WILLS AND ADVANCED DIRECTIVES
by: Steven S. Collins
Moore, Susler, McNutt, Wrigley & Root, L.L.C.
You have probably seen a movie in which a will is read. The scene is familiar and goes something like this: Family members, dressed in the dark clothes most suitable for a funeral, sit before an attorney, often played by a distinguished-looking character actor wearing a dark suit. The gathered sons and daughters of the decedent wait breathlessly while the attorney pulls some old documents out of his leather briefcase. The lawyer fumbles with the files but finally announces "I will now read the will."
After a few a stereotypical flourishes of legalese ("being of sound mind and body" is a favorite line), the attorney reads the will, typically hitting on only the most dramatic points. Depending on the movie youíre watching, the family members will either smile wickedly at their good fortune or weep uncontrollably because the bulk of the old manís fortune is going to the sexy blonde girlfriend, the chief suspect in the patriarchís mysterious demise.
The transfer of oneís property after death has provided innumerable plot lines for movies, television shows and books, but in real life, the testamentary transfer of property is far less dramatic. Wills are usually simple documents drafted to ensure an easy and worry-free transfer of property from one generation to another. Wills are flexible documents which can be used to distribute vast fortunes or meager amounts. While a will has no legal effect during the life of the person executing it, a will can provide the piece of mind necessary to enjoy life to the fullest.
What is a will? The technical definition, as found in Blackís Law Dictionary, is as follows: "An instrument by which a person makes a disposition of his real and personal property, to take effect after his death, and which by its own nature is ambulatory and revocable during his lifetime." Also: "A written instrument executed with the formalities required by statutes, whereby a person makes a disposition of his property to take effect after his death." The person making the will is called the "testator." When the "testator" dies, he or she is referred to as the "decedent."
Obviously, not everyone who dies has made a will. When a person dies, he or she either dies "intestate" (without a will, or without a properly-executed will) or "testate" (with a properly-executed will). If a person dies intestate, Illinois statute determines to whom that personís property is distributed. These "rules of descent and distribution" are found at 755 ILCS 5/2-1.
THE RULES OF DESCENT AND DISTRIBUTION
The rules of descent and distribution apply to any property of the decedent which does not pass through a properly-executed will. A person may not leave a will at all. A person may leave a will which was not properly executed, or an invalid will. In some cases, a person may have a properly-executed will, but not all of his or her property is disposed of by the will. In any of these cases, the rules of descent and distribution apply.
Many people mistakenly believe that if they die without a will, their property will be distributed to the state (such a reversion of property is known as "escheat"). However, rarely does a personís property escheat to the state. Most people have descendants, persons who are entitled to inherit the decedentís property. For example, if a person dies and has a spouse, but no children, the law states that all of the personís property descends and is distributed to the surviving spouse. If there is a surviving spouse, and at least one surviving descendant (such as a child or a grandchild), the spouse will get half of everything and the descendant will get the other half. If there is more than one descendant, those persons will split the one-half of the property into equal shares. This is called "per stirpes," a Latin term which means that property goes in equal shares to all descendants, with children of a deceased descendant divvying up the share of their parent.
A quick example: Paul dies, survived by his wife, Mary and his two children, Peter and Martha. A third child, Alan, died before Paul, but his two children, Jack and Jill, survive their grandfather. Whatever Paul owned in his own name at his death (and not property owned in joint tenancy or in some payable-on-death form) would be divided thus: one half to the widow Mary, one-sixth to son Peter, one-sixth to daughter Martha, one-twelfth to grandson Jack and one-twelfth to granddaughter Jill. Had Paul been survived by his wife, Mary, but did not have children, Mary would take all. If Paul had no wife, but had one or more descendants, they would receive everything, split into shares pursuant to state law.
If the decedent has no spouse or descendants, the rules of descent and distribution require the decedentís estate to pass to siblings and parents. If only one parent survives, that parent would receive a double share of the decedentís estate. No siblings or parents? Next in line are the paternal and maternal grandparents, nieces, nephews, great-grandparents, cousins, etc. Only if no kindred can be found anywhere will the decedentís estate escheat.
