Wills, Trusts, Guardianships, and Fiduciary Administration - Mary F. Radford

• Publication year: 2006

Wills, Trusts, Guardianships, and Fiduciary Administrationby Mary F. Radford^*

This Article describes the significant Georgia cases and legislation from the period of June 1, 2005 through May 31, 2006 that pertain to Georgia fiduciary law. Specifically, the Article covers cases and legislation on matters relating to wills, trusts, the administration of decedents' estates, and the guardianship and conservatorship of minors and incapacitated adults.

I. Significant Georgia Cases

A. The Effect of a Testator's Marriage Subsequent to the Making of a Will

Under Official Code of Georgia Annotated ("O.C.G.A.") section 53-4-48, as amended in 2002, a marriage subsequent to the making of a will "shall result in a revocation of the will only to the extent provided in the remainder of this Code section."¹ The section then goes on to explain that, assuming the will was not made in contemplation of marriage, the subsequent spouse is to receive the share of the decedent's estate that he or she would have received if the decedent had died intestate.² The question that arose in English v. Ricart³ was whether the subsequent spouse's right to her intestate share was one that existed automatically by virtue of the statute or one that would be granted only if the subsequent spouse filed a timely caveat to the will.⁴ The Georgia Supreme Court gave a limited answer to this question.⁵

After divorcing his first wife, Mr. English executed a 1994 will leaving his entire estate to his two sons. Mr. English married Ms. Ricart in 2001. He died in 2004 without changing his will. His executor filed a petition to probate the will and named Ricart as one of English's heirs. The citation included the standard language requiring any objection to be filed within ten days of service of the petition. Ricart signed an Acknowledgment of Service and Assent to Probate Instanter. The sons requested a hearing to contest Ricart's status as their father's spouse. Later, before the will was admitted to probate, Ricart filed a motion for clarification of her status as an heir.⁶ She relied upon O.C.G.A. section 53-4-48.⁷ If O.C.G.A. section 53-4-48 applied, then Ricart would have been due one-third of English's estate under O.C.G.A. section 53-2-1(b)(1).⁸ The sons, however, claimed that she had waived her right to this statutory share when she assented to the probate, acknowledged service, and failed to object within ten days of the service of the petition. The sons also said that the court should have admitted the will to probate immediately after receiving the sons' proposed order.⁹ The probate court held that Ricart had a right to make a claim because the will had not yet been admitted to probate at the time her claim was filed.¹⁰ The Georgia Supreme Court affirmed.¹¹

The court stated that the O.C.G.A. gives the probate judge the discretion to extend the time for filing any objections and for holding any required hearing.¹² Thus, the probate judge had the right to extend Ricart's time for filing a response and had done so by not admitting the will to probate.¹³ The supreme court noted that it expressly did not reach the issue of whether Ricart could have claimed her statutory share as a matter of law even after the will had been admitted to probate.¹⁴

The more interesting legal discussion in this case appears in a concurring opinion written by Justice Carley and joined by Justice Thompson.¹⁵ In his opinion, Justice Carley took his colleagues to task for refusing to address the statutory issue.¹⁶ Justice Carley stated that Ricart's right to take her intestate share existed as a matter of right regardless of whether she filed a claim after the will had been admitted to probate.¹⁷ Citing the probate court, Justice Carley explained that while a caveat to a will alleges facts that show why the will should not be probated, the spouse's claim in this case was not based on disputed facts but was one that arose by operation of law.¹⁸ Justice Carley outlined the derivation of the rights under O.C.G.A. section 53-4-48 of a spouse who marries a testator after the testator has made a will that does not contemplate a subsequent marriage.¹⁹ He noted that the pre-2002 version of the statute had called for a complete revocation of the will upon the testator's subsequent marriage if the will did not contemplate such an event.²⁰ However, under the 2002 amendment, the will would remain intact, and a limited revocation would occur only to the extent needed to give the spouse her intestate share.²¹ Justice Carley thus stated that the "clear and obvious intent of the General Assembly . . . was to uphold the validity of a will, and thereby dispense with the procedural applicability of a caveat" in this type of situation.²² Using this logic, he concluded that Ricart's assent to the probate of the will was "completely consistent with her statutory claim to an intestate share."²³ The issue of whether the spouse could take that statutory share was not one that needed to be raised prior to probate because the spouse retained that right as a matter of law, regardless of whether the will had been admitted to probate.²⁴

