Three persons attempted to witness a will.  One of them, a notary, signed on a line that was reserved for witnesses and also signed as a notary.  The notary signed in the presence of the testator (the person who made the will); the second witness also signed in the testator’s presence; the third witness, however, signed the will in another room.  Georgia law requires that a will be attested by two witnesses in the presence of the testator.  A notary may not sign as both a notary and a witness, but since the will did not need to be notarized, the notary’s signature was valid as a witness signature, and the Supreme Court held that the will was executed properly. 

283 Ga. 54 (2008) 

Two daughters petitioned to be appointed guardians and conservators of their elderly mother, who was suffering from end-stage Alzheimer’s disease.  The petitioners had removed their mother from the Medicaid program, fearing that the State would take possession of their mother’s real property under Medicaid’s estate recovery program.  They planned to sell some of the mother’s property to a relative to generate funds for her care, thus keeping the property in the family.  The probate court appointed the county conservator and denied the guardianship.   

The Court of Appeals upheld the determination to appoint the county conservator but reversed on the guardianship.  Georgia law establishes an order of preference for conservator appointments, and though the adult children would have preference, the probate court had discretion to disregard that preference order.  Here, there was no evidence that the Medicaid opt-out was financially wise or that the mother would have sufficient funds without Medicaid, and further, the petitioners, as heirs-apparent, had a conflict of interest in the matter.  On the matter of the guardianship, the probate court judge determined merely that the petitioners had taken care of their mother’s affairs thus far without a guardianship, so none was needed.  Under Georgia law, however, the court’s inquiry must focus on the condition and best interest of the adult, not only on whether the adult’s family to date has acted successfully on her behalf.  The Court of Appeals held that the probate court’s incorrect analysis was an abuse of discretion, and it remanded the case for further consideration of the guardianship issue. 

289 Ga. App. 145 (2008)

The decedent’s sister filed a caveat (objection to a will) alleging that the decedent lacked testamentary capacity and had been unduly influenced by the person named as executor in the decedent’s will.  The caveat also claimed that the person named as sole heir in the will was neither the natural nor adopted child of the decedent, thereby making the caveator (person challenging the will) the decedent’s sole heir-at-law.  After a hearing that was not transcribed, the probate court issued an order dismissing the caveat because the caveator failed to prove that the child was not the decedent’s heir-at-law, and thus, the caveator lacked standing (the right to make a legal claim) to challenge the will.  Upon appeal, the Supreme Court held that in the absence of a hearing transcript, there was a presumption that the probate court’s determination was correct. 

282 Ga. 902 (2008)

A son, the named executor of his father’s will, filed the will for probate.  Two other sons filed a caveat (objection) raising claims of undue influence and revocation.  The caveators’ undue influence claim was based on the role the executor played in selecting the attorney who drafted his father’s 1998 will and his alleged participation in preparing the will.  The trial court excluded much of the evidence the caveators attempted to present, including evidence of the testator’s conduct years later, since it was not probative of whether the will was a product of undue influence when it was executed.  Further, the trial court denied a request to charge the jury that there was a presumption of undue influence, because the caveators introduced no evidence showing either that the testator was weak and hence susceptible to undue influence, or that the executor occupied a dominant position with regard to his father.  On appeal, the Supreme Court upheld the trial court’s rulings on the admissibility of evidence and jury instructions.  

The caveators’ claim of revocation (an invalidation of the will by the person who executed the will) was based on documents showing that the father planned to execute a new will.  The father had marked up a copy of his will, making changes and noting specific bequests, and had sent a letter to the executor requesting that the new bequests be given effect if he died before his new will was executed.  The Supreme Court held that Georgia law permits a presumption that a will was revoked only if the original will or a material portion of the original will is destroyed or obliterated.  Thus, the testator’s markings on a copy did not raise the presumption of revocation. 

282 Ga. 866 (2008)

A petition to probate a will listed a woman and her brother as the decedent’s heirs, though they were not named as beneficiaries in his will.  Acting pro se (without an attorney), the woman filed a caveat (objection) to the petition, asserting that the will failed to identify her or other heirs as being disinherited.  The caveat was filed on the last day of the ten-day period in which such objections can be filed.  The following day, she filed an amendment to the caveat, claiming that the will was invalid due to undue influence and the testator’s lack of capacity.  The propounder (person who filed the petition for probate) objected to the amended caveat, contending that because the first claim was not an allowable reason for objection, there was no valid caveat to be amended after the expiration of the objection period.  

On appeal, the Supreme Court ruled that a caveat is amendable at all times and in every respect, even when it is the amendment that sustains the validity of the caveat.  Additionally, the court ruled that amendments relate back to the original filing date of the caveat, so that an amendment filed outside the ten-day objection period is deemed to be filed as of the original date of the caveat. 

282 Ga. 161 (2007)

After a man died intestate (without a will), his widow petitioned the probate court for year’s support.  The probate court granted her petition.  The decedent’s mother appealed to the superior court, but the court dismissed her appeal, finding that she had no standing (right to pursue the claim in court).  The Court of Appeals affirmed that decision.  Only a party to an action—a plaintiff or defendant—may appeal a decision in the probate court.  Since the mother was not a party to the year’s support petition, she had no right to appeal the award. 

286 Ga. App. 6 (2007)

A testator (person who executes a will) left the bulk of her estate to a trust.  Under the terms of the trust, some assets were to be distributed to named heirs with most of the remainder of her estate to go to a foundation.  However, the testator died before she actually established the foundation.  Merrill Lynch, as trustee, filed a petition asking the trial court to apply the “cy pres” doctrine, which provides that if a charitable bequest or gift cannot be effected in the exact manner provided by the testator or donor, the court can exercise its power to fulfill the intention of the testator as closely as possible.  The issue here was whether the testator actually had a charitable intent.  The trial court ruled that since the language of the trust did not include the word charity or any mention of a charitable purpose, the assets should go to the heirs.  

The Court of Appeals, however, noted that the term “foundation” was ambiguous, because it may be a charitable or non-charitable entity, and thus the trial court should have considered evidence outside the language of the trust to determine the testator’s intent.  The matter was sent back to the trial court for reconsideration. 

286 Ga. App. 767 (2007)

A widow filed a petition for year’s support, and the daughter of the decedent filed an objection.  The probate court granted the award and the superior court affirmed the award, but the Court of Appeals held that the widow was not entitled to year’s support.  The year’s support must be reasonably related to the amount needed by a surviving spouse for a period of twelve months to maintain the standard of living enjoyed prior to the death.  It is a transitional allowance.  In considering the amount to be awarded, the court must consider the income available to the surviving spouse from other sources.  In this case, the widow testified that she “splurged” by taking trips and remodeling her home after the death.  It appeared that her standard of living improved and she had independent resources to afford those improvements.  The court held that when the surviving spouse’s income exceeds the expenses shown for the year after the death, the petition for year’s support must be denied. 

286 Ga. App. 561 (2007)

Following her husband’s death, a widow petitioned the court for year’s support, and she was awarded a half interest in the marital home and a car.  The husband’s son appealed to the superior court, which reduced the award to the car, personal property, and $14,000.  The superior court also denied the widow’s demand for a jury trial, contending that her demand was made more than 30 days after the filing of the appeal and therefore was late under the applicable statute.  The widow appealed that ruling.  

The Georgia Court of Appeals found that since the statute in question, O.C.G.A. § 5-3-30, referred specifically to appeals from magistrate courts, it did not govern appeals from probate courts.  The longstanding rule remains that appeals to the superior court from the probate court are to be tried by a jury unless the party bringing the appeal waives the right to a jury. 

287 Ga. App. 77 (2007)

Co-executors offered the 2004 will of their sister for probate.  A granddaughter filed a caveat (objection to the will) contending that the testator (the person who executed the will) lacked capacity to make a valid will because she was physically and mentally slow and sometimes confused during the last months of her life.  A medical expert testified that, based on the testator’s medical records, she suffered from some degree of dementia on the date the will was executed.  A jury found that the testator lacked testamentary capacity.  The trial court then granted a judgment notwithstanding the verdict (a judgment for one party even though a jury verdict has been rendered for the opposing party), and the court conditionally granted a new trial based on its determination that the jury’s verdict was contrary to the weight of the evidence.  

On appeal, the Supreme Court ruled that since there was some evidence to support the jury’s verdict, the trial court erred in granting the motion for a judgment notwithstanding the verdict.  However, since there was also evidence of the testator’s capacity from the testimony of the drafting attorney and several witnesses, the trial court’s decision to grant a new trial was not an abuse of its discretion. 

