ESTATES AND TRUSTS

FINAL EXAMINATION

Professor Robert A. McLeod

(Undated)



QUESTION I

(50 Minutes)

Mike and Carole Brady are married. Mike has three boys from a prior marriage, Greg, Peter and Bobby. Carole also has three children from a prior marriage, Marsha, Jan and Cindy. Neither Mike nor Carole has a will. During a traumatic time in Jan's life, Mike adopted Jan. Carole has a $120,000 life insurance policy on her life with a beneficiary designation that reads: "to my husband, Mike, if he is then living, or, if he is not then living, to my estate to be distributed to all of my children as if by intestate succession."

Mike and Carole owned a house worth $240,000 in joint tenancy. One day, Mike and Carole were doing electrical repairs around the house. Their dead bodies were found both clutching a metal ladder that was laying on power lines. Peter discovered the bodies and in his haste to remove them from the ladder, he electrocuted himself to death. Marsha predeceased Mike and Carole with two small children, Ed and Mary. Peter has no issue and Greg predeceased Mike and Carole leaving two children, Ellen and Fred. Jan predeceased Mike and Carole leaving one child, Pat.

Question:

1) Ignoring the exempt property statutes and spousal election statutes, discuss the issues that will affect the distribution of the estates.

2) Resolve each issue one way or another and then distribute both estates Per Stirpes by representation (but state your assumptions) using Minnesota law.

3) How would Carole's estate pass by per capita in Minnesota?

(You may use models but explain your answer!)

QUESTION II

(50 Minutes)

Othello and Desdemona were a happily married couple. Each spouse wrote a will leaving the other spouse everything. Iago (Othello's longtime friend and confident) was eager to destroy Othello. Knowing Othello's insane jealousy, Iago falsely convinced Othello that Desdemona was having an affair with Roderigo. Unbeknown to both Othello and Iago, Desdemona was actually having an affair with Juliet.

Othello tore up his will leaving everything to Desdemona and wrote te a new will that reads:

"I leave nothing to my wife, Desdemona, for she had an affair with another man."

"I also leave everything to my good friend Iago."

Desdemona also changed her will. Desdemona's will now reads as follows:

"I give my entire estate to my mate, Juliet."

One day Iago could wait no more and murdered Othello.

Two months later, Desdemona died in a car accident.

Question:

1) Discuss the issues related to Othello's will and estate.

2) Discuss the issues related to Desdemona's will and estate.

QUESTION III

(50 Minutes)



Mr. Burns both the oldest and the wealthiest man in Springfield and owns 95% of the Springfield Nuclear Power Plant. Mr. Smithers owns the remaining 5% of the power plant. Mr. Burns creates a revocable trust naming Smithers as trustee. Mr. Burns contributes his 95% interest in the power plant to the trust. The trust provides that dividends from the nuclear power plant shall be paid to Mr. Burns during his life and upon Mr. Burns' death, the trust shall be distributed "to those persons of the good city of Springfield that the trustee must decide pursuant to the limited power of appointment hereby granted to the trustee."

Mr. Burns and Smithers had secret agreement that Homer Simpson would be appointed the power plant stock.

With time, Mr. Burns' neglect of the nuclear power plant caused the value and profits of the plant to fall. To stabilize the value of the stock, Mr. Smithers contracts with the Springfield Bank to appoint the power plant stock to the bank pursuant to the limited power of appointment if the bank currently pays for plant repairs. The bank made and paid for repairs.

Both Mr. Burns and Mr. Smithers died in a car accident. At the advice of their attorney, Lionell Hutz, Homer Simpson (a resident of Springfield) and the bank sue the Smithers' estate and the Revocable Trust for breach and other relief.

Question:

1) Discuss the claims, if any, Homer can raise.

2) Discuss the relief the bank might seek.