In re Estate and Trust of Pilafas

Brief Fact Summary. Steve J. Pilafas executed a will and trust that were not found among his personal effects at his death. The trial court held that Pilafas had revoked his will and trust. The remainder beneficiaries of his trust appealed the decision.

Synopsis of Rule of Law. A will is presumably revoked if it was in the testator’s possession, but not found among his personal effects at his death. If a settlor reserves the power to revoke a trust in a particular manner and under certain circumstances, he may only revoke the trust in the stated manner and under the same circumstances as stated in the trust.

Facts. Pilafas created a trust in which eight nonprofit organizations were to receive a portion of the trust property upon his death. The remaining portion was to go to his wife and other stated relatives. He amended the trust twice and simultaneously executed a will at the same time that he amended the second trust. The attorney did not retain the originals of Pilafas’s will but to the best of his knowledge, gave the originals of the trust agreement, the amendments and the will to Pilafas. Pilafas kept meticulous records but his will and the trust with amendments could not be found among his personal things at death. Pilafas had a room filled with important documents including photographs and old divorce papers. After Pilafas died, his son sought a determination that Pilafas revoked his trust agreement and will. The trial court held that Pilafas had revoked his will and trust. The remainder beneficiaries appealed the decision of the trial court that Pilafas revoked his inter
vivos trust and will and died intestate.

Issue.
Whether a will is revoked where there is evidence that the testator had the will in possession before death but the will is not found among his personal effects after his death.

Whether a trust is revoked where a settlor does not revoke the instrument in the manner provided for in the trust terms but the trust is not found among the settlor at his death.

Held.
Yes. The deceased revoked his will because there was evidence that he had possession of his will and trust before he died but it could not be found among his personal effects at death.

No. The settlor here did not revoke his trust because he did not deliver a written revocation to the trustee. The settlor reserved the right to revoke the trust by delivering a written revocation to the trustee so he could only revoke the trust in that manner. Though there may be a trend in the law to apply the law of wills to revocable trusts, those cases involved trusts that operate only after the settlor’s death. This case involves an intervivos trust where the beneficiaries are entitled to insist on full compliance with the terms of the trust interest. The beneficiaries receive a present interest in the trust property at the time of the creation of the trust.

Discussion. The law of wills cannot be applied to intervivos trusts because the latter serve a function before the deceased’s death. The law of wills applies to dispositions that take place at death. In intervivos trusts, beneficiaries have an expectancy interest in the property and a claim against the trustee if the property is mismanaged.