282 Ga. 488 (2007)

A man died in 2006 after a long battle with dementia.  A woman attempted to probate a will the man purportedly executed on July 29, 1999.  The man’s son and stepson filed caveats (objections to the will).  A jury found that the will was invalid because it was the product of the woman’s undue influence and because the man lacked the mental capacity to execute a will on that date.  

On appeal, the Supreme Court upheld the verdict.  The woman argued that the probate court erred in admitting evidence of undue influence and lack of testamentary capacity outside of the four-months immediately preceding and following the man’s execution of the will.  The court held that in Georgia there is no set four-month window for the admissibility of such evidence.  Courts in Georgia have long adhered to the rule that evidence relating to undue influence or capacity to make a will is admissible if it relates to a “reasonable period of time” before and after the execution of the will.  In this case, there was evidence of the woman’s two-year exploitation of the man prior to his execution of the will.  The probate court was correct to let the jury hear the full story rather than isolated snippets of undue influence and mental impairment. 

284 Ga. 464 (2008)

A woman left the bulk of her estate to her youngest daughter, the product of her second marriage.  The woman’s four older children from her first marriage filed a caveat (objection to the will), contending that the will was invalid due to undue influence.  They presented evidence that their mother’s second husband had dominated her to the point of complete submission thirty to forty years ago, during their childhoods.  One of the older children testified to a conversation with his mother, on her deathbed approximately two years after the will was executed, in which she said that her second husband and youngest daughter had harassed her into disinheriting everyone except that daughter, and that she had been forced to make a will against her wishes. 

On appeal, the Supreme Court ruled that undue influence must be shown at or near the time of execution of the will.  Testimony of undue influence many years before and statements made two years later are insufficient to show that undue influence was actually exercised at the time the woman executed her will. 

282 Ga. 768 (2007)

When a man died intestate (without a will), his widow and surviving son entered into an agreement to divide the net estate, and they each took distributions of $30,000.  The widow then filed a petition for a year’s support of $60,000 plus other assets worth $24,000.  Following a hearing, the probate court awarded her a year’s support of $30,000 plus title to a car and antique furniture.  She appealed, and the Superior Court found that the widow and the son had entered into an agreement to share equally in the estate assets and had acted on that agreement by accepting $30,000 each, so the court declined to award any additional money as a year’s support.  

The Georgia Court of Appeals upheld that ruling.  While a person need only establish that he or she is the spouse of a decedent to be eligible for a year’s support, determining the amount of the award is a separate inquiry.  The award must be reasonably related to the amount needed by the surviving spouse to maintain the standard of living enjoyed prior to the death.  Here, since the widow presented no evidence of the income or expenses during the marriage, there was no evidence of her married standard of living, and the court was justified in not awarding any additional amount as year’s support.  Additionally, although the widow said she was unaware of her right to year’s support when she entered into the agreement with the son, she was represented by counsel at that time, so the court had the power to enforce the agreement and reject her testimony as lacking credibility.288 Ga. App. 334 (2007) 

After a man was murdered in 2001, his wife was appointed executor of his estate.  She was later indicted for her husband’s murder.  The wife hired a law firm for her defense, and the retainer agreement provided that as payment, the wife would give the firm the proceeds she received from a life insurance policy on her husband and deed over to the firm real property she inherited from him.  A year after her indictment, the woman pled guilty to murdering her husband.  The executor of her husband’s estate sought to recover funds from the law firm, under the theory that the firm was not entitled to be paid from assets the wife had received as a result of her husband’s death.  The state court found that the law firm was entitled to the payment.  The executor appealed. 

The Court of Appeals affirmed the lower court’s ruling.  In Georgia, a person who kills another forfeits the right to inherit from the victim’s estate.  In this case, however, the woman’s guilt was not established until a year after she paid the retainer fee.  At the time she made the payment, she had ownership of the insurance proceeds and the real property.  The court opined that the legislature did not intend that creditors should have to forfeit payments they accepted in good faith from a person who is later found guilty of murder and ineligible to inherit from the victim. 

294 Ga. App. 104 (2008)

After a man was murdered in 2001, his wife was appointed executor of his estate.  She was later indicted for her husband’s murder.  The wife hired a law firm for her defense, and the retainer agreement provided that as payment, the wife would give the firm the proceeds she received from a life insurance policy on her husband and deed over to the firm real property she inherited from him.  A year after her indictment, the woman pled guilty to murdering her husband.  The executor of her husband’s estate sought to recover funds from the law firm, under the theory that the firm was not entitled to be paid from assets the wife had received as a result of her husband’s death.  The state court found that the law firm was entitled to the payment.  The executor appealed. 

The Court of Appeals affirmed the lower court’s ruling.  In Georgia, a person who kills another forfeits the right to inherit from the victim’s estate.  In this case, however, the woman’s guilt was not established until a year after she paid the retainer fee.  At the time she made the payment, she had ownership of the insurance proceeds and the real property.  The court opined that the legislature did not intend that creditors should have to forfeit payments they accepted in good faith from a person who is later found guilty of murder and ineligible to inherit from the victim. 

294 Ga. App. 104 (2008)

A man executed a will on March 15, 2000; he executed another will on May 10, 2000.  Twenty months later, he executed a codicil in which he referred to the March will.  After his death, his heirs retrieved the original May will with the codicil attached from the man’s safe deposit box.  Both documents were in a single sealed envelope labeled with its contents.  The original March will was located in a file cabinet.  The heirs who were named executors in the May will filed a petition to probate the May will and the codicil.  Other heirs filed a caveat (objection to the will).  The probate court held that the May will and codicil together constituted the man’s last will and testament.  The caveators appealed.  The superior court granted the executors’ motion for summary judgment (a ruling that there are no issues of fact to be decided and so that party must prevail), and the caveators appealed that ruling. 

As the Georgia Supreme Court explained, the issue in this case was whether the man had intended his last will and testament to consist of the March will and the codicil or the May will and the codicil.  In Georgia, a new will revokes a prior will, so the May will revoked the March will.  However, a previously revoked will may be republished by a codicil.  It was unclear whether the testator executed the codicil with the intent of republishing his March will or amending his May will.  Because the circumstances of the codicil created an ambiguity, parol evidence (evidence outside of the codicil itself) was admissible to explain the man’s intent.  The executors offered evidence of the man’s intent to amend his May will, and the caveators failed to refute that evidence; therefore, there was no error in the superior court’s granting of summary judgment. 

284 Ga. 583 (2008)

In her will, a woman directed that “a Trust Fund be established” of no more than $25,000 to cover educational expenses of deserving persons, preferably relatives, with an interest in agriculture or homemaking.  Another provision in her will stated, “I give, devise and bequeath the following amounts to the following private cemeteries,” and she named three cemeteries, with two receiving $25,000 each and the third receiving $20,000.  The executor was the attorney who drafted the will.  Instead of funding the education trust, the executor distributed the money to relatives named in the will.  He paid $25,000 to one cemetery, but paid nothing to the other two, again distributing the remaining $45,000 to persons named in the will. 

The Attorney General of Georgia sued, contending that the will created charitable trusts for education and for the cemeteries, and that the executor breached his fiduciary duties by failing to fund them.  The superior court agreed, and ordered that the trusts be properly funded.  In addition, the court ordered the executor to forfeit his fees.  He appealed. 

The Supreme Court held that the will created a charitable trust for education; however, the court found that the will unambiguously called for an outright bequest to the cemeteries, and did not create a charitable trust for them.  Georgia law gives the Attorney General the power to enforce charitable trusts, but in this case the Attorney General may enforce only the provision relating to the educational trust.  As for the executor’s fees, the court found that since the executor failed to fund the education trust, he violated his fiduciary duty and thus forfeited his right to compensation. 

284 Ga. 452 (2008)

A husband brought a declaratory judgment action against his wife’s siblings to establish that they had no interest in land owned by her at her death.  The superior court entered a judgment for the husband, but the siblings, our clients, appealed on the grounds that a declaratory judgment action was not the proper action for this controversy.  The Georgia Supreme Court ruled in favor of our clients and reversed the lower court, holding that a declaratory judgment action was not available to the husband to establish his claim.  Instead, the husband should have filed a claim pursuant to the Quiet Title Act. 

