Episode 20: You Just Lost Half Your House – Stand, Fight, Win! Real Lawyers, Real Answers

It's to join us how you doing today Stuart I'm doing great whether it's wonderful yeah a little hot actually I'm surprised global warming in effect time to go sailing time to go sit well okay you dressed for it I'm dressed for sailing yes good let's do it I'm getting over a cold so my voice is somewhat back to more like the second or third weekend oh I don't keep count it's been bad yeah your new systems I know I haven't been able to kiss anybody for quite a while oh that's actually good I know lucky them yes lucky everyone all right why don't we get started welcome to the stand fight win live stream we're lawyers real answers the topic today is marital rights so we're gonna learn and discuss what rights married people have when it comes to passing an estate or an inheritance and there's a lot of confusion I think in that realm in terms of what married people have the right to do what they don't have the right to do and so why don't we start off by going over our case and this will be our breaking news segment and we're going to talk about a case that is not necessarily breaking news it was decided back in 2014 but it's a very good case and it's called Lintz V Lintz Li ntz Lin's violence and the site forward is to to to Cal app fourth one three four six that's two two two cattle at forth 13:46 so this is an interesting case and Stewart you are very familiar with this case I'm very familiar with this case we were kind of excited to see it back when it came out and it has to do with can one spouse unduly influence another spouse in order to get money as part of an inheritance and there's a little bit of an issue there right so a lot of times people will come in and say well husband unduly influenced wife or wife unduly influenced husband and what usually is the the thought that you give when somebody says that one spouse unduly influenced the other what thought comes to your mind well I'm not going to be politically correct here I think they'll be expected to I think that in marriages that are longer than 10 years I think that I've seen evidence empirical evidence that leaves we believe that most wives unduly influence their husbands on a daily matter and the husband's say I I in younger relationships you don't see that as much I'm not saying that's a good or a bad thing I'm just saying that's what I have you and so we tend to see that women make more of the decisions later on in the relationship and that makes sense because let's be mean to the men now we kind of revert to our teenage years as we get older sometimes we need someone to help us out with our thought process ease it and so we're seeing that now that's totally incorrect for me to say that I hope I'm not offending me but I'm not attempting to offend anybody I'm just saying I think that spouses and I see more of the female spouses than the male spouses doing this although male spouses do it too they do things that certainly influence their spouse on a daily basis and even unduly influence their spouse on a daily basis where they get their spouse to do something the spouse wouldn't do but for the one spouse asking them to do it and that's a fine line isn't it by the way you can send your complaints to Stuart at out deadline.com it's a fine line isn't it because people influence each other all the time husbands influence wise wise influence husbands and that isn't necessarily illegal and it's not undo it can even be very heavy influence that doesn't necessarily make it undo but in lens V lens we have a case where it did go a little too far and you can tell that this was a difficult marriage situation because in the facts it actually says that this was there the defendants third marriage and they were are the decedent's third marriage and they were married divorced six months later and then remarried so that's not looking good in terms of being a stable relationship right and so as husband started to decline in health all of a sudden there started to be amendments to the trust and there was many amendments between 2005 2008 to the point where the last amendment left it all the wife right I disinherit the the husband's kids so there's a number of different issues that the court looked at one of them was capacity which isn't a huge issue for us we you know we we have a lot of capacity lack of capacity cases although they're hard to prove the thing that I found interesting in this case when it comes to capacity the Stewart is the court talked about a case that's near and dear to our heart Anderson V hunt Anderson V hunt 2011 finding yeah and by the way the Anderson vs. hunt if you want to look it up 196 Cal app for of 722 196 Cal out for 722 Anderson vs. hunt 2011 and Anderson vs. hunt said for the first time and it said it and incorrectly so in our opinion it also said at a very inopportune time for us but it said for the first time that the capacity required to amend a trust is the same as the capacity needed to make a will which is a lower level of capacity if the trust instrument was something simple simple versus complex which yeah who knows what's simple trust amendment and what's a simple trust amendment let me ask you this Keith and not to get off track here but I'm Anderson vs. hunt where the court in its infinite wisdom for the first time says that we're gonna look at capacity on a trust amendment and we're gonna use testamentary capacity under probate code 6100 point 5 let me ask you if I went and amended a will which we call a codicil to a will yes is there something specific I have to do from a formality standpoint that I would not be required to do for a simple trust amendment yeah you have to have two witnesses they have to sit there and sign and look see you sign the document and that's for a will that's for a will but not for a trust but we're they're gonna use the same lowered standard of testamentary capacity versus legal capacity so gonna say oh for simple quote unquote whatever simple means trust amendments we're gonna have testamentary capacity but there's no to witness requirement right and that to witness requirement is important because it backstops that lower level of capacity standard I mean it's just a little bit of a safeguard that trusts don't have so but the court said you can do that now this court lens Phelan said in this case where you were doing a complete restatement of the trust Anderson doesn't apply you have to use the hire contract capacity because the trust instruments were unquestionably more complex than a will or a codicil okay so that leads me to my next complaint