Question 1

Dyan executes her will to give "to my nephew Esau my stock in Fargo, Inc." Later, Dyan writes separately, with the same formalities required for a will, to leave the stock to her niece Ginny and cash to Esau. This writing

Accepted Answer

The later writing revokes the will's gift of the stock to Esau, so the stock will not pass to him.

Question 2

Patty, who is divorced, owns a house. She has no reasonable expectation of benefit from the life of Quinn, her ex-spouse, but she applies for insurance on his life anyway. She also obtains a fire insurance policy on the house, which she later sells. Five years later, Quinn dies and the house is destroyed in a fire. Can Patty obtain payment on either the death of Quinn or the loss of the house? Explain.

Accepted Answer

The answer of Patty, who is divorced, owns a house....

Question 3

Orin creates a living trust to pass his assets, including stock in Petro Oil Company and other business investments, to his heirs. One advantage of this arrangement is that

Accepted Answer

One advantage of creating a living trust is that the assets can be transferred without going through probate, which can save time and money for the heirs. However, it is important to note that a living trust does not necessarily shelter assets from estate taxes, and income taxes may still need to be paid on any earnings generated by the trust. Additionally, the trust is created while the grantor is still alive, but the distribution of assets only occurs upon the grantor's death.

Question 4

Mason creates a trust to prevent his son, Newt, the beneficiary, from assigning his rights to future payments of income from the trust. This is

Accepted Answer

This is a spendthrift trust, where the beneficiary's right to assign future payments from the trust is restricted to avoid creditor claims or improper handling of funds.

Question 5

Benny dies without a will, with no surviving spouse or child. Benny's survivors include his granddaughter Callie, his nephew Duncan, and his cousin Earl. In most states, his estate would pass to

Accepted Answer

In most states, when an individual dies without a will or any surviving spouse or child, the estate would be passed down to the closest surviving relative(s) such as grandchildren, nieces/nephews, or cousins. In this scenario, Callie is Benny's only grandchild and therefore the closest surviving relative, making her the rightful heir to his estate.

Question 6

Cliff dies without a will. His survivors include his spouse Dana and his two children, Efrem and Fay. Under applicable laws, Dana will probably receive

Accepted Answer

Without a will, Cliff's estate will be distributed according to the intestacy laws of the state. In this case, the most common scenario is that the surviving spouse (Dana) will receive one-third of the estate and the remaining two-thirds will be split equally between the two children (Efrem and Fay). Therefore, Dana will likely receive one-third of Cliff's estate.

Question 7

Juli types onto a computer what she intends to be "My Will" and prints it out. Juli has capacity. "My Will" is

Accepted Answer

The answer of Juli types onto a computer what she...

Question 8

Sherman dies without a will, survived by his granddaughter Roxy and Roxy's brother Pio. Roxy and Pio are Sherman's

Accepted Answer

Roxy and Pio are lineal descendants of Sherman, meaning they are his direct descendants in a straight line of descent.

Question 9

Lani is asked to serve as a witness to Mona's will. To qualify, Lani must be

Accepted Answer

The answer of Lani is asked to serve as a...

Question 10

Amelia executes a separate written instrument to amend her prior will. This separate document is

Accepted Answer

A separate written instrument to amend a prior will is called a codicil.

Question 11

Ratzo is asked to be a witness to Sade's will. Before attesting to the will,

Accepted Answer

Ratzo does not have to read the will or be informed of its contents before attesting to it. As a witness, his role is to simply verify that the person signing the will is of sound mind and aware of the document they are signing.

Question 12

Dieter's will provides for a distribution of his assets on his death. Who will "distribute" Dieter's property, and what are the steps involved?

Accepted Answer

The answer of Dieter's will provides for a distribution of...

Quiz 37: Insurance, Wills, and Trusts