273 Ga. 407 (2001)

Our client, a credit card transaction processing service, brought an action against a bank for failure to pay its losses pursuant to an indemnification agreement.  The trial court granted our client summary judgment; the bank appealed and our client cross-appealed.  The Georgia Court of Appeals ruled in favor of our client on almost every issue, holding that the indemnity agreement required the bank to pay our client for its losses, and that our client was entitled to both prejudgment interest on damages and an award of attorney fees and expenses calculated in accordance with agreement provisions. 

254 Ga. App. 686 (2002)

A woman who died in 2003 was survived by her daughter and two grandchildren.  The daughter attempted to probate a will executed in 1956.  The grandchildren filed a caveat (an objection to the will) asserting that the 1956 will had been revoked by a 1999 will.  The daughter contended that the woman did not have the mental capacity in 1999 to make a valid will.  The probate court found that the 1999 will was valid.  

On appeal, the Supreme Court ruled that the probate court’s factual findings in a non-jury trial may not be set aside when the finding are supported by any evidence.  Here, testimony from the attorney who drafted the will, from a witness, and from a notary all supported the probate court’s finding that the woman possessed the necessary testamentary capacity at the time she executed the 1999 will. 

282 Ga. 652 (2007)

An elderly woman left her husband in Florida in early 2003 to live with her sister in Georgia.  The day after the woman arrived in Georgia, she met with her sister’s attorney to draft a new will leaving her estate to that sister and another sibling.  A few weeks later, with the help of a second attorney, the woman initiated divorce proceedings and drafted another will naming her sister as sole beneficiary.  Within a month, the woman retained a third attorney to prepare an irrevocable trust naming her sister as trustee and beneficiary.  Shortly thereafter, she was admitted to a mental health facility, experiencing bouts of agitation and insisting that her sister and other family members were trying to control her.  She was discharged to a nursing home and died later that year.  At trial, the husband presented evidence that he and the woman had been happily married and that the sister had been involved in the woman’s financial affairs, contrary to the woman’s expressed wishes, since 2000.  The jury returned a verdict in favor of the husband, setting aside the trust.  

On appeal, the Supreme Court held that the sister waived her right to challenge the husband’s lack of standing (right to sue) because she waited until after the judgment was entered to assert that claim.  The Court similarly ruled on several other legal issues.  Finally, the Court held that evidence of the woman’s weakened mental state and the sister’s interceding in the woman’s estate planning was sufficient to support the jury’s finding of undue influence. 

282 Ga. 763 (2007)

Our client, a real estate agency, sought summary judgment against a customer for breach of contract.  Our client won on the breach of contract claim, though the court denied that summary judgment was warranted on the matter of attorney fees.  We appealed, claiming that the customer acted in bad faith, had been stubbornly litigious, and caused our client unnecessary trouble and expense, all statutory bases of recovery of attorney fees.  Because the evidence on these matters was not undisputed, the Court of Appeals affirmed the denial of summary judgment and remanded the case for a hearing on the issue of attorney fees.

276 Ga. App. 155 (2005) 

An adult son was named executor of his mother’s estate, and he filed a petition to probate the will.  His sister signed a letter assenting to the probate.  Nine months later she attempted to caveat (objection) the will, claiming that her mother was in an advanced state of dementia when she executed the will.  The sister also claimed that she and her brother had a separate contract regarding the distribution of their mother’s estate.  The probate court dismissed the sister’s claims without a hearing, and she appealed.  

The Court of Appeals ruled that by signing the letter of assent, the sister had agreed to the immediate probate of her mother’s will, and it was too late to raise a challenge.  Even if the sister was unaware of her mother’s dementia, she should have tried to discover relevant facts before she signed the letter assenting to probate.  The Court of Appeals also ruled that the probate court was not the proper court to decide the matter of the separate contract.  Since there was no way the sister’s claims could succeed, the probate court was correct to dismiss them without a hearing. 

288 Ga. App. 449 (2007)

A father died, survived by his two minor children.  He willed all of his property to his sister, as trustee, to be divided among his children.  After the sister refused to serve as trustee and the executor died, the court appointed one person to be both administrator and trustee.  After serving for three years, the administrator filed a petition for discharge.  He subsequently filed a return with the court indicating that he had already paid himself administration fees from the estate, and requested that the court compel the payment of his fees for acting as trustee.  The trial court denied the motion. 

The Court of Appeals upheld that ruling.  While a trustee is generally entitled to fees, in an amount specified either by the trust document or by law, the problem in this case was that the administrator had never actually transferred estate assets to a trust.  All of the receipts and disbursements made to or on behalf of the children were made from the estate, not from a trust.  Additionally, the administrator did not provide each child with an annual report, as required by the trust established under the will.  Therefore, he was not entitled to trustee fees. 

292 Ga. App. 236 (2008)

A woman who died in an automobile accident was survived by her minor son and her parents.  She did not have a valid will.  Her ex-husband, the father of her son, filed a petition to be named administrator of the estate.  The woman’s father also petitioned to be named administrator, and objected to the petition of the ex-husband on grounds that he had failed to pay child support and filed for bankruptcy.  The judge appointed a guardian ad litem (a guardian appointed by the court to appear in a lawsuit on behalf of a minor or incompetent party) to represent the interests of the son.  The ex-husband then requested that the judge remove herself from the case because she had assisted the father in filling out his petition.  The judge voluntarily disqualified herself, and the case was assigned to another judge.  The probate court subsequently appointed the father as administrator. 

On appeal, the Court of Appeals rejected the ex-husband’s argument that the first judge’s appointment of a guardian ad litem was invalid.  The guardian was named before the ex-husband had filed his motion to remove the judge, and the appointment of a guardian merely protects the interests of the minor; it does not affect the merits of the case.  The court also rejected the ex-husband’s argument that the trial court improperly denied him a jury trial.  In probate court, a party must demand a jury trial within 30 days after the filing of an initial pleading or within 15 days after the filing of the first pleading of an opposing party.  The ex-husband argued that the father’s objection did not contain his address and phone number, and thus was not properly filed, and so he had additional time to request a jury trial.  The probate court had accepted the filing, however, and a technical flaw in an objection to a petition does not expand the time in which a jury demand can be asserted. 

292 Ga. App. 343 (2008)

A widow died with her petition for a year’s support from her late husband’s estate still pending.  The executor of the widow’s estate, who also was the executor of the husband’s estate, filed an amendment to the year’s support petition.  Upon the filing of the petition, the probate court issued a citation to the executor to show cause why the petition should not be granted.  The court ordered that the executor of the estate of one of the husband’s sons was entitled to notice of the citation by mail.  The son’s executor objected to the amended petition, but the probate court dismissed the objection as untimely.  The written objection was required to be filed in the probate court no later than ten days from the date the executor received service by mail.  When no written objection was filed by that time, the year’s support proceeding automatically became in default.  Six days later, however, the son’s executor attempted to open the default by the payment of costs and the filing of defenses objecting to the amendment. 

The Court of Appeals held that the provisions of the Civil Practice Act relating to the opening of default judgments as a matter of right within fifteen days of default apply to year’s support proceedings in probate court.  Thus, the objection filed by the son’s executor pursuant to the notice was timely, and the probate court’s dismissing it without ruling on the merits was error.  

289 Ga. App. 14 (2007)

After a woman died intestate (without a valid will), the probate court issued an order finalizing a settlement agreement reached by the woman’s heirs.  The court also appointed an administrator and established a procedure for selling the woman’s real property.  The order provided that the administrator must notify the heirs that property was for sale, and then within 30 days the administrator could accept the highest and best offer.  The woman’s son submitted a bid for certain property, but another party submitted a higher bid.  At some point after learning of the higher bid, the son verbally countered with a higher offer, but his counteroffer was rejected as untimely, and the property went to the other party.  The son argued that because he was an heir, he had an extra thirty days to bid after he learned of a competing offer.  The probate court disagreed, ruling that the heirs only had 30 days to submit an offer once they were notified that property was for sale.  

The Court of Appeals affirmed, concluding that the order establishing the sales procedure was clear.  Though the trial court transcript did not reveal the date of the son’s verbal offer, the Court of Appeals presumed that the evidence supported the trial court’s conclusion that the son’s verbal offer was not made before the 30-day deadline expired. 

