What We Leave Behind: Legacies and The Law of Wills - Part 4: Evil Hypotheticals
The following is a rough transcript of this podcast episode together with sources imbedded as links:
My name is Nathan Green, and I am a practicing lawyer.
Imagine you were not a very nice person. If you got thinking about your will you might realize it was something of a unique opportunity. It can stay secret until you die, so whatever you put in there, there are zero consequences. You can’t be chewed out, you can’t get weird looks for your neighbors. Literally zero consequences. Potentially you could even do something straight up illegal and since you are already dead you can’t be punished. Imagine someone who’s will said “A million dollars to the person who kills my ex-wife.” Surely there is someone out there who would be willing to risk going to jail for twenty years for a million dollars. Or maybe less extreme “ten thousand dollars to anyone who can convince my ex-wife that her new husband is cheating on her – whether he is or not.” Or what if you hated someone and wanted to use your death to slander them. “My entire estate to place full page newspaper ads in every paper saying John X is a paedophile and impregnated his sister.” If your estate went entirely to pay for the ads how could John X have any recourse against you?
Now obviously there are some easy solutions here. You can’t give a gift to someone for killing someone else, or for doing anything illegal for that matter. That is a simple enough rule. In fact I know off the top of my head of at least two different stops on pure illegal gifts. First a rule in common law to void the gift in the will, and second most places have legislation to strip the profits from someone who gains them through crime.
But imagine there was a painting that had caused a feud with your mother-in-law. She wanted the painting and thought it should belong to her. But you own it and think it is yours and yours alone. So when you die, you direct your executor to take the painting, and a video camera, to your mother in law, and then burn it to ash in front of her while giving her the middle finger, then play the tape at your funeral. Legal?
I personally have always been fascinated with people who look at the world differently. People who would see their will as a unique opportunity for chaos and actually take up the challenge or making a will that was both enforceable, and devious.
So, I hope you enjoy the discussion of law to come, you share an evil laugh with me, and you remember that above anything else, This is not legal advice.
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Disclaimer
This is not legal advice
The information here in any form is for entertainment purposes only.
You should not rely on or take or fail to take any action based upon this information.
Never disregard professional legal advice or delay in seeking legal advice because of something you heard here.
This is not legal advice.
This is not legal advice.
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One case I am going to specifically mention, and actually it was multiple cases, was over the will of one man, Charles Vance Millar. It took ten years and a supreme court decision to deal with this will (and that was in 1920’s time when litigation was a great deal simpler than it is today). Mr. Millar was actually a lawyer, who specialized in wills, and when he made a will for himself he set out to make one that would create as many problems as possible for everyone involved in it. It wouldn’t just be a problem for people he didn’t like, it would be a problem for the people who were going to receive gifts under his will. He was, at the time, referred to by the court as a “practical joker”.
He gave seven protestant ministers, well known temperance advocates, a fortune of stocks in a beer company – on the condition they not sell the shares but participate in the management of the company and take dividends from future profits. There is a famous case from this that stands for the proposition “you take the gifts contained in the will, not their cash equivalent value”. Mr. Millar was childless, and he left another fortune to the woman who had the most children in the decade after his death. This triggered the great stork durbey where women living through the great depression competed to see who could have the most children and win the fortune.
In perhaps a twist it takes a lawyer to appreciate, he gave a property to three men who despised each other, on the condition they live their together and cooperate over its management.
Millar was a well-known “practical joker” and while designed to cause… difficulty… none of his gifts were either criminal nor voidable for reasons of public policy. So what does it take, short of illegality, to get a court to invalidate a will provision?
Researching American, Canadian, and English law there seem to be four general areas: 1. Interference with marriage, either trying to manufacture a divorce, or force a wedding; 2. An illegal purpose; 3. Wastage – a fancy word for loss of economic value; and 4. A residual public policy power for categories that are not already known.
It is actually a bit surprising but there are not very many cases in this area. And the cases that do exist tend to follow a similar theme: The deceased didn’t like their child’s partner. Or they had something against a specific person, or group of persons. In one famous Canadian case, and I won’t dignify the deceased by mentioning his name, the testator gave his money to a white supremacist group in the US. The court struck down the gift saying this white supremacist group would be illegal under Canadian law and thus the gift failed.
Forgetting for a moment that these rules serve a valuable social function lets try out some hypotheticals that might get around them. I’m going to focus on two types (breaking up a relationship and revenge against an enemy as I don’t really want to turn my mind to how I could help people be racist or set up a perpetuity).
