A Wisconsin appeals court has ruled a dying man’s intention to forgive debts to several of his relatives in anticipation of his death were not valid due to a lack of proper delivery. 88-year-old Roger Hansen died before signing the last draft of a will in which he forgave mortgage loans made to his brother’s children and grandson totaling approximately $278,000. Because he died before his will was signed, his estate was distributed according to Wisconsin’s intestate succession laws and the mortgage loans were included in Hansen’s estate.
The relatives who obtained loans from Hansen argued early drafts of his will along with a letter to his attorney provided sufficient proof Hansen intended to forgive the loans. A Dane County Circuit Court Judge agreed and allowed the mortgage loans to be removed from Hansen’s estate. Another relative who did not have a mortgage loan from Hansen, but who was to receive an inheritance as part of Hansen’s intestate succession appealed the circuit court’s ruling.
The District IV Wisconsin Court of Appeals recognized Hansen’s intention to forgive the mortgage loans, but reversed the lower court’s ruling because the requirements for a gift in contemplation of death were not satisfied. According to the court, a gift in contemplation of death provides an exception to the statutory requirements of a will in Wisconsin. For such a gift to be valid, the gift grantor must intend for the gift to become complete at his or her death, must be contemplating death from a specific ailment which later takes the gift grantor’s life, and the gift must be delivered.
Although the relatives with mortgage loans argued delivery of the gift occurred when Hansen sent instructions to his attorney, the appellate court disagreed. According to the Court of Appeals, since Hansen failed to instruct his attorney to deliver the information to the would-be gift receivers, the gift was never delivered. The court stated the purpose of Hansen’s instructions was merely to provide guidance regarding his will and did not evidence his intent for delivery to the debtors.
One lesson from this is that if you are ill, an imperfectly drafted instrument that is signed is more valuable than a perfect one that is not signed. As I learned in the military, a good plan in time is better than a perfect plan too late. At Krause Law Offices LLC, we offer home and hospital visits and can produce documents in a hurry for cases where our clients are ill or facing major surgery. Sometimes this extra effort can save our clients’ loved ones hundreds of thousands of dollars. In cases like this, once a plan is in place, we can work to improve it if there is time.
Proper estate planning is essential to ensure your assets are transferred in accordance with your wishes at your death. It is even more crucial if you have minor children or own a family business. Common estate planning tools include wills, trusts, insurance, limited liability companies, powers of attorney, health care documents and more. If you have questions regarding completing a unified estate plan to protect your family, contact a skilled Wisconsin estate planning attorney today.
Krause Law Offices, LLC can assist your family with all of your estate planning needs. Daniel J. Krause is a dedicated and hardworking Madison estate planning lawyer. He is available to assist you plan ahead for your family’s financial future. To speak with an experienced wills, trusts, and estates lawyer, contact Krause Law Offices LLC through the firm’s website or call Daniel J. Krause at (608) 268-5751 today.
Using Estate Planning to Protect Your Wisconsin Family, Madison Trust Law Blog, March 9, 2012
Forgiveness of debt in contemplation of death not valid, appeals court concludes, by Joe Forward, State Bar of Wisconsin
Meegan v. Netzer, 2012 WI App 20, (Jan. 26, 2012).