292 Ga. App. 285 (2008)

Four brothers filed lawsuits after the deaths of their parents.  After their mother died, their father petitioned for a year’s support from her estate.  Three of the brothers filed a caveat (objection) to the petition.  The probate court issued a partial final order, stating that it was a consent order agreed to by all parties, awarding the year’s support and including, among other provisions, a requirement that the father name a neutral party as executor of his will.  When the caveators’ attorney informed the court that he had not had an opportunity to review the order before it was issued, the court entered another order declaring the partial final order void on the grounds that it had been prematurely issued in error.  Eight months later, after a hearing, a final order was issued, but that order failed to include the provision requiring the father to name a neutral executor.  When the father died five years later, his will named his fourth son as executor.  The three caveators objected, but the probate court dismissed their objection on the grounds that the partial final order remained void.  

The caveators appealed to superior court, which found that the final order supplanted the partial final order, rather than supplemented it, because it was substantially similar and it provided that it was to be “final in all respects” except as to an easement issue.  The superior court therefore concluded that the omitted provision relating to the executor was not in force. 

The Court of Appeals reversed, holding that although the final order indicated that it was final, that did not mean it was complete.  Evidence showed that the attorney who prepared the final order understood that the omitted paragraph about the neutral executor remained in effect, and the opposing attorney did not object because that was his understanding too.  Georgia statute allows a court to correct mutual mistakes admitted by all parties at any time, and therefore the court that issued the final order was authorized to correct the mistake. 

292 Ga. App. 339 (2008)

In 2000, a mother named her daughter as beneficiary of her life insurance policy.  In 2003, she added her two sons as contingent beneficiaries, leaving her daughter as sole primary beneficiary.  When the mother died after a long illness in June, 2005, her daughter sought 100% of the proceeds of her mother’s life insurance policy.  The mother’s two sons each claimed one-third of the proceeds, relying on a beneficiary designation form purportedly submitted by the mother a month before she died, making her three children equal beneficiaries.  The daughter argued that their mother did not understand the effect of the last beneficiary designation when she signed it and therefore it was not valid.  The trial court refused to admit evidence on that issue and ruled in favor of the sons. 

The Court of Appeals reversed.  Ordinarily, when an agreement is “unambiguous” (there are no uncertainties of meaning or intention in the contract language), the court will not consider “parol evidence” (evidence relating to a contract but coming from sources outside the contract, such as statements between the parties or circumstances surrounding the agreement).  However, parol evidence is admissible to show that the agreement was originally void or later became void.  The court should have considered affidavits from two close friends of the mother, who spoke with her just days before she died and after she purportedly submitted the new beneficiary designation, when she reiterated her desire that her daughter get all of the life insurance.  

292 Ga. App. 879 (2008)

In November, 1979, a widow filed a petition for year’s support from her husband’s estate.  Her husband’s son and his ex-wife both filed caveats (challenges to the petition).  In March, 1980, the widow was deposed.  After that date, no other action was taken by any party concerning the petition for year’s support until May, 2006, when the widow submitted a proposed final order to the court seeking approval for her petition for year’s support.  The probate court dismissed the petition, citing the Georgia statute that provides for automatic dismissal of any case in which no written order is issued for a period of five years. 

The Court of Appeals affirmed that ruling.  The widow argued that her petition stood as a final order, and the failure of the court to sign it was merely a clerical error.  But the petition could not be a final order until the caveat matters were settled, which never occurred.  The provisions of the Georgia Code governing automatic dismissals after five years are mandatory.  It was the widow’s duty to pursue her case and seek a written order from the court granting her petition; when she failed to do that, the entire case was automatically dismissed in November, 1984, five years after the court filed its last written order in the matter. 

293 Ga. App. 309 (2008)

Beginning in 1978, two brothers built a business operating nursing homes.  They created an irrevocable trust for each of their children.  The trust property consisted partly of shares in the business.  In 1995, the business agreed to merge with a publicly traded healthcare company, and the merger was completed in 1996.  Prior to the merger, the brothers reviewed several years of the healthcare company’s financial statements, which had received “unqualified” audit opinions (meaning that the statements were free of material misstatements and were prepared according to generally accepted accounting principles). In 1998, the healthcare company was acquired by another company, but by 2000, the company filed for bankruptcy.  In 2002, the brothers and another trustee learned that during the year-long period between the agreement to merge and the closing of the merger, the healthcare company had used misleading accounting practices to significantly overstate its revenues and profitability in the three years leading up to the merger.  Additionally, the auditor had assisted the company by giving unqualified opinions that endorsed the misleading financials.  The trustee filed suit, alleging negligent misrepresentation and several other grounds.  After a trial, a jury awarded the trusts $10 million on the negligent misrepresentation claim. 

The auditor appealed, contending that since the trustee did not testify, there was no evidence that he actually relied on the alleged misrepresentations about the healthcare company’s financial condition.  The Georgia Court of Appeals disagreed, holding that there was sufficient evidence for the jury to find that the auditors knew that investors like the trusts would rely on its audits and unqualified opinions regarding the finances.  The auditor also claimed that the claim was filed too late, more than four years after the 1991-1993 financial statements were issued.  Again the court disagreed, holding that the auditor’s conduct prevented the trustees from discovering the misleading financials until 2002, despite their diligence, and since the claim was asserted within four years of their discovery, it was properly filed. 

293 Ga. App. 274 (2008)

A man made a will in 1998, and in 2003, he made notes of potential changes on a copy of his 1998 will.  The executor of the man’s will, one of his sons, discovered the notes before the man died, along with a letter addressed to the executor asking him to abide by the handwritten changes.  After the man’s death, the executor attempted to probate the 1998 will.  The man’s two other sons filed a caveat (challenge to the will), but the probate court rejected the caveat and admitted the will to probate.  The Georgia Supreme Court affirmed that decision.  See Morrison v. Morrison, 282 Ga. 866 (2008). 

While that case was pending, the sons filed a lawsuit against the executor in superior court, claiming, among other things, that the executor failed to use his power of attorney prior to the man’s death to comply with his written directions to transfer property to the sons in accordance with handwritten notes on his 1998 will.  After the superior court ruled in favor of the executor on all claims, the sons appealed.  The Georgia Supreme Court began by noting that the 2003 handwritten instructions did not constitute a “completed gift,” and the incomplete nature of the gift was therefore a necessary element of the claim for intentional interference with an expected gift.  

The Supreme Court then held that the superior court had erroneously barred the claims due to “collateral estoppel” and “res judicata.” For the doctrine of collateral estoppel to bar a claim, that particular issue must have actually been litigated and decided in a previous action, even if the lawsuit including that issue differed significantly.  Here, the claim of intentional interference with a gift was not decided in the probate court because the probate court only decided whether the 2003 notes were relevant to a claim of undue influence or constituted a revocation of the will; the probate court did not decide whether the executor, using his power of attorney, should have complied with the instructions in the notes to transfer property.  For the doctrine of res judicata to bar the claim, the claim must be identical to one decided previously, with the same parties and facts.  Here, the suits were not identical because the probate court only had authority over a claim concerning the estate, not a claim about an action that occurred prior to the man’s death and the appointment of the executor.  The court ruled that the claim for intentional interference with a gift, as well as the other claims, could be heard. 

284 Ga. 112 (2008) 

Our client was a named beneficiary of his mother’s will.  The will established two trusts; the co-trustees were our client and his mother’s husband.  The lawsuit in this case concerned a lake house.  After the will was probated, the mother’s husband, serving as executor, transferred a 75% interest in the lake house into one of the trusts, and the remaining 25% interest in the lake house into the other trust.  Two provisions in the will permitted the mother’s husband to direct the trustees to sell “any home” held by the trusts established in the will.  Another provision of the mother’s will, however, specified that the lake house, not called by that name but identified by its legal description, should be held in trust for the benefit of our client for seven and a half years after his mother’s death. The husband tried to sell the lake house, and our client objected.  

The trial court found in favor of our client.  It held that the will unambiguously carved the lake house out from the property of the trusts and gave our client the option to receive it after seven and a half years.  

On appeal, the Georgia Supreme Court upheld that ruling.  The specific grant of the lake house, by plain mandatory language in the will, was not overcome by a less clear and more general limitation in other provisions.  Although the lake house could be described as “any home,” giving the mother’s husband sole authority to sell it, that interpretation was inconsistent with the plain requirement in the will that the lake house be held in trust specifically for our client. 

284 Ga. 87 (2008)

In 1998, a woman executed a will dividing her shares of stock among her children and grandchildren.  Two years later, concerned that the named executor would receive part of the stock value in fees, the woman wrote a letter to the executor saying she intended to name a granddaughter as executor, and stating that the granddaughter knew how to distribute the stock to the heirs as provided in the will.  That same day the woman authorized the transfer of all of the stock to her granddaughter.  The woman died several months later, without amending her will.  The granddaughter, acting as executor, ineffectively attempted to transfer the stock to the named relatives in accordance with the terms of the will.  Sometime later, however, the granddaughter changed her mind and decided not to transfer the stock; she sold all the shares and deposited the proceeds in a Swiss bank account.