To bypass the rules of descent and distribution, a person can execute a will. To make a will, a person must be at least 18 years old and must possess the necessary mental "capacity." Capacity is essentially "sound mind and memory" -- the ability to know the "objects of oneís bounty."
To execute a will, the testator must know and understand the plan of distribution included in the will and must have formulated the plan of distribution free from the influence of others. For the will to be valid, the testator must exhibit, at the time the will is executed, that the document operates has his or her own will. Minors or persons with certain mental disabilities cannot properly execute wills. They do not possess the legal capacity to understand what a will does.
While not a formal requirement, all wills should include language such as this: "I, John Smith, do hereby make this my Last Will and Testament . . . ." This evidences the testamentary intent required to make a will a valid one.
DRAFTING THE DOCUMENT
If the testator has the necessary capacity and is the right age, the next step is to draft the document. A will in Illinois need not be typewritten; handwritten wills are OK. A testator does not need an attorney to draft a will. A will need not dispose of property. For example, a will can simply appoint a personal representative (such as a guardian for children) or revoke or revise another will. A will need not dispose of all of a personís property. However, if it does not, that property not included in the will could pass through the rules of descent and distribution.
While options for disposing of property are nearly limitless, a well-drafted will should ensure all of the testatorís property, both real and personal, will pass to designated heirs or legatees without problems. A will can direct that all property (the "rest and residue" of the testatorís estate) go to specific persons. Or the testator may want to make "specific bequests," or items of property given to particular individuals. A will can include trusts, such as one to aid minor children or disabled adults. A will makes it possible to make special gifts to cherished relatives or friends. A testator can also make charitable gifts with a will.
Every will should nominate an "executor," the person who will carry out the testatorís plan of distribution. The executor will also oversee the administration of the testatorís estate. Sometimes the executor is called a "personal representative."
The executor should be a trustworthy person; the testator should nominate someone who is willing to handle the responsibilities of distributing the property after the testatorís death. The executor does not have to be an individual. For example, many banks have trust departments which act as executors. However, Illinois law requires that an executor be a person at least 18 years of age who has the mental capacity to act as executor. Also, convicted felons cannot act as executor of wills probated in Illinois.
EXECUTING A WILL
Once the will is drafted, it must be executed to be valid. "Executed" means properly signed and witnessed, pursuant to Illinois law. For a will to be valid in Illinois, it must be in writing, it must be signed by the testator (or by another person who is personally directed by the testator to sign in his or her presence) and it must be attested by two witnesses, who must attest to the testatorís signature in his or her presence. The two witnesses must be at least 18 years old and have capacity. Further, the witnesses cannot be "interested witnesses," that is, persons who are also beneficiaries under the will. If one of the witnesses is an interested witness, the will may still be admitted to probate -- however, that witness/beneficiary may lose his or her legacy.
Once a will has been properly executed, it is important to remember that it is revokable by the testator at any time, as long as the testator has the necessary mental capacity. A will can also be amended at any time, usually by the attachment of an amendment, known as a "codicil." The codicil, to be valid, must be witnessed in the same fashion as the will. Any amendments to the will not witnessed by two competent people will not be recognized in probate.
"Probate" was originally considered the process by which a will is determined to be valid or invalid. Now, the definition of "probate" has expanded to refer to the legal procedure by which a decedentís estate is administered. To have a will admitted to probate, the core requirements of the execution of a will -- a writing signed by the testator in front of two witnesses -- must be met. Otherwise, a probate judge can refuse to have the will admitted and the duties of the executor become somewhat more difficult.
Probate can be an expensive process. With a complex estate, attorneys are often required to help an executor with the necessary documentation. A petition to admit a will to probate must be filed, together with supporting documents. These include an affidavit of heirship, a bond and an oath of office. Proper notice must be given to all heirs and legatees. All known creditors need also receive notice; a notice published in a local newspaper is required to notify unknown creditors.