about Anderson versus hunt and I know you want to talk about Lynch be Lynch but Anderson vs. not is problematic on various levels yeah and one of those is is that even in a quote unquote simple trust amendment which I'm assuming the court meant in Anderson vs. hunt I'm changing somebody from 30 percent to 25 percent of the ultimate distributions yeah not doing a whole lot more but there's always this not always but generally a good drafting attorney is gonna include at the end of an amendment I here by rhea sh and affirm my previous trust in full and how many pages is that previous dress let's call it 50 pages usually long so if does that mean that's no longer a simple trust amendment because at that moment in time when you're signing when you're probably demented at that point in time how can you have the lower standard of capacity testamentary capacity versus legal capacity if you're reaffirming the entire original trust because you'd have to understand the entire original trust to reaffirm it in theory and so yeah that's the problem with Anderson V hunt is that nobody knows what a simple versus complex trust amendment is and so if you go in to do a trust amendment to an estate planning attorney how would they even know if you have the necessary capacity to do it because they don't know what capacity standard they're using right and so yeah it's it's it's crazy and the last thought I have is that if I were doing state planning still and I was doing a simple trust amendment I would get two witnesses to sign it yeah even though the best terms don't call for it but right enough about Anderson versus which I obviously have a little bit of passion for but go ahead with your list versus Lentz analysis okay so when it comes to undue influence on Lenz v Lintz the court here really does something interesting which is it looks at Family Code section 721 and Family Code section 721 imposes a duty of the highest good faith and fair dealing on each spouse and so the courts saying well look spouses have fiduciary duties for one another meaning they have to do right for the other spouse and put their interests above their own and when you're dealing with the spouse who has a lot of separate property which was the case here the husband had a lot of separate property the wife didn't and the wife is not only spending his separate property during his lifetime but also was creating these amendments so she can get the rest of the property after her death and it didn't do anything to benefit the husband it was just benefiting the wife so really what the court says is this presumption should have been applied there should be a presumption of undue influence so in other words it's because the there's this fiduciary duty between spouses anytime one spouse does something that improves his or her position favorably to the detriment of the other spouse there's a presumption of undue influence that means that the spouse would then have to prove that there was no undue influence and keep in mind let's versus let's was decided in 2014 and prior to this decision and prior to us reading this decision we would have people call us beneficiaries of a mom or let's call it a dad a dad that's passed away that was married to a stepmom under very similar circumstances to Lintz and we would tell them look we're sorry we can't take your case because these are just too difficult the courts going to side with the the spouse they generally do this they will side with the spouse over children in most cases unless you can show something really egregious and linds versus lens comes along and while these cases are still difficult against the surviving 2nd or 3rd or 4th spouse we now have this presumption and that's beautiful so let's walk through that a little bit more and I think it depends on the underlying factual scenario so let's take an example where let's say let's say two people are older in life let's say the husband 70 and the wife 65 and they get married and they're only married two years and let's say the husband has a substantial separate property and a new trust is created and it disinherits the kids leaves everything to wife and then a month later husband dies do you think that that has a ring of undue influence in it in your mind it depends it depends I mean it could be the most wonderful relationship of two people that got together not knowing the husband was gonna pass away we can't use fine side on that they had a wonderful marriage everyone will testify they had a wonderful marriage she adored him he adored her and the two years was the best two years of his life and they in you know anticipated traveling together I mean you know all kinds of facts that would support a fantastic relationship you could also have a bunch of facts where you know they weren't close so she was out seeing other people and even though that probably technically isn't supposed to come into the case if she was out cheating on him and not in good spouse and ended up favoring herself in a very short period of time I think that brings us some questions yeah and I think that's gonna probably be a little bit more suspicious versus let's say you have a marriage of 30 years and let's say five years before husband dies there is a change to the estate plan that favors the spouse I mean it's a whole different ballgame those are still cases we probably won't take just because yeah you're married for 30 years whether it's a good marriage or bad marriage and there's some good ones out there there's some bad ones out there but they've chosen to stay together for 30 years they've made that choice right if they leave everything to the surviving spouse well the courts gonna say hey that's what most people do I don't have a problem following through with that and the other thing I think that I hurt the spouse and Lynn's feel and says she was spending a lot of the husbands separate property while he was still alive and I think for whatever reason the court just found that to be something that was improper and so I think it really depends on the underlying circumstances of these cases but in theory you can have a presumption of undue influence where one when one spouse gains an advantage over the other one you know there might be a presumption of undue influence I'm just I would caution people don't assume that that's gonna be the true in your case just because a spouse gets something doesn't automatically mean that there's gonna be a presumption well let's just say firm versus lens cases I think your case they're just going to fall into these four corners of this opinion are gonna be shorter term marriages and they're