Just before we discuss these hypotheticals, to be clear I am not suggesting anyone actually do this. If you do you are almost guaranteeing your estate will incur massive, massive, legal fees and maybe even penalties and at the end of the day they could fail or be unenforceable in your jurisdiction. The point of this isn’t to give you ideas for terrible things to actually do, rather this is about learning to think like a lawyer. We took some simple enough rules, with fairly clear objectives, and now we are going to try and examine just how wide the wall that those rules throws up is. We are going to engage in a mental exercise to see if we can find an edge to that wall, or a way over its top, and the hope is, you find that mentally rewarding and interesting – and in so doing we can take some evil glee in imagining that we were the villain of a story. So, just as with anything else, don’t actually do this, this isn’t legal advice, consult a lawyer, etc. But now, Evil Hypotheticals.
I think it is relatively clear that you cannot say “A million dollars to my son if he divorces his wife.” The public policy prohibition is that marriages are a socially valuable institution and a will should not try to break one up – at least that’s the theory. So instead of that, what if we were ostensibly attempting to improve the marriage, would the gift be valid then? Of course judges are not stupid and while we might put language to the contrary in a will, a judge would likely see through some attempts at a creative drafting around the prohibition. So first the gift needs to be to the in-law, not the child, second its conditions need to be accomplishable, on their face individually enforceable, and yet still working towards the actual objective of ruining the marriage.
Imagine a not unique situation where a husband and wife are married and there are a few friction points in their relationship: He would be happier if she lost 10 pounds, while she is insecure about her weight, he likes sports and she resents how much time he spends on it. He always wanted a pet, and she hates pets.
Every relationship is going to have its own special hot button issues that are unique to it. So lets design the will to try and hit those hot buttons. While it doesn’t have to be these specific things we could imagine there are some hot button topics in relationships (having children, breast implants, abusive behavior, etc.) that the court could well void as conditions based on public policy. We could probably get away with a will leaving money on the condition someone loses weight, we probably couldn’t get away with a condition that someone gets breast implants.
You are probably asking “Why specifically avoid having children? The baby durby case establishes that you can give a gift for that. You don’t need absurd hypotheticals, you have case law.” Three answers 1) times have changed. It may well be that in the 1920’s you could dictate someone have kids to inherit and judges of that day, steeped in the judeo-christian morality of “go forth and multiply” would uphold it. But this is no longer the world we live in. For all we know this will could be in front of a female judge who would be deeply offended at the concept of a testator trying to control a woman’s uterus. 2) The gift in the baby durby case was a gift that identified who was to receive it by whoever had the most kids. In this case we are making a gift to a specific person conditional on her engaging in a behavior. In the first case no one had to do anything, in the second we are trying to dictate action. This is enough of a distinction that I doubt the courts of today would feel bound by the 1920’s jurisprudence on the topic. 3) There is some common law precedent saying that a condition must be within the control of the person. What if the court found pregnancy was not something that could simply be controlled?
So… My hypothetical will says – and I am using very simple language to make this easy to listen to. If you are a lawyer and listening thinking “that isn’t how you draft a will” I can unto, whereas, and notwithstanding as well as the next man, but I don’t think very many people could follow along in a podcast: Anyways… the provision reads:
As my son, and his wife, know, I have always felt that my son’s wife was not caring to his needs. My intention is to give my son’s wife an incentive to improve herself and strengthen their relationship.
So, to my son’s wife I give $1,000,000 on the conditions that, within two years of my death, she has:
1. Lost ten pounds;
2. Adopted and keeps a puppy; and
3. Develops an understanding of football such that she can beat my best friend, Jimmy Thompson, at a football trivia contest.
Now, as a practical matter what is going to happen here? The wife is going to be pissed, and the husband is likely going to be thinking that she should just do those things. With a little luck it drives a wedge between them.
But we can’t stop there. All the wife has to do is get the conditions declared invalid and she will get the money free and clear. She would challenge the will, and as we have seen it can be hard to predict what courts might do. So we need to discourage her from challenging the will, and discourage the court from finding the provision is void. We need a backup, a failure condition, and better yet a backup that might even further our objectives to end the marriage. So onto paragraph 2.
In the event that my sons wife does not complete all of the above conditions within the time set out, or if a court finds any of the above conditions void or unenforable, then the $1,000,000 gift shall instead pass to my son’s ex-girlfriend Sussie Miller on the condition that she send my son birthday, and Christmas cards each year for ten consecutive years.