To properly administer an estate, the executor or personal representative must receive "letters of office" from the probate court. These letters are simply documents indicating that the executor has been appointed by the court and has authority to properly administer the estate. All claims against a decedentís estate must be filed with the court. All distributions must be filed with the court. Deeds and other documents are often needed to transfer real estate to heirs and legatees. An inventory, or list of items, of the decedentís estate usually is filed. Before an estate is closed and the probate process ended, the executor must complete an accounting.
Less complex estates can often be handled with a minimum of court supervision and attorney fees. "Independent administration" is a procedure by which the executor or personal representative handles the administration of the estate with very little court involvement. Under Illinois law, an independent administrator is authorized to distribute property, transfer real estate, settle claims and do any number of other tasks without direct court approval. However, with an independent administration, all necessary petitions and supporting documents must still be filed and the will still needs to be admitted to probate. An independent administrator also requires letters of office.
For estates of less than $50,000, probate is unnecessary. The law provides for what is known as a "small estate affidavit." With this document, a personal representative can provide for the easy distribution of estate assets without court supervision or the filing of probate. However, for the small estate affidavit to meet necessary statutory requirements, the decedent cannot own more than $50,000 in TOTAL assets, including real estate or other personal property. Also, the decedent cannot have creditors.
Many financial "experts" warn against the costs and complexity of probate and further warn that probate only benefits attorneys and creditors. This is not necessarily true. Probate provides a legal method of distributing a decedentís estate in which all necessary parties are represented. Probate of simple estates need not be expensive at all. If a properly-executed will is clear as to the distribution of property, probate need not be difficult.
Before by-passing the execution of a will for a so-called "living trust" or other probate-avoiding trust, testators should examine all their estate planning options. Every testators will have unique needs. For example, one person may have concerns about disability planning; in that case, the choice of a "living trust" may be disastrous. Another person may want to avoid "death taxes" owned; here, a "living trust" may be beneficial. Avoiding probate is not necessarily a good reason to put off drafting a will or focusing on estate planning.
Estate planning is not only the drafting and execution of a will or trust, but also the drafting and execution of supporting documents, often call "advance directives." These documents include the Power of Attorney for Property, the Power of Attorney for Health Care and the Living Will. When executed at the same time as a will, these documents help prepare the testator for the temporary or permanent loss of decisional capacity.
Many people believe powers of attorney or living wills are for those contemplating the end of life or for elderly individuals. Yet, in our modern world, young people are as vulnerable to disability caused by accident or disease as the elderly. The need for a power of attorney or a living will often becomes brutally apparent when it is too late to do anything about it. Like wills, these advance directives can only be executed by persons who have the requisite mental capacity. Once the person has become disabled or in need of the document, it is usually too late to do anything about it.
Those executing powers of attorney need to name an agent or co-agents and should only name people they trust without question. Powers of attorney place much authority in agents and can often result in abuse and malfeasance. A power of attorney for property can be very broad and gives the agent authority to handle any of the principalís financial matters. A power of attorney for health care gives the named agent authority to make medical decisions for the principal. Clearly, if the agent or co-agents were not trustworthy, the powers of attorney could be used against a principalís best interests.
Given the far-reaching legal implications of advance directives, it is advisable for those considering them to contact an attorney. Those attempting to draft their own advance directives or those who purchase "fill-in-the-blank" documents may not comprehend the legal importance of the documents until it is too late. Many financial "experts" and medical personnel may provide some guidance, but only an attorney would be qualified to address the legal consequences. Unlike a will, an advance directive can have immediate, and negative, effects on a living person.
The process of estate planning need not be complex or scary. Unlike in the movies, estate planning and probate often do not result in dramatic results. A carefully drafted will, together with appropriate advance directives, can give the average person a sense that the administration of his or her estate will not result in upset heirs or unnatural surprises. Estate planning can help keep the drama in the movies.
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