gonna be blended families and it's gonna be where the husband but the see substantial changes to this date place either have a lot of separate property coming into it or you know there's some type of person coming in it doesn't have a lot of property and they end up with a lot at the end of the day if it's a blended family short term marriage it's worth looking into right right there's one other small issue that Lynne's feelings covers that I always find helpful which is that it really has a nice section talking about how undue influence can be proven by circumstantial evidence I think that's important just because you don't you rarely have direct evidence of undue influence the person who is unduly influenced is deceased and the person who did that undue influencing isn't gonna come forward and say yep my unduly influenced oh my coerced them and so usually it is gonna be circumstantial evidence that you're gonna find so facts of isolation controlling food controlling medicine cutting an elder off from their family or friends manipulating their finances these are all the kind of circumstantial things that you're looking for in these types of cases that's right and by the way when young lawyers or even older lawyers are mediating these kind of cases undue influence cases not just lens versus lens but any case dealing with undue influence the mediator and even a judge at the time of trial is gonna ask you yeah but what evidence do you have that this undoing so stick play took place and it's a hard question at first if you haven't really buried yourself in these cases because there isn't direct evidence generally of these types of behaviors and so what you have to do is step back from the case and you have to pull together all the circumstances it's a totality of circumstances analysis you're looking at the age of the individual as you pointed out are they ill and the statute here it comes from the financial what is it the financial elder abuse act and that is under owns one five six ten seventy I believe welfare and institutions case I'm sorry what is the provision where it defines undue influence I think it's one five six ten seventy yes that's right okay the boyfriend institutions go so it's one five six ten point seventy and if you actually go to that statute you'll see the definition of what undue influence is in the first paragraph and then they're gonna break down the four categories that they're gonna look at and that's that circumstantial evidence that you need to look to and you need to pull together in your cases you get that from medical records you get it from the estate planning lawyers file and you get it from third party witness as a friends family or third party which this is valuable and these kind of case is so valuable probably in fact third party if you have a friend or a neighbor somebody who's not gonna get anything in the estate and they can come in and say oh I saw the whole thing you know this is what was going on those witnesses are invaluable they're way more valuable than expert witness and especially if that person has no connection with you as the person yes client yes if they're independent they're not gonna benefit from the estate they're just gonna come in and testify they're fantastic I recently did a mediation with a judge that we admire very much and he was explaining to me some of these issues on undue influence and he said that in these cases whoever has a dog in the hunt whoever is gonna end up with getting something he gives them very little credibility in their tests even if they sound good he gives them very little credibility because they have so much to gain right so he says give me those third-party witnesses and we have a different story and the other thing that is not circumstantial evidence is a lot of times people will say I know that my mother would never do this I know that my grandmother would never do this that in and of itself is not evidence of anything you know like you said you got to look at the statute it requires susceptibility done to influence the actions and tactics of the wrongdoer I mean these are things that you have to go out and find for evidence for your case but coming in and saying I know that my mother would never disinherit me it's not gonna get you too far yeah let me give you you know some people when I was younger I used to have a hard time putting concrete facts on what undue influence is I'll give you a small example and that is in a Lynne spiel it's a hypothetical you've got a second or third wife and it now married to the husband the husband in this case has two or three kids and he has significant wealth and in his current trust he's giving them the bulk of to his kids and the wife comes in and starts many people view undue influence as some kind of a mean kind of address I'm somebody's will even got up too you know many times it's the wife coming into the husband who's in a in a bed maybe saying why aren't your kids here oh my gosh they must not care about you this is awful here let me take care of you and it goes on so it's a progression it happens over time and slowly but surely the will is poisoned and then the husband becomes frustrating as sure enough his kids aren't there and older people in my opinion again I'm gonna get in trouble for this they tend to fear that people are gonna take their assets mm-hmm and you and I will be there one day we're gonna fear that somebody's gonna Kayla Manisha would you guys get your people yeah these young people is all they want is my assets and so there's already that fear that's innate in all of us and now this person's flaming doing that yeah they're also afraid that nobody will take care of them yes and here that person is that they rely on day in and day out for whatever care they're receiving yeah so so it happens that way it usually happens over a period of time it's not written down it's very circumstantial it is not something you can point to and say this is where it happened yeah that one thing no it's it's yes it's been described as death by a thousand cuts so that's kind of what it comes down to and some judges would say you trying to prove a case of undue influence is also a death yeah yeah yeah they're tough cases there's no doubt about it yeah so all right so I guess the takeaway from Lynn's be lenses you can have undue influence between spouses you could even have a presumption of undoing slices they spices spices no it's like this is it can't be spouses of spices yeah and you can't have a presumption of undue influence between spices thank you but you don't think mouse is nice I don't you say mice I don't care about