Our last estate planning blog post was about preparing for an estate planning consultation: things to think about beforehand, ways to prepare, expectations to have for your initial meeting.
Today, we want to address some common reasons why people don’t pursue the creation of their own personal estate plans. They often say something like:
“I wrote down everything I want to happen when I die.”
“I don’t need to speak with a lawyer because I’ve documented it already.”
“There’s paper in my fridge that says who I care about and what I want them to receive.”
While this is all well-intentioned, statements like these raise the alarm for us.
There are certainly unique scenarios where a handwritten document stating who you want to receive your assets may be fully effective and enforceable; however, there are very strict requirements to ensure that a handwritten document is in fact enforceable and effective.
Without the proper knowledge of these strict rules and requirements, a handwritten document is more likely to cause greater conflict than it is to be truly useful for your beneficiaries.
What estate planning documents are we talking about?
If “Estate Planning” is one of those concepts you’ve heard of, but are not entirely sure what is meant by it, please feel free to take a look at our Estate Planning Primer, for short descriptions of common estate planning tools. See Estate Planning Primer
The Problem with Handwritten Estate Planning Documents
The first common pitfall is that the person making the document may not actually know what document they are trying to create—especially if they don’t have a clear purpose in mind and understanding of that document.
For example, someone may think they want a trust, but unintentionally create a will. These documents do very different things, and without a clear understanding of your own purpose and how to achieve those goals, it is highly probable that your original plan will not ultimately play out as you intended it to.
Will your handwritten document be honored?
This is an important question to ask, but a difficult question to answer. Each document has its own set of requirements:
- Notary vs witnesses
- Simple terms vs complex provisions
- Identification of people with authority to act vs identification of beneficiaries
- Scope of authority to act
- Legal disclosures or warnings
For standard estate planning documents, there is a specific way to produce them in writing.
From a legal perspective, the question we ask first and foremost is always:
Does this document meet all of the legal requirements necessary to be effective and enforced?
For example, if you were to handwrite a power of attorney that gives a friend authority to work with your bank on your behalf, have you properly executed the document?
- For your handwritten power of attorney to be legal, you’d have to answer these questions:
- Do you have the proper statutory disclosures attached?
- Have you correctly and clearly identified the individual you are granting authority to?
- Have you identified the scope of their authority and what they can and cannot do on your behalf?
The next question is:
Will the person, business, or entity receiving this handwritten document accept it?
When dealing with third parties, we are always faced with that third party’s liability concerns.
For example, let’s say that someone comes into a bank and requests access to a customer’s bank account. He claims to be an authorized signatory with a handwritten document purporting to be a power of attorney. It is highly likely that the document will be sent to the institution’s legal department to determine if they can accept and rely upon it. The bank personnel will review the document to determine what their exposure to potential liability is, they may choose to exercise their discretion and decline to accept the power of attorney.
Likewise, you may think that you have prepared a trust sufficient to avoid probate; however, when you pass and your beneficiaries review the document, there may be an argument where it is determined that it is not a trust, but a Last Will and Testament. This will then require your estate to pass through probate and a court proceeding, ultimately causing your estate to incur expenses you hadn’t anticipated or planned for.
Are there any documents commonly created by handwriting?
California is one of many states that do recognize the validity of a handwritten Will; however, the validity of a handwritten document will be dictated by each state’s laws.
Handwritten Documents May Have Problems When the Crossing States
You may run into an issue where you write a handwritten document that is valid in the state you reside in for a time, but if you move and die in another state, that document—and your wishes— may no longer be legally recognized or enforceable.
California recognizes what is known as a ‘holographic will’ which is another name for a ‘handwritten will’. A Will is simply a document that identifies your wishes for your assets upon your death.n For example, a will can be a statement as simple as writing the phrase “I leave everything to my wife.”
With that said, California has strict requirements for holographic wills, and any handwritten document that falls outside of these strict requirements will not be recognized by the courts.
What does California say about Holographic or Handwritten Wills?
California Probate Code 6111 governs the legality of holographic wills.
Is the Will in the testator’s handwriting?
For a holographic will, it is very important that the signature and the material provisions of the document are in the testator’s handwriting (the person creating the document). With traditional or standard wills, there is some wiggle room about these issues because standard wills require witnesses to be effective. Due to the lack of witness requirement for Holographic Wills, a Will where the material provisions and signature are not in the creator’s handwriting will not hold up in court. In fact, properly proving that the handwriting belongs to the testator is a mandatory component of establishing the validity of a handwritten will.
Is there a date of execution?
The California Probate Code does not require that the holographic Will include a date of execution. That said, the failure to include a date may cause conflict and it is best practice to include a date. Without a date, there is the possibility that another document could be presented as a valid Will or Trust, and then the discussion with the court becomes which document is the most recent. If you are using a handwritten document to revoke other estate planning documents, or amend or replace them, having a date is critically important to ensuring your intention and wishes are carried out.
Did the testator have the legal capacity to create a will?
One must also establish that the person who created the holographic will have the mental capacity to do so. Many Will contests are based on the testator not having the legally required capacity to create the will…
Due to the lack of witness requirements, it is common for holographic Wills to be drafted and signed when no one else is present. Add to that a missing date, and it becomes impossible to determine when in time the testator created the document, and more importantly, to draw connections to how that person was behaving in interactions with others— even if that person was alone at the time of the creation and execution of the Will.
Did the testator have the intent to create a will?
Lastly, the surviving beneficiaries will need to be able to establish that this document was intended to be the Will of the testator. It is best practice for the creator of the Will to include a statement such as “I intend for this document to be my Will.”
It is acceptable for the statement of intent to be a printout of boilerplate language indicating the testator’s intent, but the remaining provisions and signature must be in the testator’s handwriting.
Other Concerns Regarding Handwritten Legal documents
There are many other dangers with holographic Wills or other handwritten estate planning documents.
- If they are damaged, lost, stolen, there is no record of them existing.
- It is possible that a beneficiary may see a Will which does not provide for them, and they might destroy the document.
For these reasons and many others, it is important to have an attorney prepare your estate plan so you can have an added layer of protection that your successor trustee or executor will have the means and opportunity to determine if other estate planning documents exist.
Additionally, while some people may choose to opt for a holographic will to keep expenses of document preparation down, please consider the expense to your estate or beneficiaries if there is a Will contest or any question about the validity of the document.
If you have further questions about the estate planning process, please feel free to give us a call.