After a trial, a jury found that though the grandmother had transferred the stock to the granddaughter, it was not a gift, and the granddaughter fraudulently had converted the stock to her own use.  The jury awarded damages of $623,560 to reimburse the estate for the value of the stock as of the woman’s date of death, along with attorney fees and punitive damages.

The Court of Appeals upheld that verdict, finding that the woman had entrusted the stock to her granddaughter under either an express or implied agreement that the granddaughter would hold the stock only for the purpose of distributing it to the heirs as provided for in the will.  Under those circumstances, she should not have retained the stock for her own use. 

292 Ga. App. 497 (2008)

A probate court ordered a bank, acting as executor of an estate, to distribute assets to beneficiaries and to pay itself $639,049 from the estate as reimbursement for attorney fees.  The bank sent a letter to the beneficiaries stating that by depositing the distribution checks, the beneficiaries were agreeing to the terms of the court’s order and waiving all objections or rights of appeal.  Nonetheless, one beneficiary appealed the portion of the court’s order allowing the bank’s attorney fees.  The trial court held that by accepting the money, the beneficiary also accepted the terms of the letter.

The Court of Appeals reversed that decision, ruling that nothing in the probate court’s order authorized the bank to require the beneficiaries to forgo any right merely to receive their court-ordered distribution.  The Court of Appeals also held that the bank, as executor, had a fiduciary duty to avoid potential conflicts between its interests and those of the beneficiaries. 

292 Ga. App. 773 (2008)

When a testator died in 1970, his will left real estate to his son for life and provided that after the son died the property would be shared equally by the testator’s four daughters, a named grandson, and any children of his son.  The son had no biological children, but in 2004 he legally adopted a man who was 32 years old.  The son died in 2005.  Two years later, a petition was filed asking the court to interpret the testator’s will, disputing the adopted adult’s entitlement to his one-sixth share of the estate.  The superior court found that the law applicable at the time of the testator’s death in 1970 governed the interpretation of the will, and under that law, the adopted adult would inherit.  An appeal followed.

The Supreme Court upheld the lower court’s holding.  Under Georgia law, in 1970 and currently, an adopted adult shall be considered in all respects as if he or she were a biological child of the parent.  The adopted adult shall be able to inherit under the laws of intestacy or under any provision of a will, unless expressly excluded.  Thus, if a testator wanted to limit a bequest only to blood relations, such a provision would have to be explicitly stated in the will.  In this case, there was no such provision, and thus the adopted adult was entitled to his share of the estate as a child of the testator’s son. 

2009 WL 54955 (Ga.)

The will of an executor’s deceased grandmother left the grandmother’s house to a beneficiary.  The executor did not want the beneficiary to receive the house, because the beneficiary’s husband had been convicted of murdering the grandmother’s husband, who was the executor’s grandfather.  When the beneficiary petitioned for removal of the executor, the executor obtained a continuance.  During the period of the continuance, the executor arranged for the house to be sold to her friend at a price under market value; she advanced her friend the full amount of the purchase price; her attorney prepared the closing documents, representing both buyer and seller in the transactions; and after the closing the executor deposited the sale proceeds in her personal bank account.  When the probate court held a hearing on the executor’s removal, it heard evidence about the sale.  The court ordered the executor removed and the property transferred back to the estate through a quitclaim deed.  The probate court also awarded the beneficiary compensatory damages, general damages, punitive damages, and expenses of litigation and attorney fees.  The executor and her attorney appealed. 

The Court of Appeals upheld most of the damage awards.  Georgia law allows a beneficiary to recover compensatory damages if an executor breaches her fiduciary duty.  The beneficiary presented evidence concerning the rental value of the house, which authorized the court to award damages in the amount of the lost rent.  Finding insufficient evidence of damages for the losses of other estate assets, however, the court reversed an award in connection with those assets.  The court affirmed the award of general damages, because the executor had perpetrated a fraud in attempting a sham sale of the house, and the court affirmed the award of punitive damages, because there was clear and convincing evidence of the executor’s willful misconduct.  Finally, the court affirmed the award of the beneficiary’s litigation expenses and attorney fees, based on several statutes, including O.C.G.A. § 53-12-193(a)(4), which allows recovery of such expenses incurred before both a trial court and an appeals court.

After legal proceedings in superior court, the Georgia Supreme Court reversed the probate court, holding that the divorce had no effect on the will. Though the codicil did not use specific words like “republish” or “revive” or “reaffirm” regarding the will, it unequivocally identified the will, and so there was a presumption that at the time he executed the codicil, the man knew and understood the provisions of his will. The language of the codicil made it plain that the will leaving the estate to his former wife was to be given effect.

2008 WL 2563507 (Ga. 2008)

¹ 2008 WL 256986 (Ga. App. 2008)

Squire Sanders Sues Lawyer’s Estate for Loan Repayment

The claim involved a home and lot purchased by his mother in 1994. She paid the $24,000 down payment, she was the sole owner under the sales agreement, and she was the only person obligated on the mortgage. Three days after the closing, the son gave his mother a $12,000 check, noting that it was for “investment.” Eight years later, the mother transferred title to all her real and personal property into a trust. The purpose of the trust was to provide for her support, maintenance, and health care.

Sometime later, the home was put on the market to provide liquidity to the Trust to enable it to pay the mother’s expenses. In his suit, the son claimed that he and his mother had a verbal agreement to own the home as partners. The mother and trust denied that the son had any interest and filed a motion for summary judgment (a ruling that there are no issues of fact to be decided and so the party moving for summary judgment must prevail). The trial court granted the motion and the Court of Appeals affirmed.¹

The type of implied trust the son attempted to establish was a “purchase money resulting trust” (a trust implied for the benefit of the person paying money for the transfer to another person of title to property). It must be shown, however, that the money was paid at or before the time of the closing, and that it was the intent of the parties at that time that the person claiming the benefit of the trust should pay the purchase money. Here, the son gave his check three days after the closing. The only evidence to the contrary was his affidavit claiming a verbal agreement with his mother, and that evidence was inadmissible.

¹ Rosado v. Rosado, 2008 WL 2151717 (Ga. App. 2008)

After the man died, his daughter filed a caveat (objection) to the will, which left his primary residence to the nurse and the rest of his estate to his sister and brother-in-law. A jury found the will to be invalid because it was the product of undue influence. When the brother-in-law, as Executor, appealed, the Supreme Court upheld the jury verdict.¹

A presumption of undue influence invalidating a will arises when a beneficiary under the will has a “confidential relationship” with the testator (exercises a controlling influence over the conduct and interest of the person executing the will).

Here, the man was almost completely dependent upon the nurse for all of his personal and medical needs, she isolated him from his daughter, and she took part in the preparation of the will. That evidence was sufficient to support a jury finding that the will was the product of undue influence by the nurse. The will was therefore invalid, and the daughter became the sole beneficiary of her father’s estate.

¹ Bean v. Wilson, 2008 WL 2077911 (Ga. 2008)

Here, the shareholder had filed a direct action against the officers. One exception to the general rule, however, is that a direct action may be brought when there are no other shareholders involved. Though the minority shareholder argued that suits from other shareholders were unlikely, the court found that he failed to prove that assertion, and thus the rule prohibiting direct actions applied in this case.

¹ 2008 WL 756112 (Ga. App. 2008)

The New York Court of Appeals ruled¹ that a child who is adopted out of a family cannot share in a class gift (a gift to a group of persons, such as “my children,” uncertain in number at the time of the gift but to be ascertained at a future time, who take in equal shares depending on the number of persons in the group). The court cited New York’s Domestic Relations law that terminates an adopted child’s right to inherit in this manner from the biological family (although preserving the right of an adopted child to inherit if he or she is specifically named in a biological family member’s will).

The court cited three policy reasons for its holding: (1) promoting the adopted child’s assimilation into the adoptive family, (2) keeping adoption records confidential, and (3) assuring the finality of judicial decrees by foreclosing the possibility that a secret out-of-wedlock child could materialize, years later, to intervene in the distribution of an estate or trust.

