chapter a the client interview: estate planning and · pdf filechapter a the client interview:...

Chapter A The Client Interview:

Estate Planning and Probate

Holly J. Gilman, Austin Gilman & Associates, P.C.

Update By:

Michael H. Ripp, Jr., Austin Giordani Schurig Beckett Tackett

2 STATE BAR OF TEXAS p TEXAS BAR CLE

THE CLIENT INTERVIEW ESTATE PLANNING Holly J. Gilman Gilman & Associates, P.C.

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Table of Contents

I. INTRODUCTION ...................................................................................................................1 A. Estate Planning Questionnaire................................................................................1 B. Checklist at Initial Office Meeting ...........................................................................2 C. Communication Key to Build a Positive Attorney-Client Relationship ..............2 D. Determine Client's Motivation in Planning Estate ................................................2 E. Addresses Client Concerns and Desires ...............................................................3 II. INFORMATION GATHERING PROCESS .............................................................................3 A. Information Necessary to Prepare an Estate Plan ................................................3 B. Determine the Client's Wishes ................................................................................4 C. Discuss and Determine a Plan for Probate and Non-Probate Asset Distribution ................................................................................................................4 D. Determine the Client's Wishes Regarding Fiduciaries.........................................5 E. The Person or Entities Who Cannot Serve As a Fiduciary Are ...........................5 F. Review of Existing Documents ...............................................................................6 G. Complete Estate Plan Includes All of the Following Documents ........................6 H. Other Estate Planning Documents Your Client May Want or Need.....................6 III. ETHICAL ISSUES ..................................................................................................................7 A. Confidentiality ...........................................................................................................7 B. Conflicts of Interest ..................................................................................................7 C. Liability of Attorney to Estate and Trust Beneficiaries.........................................9 D. Other Fiduciary Liability Cases ...............................................................................9 IV. COMMON ISSUES REQUIRING RECOGNITION AND CAREFUL TREATMENT IN ESTATE PLANNING ..............................................................................................................9 A. Nontraditional Families ............................................................................................9 B. Taxable Estates .......................................................................................................12 C. Elder Law Issues.....................................................................................................12 D. Disabled Individuals ...............................................................................................13 E. Non-United States Citizens ....................................................................................13 F. Family Issues Likely to Cause a Will Contest .....................................................13 G. Capacity Issues .......................................................................................................14 V. PRACTICE POINTERS ........................................................................................................15 A. Fee Agreements ......................................................................................................15 B. Non-Representation of Client and Others............................................................15 C. Setting Your Fees....................................................................................................15 VI. CONCLUSION ......................................................................................................................17 APPENDICES: 1 Will / Client Questionnaire ...........................................................................................19 2 Checklist for Estate Planning ......................................................................................25 3 Fee Agreement ..............................................................................................................33 4 Letter Declining Representation .................................................................................35

ii STATE BAR OF TEXAS p TEXAS BAR CLE

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I. INTRODUCTION In planning your client’s estate, you will generally have only one or two face-to-face meetings with your client before he/she signs their final estate documents. During the initial meeting, it is your job to: (1) make the client comfortable about planning for his or her incapacity and death, (2) gather sufficient information from the client to draft appropriate documents, (3) evaluate the client’s needs and desires, and (4) recommend the documents which will accomplish the best estate plan for your client within their needs, desires, and financial constraints. The client interview, therefore, is the critical point in developing your estate planning practice. Your ability to successfully help your clients plan for their incapacity and transfer of their property at death is directly related to how comfortable that client is in communicating with you. How do I gather the information I need to prepare a client’s estate planning documents?