B. Joint Wills, Mutual Wills, and Other Miscellaneous Issues

The Georgia Supreme Court addressed a variety of issues in the case of Hodges v. Callaway.²⁵ The testators in this case, Mr. and Mrs. Jones, executed a will in 1974 that was called the "Mutual Last Will and Testament of P. H. Jones and Mrs. Lucille C. Jones."²⁶ The will provided that the survivor of the two would serve as executor of the other's estate, would receive all personal property of the other, and would receive a life estate in all real property with the right to sell the property "'if necessary for their (his or her) maintenance and support, without any limitations or restrictions.'"²⁷ Upon the death of the life tenant, the remainder of the real property would be divided between the spouses' families. When Mr. Jones died in 1986, the will was not submitted for probate.²⁸ At that time, however, Mrs. Jones did sign a codicil²⁹ to the will to name a new executor, Linton Hodges, for her estate. In 1999 Mrs. Jones conveyed by gift to her second cousin, William Callaway, a tract of land that had been owned by the two testators when Mr. Jones died. At the same time, she appointed Callaway as her attorney-in-fact.³⁰ Both the deed and the power of attorney document were witnessed by a state court judge and a probate court judge.³¹

Mrs. Jones died in 2001, and Hodges, the executor, submitted the will for probate. Hodges then filed an action against Callaway seeking to void the deed of gift. Hodges claimed that the gift was null and void for several reasons including: (1) the will precluded Mrs. Jones from making the gift; (2) Mrs. Jones did not have the appropriate capacity to execute the deed of gift; (3) Callaway exercised undue influence over her; and (4) Callaway breached his fiduciary duty as attorney-in-fact when he accepted the gift. Callaway counterclaimed, alleging fraud and a breach of a warranty covenant that was contained in the deed.³² He sought compensatory and punitive damages of $1,000,000.³³ The Georgia Supreme Court held as follows: (1) the will did not preclude Mrs. Jones from making the gift; (2) Mrs. Jones did not lack the capacity to sign either the deed of gift or the power of attorney document; (3) Callaway did not breach a fiduciary duty when he accepted the gift; (4) the trial court was not precluded from considering whether Mrs. Jones had breached the warranty of title; and (5) Mrs. Jones had in fact breached the warranty.³⁴

1. The Joint Will.³⁵ The first question raised in deciding if the will precluded Mrs. Jones from conveying the real property was whether the pre-1998 Probate Code (the "former Code") or the Revised Probate Code of 1998 (the "Revised Code") applied.³⁶ The Georgia Supreme Court determined that the answer would be the same under either version but carried forward from the former Code the confusing term "mutual will."³⁷ The will was definitely a "joint will," which is one document signed by two individuals that contains the dispositions of both of their estates.³⁸ Under older case law, the term "mutual will" was a term of law as well as a term of description and was used to refer to a will that contains reciprocal provisions and an agreement that the survivor is bound by contract to abide by the terms of the mutual will.³⁹ Thus, if the Joneses' will was determined to be a "mutual will" under this old case law, Mrs. Jones was bound by contract to retain the testamentary scheme contained in the will and thus bound not to dispose of the property in any manner other than that set forth in the will.

By defining both "joint" and "mutual" wills, the Revised Code attempted to clear up some of the confusion caused by that terminolo-gy.⁴⁰ Under O.C.G.A. section 53-4-31, a "joint will is one will signed by two or more testators that deals with the distribution of the property of each testator."⁴¹ "'Mutual wills are separate wills of two or more testators that make reciprocal dispositions of each testator's proper-ty.'"⁴² Neither term is meant to convey the legal notion that the survivor is bound by contract to keep the testamentary scheme intact.⁴³ Under the Revised Code, such contracts, if entered into on or after January 1, 1998, must be express and in writing.⁴⁴ The supreme court cited all of these Revised Code sections but then persisted in using the term "mutual will" as a legal term when it stated that "the will in issue here is joint, but not mutual, and was revocable by Mrs. Jones . . . ."⁴⁵ In any event, the court determined that the will in question did not contain the requisite express or definite statement of a contractual agreement, and it also did not contain "a clear and definite agreement," which would have allowed equity to intervene to prevent fraud.⁴⁶ Thus, Mrs. Jones was within her rights in conveying the property to Calla-way.⁴⁷

2. Deed of Gift and...