¹ 2008 WL 656471 (Ct. App. N.Y. 2008)

After the man died, the executors claimed that he did not have legal capacity at the time he signed the stock transfer requests, and they brought an action against the corporate entities that guaranteed his signature. The Court of Appeals ruled¹ that the Commercial Code in Georgia makes a signature guarantor liable only to persons taking or dealing with a security for losses due to the breach of warranty; it does not allow recovery by the stock owner himself (or his legal representatives after his death). Thus, Wachovia and Regions Bank were not liable to the executors.

However, AFLAC, Regions Financial, and Southern Company had a different role, since they issued the stock that was the subject of the transfers and signature guarantees. The court ruled that a stock issuer is liable for wrongful registration of a stock, and a signature guarantee does not absolve the issuer from the liability, though it shifts the financial risk to the guarantor. In making their case, the corporate defendants had argued that the man was not harmed by the change in ownership status, since he owned the stock until his death. The court disagreed, ruling that the issuer’s conduct deprived the man of the right to decide who should have his property after his death.

¹ 2008 WL 624957 (Ga. App. 2008)

The Court of Appeals agreed¹.

While there were no previous Georgia cases interpreting the phrase “sums of money” with regard to conservators, the Georgia Supreme Court had interpreted an almost identically-worded statute governing executor fees. In that case, the Supreme Court found that “sums of money” meant currency or a medium of exchange. Stocks, bonds, and real property are not sums of money because they have to be converted to cash. Additionally, the Court of Appeals ruled that the conservator was required to pay prejudgment interest (interest accruing from the time the dispute arose, rather than from the time the court issued its judgment) on the excess commissions.

¹ 2008 WL 565702 (Ga. Ct. App. 2008)

¹ 2008 WL 400375 (Ala. Civ. App. 2008)

¹ 2008 WL 350941 (Ga. 2008)

¹ 2008 WL 215217 (Ga. 2008)

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The Georgia Supreme Court decided¹ that a “security deed” such as this one was nothing more than a lien, conveying legal title only for the purposes of security, not ownership. The court held that a deed to secure debt did not sever a joint tenancy with right of survivorship, and thus the effect of the man’s death was that his sister, as surviving joint tenant, became the sole owner, and the property did not go to his estate. The man’s death terminated his interest in the property, and thus extinguished the security interest held by his sister-in-law.

¹ 656 S.E.2d 835 (Ga. 2008)

The daughter disclaimed only the assets that went to the foundation and the trust annuity; she did not disclaim the contingent remainder in the property passing to the trust. On the estate’s tax return, it deducted as charitable contributions the disclaimed property passing to the foundation as well as the present value of the annuity interest passing to the charitable trust. The Tax Court held¹ that the estate could deduct the entire value of the property passing to the foundation because that was an effective “qualified partial disclaimer” in conformity with the provisions of Internal Revenue Code Section 2518.

The court also agreed that the charitable deduction could encompass a higher valuation than was first reported on the estate tax return, because the parties agreed that the value of the property had increased substantially since the date of the mother’s death. However, the court allowed no deduction for property passing to the trust, because the partial disclaimer of that property was not effective, since the daughter disclaimed only the annuity portion and not the contingent remainder portion.

¹ 130 T.C. 1 (2008)

Prepared and presented by: Georgia Council of Probate Court Judges and the Fiduciary Law Section of the State Bar of Georgia.

¹ 2008 WL 81307 (Ga. App.)

The decedent’s sister filed a caveat alleging that the decedent lacked testamentary capacity and had been unduly influenced by the executor. The caveat also claimed that the person named as sole heir was neither the natural nor adopted child of the decedent, thereby making the caveator the decedent’s sole heir-at-law. After a hearing that was not transcribed, the probate court issued an order dismissing the caveat because the caveator failed to prove that the child was not the decedent’s heir-at-law and thus the caveator lacked standing to caveat the will. Upon appeal, the Supreme Court held that in the absence of a hearing transcript, there was a presumption of correctness to the probate court’s determination.

¹ 2008 WL 65452 (Ga.)

The caveators, sons of the testator, raised claims of undue influence and revocation. The undue influence claim was based on the role the executor, another son, played in selecting the attorney who drafted his father’s 1998 will and his alleged participation in preparing the will. The trial court excluded much evidence the caveators attempted to present, including evidence of the testator’s conduct years later, since it was not probative of whether the will was a product of undue influence when it was executed. Further, the trial court denied a request to charge the jury that there was a presumption of undue influence, since the caveators introduced no evidence showing either that the testator was weak, and hence susceptible to undue influence, or that the executor occupied a dominant position with regard to his father. On appeal, the Supreme Court upheld the trial court’s rulings on the admissibility of evidence and jury instructions. The revocation claim was based on documents showing that the testator planned to execute a new will. The testator had marked up a copy of his will, making changes and noting specific bequests, and had sent a letter to the executor requesting that the new bequests be given effect if he died before his new will was executed. The Supreme Court held that O.C.G.A. § 53-4-44 permits a presumption of revocation only if the original will or a material portion of the original will suffers destruction or obliteration. (A predecessor statute allowed for the destruction of “the original will or a duplicate.”) Thus, the testator’s markings on a copy did not raise the presumption of revocation.

¹ 2008 WL 65261 (Ga.)

Incapacity

A testator must have “testamentary capacity” in order to make a valid will. Generally that requires that the testator be of “sound mind,” as shown by the testator’s capacity to (1) understand the nature and extent of his or her property, (2) know the persons who would naturally benefit from the will, and (3) realize that the will he or she is executing does indeed makes a disposition of his or her property. A testator may be shown to lack testamentary capacity if it can be proved that at the time of executing the will he or she exhibited signs of dementia or mental illness or was under the influence of alcohol or drugs. Generally, the mere fact that a testator shows signs of advancing age, feebleness, or eccentricity is not enough, in and of itself, to prove testamentary incapacity invalidating a will.

Undue Influence

A will can be overturned if the challenger proves that at the time the will was made, the testator was subjected to such strong influence by another that the testator made a disposition of estate property that he or she otherwise would not have done. Coercion and duress are examples of undue influence.

Fraud

To invalidate a will on grounds of fraud, the challenger generally must show that the testator relied on a fraudulent misrepresentation and was deceived by it when he or she executed the will. Evidence of only the opportunity or motive for fraud, without showing that the fraud had an effect on the testator, is not enough to invalidate the will.

Improper Execution

Each state has procedural requirements for the execution of a will, generally including a number of required witnesses. Many states also require that the will be in writing or that the signatures of the testator or witnesses be notarized. A will that does not conform to statutory requirements may be held to be invalid.

Existence of a Later Will

Generally, a validly executed later will is presumed to revoke any prior wills.You should consult an experienced probate attorney if:

• You are the executor of a will that is the subject of a will contest;
• You are the beneficiary of a will that is the subject of a will contest; or
• You want to challenge a will that you believe is invalid.

A widow died with her petition for a year’s support from her late husband’s estate still pending. The executor of the widow’s estate, who also was the executor of the husband’s estate, filed an amendment to the year’s support petition. Upon the filing of the petition, the probate court issued a citation to the executor to show cause why the petition should not be granted. The court ordered that the executor of the estate of one of the husband’s sons was entitled to notice of the citation by mail. That executor objected to the amended petition, but the probate court dismissed the objection as untimely. The written objection was required to be filed in the probate court no later than ten days from the date the executor received service by mail. When no written objection was filed by that time, the year’s support proceeding automatically became in default. Six days later, however, the executor opened the default by the payment of costs and the filing of defenses objecting to the amendment. The Court of Appeals held that the provisions of the Civil Practice Act relating to the opening of default judgments as a matter of right within fifteen days of default apply to year’s support proceedings in probate court. Thus, the objection filed by the executor pursuant to the notice was timely, and the probate court’s dismissing it without ruling on the merits was error.

¹ 2007 WL 4357730 (2007)

If a decedent leaves a valid will, the will generally names an executor to handle the administration of the estate. The estate assets are distributed by the executor in accordance with the provisions of the will and under the supervision of the probate court.

If a decedent does not leave a will, or if the will is found to be invalid for any reason, the decedent is said to have died “intestate.” The state’s inheritance laws determine how the estate assets are distributed, and the probate court appoints an administrator to administer the estate.

Some types of assets do not have to go through the probate process, including life insurance, tax-deferred retirement plans such as IRAs and 401(k)s, and property owned jointly with a right of survivorship. These non-probate assets are usually directly payable to a named beneficiary or co-owner. Additionally, property held in a revocable living trust does not have to go through probate.

