include the following:
º More men than women (61% to 53% do not have a will or trust – despite often being the primary breadwinner in the household.
º More than 22% of people over 65 do not have a will, despite their advanced age.
º Thirty-two percent (32%) of those surveyed responded that they would rather give up sex for a month, or sit through a root canal, rather than create or update their will, or other estate planning documents.
º More Republicans have wills than Democrats (46% to 37%).
Rocket Lawyer suggests that you create a will as cheaply as possible. My recommendation is that you avoid do it yourself wills. There are too many potential pitfalls in doing your own will that can jeopardize the very purpose for which you are creating the will, or other estate planning documents.
Will must be executed with a formality that is dictated by statutes that vary from state to state. What is satisfactory to establish a valid last will in one state may be insufficient, as a matter of law, in another state. My experience is that most do it yourself wills fail becuase the document is not properly signed, with the appropriate witnesses and notarization.
We recently have been invovled with assisting a woman who’s former husband passed away a few months ago. The former husband began his will preparation by taking portions of a will that was prepared by an attorney for him in the early 1980’s. He then cut out provisions from the old will that still reflected his desires with respect to the distribution of his million dollar estate. He pasted those provisions together with some handwritten provisions. The handwritten parts provided for significant benefits for our client, who he divorced a few years before his death. Despite the divorce, they continued to live together and were still very close right up until his death.
Then he pasted the handwritten portions with the portions he copied from the 1980s will, and signed the will. However, the signature section of the will did not include all of the formalities provided by Florida law. The will was thus invalid. As his divorced spouse, she was entitled to nothing from his estate under Florida law. Instead, his estate went to the daughter of the woman to whom he was married in the 80s, but from whom he divorced in the early 90s.
So, even though the handwritten provisions of the do it yourself will clearly expressed his intention to benefit his second wife, with whom he lived at the time of his death, she received absolutely nothing because the will was not properly signed.
A recent Florida appellate court case is illustrative of another reason to use qualified counsel to prepare estate planning documents. Though it deals with a revocable living trust, the issue that prevented the trust from accomplishing the trustmaker’s objectives was one of pure estate law derived from the Florida statutes, dealing with “abatement.” The case is Reid v. Estate of Sonder, that was decided by the Third District Court of Appeal of Florida on March 23, 2011.
The legal issue surrounding “abatement” is this: if the willmaker, or trustmaker, provides for distribution to more than one person, and there is insufficient assets in the probate estate or trust to satisfy all of the distributions, then each distribution takes an equal share of what is remaining in the probate estate or trust. For instance, if a willmaker provided that individual A and individual B were to each get $1,000, but there was only $100 in the estate at the time of his death, each individual, A and B, would receive $50 each. Florida Statutes, Section 733.805 provides the order in which specific gifts under a will or trust will “abate.”
The abatement statute provides a good example of a legal “rule of construction” that is applicable to all Florida wills and trust, and is not a part of the actual text appearing in the will or trust that is signed by the willmaker or trustmaker.
The failure to consider the abatement statute, and deal with it effectively in the disposition of an estate through a will or a trust, can result in a distribution of assets totally inconsistent with the intentions of the willmaker, or trustmaker. Such was the situation in the Reid case.
In the Reid case, the trustmaker clearly wanted the condominium that he lived in to be distributed to the nurse who had cared for his wife, and then for him, prior to their respective deaths. He also made gifts of cash to different charities. At the time of his death, there was insufficient cash to pay all of the gifts to the charities. The appellate court ruled that the abatement statute applied to all of the gifts provided in the trust, even though there was a specific gift of the condominium to the nurse and cash gifts designated for the various charites. In so ruling, the court required the condo be sold, and all of the cash then be divided among all of the beneficiaries of the estate based on the pro rata value of their original gift.
Applied to the do it yourself will or trust, the lesson of Reid is that a non-lawyer, even if he or she cannot be expected to read and “understand” a will or trust document the same way as a lawyer with years of experience and specialized training, the non-lawyer preparing his own will or trust, will be treated as “understanding” all of the statutes and case law that apply to all wills and trusts in Florida. Even if the willmaker’s intentions are clear, if appropriate provisions have not be included to deal with all of the applicable statues and cases, the assets may end up being distributed in a way vastly different from the original intentions.
Other significant legal issues often need to be addressed to ensure that a will or trust adequately accomplishes the maker’s objectives. For instance, most states have an “elective share.” The elective share statute typically provides that a surviving spouse can set aside a will or trust for purposes of the distribution of assets to the surviving spouse and “elect” against the will. In Florida, the elctive share statute essentially provides (in very oversimplistic terms) that a surviving spouse can take 30% of the deceased spouse’s estate if he or she is not satisfied with the distribution provided in the will or trust. The surviving spouse electing against the will or trust can create havoc with estate taxes and other planning that may be in place. (The elective share statute was used by the widow of Joe Robbie to wrest control of the Miami Dolphins from other family members – which ultimately resulted in the sale of the Dolphins to Wayne Huizeinga.)
The elective share can be effectively dealt with through various planning mechanisms – if you know of its existence and the requirements for structuring your estate to avoid its use by the surviving spouse. This can be particularly important for blended families where both spouses have children from prior marriages.
The bottom line – estate planning, even in apparently simple circumstances, is never simple. You do need a will, trust or other testamentary documents. To ensure that your intentions are followed, you also need the assistance of an experienced professional to avoid the unexpected application of statutory or judicial case law that affect all wills and trusts in Florida, and can bring about an unanticipated result.
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