mine okay I'm just saying if we're gonna be correct Moose's yeah I think mooses would be nice missus okay well whether they're Mises mices or spices there can be a presumption of undue influence but still very hard case this is literally what happens 24 hours of babies this camera goes off do you think it's entertaining you may not you shouldn't so let's go to our ass and answered segment and see if we can answer some questions that might flush these issues out its flesh not flush its flashes yeah that's flesh is it a bird I don't know you're making me tired all right I need a nap I'm here to interrupt that fun you guys were just having would you wanna have a trip and what across the United States or something you see any nieces while you're out there I didn't see any nieces or mousse by the way I'm from Alaska and nobody says nice miss you too mr. nice in the lots but you can walk up I did see some elk though we went to Yellowstone and yeah well yeah that was cool was it big so our first question today is does my half of the marital property have to go to the surviving spouse does it you better be nice it depends I mean yeah no it doesn't so I mean if I'm married which I am my half of the community property I can leave it to whomever I like that's right I can leave it to my law partner but I can leave it to whomever I like and I can exclude my spouse and you know and same thing with any of my separate property so my separate property can go away from my spouse as well there's gonna be one exception to that which is gonna be a family allowance well we'll get to that in a minute but in terms of who owns the property I can give away half my property to anybody I want think about that though I mean your your spouse dies and all of a sudden half your house goes to somebody else I mean that's gonna be a shocker yes Chuck you know that that is very surprising for people to find out thirty forty year marriage yeah that one happened at the community of yours where like my wife passes away and half my house goes to the yoga instructor yeah but it can you know the spouses are allowed to do that and it's it's it is a bit of a shock right now family allowance let's make a quick pit stop there you so if you're married in California you don't have to leave your half of the community to your spouse you can't leave their half the community though so the other half of the community you can't just give that away or give it away to somebody that belongs to your spouse they get to keep at least half of those assets however you're not allowed to leave your spouse or children destitute and so there is something called a family allowance where under the probate code the court can order some amount of money that's like a support payment that goes to the spouse or the children it's usually for a limited amount of time to let the family members get up on their feet and get on to whatever they need to do to support themselves it's not a right to property it's not a right to a portion of the estate but it is kind of a support payment that you can apply for yes and let's change up your analysis let's go to limbs versus lens if this guy had community property significant community property with his spouse and lens I'll say they've been married 30 years and they own you know five million dollar asset and his community property and under the lens versus lense analysis wife gets husband to sign a transmutation of his community property interest and give it to her making it all her supper property then he passes away do we have a lens versus lens situation yeah I think so because I think what you've done is the spouse has benefited herself by making something separate property and essentially securing the whole property for herself because husband may have wanted to give it to his children or to charity or whatever and you took that right away let me give you a harder hypothetical wife is smart she's savvy she understands she redlands versus less last night as she googled it on how to take money away from a spouse and not be caught she decides you know what I'm not gonna having to do a transmutation because that looks too fishy I'm gonna have him sign a joint tenancy deed I mean technically that's still gonna be Allen's veal incest you no doubt I think it's gonna be harder and I think the reason why it's gonna be harder is technically speaking with joint tenancy deeds you didn't take anything away from husband during life whereas when you do a transmutation you literally are taking their half of the community away from them during life right and I think that's what what got the spouse in trouble and Lindsey Linds is that she did things during life right I think a court it's not gonna be as inclined to overturn a joint tenancy deed because during life they each owned half you didn't take anything away from husband it was only a debt that it took effect so in theory it would still be a lint spilling situation but I think it'd be harder impractical in practice wife would not be stopped she continues her google search and she realizes that the transportation is not a good idea it looks a little too fishy joint tenancy it's a good argument but there's a better way to title this and that's community property with the right of survivorship how about that one is that all Lynne's versus Lynn's situation again I think that makes it even harder because I think the arguments gonna be I didn't change the community property nature of this it's just that he wanted to leave it to me and I thought you were gonna go with and this is I think would be just as hard let's put it into a trust and under the trust it says that that's my asset upon your death I think it's the same difference I mean I think it becomes much harder to dislodge something like that because the courts gonna say well you didn't really change the property interest while husband was alive right you didn't disfavor him while he was alive it just affected where I went after his death and have you been married 30 years right one assumes that it probably wants to go to the spouse right I don't know right no I'm with you on all that and I would say in a shorter marriage situation if wife really wanted is then and I'm talking about a nefarious person here so if they really wanted to be nefarious what they would do is they would essentially either we have a trust do it by way of a joint tenancy or community property with right of survivorship or get one half of it which they're entitled to possibly and then get a life estate in the other half yeah and that's what you can do under a trust so you could create a trust and then wife gets her half