An article that recently appeared in the ABA Journal described yet another disastrous consequence of a “do-it-yourself” estate plan. In the Florida Supreme Court case of Basile v. Aldrich, the decedent drafted her own will with the “guidance” of an “E-Z Legal Form,” an online service that allows consumers to draft their own legal documents. The decedent left several specific items to specified beneficiaries but failed to include a “residuary clause.”
The purpose of a “residuary clause” is to dictate how any assets that are not specifically identified are to be distributed. A “residuary clause” is a basic estate planning concept that is fundamental to any will or trust. It often serves as a “catch all” clause to address any assets that are not specifically identified by the estate planning document.
In the Aldrich case, the decedent acquired certain assets after she drafted her will but never updated her will to specify to whom those additional assets should be distributed. Because there was no “residuary clause” to control the distribution of such non-specified assets, the Florida Supreme Court ruled that such assets should be distributed to the decedent’s “intestate heirs,” those persons who would inherit had the decedent not established a will in the first place. The decedent’s intestate heirs were never mentioned in her will and it was readily apparent that the decedent did not intend for those heirs to inherit from her.
In the opinion, Florida Supreme Court Justice Barbara Pariente stated:
While I appreciate that there are many individuals in this state who might have difficulty affording a lawyer, this case does remind me of the old adage “penny-wise and pound-foolish.”
I therefore take this opportunity to highlight a cautionary tale of the potential dangers of utilizing pre-printed forms and drafting a will without legal assistance. As this case illustrates, that decision can ultimately result in the frustration of the testator’s intent, in addition to the payment of extensive attorney’s fees—the precise results the testator sought to avoid in the first place.
This story illustrates two common ironies with respect to “do-it-yourself” legal services.
First, as is noted in the Justice’s comments, it is likely that the decedent was attempting to save legal fees by using the E-Z Legal Form. However, the poorly drafted will forced her beneficiaries to battle her intestate heirs in the court system, presumably for years. The will likely resulted in tens of thousands of dollars in legal fees for the decedent’s family. I am reminded of a sign I once saw in a TV repair shop showing three tiers of fees: “Standard Rate: $40 per hour; “Rush Job: $70 per hour; “You Already Tried to Fix It: $140 per hour.” I am also reminded of the old slogan for Fram Oil Filters: “You can pay me now, or pay me later.” In this case, the decedent’s family certainly had to pay their lawyers later, much more than a properly drafted estate plan would have cost.
Second, in establishing her will, the decedent attempted to override Florida’s intestate rules by giving her assets to individuals who would not inherit from her by operation of law if she did not create an estate plan. Because her will failed to include a residuary clause, a significant portion of her estate was distributed to her intestate heirs nevertheless.
It is not clear why the decedent’s will did not include the basic concept of a “residuary clause.” It could have been that the will form was poorly drafted or it could have been the fact that the decedent failed to select that option, not comprehending the nature of such a clause. In either case, this story reinforces the notion that complex legal tasks should be performed with the aid of a knowledgeable attorney.
(Source: ABA Journal,“Estate dispute caused by ‘E-Z Legal Form’ is a ‘cautionary tale,’ says justice,” by Debra Cassens Weiss.)
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Disclaimer: This article is for general information purposes only. Reading this article does not create an attorney-client relationship. Because the law is so complex and everybody’s situation is unique, you should consult with a qualified attorney licensed to practice law in your community before acting upon any of the information contained within this article.