Now, this creates an incentive for the wife not to challenge the will. If a court finds the provision invalid someone else gets the money! Now, on its face we are again trying to interfere with a marriage by this gift. While two cards a year is a fairly innocuous form of interference, the intention of the provision is also clear and that intention is interference. The wife could feel that there is a good gamble to take that the court would void both provisions and leave her with the money. However we have made the odds of this longer, and hopefully made the husband more encouraging for her just to lose weight and learn football.
But I would humbly propose that we need another backup, we also need a third paragraph. What we need is a third paragraph that the beneficiaries would both think is enforceable, and that the court would probably take up, and at the same time a paragraph that the court would very much not want to adopt but couldn’t void for reasons of public policy.
So the will says “If the above gifts fail the million dollars goes to a charity. We don’t want to notify the charity in advance, as they might have the right to contribute to the litigation and argue the previous provisions are invalid, so we have to set something up to determine which charity is to receive only if the first two gifts fail..
Anyways, let’s move on to the next hypothetical. Revenge against an enemy.
Again I would think the key is to exploit legal paths that are often sources of friction in daily life. Imagine for example that one’s enemy was also a homeowner – as most people are these days. What are the usual things that bother a home owner? The neighbors putting on some kind of addition to their house is usually a pain. Or when the town decides it is time to tear up the whole street to fix the sewer system. Maybe if your neighbor has a teenager who plays loud music, or drives a car with one of those loud after-market exhaust systems. Those are the most typical issues in the suburbs.
The will could give the following gifts:
To the four neighbors surrounding enemy, $50,000.00 each for zoning applications, and appeals, and construction for adding the largest possible footprint, height, decks, and pools to your properties. To the municipality, $100,000 to improve the sewer and electrical services that run directly in front of enemy’s house, provided that such improvements are carried out within five years of my death. To any teenager of an immediate neighbor of enemy, $5,000.00 to be used for music speakers, and a further $1,000 to modify the exhaust system of any cars they own.
But what else gets home owner’s up in arms? A homeless shelter going into the neighborhood is often one.
So what if we had a gift in the will that paid for a weekly bus to pick up homeless people from the city, buy them a big breakfast, and drop them off in the suburbs right in from of enemy’s house. Is a court really going to void a provision buying the homeless a hot meal because it bothers some jerk in the suburbs?
Again though, a backup provision is needed. One so terrible that our intended target wouldn’t want to risk it being enforced.
For example, what if, should the gift fail, the neighbor’s houses are to be purchased and rented out to sex offenders for a dollar a year.
A good lawyer tries to avoid their client having to litigate. All these provisions would probably result in litigation.
Beneficiaries, trusts, and planning for the future
The last topic I would like to discuss in this podcast has to do with beneficiaries. We are going to switch mental gears from reverse to drive, and instead of trying to actively harm the beneficiaries, we instead want to help them. Hopefully this section also balances out the maliciousness of the previous one. But we also need to be in the right mental space when discussing this because there are a lot more ways to hurt someone than just to hurt them, you can also be trying to help them but instead ruin their lives.
We have already talked about the rich trying to consolidate their power and disinherit some of their own children. We talked about social justice implications of wills and how important it is for society that money gets spent by the beneficiaries. But what about talking about all this from the perspective of the people actually listening to this? You, an average, ordinary person.
The majority of people who make a will do it at one of two times in life: shortly before they die in contemplation of their death, and when they are newly married or have just had kids wanting to make sure their new family is protected.
What do the estates of a 32 year old couple look like? Say they have worked hard, made some smart investments, and have a quarter million dollars in assets saved up. They, being responsible enough to make a will, have also been responsible and purchased life insurance policies. You walk into an insurance broker today, 32 years old, and ask for a life insurance policy, they are going to point you to a million dollar policy that is fairly cheap (as you are young and unlikely to die). You get one, your husband or wife gets one. Now, if you and your spouse die unexpectedly you have a quarter million in assets, two million in life insurance, and a potential multi-million dollar wrongful death claim against whoever is responsible for your deaths. Let’s say we just assume 2.25 million dollars. Let’s also assume that you have two young kids. Timmy and Suzy (3 and 1 years old respectively).
Here is the question: I know the plan is for Timmy and Suzy to get the money (probably 1.1 million each), but how exactly are they going to get it?