and then the other half held in a marital trust for her benefit and she's trustee that merit ultra she effectively has the whole house she controls it she's trustee of it but she hasn't taken it away from the ultimate beneficiaries we can still be the children and that's a good that's just good estate planning actually because it protects the kids it protects the spouse right and if she's 30 and the kids are 30 yeah they're gonna be waiting a while so and the only reason we bring up these hypotheticals is because this is what we see we see this type of planning happening yeah around California yeah it's willy-nilly and it's a mess what's our next question if my spouse leaves his half of our house to his children and my stepchildren can I be displaced do you think well that's a good question so it has to come down to timing and that is when is the gift being made is it being made right at his death and if so the kids step into his shoes they get that asset they can do a partition action if she refuses to sell it boom she's out now you did raise an interesting issue and that's family allowance could you possibly petition the probate court and as a probate court for some time you know I think you could I think it'd be limited but I think you limit it but ultimately yeah and like you said this is this is a real surprise to the surviving spouses out there if they have a deceased spouse that you know this is an awful thing to do in my opinion not tell your spouse without knowing more facts about your marriage but not tell your spouse that you're giving away your one-half to your children who are the stepchildren and unfortunately those perceptions are gonna have rights to the one-half of that asset as owners as owner if you give it out right so the other thing is if you gave it in trust where it stays in a marital trust for the wife's lifetime and then it goes to the children a whole different ballgame now the spouse can stay in her home you're not dislodging her the kids get the interest after she's gone much better way to go but yeah if you just give half your house to your kids right day one as soon as husband dies or wife dies right the spouse is done unless they get along with the right stepchildren and whether we see this from time to time too we see a spouse the surviving spouse before the deceased spouse's passes passes away there's usually some type of mental incapacity or injury or something somehow no they find the trust in the house and they see what's happened what's the first thing they do they call up a state planning attorney who's willing to take $1,500 to come over to the hospital quick amendments quick amendment and now everything's going to the spouse so we see that happening too and I wouldn't necessarily say that that surviving spouse doing those things is an evil person this is a person that's that's dealing with a real issue or they're thinking I'm gonna lose half of my house but what would you do to keep half of your house so these aren't evil people it's not right with what's happened and it can be hopefully corrected with some litigation but I understand why people do these things well it's so much easier if you have other assets if you have a house plus stocks and you can say hey let's give husbands kids the stocks and I'll keep the house and that way I'm not disrupted hey great right but a lot of times when you have these estates where our house is a major asset and it's the most valuable asset it's tough and you know if you lived in a house for 30 years you don't want to just get kicked out especially if you're older that's got to be terrifying terrifying absolutely all right Kayla my husband has a mistress is it possible that he could leave half of our house to her boy it is possible yeah maybe probable it's it's it's interesting isn't it now I had a case years ago where a wife left the house we thought to her husband but they were separated but they weren't technically divorced turns out she had a handwritten will leaving the house to yoga instructor and we thought well that's weird why yoga instructor until he came in the office he's young he's handsome he's wearing one of those puka shell necklaces cuz he's got the shirt down like that I'm like I get it like I'd leave half the house to a yoga instructor and I'm you know I'm married to a woman but like I get it I get it that's a guy I don't have a response but I'm just saying Oh some people are attractive it's not my fault okay if I notice in any event it was a shocker and so these things can happen and unfortunately because each spouse has the right to give away their half the community you could wake up you know one day and your spouse is gone and you're the mistress owns half the house that's a possibility so not only the insult of finding out that one half of your house is gone but it's going to a mistress I mean again this is this this person who just deceased spouse is despicable in my opinion yeah this is not a good behavior know the manners rapport well it's kind of reminds me of these cases where you know the guy dies and he's living like two different lives he has two different families and two different cities or something it's like first of all how did he get away with that and how do you have the energy to even do that it sounds exhausting to me I wouldn't even want to do that but but it is a terrible result and so what do you do about it I mean if you're a spouse and you're worried that this is gonna happen what would you do you look well you make sure that you know what the trust says and you number one you create a trust yeah yeah you you work with your spouse on your lagar estate plan and then you look for facts of undue influence for like a capacity for anything that changes that estate plan right and if you can't find them it's tough you know I think about it I used to teach when we back went on trust and wills at Chapman law school we used to go over this case and it was Charles Kuralt he left his ranch in Montana to his metric mistress using a holographic will it was a letter right that he wrote and it wasn't part of his regular estate plan because apparently it'd be a little embarrassing to sit down with your wife and your estate planning attorney and explain to them that I won't leave the ranch in Montana to my mistress that probably wouldn't go so well in a meeting so he did it on a holographic will it was enforced the mistress actually got the ranch in Montana now he was very wealthy so the spouse obviously had other assets journalist yeah yeah he's go around the country Charles Kuralt yeah that's right yeah the Sunday morning yeah please you know