There are two common methods to gather the information you will need to prepare a client’s estate planning documents: (1) have the client complete an estate planning questionnaire to bring with them to the first meeting with you; or (2) collect the information directly from the client at your initial consultation. A. Estate Planning Questionnaire 1. Benefits a. Clients will have thought about their assets, family history, and who they will want as their fiduciaries making it easier for them to discuss and decide related issues at your initial consultation. b. For many clients, just meeting with an attorney is stressful. The questionnaire allows them to think about issues relating to their incapacity and death before meeting with you thus making it easier to discuss and decide those difficult issues at your initial consultation. c. Provides you and your staff with the a client’s information at your fingertips when drafting and in the event of future need. d. Valuation of assets owned by the client will help to advise you if you are capable of handling the estate planning for this client. e. Saves the client money if you are billing on an hourly basis. 2. Use of the Questionnaire a. Whether you set your own appointments or your staff does so, it is easy to advise the prospective client that you will be sending a questionnaire for them to complete and bring with them to your initial consultation. b. Make sure when making the appointment that you or your staff has set the appointment far enough out to have given the client at least one week to complete the questionnaire before their first meeting with you. c. Not all clients are willing to take the time to complete a questionnaire. If your prospective client balks at completing a questionnaire or postpones the appointment because he/she has not completed it by the initial appointment time, invite them to the office and use the


checklist process described below. B. Checklist at Initial Office Meeting 1. How to Use a Checklist a. Complete a checklist as you have your initial meeting with a client. b. Determine the client’s wishes for the disposition of his/her property at death. c. Determine the client’s wishes if he/she becomes incapacitated before death. d. Determine the client’s wishes if he/she becomes incapacitated before death. e. Explain various documents you recommend a client complete as part of their estate plan and their function to the client.

How Can I Establish Effective Client Relations with My Estate Planning Clients?

C. Communication Key To Build a Positive Attorney-Client Relationship 1. Establish your credibility with the client a. do not make promises that you cannot keep; b. respond to telephone calls, questions, or complaints of the client promptly; c. be yourself, don’t pretend to have more expertise than you have; and d. take a sincere interest in the client and his or her needs. 2. Develop mutual trust and respect with your clients a. be completely open about fees and your financial requirements; b. really listen to the client’s needs and wants; c. be realistic about when you can complete the client’s work with your other commitments; and d. advise client who else in your office may be working on the client’s matter. 3. Advise client of your expectations of them a. to provide you will complete and truthful information; b. to follow your advice; and c. to perform his/her financial obligations to you by paying fees and expenses.

How Do I Make the Client Feel Comfortable Talking about Incapacity and Death?

D. Determine Client’s Motivation in Planning Estate 1. Common motivations a. life threatening illness to client or a loved one; b. recent accident involving client or a loved one; c. client has minor children and wants to provide for them if something happens to the client; d. recent death of someone close to the client; e. change in client’s financial condition; or f. went to a seminar on Living Trusts to “avoid probate and death taxes.” 2. Explain what happens to a person at incapacity and death

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a. incapacity i. temporary incapacity ii. permanent incapacity b. death i. probate process ii. avoidance of probate through use of trusts, survivorship agreements, beneficiary designations, and other non-probate techniques E. Addresses Client Concerns and Desires 1. Clarify misconceptions a. Common misconceptions include: i. do not need a Will because I have no valuable property ii. do not need a Will because someone has a power of attorney for me iii. probate takes years to complete and costs thousands and thousands of dollars 2. Acknowledge which of client’s desires can be met in estate plan a. address what can and cannot be done with various documents comprising the client’s estate plan b. use personal examples to highlight what you have done in your own estate plan when discussing the pros and cons of completing certain estate planning documents. i. Example: I speak to my clients about my husband’s use of my durable power of attorney for health care when I had surgery in 1993. I also advise many of my clients that I have disqualified one of my sisters on my Declaration of Guardian in the Event of Later Incapacity or Need of Guardian.

II. INFORMATION GATHERING PROCESS What information is necessary for me to collect in order to begin drafting a client’s estate planning documents?

A. Information Necessary To Prepare an Estate Plan 1. Information you will need to know a. marital status, marital history, and information about children; b. the client’s family history; c. valuation of assets owned; d. the client’s desires for distribution of their estate; and e. client’s determination of which person or entity shall serve in various fiduciary capacities. 2. Information you will want to know a. family issues likely to cause a Will contest b. relationship with desired beneficiaries other than family members or a charity 3. Marital status and history a. information on prior marriages ending in death or divorce, including names, dates, and locations in Will itself;


b. names, ages, and residences of children from prior marriages; and c. names, ages, and residences of children from current marriage. 4. Family History a. identify all family members in Will b. whether client’s parents are alive and where they reside; c. client’s siblings and where they reside; and d. whether there is any strain within the client’s family likely to lead to a contest. 5. Valuation of Assets of the Estate a. You MUST determine the value of the client’s estate in order to decide whether or not the client needs estate tax planning. Estates very near or over $1,000,000 ($2 million for a married couple in Texas) need to have estate tax planning done and should be referred out to a knowledgeable estate planner until you become proficient in the tax issues.