What I mean by that is 1 million dollars (really anything between 1-2 million) is an interesting amount of money. It is enough to live on forever if you live a Spartan existence. Alternatively it is enough to finance a decade of debauchery, depravity, and a hell of a time. But I don’t think most people who come to me for a will want their estate to be used to let Timmy live in a shitty apartment, eating pizza, and watching Netflix for forever. I also don’t think they want their estate used to fund the purchase of sports cars, hookers, and drugs, so that when the money eventually runs out Timmy has no useful job skills and some very expensive habits. You hear about lottery winners who have their lives ruined all the time. That is what a bequest in a will can do, it can ruin someone’s life if it isn’t given properly.
What do you want your will to do, really do?
Freedom for your child.
You want your child to live a rich, fulfilling, life doing what they love, not what they have to do to make money. For example. Imagine Timmy wanted to be a painter. If he could make 10K a year on his own, between painting sales and teaching painting classes, that combined with the money in the will, could let him put his entire life into painting and now have to worry about making rent, or buying food. He could spend 100K studying the masters in Europe for a few years. He could live whatever life he wants and, who knows, maybe freed from worry about money and given decades to study and hone his skill, at fifty he could be one of the world’s leading artists.
More interestingly to me… What if Timmy at 18 would waste the money, but Timmy at 25 has figured himself out and can use the money responsibly. How does the will get “programmed” to pay out for responsible Timmy but not irresponsible Timmy?
I haven’t figured that one out yet. I think you can get close. You can update your will every few years as your kids grow and you get a sense about who they are growing into. You can set up trusts, you can set up delayed payments, you can do all sorts of things, but each comes with a cost, each comes with a possible negative outcome depending on what happens. There are some people who, even with parents alive then and there to raise and guide them, still go down the wrong path and never get themselves right again.
Even for yourself, can you honestly answer the question of what you would do if any job would provide you enough to live on. You could be a painter, a writer, an actor, so long as you worked you would be ok, but you can’t simply say that you are going to spend the rest of your life traveling or being a self-financed restaurant and wine reviewer. How would that change your life?
In the end this is the biggest issue about wills. They are attempts by people today to impose their intentions on the future. For various reasons of policy we have restricted their ability to do this. And for various reasons of practicality sometimes the world refuses to allow this. It is fun to sit back imagining crazy, malicious, and horribly uncivilized will provisions, but for what real people want to actually do, how can you manage things?
The most common way is simply to put in age limits. Maybe give Timmy 30K when he is 18 to buy a car, go on vacation, have some fun with, and see just how easy it is to blow that money. Then at 25, once he has completed school and been working for a few years, enough for the down payment on a house. Maybe he squanders it, maybe he invests prudently and gets a leg up on life. And at 30 he gets the rest. Maybe he has wasted the first two tranches, and really what could we have done to protect him from himself at that point? Or maybe we have made a terrible mistake delaying the money that long and he has had to do things for economic need that were never our intent.
Wills for the elderly are much easier because their objectives are much simpler. Their families are static, their children are the people they are, and whether a trust or an absolute gift are appropriate is a simple matter of drafting.
Of course the funny thing about this whole thing is that when people call me and ask what it costs to do a will, why they can’t just use a legal will kit, say that their estate is simple and they just want their children to get everything if their spouse dies before them, they are trying to think of a will like a fancy cheque “pay everything I have to the order of spouse and kids”, and they are willing to pay something in the order of what the bank would charge for an extra fancy wire transfer or bank draft.
And in fact a will is like an insurance policy for the benefit of the loved ones you leave behind. It isn’t about trying to move assets from one person to another, it is about trying to ensure that your deeper objectives (be it concentrating power in a single heir, protecting their daughter from her no good husband, or ensuring that a minor child appreciates the value of a testamentary gift and it improves their life not ruins it) are met. It is an attempt to protect loved ones from an almost innumerable number of unlikely but possible events. But people think that the lawyer telling them this is just trying to make a buck to hit an annual billing target. But the reality is that if tomorrow the government announced it was illegal for lawyers to write wills for people, the legal profession would be thrilled because there would be a hundred times more money spent litigating estates and fighting over the massive bulk of assets to be divided, than we could ever bill for our simple time to draft an appropriate, considered, will.
I hope that I have changed how you think about wills and shown you some of the machinery that makes the world work that is ordinarily obstructed from view. If you are still interested my next podcast series is coming out soon, this one on the law of mortgages which account for a massive amount of the economy and are still, even after the 2008 financial crisis, poorly understood. Interesting fact, the word mortgage has two roots mort, meaning dead, and gage, meaning pledge. So a mortgage is literally a death pledge. Find out why, and much, much more, coming up next. But, if you take only one thing away from this podcast I hope it is this: This is not legal advice!