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Estate planning documents express your wishes in the event of your disability or death. However, estate planning documents must follow certain formalities to be legally enforceable. If your estate planning documents lack these formalities, they may not be enforceable, which could be disastrous for your loved ones and beneficiaries.

Iowa Requirements

Keep in mind estate planning requirements vary state by state. Let’s look at a Last Will and Testament, just one of six “must have” estate planning documents every Iowan needs. For a will to be valid in Iowa, it must comply with these requirements:

  • Maker (testator) must be at least 18 years of age or married;
  • Maker must be of “sound mind”;
  • Will must be written;
  • Will must be signed by maker in presence of at least two competent witnesses, at least 16 years of age, who also sign in presence of maker and each other; and,
  • Maker must tell the witnesses it is his or her will.

Formalities Matter

 

It is important to have a reputable legal professional handle your estate planning. If you don’t, you risk missing one or more legal formalities, which might make your entire estate plan worthless. For this reason, avoid creating a will, or for that matter any estate planning documents, through an online service.

Starting an estate plan may seem like a daunting chore, but it doesn’t have to be. The easiest place to start is with my free, no obligation Estate Plan Questionnaire. Of course, you may always reach out to me at any time with any questions or concerns.

A will may provide for disposition of the testator’s assets at the time the will is executed, but of course it may be many years—many decades, even—between the will’s execution and the testator’s death. What if between the execution of the will and the testator’s death, there are changes in circumstances (such as the death of beneficiary) which make it impossible for the executor to follow the dispositive provisions of the will? That’s where estate planning gets complicated and can open the door to litigation.

Changed Circumstances = Default

Of course, we would first look to the language of the will. But, what if the will fails to address the changed circumstances? In such cases, Iowa law provides default rules. Obviously, it is much preferable for the estate planner to raise the possibility of changed circumstances with the testator during the drafting process, and address them accordingly with clear language in the will. (Yet, another reason to use a lawyer to draw up your estate plan.) And, yes, you should keep your will (and overall estate plan) updated.

Death of a Beneficiary

If Grace provides in her will, “I give Lawrence $10,000,” and Lawrence dies before Grace, the will can’t be followed exactly as written. Of course, this situation can and should be avoided by careful drafting – the estate planner asking what the testator wants if a beneficiary should predecease the testator. If, continuing this example, Grace wants the bequest to pass to Lawrence’s estate or Lawrence’s children if Lawrence predeceases her, Grace should so specify in her will. If instead Grace wants the bequest to go to other beneficiaries, the will should spell that out, too.

The Doctrine of Lapse

Let’s take our example and apply the doctrine of lapse. Under the common law, a bequest would fail, or lapse, if the beneficiary predeceased the testator. The bequest would simply fall back to the estate.

Iowa’s Anti-Lapse Statute   

Iowa is among the majority of states which have adopted anti-lapse statutes. Iowa Code Section 633.273 provides that if a beneficiary (actually, the statute uses the legal term devisee) dies before the testator, leaving children who survive the testator, the devisee’s children inherit the property devised, unless the terms of the decedent’s will is clear and explicit to the contrary.

Real Life Case

Clyde Guthrie executed a will in 2002 and died in 2006. His wife predeceased him, and so did two of his five children. Both of the predeceased children died before Guthrie executed his will. That turned out to be a key fact. Guthrie’s will left his entire estate equally to his five children except “in the event any of my children should predecease me leaving issue who survive me, then the share of such predeceased child shall go in equal shares to his or her issue who survive me . . .” His three surviving children claimed that the will language meant to include only them—the decedent’s children that survived him, and not the grandchildren of one of their deceased siblings. That predeceased sibling only had one child, and that child also predeceased the decedent, but left two surviving children–great-grandchildren of the decedent. (The other predeceased child died without having had children).

 

old hand and baby hand

Application of Facts to Iowa Code Section 633.273

On first glance Guthrie’s will appeared to be clear. Again, his will stated that if children predeceased him, “the share of such predeceased child shall go in equal shares to his or her issue who survive me.” However, the Iowa anti-lapse statute defines “devisee” as a person who dies after execution of the decedent’s will unless the will clearly specifies otherwise. Here the pre-deceased child that left surviving issue died long before the decedent executed his will. So, the anti-lapse statute didn’t apply, and the great-grandchildren were not beneficiaries of their great-grandfather’s estate.

Guthrie of course knew that two of his children had already died. The language of the Guthrie’s will, the Iowa Court of Appeals reasoned, could only possibly refer to the possibility of any or all of the three remaining children dying before he did – and the decedent’s will did not clearly state that issue of an already pre-deceased child should be included. (Review the case: Estate of Guthrie v. Busch, No. 8-093/07-1427 (Iowa Ct. App. May 14, 2008).

Back to the Basics: Let’s Review

With that example in mind, let’s review again the basics of the doctrine of lapse. Under the common law, if a beneficiary dies before the testator, the bequest lapses, i.e., goes back to the estate.

Iowa changed this rule by adopting an anti-lapse statute. Under current Iowa law, if the beneficiary dies before the testator, but leaves children who survive the testator, the beneficiary’s children inherit the property devised, unless the terms of the decedent’s will are clear and explicit to the contrary.

Of course, the problem of lapse/anti-lapse can be avoided through careful drafting by a trained professional, as well as annual reviews to see if your estate plan needs updating.


Have questions about your own estate plan that may be in need of revisions after learning about lapse? Contact me and we can talk about what changes would be wise for you to incorporate into your estate plan.