How Do I Determine What Constitutes the Client’s Estate For Valuation Purposes?

b. The Client's Estate i. all real property, including any oil and gas interests (a) rule of thumb for oil & gas interest is three times the annual income ii. all personal property, including stocks and bonds owned by client; iii. all bank accounts, certificates of deposit, and money market funds; iv. all retirement benefits of client; v. the face value or death benefit value of all insurance policies insuring the client’s life; and vi. all claims owed to the client from any source (loans made, personal injury awards, lottery winnings paid over time, etc.)

How Can I Determine my Client’s Goals for Distribution of Estate?

B. Determine The Client's Wishes 1. Disposition of his/her assets of the estate at death; 2. Does client wish to make gifts a. If client wishes to make gifts during his/her lifetime, does client want an i. an outright gift to donee ii. control over access to the gift to donee 3. Whether client feels need for a trust for an beneficiary; and 4. Alternate beneficiary designations a. Client should provide name alternate beneficiaries in the event first named beneficiaries do not survive client. C. Discuss and Determine a Plan for Probate and Non-Probate Asset Distribution 1. Non-probate assets a. life insurance payable to a beneficiary other than

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the client’s estate; b. retirement plans payable to a beneficiary other than the client’s estate; c. property held as joint tenants with right of survivorship (most commonly bank accounts/brokerage accounts); and d. assets placed in trusts prior to client’s death. 2. Probate assets a. include any property not held as joint tenants with right of survivorship i. real property; ii. stock and bonds; iii. bank accounts, notes, mortgages, and cash; iv. life insurance payable to the estate or where no surviving beneficiary designation; v. jointly owned property; and vi. personal property such as: (a) furniture and fixtures; (b) motor vehicles and boats; (c) artwork, silver, and other items of a decorative nature; (d) clothing and jewelry; and (e) all other items of miscellaneous personalty. D. Determine the Client's Wishes Regarding Fiduciaries

What Are The Common Fiduciaries Used in Estate Planning?

1. Fiduciaries appointments during life of client a. agent under statutory durable power of attorney b. agent under medical power of attorney c. guardian for the person and estate of client d. trustee of inter vivos trust and/or irrevocable trusts 2. Fiduciary appointments at death of client a. executor of Will b. guardian of person and estate of minor children c. trustee(s) of testamentary trust (created in Will) d. agent to control disposition of remains of client

Who cannot serve as a fiduciary?

E. The Person or Entities Who Cannot Serve As A Fiduciary Are: 1. Probate proceedings (Executor/Administrator) - § 78 Texas Probate Code a. incapacitated persons; b. convicted felons; c. non-resident of Texas who has not appointed a resident agent; d. corporation not authorized to act as a fiduciary; and e. person whom the court finds unsuitable 2. Guardianship - § 681 Texas Probate Code a. minors; b. person whose conduct is notoriously bad;


c. incapacitated persons; d. person who is a party or whose parent is a party to a lawsuit concerning or affecting the welfare of the proposed ward (with exceptions); e. person indebted to the proposed ward; f. person asserting a claim adverse to the proposed ward’s property; g. person incapable of management and control of ward’s estate; h. person whom the court finds unsuitable; i. person disqualified in a declaration made under §679 of Tex. Probate Code; and j. non-resident of Texas who has not appointed a resident agent.

What if My Client Already Has Estate Planning Documents?

F. Review of Existing Documents 1. Do current documents accomplish client’s wishes? a. If the documents are insufficient, recommend completing new documents. b. If the documents are sufficient, advise the client of any other documents they should consider to make their estate plan complete.

What Is Included in a Complete Estate Plan?