For large and complicated estates, probate can be time-consuming and costly. Most states, including Georgia, provide a streamlined and less expensive process for smaller estates. No matter what the size of the estate, however, dealing with the probate process and preserving estate assets requires an understanding of probate and tax laws. If you are involved in any way with administering an estate, you should contact, an attorney with experience in probate and estate administration for guidance.

• Petitioning the court to probate the will;
• Sending notice of the probate to named beneficiaries, other interested parties, and creditors of the decedent;
• Collecting, inventorying, and if necessary, appraising the assets of the estate;
• Collecting any payments, debts, and income due to the estate;
• Paying any debts owed by the estate;
• Filing federal, state, and local income taxes for the estate; and
• Distributing the remaining estate assets to beneficiaries in accordance with the terms of the will, or in accordance with state intestacy laws if there is no will or if the will is determined to be invalid.

When an estate is probated, it becomes a matter of public record, meaning that anyone can find out the size and contents of the estate and names of the estate beneficiaries.

Time and Expense of Probate

Probate may be a time-consuming process. While it may take only one or two months to probate a simple estate, the process may continue for a couple of years, depending on the size of the estate and the complexity of collecting, valuing, and distributing estate assets. Any will contests or other challenges over the estate will naturally lengthen the duration of the probate process. A lengthy probate process can also be costly, although normally the expenses of probating an estate, including legal fees, are paid out of the estate assets.

Small Estates

Georgia and many other states have a simplified process for small estates that fall within certain guidelines. The simplified process will generally be less expensive and of a shorter duration than the normal probate process.

Intestacy

When a person dies without a will, or if the probate court determines that the will is invalid, the person is said to have died “intestate.” In that case, the state’s intestacy laws will determine who is to inherit the estate. The intestacy statutes establish a default inheritance scheme which generally provides that estate property goes the decedent’s spouse and children and then to parents and other close family members. If the decedent leaves a valid will, however, the provisions in the will control the distribution of estate assets, and the state intestacy laws are not applicable.

Do You Need to Consult an Experienced Probate Attorney?

While probating a small and uncomplicated estate may not be difficult, it is best to seek the advice of an experienced probate attorney. If you have been named as the executor of an estate, an attorney can guide you through your state’s probate process; explain all of the duties of an executor; assist with filling out court forms, sending out required notices of probate and meeting court deadlines; and suggest ways to avoid or mitigate potential estate claims from other parties. You should consult an attorney promptly if any legal challenges are raised regarding a will under which you serve as executor.

The executor must be capable of performing all the duties required of him or her under the will and in accordance with the state’s probate process. The executor owes fiduciary duties to anyone who has an interest in the estate, and the executor must act in the best interests of the estate. For example, if an executor mismanages the estate assets, he or she can be held personally liable and may have to repay the estate for any losses. If a person cannot serve or refuses to serve as executor for any reason, the probate court generally will appoint another person to administer the estate.

The executor has many responsibilities, including:

• Locating documents left by the testator, such as will, trusts, and deeds;
• Initiating the probate of the will;
• Notifying Social Security, pension providers, insurers, financial institutions, and other entities of the death of the testator;
• Collecting, inventorying, and if necessary, appraising the estate assets;
• Collecting debts owed to the estate;
• Paying claims against the estate;
• Distributing the remaining assets in accordance with the terms of the will; and
• Closing the estate.

Initiating Probate

If you are named as an executor of an estate, you should consult an experienced probate attorney to discuss the responsibilities you are expected to fulfill. An attorney will represent the estate during probate, explain the probate process, and delineate each of your duties. An attorney can obtain the required forms, such as a death certificate and original copy of the will. These forms are needed to probate the will and to notify Social Security and financial institutions of the decedent’s death. An attorney also can send notices of probate to interested parties, as required under the state’s probate code.

Inventorying Assets

An executor is responsible for marshalling all the assets of the estate, including the real and personal property of the decedent, for distribution according to the terms of the will. An executor must locate deeds to real property, gather assets in the decedent’s bank and investment accounts, and inventory the decedent’s personal property, including automobiles, furniture, and household items. If the decedent owned any personal property of value, such as jewelry or collectibles, the executor may have to arrange for that property to be appraised.

An executor also is responsible for preserving and protecting estate assets prior to the eventual distribution of those assets to beneficiaries. Preservation of estate assets can be accomplished through reducing estate taxes when possible and taking advantage of appropriate asset valuation techniques. An experienced attorney can assist the executor in implementing effective asset preservation and tax strategies.

Collecting Debts

The executor is responsible for identifying and collecting any debts owed to the estate. For example, an executor should check with the decedent’ employer to determine if any unpaid salary or benefits are owed. Any expenses of collecting debts owed to the estate, such as the costs of hiring a collection agency, are generally paid out of estate assets.

Paying Claims

The executor must pay all valid claims against the estate. Such payments would include taxes and creditor claims. An experienced probate attorney can assist an executor in filing an estate tax return.

Distributing Assets

Generally, the costs of probating the estate, including attorney’s fees, are paid by the estate out of estate assets before those assets are distributed to the named beneficiaries. After all debts are collected and claims are paid, the executor is responsible for distributing the remaining estate assets according to the terms of the decedent’s will.

Closing the Estate

When all of the estate assets have been distributed, the executor can close the estate. This generally involves giving the probate court evidence that all required notices of probate have been sent, all debts owed to the estate have been collected, all claims against the estate have been paid, and all remaining estate assets have been distributed in accordance with the provisions of the will.

When the probate court is satisfied that the estate is closed, it will release the executor from any further responsibilities on behalf of the estate.

Assets are considered non-probate when, by contract, the beneficiary is already named. The most common examples of non-probate assets are life insurance proceeds and tax-deferred retirement plans, such as IRAs and 401(k) plans.

Life Insurance Proceeds

A life insurance policy is a contract with an insurer that specifically identifies who will be paid after the decedent’s death. Since payment of the proceeds to the named beneficiary is part of the contract, there is no reason for the life insurance to go through the probate process.

Tax-Deferred Retirement Plans

These plans generally require the participant to name a beneficiary who will receive the proceeds of the plan in the event of the participant’s death. Since the beneficiary is determined by contract in advance, there is no need for the plan to go through the probate process.

Revocable Living Trusts

A revocable living trust is a legal entity established to hold title to property. When the property owner gives property to the trust, title to the property passes to the trustee of the trust. The document establishing the trust designates to whom the trust property will be distributed at the donor’s death. Since the trust is revocable, the donor has access to the property during his or her lifetime and can, if he or she chooses, take back title to the property. At the donor’s death, the property in the trust passes outside of probate because title is not in the name of the donor.

Other Non-Probate Assets

If an owner of property contractually names a beneficiary who will succeed to ownership in the event of his death, then the property falls outside the probate process and the asset will go directly to that named beneficiary. Methods of establishing non-probate property include:

• Joint Tenancy with Right of Survivorship – When two or more people own an asset jointly, it is often held with a right of survivorship. If one of the owners dies, the other owner(s) then automatically acquires the decedent’s ownership interest in the property. It is common for married couples to hold real estate or bank accounts in joint tenancy with right of survivorship.
• Payment on Death Bank Account – A beneficiary is named when an account is opened. The beneficiary has no ownership interest in the account while the account owner is alive, but at the owner’s death full ownership of the balance in the account automatically passes to the named beneficiary.
• Transfer on Death Securities – Stock, bonds, and brokerage accounts titled in this manner work the same way as POD bank accounts. The account owner names a beneficiary, the beneficiary has no ownership interest in the securities while the owner is alive, and at the owner’s death full ownership in the securities passes to the named beneficiary without probate.

Each of the foregoing strategies presents some attendant risks. For example, a person who opens a bank account jointly with a right of survivorship gives up exclusive control of the funds in the account. The other joint owner may take the funds or a creditor of the other owner may reach the funds.

If you are interested in strategies to avoid probate, please consult with an experienced attorney who can offer comprehensive estate planning advice.

Thanks to the Daily Report.

Source: Daily Report.

¹ Baker v. Merrill Lynch Trust Co., __ S.E.2d __, __ Ga. App. __, 2007 WL 1933135 (July 5, 2007).

¹ Ashburn Health Care Center, Inc. v. Poole __ Ga. App. __, __ S.E.2d __, 2007 WL 1764217 (June 20, 2007).