and and if that person wants to leave their legacy that they've done that well that's what he's gonna remember for my very popular case in the law school class always entertaining alright my spouse and I purchased a property together but it was put solely in their name I made payments on the property and paid for repairs I just found out that the house was placed in a trust to give to someone else what can I do and I just based on that hypothetical the husband has passed away yes or student will pass away no the wife knows this yes so this is a tough case although this has to do with what we call tracing and so what funds were used to purchase the house it's not so much what title is on the house was a community property funds that were used to purchase the home or was a separate property funds and I'm gonna assume it was community property funds she also has stated that she continued to make payments on the mortgage payments on the taxes payments on repairs and upkeep for the home those would also be community property assets so absent a marital agreement of some type or absent separate property being proven I think it's gonna be presumed to be community property there's always presumption of well if it's if it was purchased during the marriage so if it's person purchased during the marriage the presumption as it starts its life is community property correctly I'm out the presumption and so I'm gonna presume that this person can prove up the business community property and it's interesting too because you'll have these situations where the house is purchased during the marriage but maybe it's only purchase someone spouse's name for credit reasons or who knows why so does that purchasing it and one spouse's name does that make it separate property it is not because the transportation has to be expressed and clear transportation being I'm taking my community property and I'm changing his character to separate property and giving it you it needs to be and I understand that I'm doing that it needs to be clear to be a transportation just simply title is not enough and a lot of times these finance companies will make the spouse who's not gonna own the property sign a quick claim deed saying I hereby quick claim my interest to my spouse's her separate property I don't know but that even isn't necessarily enough because it's not a declaration that I understand I'm transmuting this so now you have a piece of property that's community property you're entitled to have yes you're gonna get half in that type of a case that Kayla just asked it's the person that's alleging separate property that's gonna have to meet a burden of proof and a gray and there got to overcome the community presumption and then oh you have to prove it's separate property right I think that's my estimation of it yeah I agree how can I protect myself from losing half the interest in my house I think it starts with a good estate plan using a trust and so I think you and your spouse need to meet with an estate planning lawyer and put together a good solid estate plan and then you need to make sure your house is titled in the name of the trust so the trust controls that house and if you have a trust document with a plan of how it's going to go and it's fine if you know your spouse's children are gonna get something out of the trust after you're gone or whatever or even as soon as your spouse dies if they're gonna get something but at least plan it out and talk about it I think where people go wrong is when they don't have any plan at all so like you said if they own their property is community if if I own my property as husband wife is community property but no right of survivorship well now my spouse could do a will and leave it to somebody else they could do their own trust and leave it to somebody else any number of things can go wrong with that yeah I'm actually glad you brought that up because we talked earlier about a deed a titling known as community property with right of survivorship which is really a joint tenancy between two spouses right races spaces yeah stick with that yeah but you know I don't want to mislead anybody that if you have owned as husband and wife community property that that is what's gonna happen that's just simply a 50/50 ownership right that's like owning tenant accom yes and so you want to be careful if you're looking at the deed of your house you want to make sure that you're gonna get it if your husband passes away you're the surviving spouse you're gonna want to see either joint tenancy those are the magic words or with right of survivorship in a property with right to survive that's right and not more in a trust or in a trust and then the trust can describe what happens to the property amazing the trust is the best way to go but certainly if you at least the problem with having it just in joint tenancy with right of survivorship or community property the right of survivorship is either party has the right to break that just by filing another deed so even like if you and I were joint tenants on a property I could break that by deeding it to my half to myself and tenants in common well let me ask you this what if you went ahead and you gave me let's say with you and Kristy you owned everything with community property right of survivorship on your house and then you gave me a deed a week before you died I didn't have time to record it for whatever reasons but I recorded it a day after your death is that sufficient to break that joint tenancy yeah I think it would be because with the deed a deed doesn't have to be recorded to be valid it just has to be signed notarized and delivered and if I gave it to you that's delivery what if you gave it to me 10 years earlier and then you pass ways it's still gonna be valid if I didn't record it yes yes now you may not have a right superior to like a mortgage that's recorded or something like that but the recording doesn't necessarily negate the deed the deed can still be valid and so that's why the community property titling even with right of survivorship has a few holes in it whereas if we put it in the trust and if Christy and I are code trustees then it you need the signature of both code trustees to take it out of the trust in theory and so it that can't be done as easily unilaterally and I think what you're get into there is that in most trusts the amendment provision where you can amend a trust it's gonna be a joint writing right for a community property yeah to amend yeah but you can mintue your separate property by yourself all day long that's right yeah cuz if I own something and you said community property with