G. Complete Estate Plan Includes All of the Following Documents: 1. Will with contingent trust(s) or Revocable Trust with a pour over will 2. Statutory Durable Power of Attorney - Tex. Probate Code §§ 481 et seq. 3. Medical Power of Attorney - Tex. Health & Safety Code §§ 166.163-64. 4. Directive to Physician - Tex. Health & Safety Code, § 166.033. 5. Declaration of Guardian in the Event of Later Incapacity or Need of Guardian - Tex. Probate Code § 679 H. Other Estate Planning Documents Your Client May Want or Need 1. Agent to Control Disposition of Remains - Tex. Health & Safety Code, §711.002 a. When used - where client wants someone other than a family member to handle the disposition of his/her remains at death 2. Declaration of Appointment of Guardian for Children in the Event of Death or Incapacity - Tex. Probate Code §677A a. When used - where client has minor children and does not make a designation of guardian of person and estate in his/her Will. 3. Survivorship Agreement - Tex. Probate Code §46(a) a. When used - when client and partner jointly own property and wish to leave the property to the survivor without the property passing through probate. b. Read § 46 before using with community property

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of Husband and Wife 4. Community Property Survivorship Agreement 5. Conversion of Separate Property to Community Property

III. ETHICAL ISSUES What Ethical Issues Arise in Estate Planning?

A. Confidentiality 1. General Rule

“A lawyer shall not knowingly reveal confidential information of a client or a former client to a person the client has instructed is not to receive the information or anyone else other than the client, the client’s representatives, or members and employees of the lawyer’s firm.” See Rule 1.05, Texas Disciplinary Rules of Professional Conduct (hereinafter “DR”)

a. “Confidential Information” defined as both: i. privileged information - information protected by the attorney/client privilege under Rule 503, Texas Rules of Evidence; and ii. unprivileged information - all information relating to a client or furnished by the client, other than privileged information, acquired by the lawyer during the course of or by reason of the representation of the client. 2. When Appropriate to Reveal Confidential Information of a Client a. When client has expressly authorized disclosure or consented after consultation. See DR- 1.05(c)(1)&(2). b. When the lawyer believes it is necessary to do so to comply with a court order, Texas Disciplinary Rule of Professional Conduct, or other law. See DR-105(c)(4). 3. Client Under a Disability a. Comment 17 to DR-1.05 makes mention of the fact that DR-1.02(g) requires that the lawyer representing a client under a disability to secure the appointment of a guardian or other legal representative, if necessary, and that disclosure of confidential information in order to comply with DR-1.02(g) is appropriate. B. Conflicts of Interest 1. General rule a. A lawyer shall not represent: i. opposing parties to the same litigation. See DR-1.06(a) ii. a person if the representation of that person: (a) involves a matter with an adverse interest to another client or lawyer of the firm; or (b) becomes adversely limited by responsibilities to another client or law firm’s interest. See DR- 1.06(b) 2. Permissible representation a. Lawyer may represent multiple clients if:


i. lawyer reasonably believes representation of each client will not be materially affected; and ii. each client consents to such representation after full disclosure of the existence, nature, implications, and possible adverse consequences of the common representation and the advantages, if any. See DR-1.06(c) 3. Other prohibited transactions a. Preparation of instrument with substantial gift to lawyer or a member of his or her family, including a will or trust, is prohibited unless lawyer is related to the donee. See DR-1.08(b) 4. Person paying for lawyer’s services a. Lawyer not to accept compensation for representation of a client other than from the client unless: i. client consents; ii. no interference with lawyer’s independent professional judgment or the lawyer/client relationship; and iii. confidentiality is maintained. See DR-1.08(e) b. Comment 5 to DR-1.08(e) states: “Paragraph (e) requires disclosure to the client of the fact that the lawyer’s services are being paid for by a third party. Such an arrangement must also conform to the requirements of Rule 1.05 concerning confidentiality and Rule 1.06 concerning conflict of interest”...

What are Common Potential Situations for Conflicts of Interest in Estate Planning?

