Legal Lines

Beneficiary Not Disqualified for Facilitating Will

Date:7/1/2002

Cecilia was 76 when her husband died in 1988. Later that year, Cecilia hired local handyman Rick to repair her garage. Through 1994, Cecilia placed more and more responsibility on Rick, until he was eventually making $1,400 per week managing her properties and helping her with bills, bookkeeping, and other duties.

Cecilia had no children or other close relatives. In January 1995, she met with an attorney to draft a new estate plan that would leave everything to Rick and his wife, with Mr. Rice (a long-time tenant of a ranch owned by Cecelia) as contingent beneficiary if the couple predeceased her. According to the attorney, Rick was present and did much of the talking. Rick also provided lists of Cecilia’s assets. When the attorney asked Cecilia how she wished to leave her estate, she confirmed she wanted to leave it entirely to Rick and his wife. With Rick’s assistance and encouragement, Cecilia eventually executed the plan, which included a living trust, a pour-over will, grant deeds, and other documents. She died in May 1996.

Mr. Rice brought an action to declare the donative transfers to Rick and his wife invalid under the California Probate Code (ยง21350). California law presumptively disqualifies a person as the recipient of a donative transfer by instrument if he or she drafts the instrument, or if he or she has a fiduciary relationship with the transferor and “transcribes the instrument or causes it to be transcribed.” Mr. Rice contended that Rick fit these criteria, so Cecilia’s estate should pass to Mr. Rice.

The trial court agreed that Rick had a fiduciary relationship with Cecilia, but concluded that his assistance and encouragement did not constitute “causing” the instruments to be transcribed. Though Rick took part in “arranging for preparation” of the instruments, he did not prepare them himself or direct anyone else to do so. The California Supreme Court affirmed.

Rice v. Clark (Cal. No. S037456, 6-10-02)