right of survivorship I have the right as a joint to just do my own deed without telling my wife and delivering it and that's a perfectly valid deed in that trust it's different because then I trust you would in theory require two signatures spouse would have to know about it it's just a safer way to go have any other questions Caleb one more question from Facebook so thank you for submitting your questions to us the question is my father or my stepfather is attempting to break an irrevocable trust to favor his biological son he's about to sell property that was granted to me will the funds from the sale of the property remain with the bypass trust well that's a loaded question so essentially what's happening here Keith is we see that a person feels that they have a property that's in a bypass trust so there's an original trust that was split off into two separate sub trusts at the death of the mom presumably here some properties put the bypass trust which is an irrevocable trust assuming the surviving spouse gets interest from that and so forth but they can't they're not supposed to get access to the principal in there and then the survivor has their own trust they knew whatever they want with that my concern here is that dad is trying to break the trust and I'm guessing he's doing that by way of court because it's the only way I can think of to break an irrevocable trust would be by going to court and getting the court's permission to do that well you're thinking of the only proper way to break an irrevocable trust that's right now yeah I think because if the bypass trust owns a real property or even half of a real property or some portion of a real property you can go ahead and sell that property that's not a problem but the percentage of the ownership of the bypass trust house they have to receive their share of the proceeds so if the bypass trust owns half a house you sell a house for $1,000,000 the bypass trust should receive $500,000 and is that going to happen in most cases it depends on how good the trustee is the trustee is the surviving spouse is the surviving spouse going to follow the terms of the trust and do the right thing or are they going to do the wrong thing if they do the right thing and follow the terms of the Trust's and yeah what they would do is open a bank account or a brokerage account for the bypass trust put the $500,000 in their work with a financial planner to make sure it's properly invested maybe the surviving spouse gets the income off of that during their lifetime and then the rest goes to the child that'd be the right way to do it unfortunately what we see a lot of times is the house sells the money gets moved over to the survivors trust or to some other bank account that the surviving spouse owns and the bypass trust is just like an afterthought like it never happened and then it's up to the children to have to decide what are you gonna do about it and there are wait are you yeah what are you gonna do about it and when are you gonna do it and so the what what are you gonna do about it you can recreate that you can go back and claw the assets back into the bypass trust if you follow the trust terms that's where it's supposed to be and so that requires court action you're gonna have to file a lawsuit and then the question is when are you gonna do that action if that's what you need to do and you have some pretty good thoughts about when well the when depends on the age of the surviving spouse if the surviving spouse is elderly and chances are they're not going to be around all that much longer this is kind of a dreary way of looking at life they're not gonna be around that longer it's better in my opinion in most cases to wait and then once they've passed on you can attack their survivors trust or any other assets they have and why wait because you may be a beneficiary of their trust of the survivors trust yes yeah so I think it's better to let the you know go after that after they've passed away because you never know you might get a windfall even we've seen it where even that surviving spouse didn't like their husband's kids but because the trust was drafted back in you know 2010 with everything going to the kids equally they left it maybe they left it out of Honor maybe they just take it around to make an amendment they'll definitely make an amendment if you come after all so if you sue while the spouse is still alive your concern is they're gonna go and amend the survivors trust and cut you out correct now what if you're already cut out of the survivors if you know that for certain there would be no reason not to just move forward and take action and say hey I want to get that property back keep in mind though the courts are going to be sympathetic to the surviving surviving spouse and there may also be a provision in a survivor's trust or in the bypass trust that says that mom can invade the principle of this trust for need well she's gonna go to a lawyer and say what do I need to create need so that I can start drawing down the principle that's trust so don't motivate mom I'm step mom in this case to start drawing me on that trust so in most cases it's better to wait until mom passes away if and if mom is 30 years old and you're 30 years old as a beneficiary you may need to move forward so you kind of need to monitor the situation see if the money in fact stays with the bypass trust which is what's supposed to happen the proceeds whatever the bypass trust owns the proceeds should go there right try to see if you can confirm that that happened if so then you probably in good shape right yeah that doesn't happen or you can't confirm it then you have to consider taking court action and that's a question of do you do it now or later and if you're not going to receive anything from the survivors trust or if the surviving spouse has just revoked their half of the trust and they put it somewhere else then you might as well go yeah except for keep in mind they can draw down principle and bypass trust in some cases that depends on the terms of the trust they may not have shared the trust with you so you're really dark and they're certainly not giving you a countyians even though you have a right to them you start asking for accountings they're gonna they're not gonna be happy about it so you have to figure out and do I wanna wait it's picking poison that's what it's doing which poisons gonna be less powerful to you and what rights do you have what rights do they have if you have the trust document you can start making those decisions without the trust documents very difficult that's right one last thing if you wait