¹ Booker v. Booker, File No. A07A0110, __ S.E.2d __ , 2007 WL 1761173 (June 20, 2007)
² Hall v. First Nat’l Bank of Atlanta, 89 Ga. App. 853(2), 81 S.E.2d 522 (1954)

The U.S. Supreme Court’s 5-4 ruling last week in Bowles v. Russell contains an important reminder for lawyers who handle appeals before the intermediate federal appellate courts: If an appeal is not filed within the time provided by federal statute, the appeal cannot be heard and decided on the merits.

Here is the full article (a subscription may be required): Appeal on Time, or Don’t Appeal at All, U.S. Supreme Court Advises

State Farm settles Katrina lawsuit on day of trial for an undisclosed amount. The plaintiff, Michael McCoy, was seeking $189,402, plus $5 million in punitive damages for damage done to his home during Hurricane Katrina. “State Farm says flood, which the company doesn’t cover, reduced McCoy’s house to a slab.”

“depositing at least $865,000 owed to him for an unnamed project into an attorney client trust account against his wishes.”

Opri’s original suit claims that Birkhead has failed to pay his legal fees for her representation of him during his paternity suit.

For the full story: Federal court dismisses Fannie Mae shareholders lawsuit.

“same-sex couples to enter into civil unions with the ’same rights, responsibilities, and obligations as married couples’ beginning in January 2008.”

For the full story: New Hampshire governor signs civil unions bill

In Young v. Williams, 2007 WL 1121740, Docket No. A07A0030 (Ga. Ct. App. 2007), the attorney who drafted a will for James Williams neglected to include requested language leaving the marital residence to Betsy Williams, the surviving spouse. Mrs. Williams, represented by Gaslowitz Frankel LLC, sued the drafting attorney for malpractice. The drafting attorney admitted that he had made a terrible mistake that would otherwise constitute malpractice, but he argued that Mrs. Williams did not have standing to sue him for malpractice.

The trial court rejected this argument and entered summary judgment in favor of Mrs. Williams. On appeal by the drafting attorney, the Court of Appeals affirmed holding that a contract with a lawyer to draft a will, like any other contract under Georgia law, was subject to the third-party beneficiary rule. Thus, where a person hires a lawyer to draft a will and intends for the will to benefit a spouse (or other person), the spouse (or other person) has the right to sue the attorney for malpractice after the will is probated if it did not provide for what the decedent wanted.

¹ 277 Ga. App. 524, 627 S.E.2d 141 (2006)

What single event can do more damage to family harmony than a nasty divorce dispute? The answer: A will contest or other estate dispute. The worst legal, emotional and often financial nightmares begin when someone in a family contests a will — that is, they seek the court system’s intervention to modify or set aside a loved one’s will. What they do not see going on is the emotional carnage that invariably results if litigation is pursued. Estate disputes can last for years, and have been known to drag on for decades, sometimes not concluding until well after the heirs themselves are deceased.Who wins in these cases? Usually, no one but the lawyers.Is there a better alternative? While a lawsuit over a loved one’s estate may be unavoidable, there are often better ways to resolve the dispute than turning the matter into years of protracted litigation. Mediation is one such alternative. It is an opportunity to get the disputing parties together either before taking the matter to court or soon after litigation is begun but before one side throws down the gauntlet, thereby saving money, time and emotional battle scars that may never heal.There are some early warning signs that can help you identify whether a deceased relative’s estate is going to be difficult to administer. (more…)

¹ 268 Ga. App. 316, 601 S.E.2d 813 (2004)

Click here for the full article, Personal Business; A Legacy of Rancor: Estate Fights Rising, courtesy of the New York Times.

Open communication with your children and clarity about the decisions you are making about your estate are some of the keys to avoiding a future dispute. Most parents tend to keep their finances and estate plans a secret from their children. However, if your family understands your decisions and why you are making them, they may be less likely to argue about them once you are gone. Questions and conflicts that might arise later are easier to plan around if acknowledged and addressed upfront. In addition, certain basic estate planning tools can be used to head off many of the typical problems that lead to litigation.

In my practice I have noticed certain specific situations that frequently cause conflict after the death of a parent or loved one.
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Get ready baby boomers. Over the next few decades you will inherit trillions of dollars — $10.4 trillion to be precise, according to a 1993 Cornell University study. As Depression-era investors pass away, their children stand to benefit from an “inheritance boom” that reflects the fact that more than half of all wealth in the United States is held by people over the age of 55 — 37% of the population.

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If you have a library card you can read the full transcript of this interview courtesy of AccessMyLibrary.

¹ 260 Ga. App. 857, 581 S.E.2d 375 (2003)

If you are concerned about the possibility of a will contest, I encourage you not to focus solely on drafting your documents to minimize the risk that, if brought, such contest will be successful and destroy the testator’s carefully crafted estate plan. While this goal is not to be ignored, an examination of the case law, in Georgia and around the country, as well as the related literature, should provide the planner with some comfort that the vast majority of such contests eventually fail. The real problem is that the damage (years of protracted litigation, delays in addressing estate administration concerns, delayed distribution of estate assets, legal fees and irreparable destruction of family relationships) is simply in the bringing of a will contest, regardless of which party is ultimately successful. Therefore, it is at least as important for lawyers to consider steps that can be taken to minimize the likelihood that a dispute arises in the first place.

There are countless steps that can be taken to minimize the likelihood of a will contest. Some simply involve encouraging better communication among the testator and his family members. Others make the potential caveator think twice before embarking down that road. The following suggestions focus on the actual execution of the will, and are just a few steps that will douse some of the fuel from the dispute fire: (more…)

¹ 275 Ga. 437, 569 S.E.2d 857 (2002)

¹ 275 Ga. 213, 563 S.E.2d 863 (2002)

At the jury trial, the judge failed to give instructions to the jury regarding the existence of a confidential relationship between the grandson and the grandfather, pursuant to which there was a presumption of undue influence. Our client objected, and the Georgia Supreme Court subsequently ruled¹ in our client’s favor, finding that the failure to give this instruction was a critical error. This case is one of a continuing line of cases in which the appellate courts have focused on the relationship between the parties and whether they were in a special relationship of trust, called a “confidential relationship,” because if they were, there is a presumption of undue influence and the burden of proof at trial shifts to the person who was in the confidential relationship with the decedent.

¹ 275 Ga. 38, 561 S.E.2d 806 (2002)

The Court of Appeals agreed ¹. An heir should be allowed to recover her attorney’s fees from the estate when the mismanagement of estate assets is remedied as a consequence of the heir’s lawsuit. Likewise, an executor should not be allowed to recover his fees from an estate where the lawsuit involves allegations that the executor mismanaged the estate assets and the executor loses the lawsuit.

¹ 254 Ga. App. 84, 561 S.E.2d 216 (2002)

General Observations on the Future of Estate Litigation

I. Introduction

It obviously is well-established in Georgia law that parties to a contract have a right of action against one who has procured a breach or termination of that contract by the other party. The theory behind this doctrine is that the right to perform a contract and the right to reap the benefits resulting from the performance of such contract are property rights which are entitled to protection under the law. Therefore, you can bring a tort action for any injuries suffered as a result of the interference with such contract.

But what about interference with non-contractual relationships?

As it turns out, once the tort of intentional interference with contractual relations gained acceptance, courts across the country began to recognize the tort of intentional interference with inheritance or expectancy. The courts that have considered the point have reasoned that the law should afford as much protection to noncommercial expectancies as it does to commercial ones. And in fact, this cause of action seems to now be well-established in most states, notwithstanding a rather confusing history. As our own Supreme Court so eloquently put it back in 1915, “[n]ot only does the failure to permit such a cause of action give unnecessary protection to malice, but it also invites the courts to close their eyes to cause and effect and to a large segment of the realities of human affairs.”

Restatement (Second) of Torts, ch. 37A, §774B, has probably summarized this type of claim best:
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Probably one of the largest growth areas in the fiduciary litigation field that we have seen over the past few years, and probably the easiest to foresee and/or prevent concerns the mismanagement of estates and trusts by executors, trustees or personal representatives (collectively referred to as “PR”). I’ve seen too many disputes arise out of one bad choice.

I encourage you not to get lazy in your planning and let your client do anything stupid or short sighted here. Take the selection of personal representatives seriously and make sure you convey that seriousness to your clients. Too often the choice is made off handedly based on a client’s uninformed or ill advised preference for one person over another. Frequently the decision is made long before the actual details of the estate plan have been formulated, and longer still before the actual need for the PR comes to pass. Therefore, it might be advisable to quiz clients in some detail on their possible choices and the relationship between the various parties who are likely to play out the post-mortem end game.

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¹ 220 Ga. App. 641, 469 S.E.2d 853 (1996)