RS&C

A probate court in New York recently addressed an unusual will contest. An 82-year-old Roman Catholic nun died in 2012, leaving a surprisingly large estate worth over $2 million, the product of a 1982 personal injury settlement. The sister signed a will in 1994 dividing her estate among her siblings, her congregation and various other Catholic charities.

The congregation actually contested the will...

When the sister entered the congregation back in 1959, she signed a declaration agreeing to abide by the order's requirements, which included a “vow of poverty.” To that end, the sister signed a will in 1979 leaving her entire estate to the congregation. This will, of course, predated the 1982 personal injury settlement and the subsequent 1994 will which, if valid, revoked the 1979 document.

Among other arguments, the congregation maintained admitting the 1994 will constituted a breach of contract, as it violated the sister's 1959 vow of poverty. In June 2015, a New York probate judge denied the congregation's motion for summary judgment on this issue. Without addressing the underlying breach of contract claim, the judge held under New York law, the purported 1959 contract did not affect the admissibility of the 1994 will.

Contracts to Make a Will

This case highlights an important point about estate planning. Under California law, a person can make “a contract to make a will.” This can, like the case above, be a purported written agreement to leave your estate to a particular person or organization. Or it could be a simple oral promise. A contract to make a will can also be a contract not to make a will—that is, to die intestate—or to revoke a previously signed will.

The easiest way to prove a contract to make a will in California is to incorporate the terms of such an agreement directly into your will or trust. Alternatively, your will or trust can refer to a separately signed contract. You can also sign a standalone document “evidencing the contract.” Absent any such express, written proof, a person who claims to have made a contract with a deceased person, orally or otherwise, must offer a judge “clear and convincing” evidence such an agreement was made.

Why Sign a Contract to Make a Will?

There are many circumstances where a contract to make a will might prove useful as part of your estate planning. If you own a business, such contracts can facilitate succession planning. If you are elderly or in declining health, you might promise someone a share of your estate in exchange for having them take care of you. And if you are getting married, a prenuptial agreement might include promises to make reciprocal wills naming each other as beneficiaries.

But as noted above, contracts to make a will should be in writing. Oral promises may be enforceable in court but they are never ideal.

 Originally posted to The San Diego Estate Planning Lawer Blog by Scott C. Soady on Tues, 06/26/2015 

- The Estate Planning Team
  Rogers Sheffield & Campbell, LLP

This article is not intended to provide legal advice. For legal advice on any of the information in this post, please use the form to the right or contact us by phone at 805-963-9721.

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