till they pass away you have to keep in mind that there's a statute of limitations that trumps all other open statute of limitations all that means is you have one year from the date of death of this spouse to file a lawsuit you have one year and it doesn't matter if your typical right under a lawsuit would be two or three or four years for ten years if they were still living the one year Trump's all statute of limitations and you have one year now there's an exception to that rule even where a short as how long four months if somebody opens probate so if somebody opens probate they only got 120 days that we're dealing with so people you know those are statutes and sneak up really quickly so so once somebody passes away take action well you've got to take action because there's there's there's something just briefly you're gonna have to petition for probate open up a probate estate you got the file creditors claim in that probe in a state and then you're gonna need to get your underlying lawsuit filed that takes time to do those three things yeah there's a lot to do and there's nothing more heartbreaking to have somebody call in to our office have a perfectly good claim and then you find out Oh somebody passed away two years ago and the statutes are all closed correct it's like you got to go you got to take action quickly yeah you have another question killer we have one more question what advice would you give to a spouse or an attorney who's about to draw up a trust that disinherits a spouse so who's the advice going to again and this is a key spouse or an attorney right a spouse or an attorney who's about to create a trust that disinherits the other spouse well it's interesting when I had a case a while back where a spouse wanted to do that they wanted to disinherit their other spouse and so they did a deed where they transferred half of the property into a trust and then the trust disinherited the spouse and the problem with that is that while you're legally married you cannot segregate out community property so every piece of property retains a 50/50 characterization so even if I take if I take half of my property and I move it away from an account with my spouse well that property I moved is still 50/50 and this property over here is still 50/50 you either have to get a legal separation you have to file for legal separation if you want to divide the assets or you have to file for divorce but if you have a situation where you you can't get the other spouse to sign off on something then you have to you have to do the best you can so I would do at least a pour-over will into a new trust leaving the spouses assets into this new trust and then that trust would go out the way the spouse wants it obviously the best to do it if you're gonna disinherit espouses if you get if you could get both spouses on the same page and say look I want to leave my half to my kids you leave your half to your kids its equal it's even and off you go but in my experience that's not easy to do because obviously when you come in and say I'm going to disinherit you my spouse that's when things go bad the other thing you could do is consider using a bypass trust so that the surviving spouse gets something during their lifetime or right to live in the residence and then it goes away from them I think that's a good compromise it's a good way to get both spices on the same page so that's another way that I would consider doing it but if you're gonna create a trust just for the spouse and you're gonna fund it with community property that's very difficult to do because you can't segregate it out now if you're gonna fund us if you're gonna create a trust for just one spouse and fund it with separate property and that he can do all day long that's just a separate property trust we we used to do that all the time as part of our estate planning that we would do but trying to separate out community property without a legal separation or a divorce is you just can't do it it's pretty tough and then once it's in the inside of a trust well even if you did like Charles Kuralt but the will it doesn't matter because it's a trust asset and the will doesn't control trust asset well in the argument we made in this case - is that the spouse had moved 50 percent of this house into her own trust and then tried to direct it away 25 percent well yeah I'm saying well whatever is in that trust is still 50/50 so that means the surviving husband still was entitled to 25 percent and the other 25 percent could go that way and then the 50 percent that was left outside of the trust that all went to the surviving spouse so the surviving spouse ended up with 75 percent because you can't divide assets while they're alive now if you put it into a marital a joint trust with husband and wife and you either create a bypass trust that lets the spouse live there and then it goes to somebody other than the spouse or if in the joint trust it says my half is going to go to my children and you not gonna get anything that's good you can do that but absent something like that it can be very difficult to just create your own trust and leave your assets your own way unless you own everything in your own name and you can pass it under a will a pour-over will into a trust and it goes through that way or even a standalone well that is that's true yeah you can just do a standalone will as long as your assets aren't in joint tenancy just own your assets as tenants in common with your spouse and then create a will yeah you have to go through probate but at least you can get your half out right wow this was a fun one it's complicated stuff you know I was talking to Manisha before the show and she was asking some questions about can you disinherit your spouse and I was telling her how yes you could and she was shocked and so I think a lot of people are shocked to learn about the ins and outs of how this works because when you're not dealing with this every day all day long like we are it's surprising it is so it's not all the questions we have Kayla okay that was quick I want to thank Kayla and Manisha for helping us out today they're the ones who go to all the work to set this up and to get all of the questions from our audience and also take questions during the show you can find a recorded version of our stand fight win live stream on facebook and youtube after we're done here and you can also find a recorded audio only version on pod beam at pod beam comm so I want to thank you for joining us Thank You Stuart thank you thank you everybody and we'll see you next time next time. 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