5. Potential conflict situations a. Husband and Wife i. Estate planning by one attorney for both husband and wife makes good economic sense and is easier to plan, but in today’s social realty where over one-half of the marriages end in divorce, it can prove to be quite dangerous for creating a conflict. ii. Comment 15 to DR-1.06 provides: “Conflict questions may also arise in estate planning and estate administration. A lawyer may be called upon to prepare wills for several family members, such as husband and wife, and, depending upon the circumstances, a conflict of interest may arise. In estate administration it may be unclear whether the client is the fiduciary or is the estate or trust, including its beneficiaries. The lawyer should make clear the relationship to the parties involved.” b. Parent and adult child i. It is not uncommon for an adult child to bring a parent into your office for estate planning purposes. Issues likely to arise include: (a) who will be paying the legal fees? (b) how can I keep the confidences of my client if the parent requires the child’s presence in the initial meeting? (c) how can I be certain that my client, the parent, is not being unduly influenced by the adult child? (d) am I also able to draft the adult child’s Will without a conflict of interest? ii. Similar conflicts arise here as described

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above in the husband and wife conflict situation. iii. When multiple generations are involved in a family-owned business, it is common for the estate planner to want to prepare the estate plans for all persons who may own an interest in the business to help assure the business can pass to the successive generation free from taxes. The same conflicts risks are apparent here as in the husband and wife conflict of interest. c. Other sources of conflict are likely to exist when representing two or more people who are: i. domestic partners who are gay or lesbian ii. unmarried heterosexual couples

How Can I Protect Myself in Conflict of Interest Situations?

6. Avoiding Conflicts a. avoid accepting multiple persons as clients. If you do, read the Disciplinary Rules carefully and withdraw if a conflict becomes apparent. b. when accepting multiple persons as clients, get conflict waivers and consent letters in dual representation situations c. recommend that each client seek independent legal advice

What Is an Attorney’s Responsibility to Beneficiaries of the Estate of the Client?

C. Liability of Attorney To Estate and Trust Beneficiaries 1. Barcelo v. Elliott, 923 S.W.2d 575 (Tex. 1996) a. The Texas Supreme Court decided in 1996 that an attorney retained by a testator or settlor to draft a Will or trust owes no professional duty of care to persons named as beneficiaries under the Will or trust. Id. at 579. b. Reasoning: In holding that the attorney does not owe a duty to the beneficiaries named in a Will or trust, the Court reasoned that a bright-line privity rule which denies a cause of action to all beneficiaries whom the attorney did not represent will ensure that attorneys zealously represent their clients without the threat of suit from third parties compromising that representation. Id. at 578-79. D. Other Fiduciary Liability Cases 1. McCamish, Martin, Brown & Loeffler v. F. E. Appling Interests, 991 S.W. 2d 787 (Tex. 1999) - In McCamish, the Texas Supreme Court held that an attorney can be liable to one who is not his client for negligent misprepresentation. 2. Estate of Arlitt v. Patterson, 995 S.W. 2d 713 (Tex. App. - San Antonio, 1999) - The Fourth Court of Appeals held that an attorney who negligently drafts a will can be held liable to a joint client for such negligence. In this case, the wife whom the attorney has also represented when drafting estate documents was allowed to bring the legal malpractice action against the attorney for the negligence in drafting the spouse’s documents although the children could not recover.

http://www.TexasBarCLE.com/CLE/PMCasemaker.asp?table=TX_caselaw&volume=923&edition=S.W.2d&page=575&id=96081_01




IV. COMMON ISSUES REQUIRING RECONGNITION AND CAREFUL TREATMENT IN ESTATE PLANNING A. Nontraditional Families 1. Single person with children a. Divorced single parent: Attorneys of single parents are often asked by clients to name a guardian of the person and estate of minor children other than the ex-spouse who is the parent. Although this can certainly be done in the Will or the Declaration of Appointment of Guardian for My Children in the Event of My Death by a Parent on behalf of his/her minor children, you must take care to explain to your client how both parents of a minor child are considered the natural guardians of the children without preference to custody and that the surviving parent is entitled to be appointed the guardian of the estate under Texas Probate Code §676(b). Additionally you need to advise the client that the District Court which heard the divorce case retains jurisdiction over the minor children until they reach 18 years of age, therefore, the custody question will probably be resolved in Family court. i. recommend to client the creation of an intervivos or testamentary trust for the estate of the minor child which does away with the need to appoint a guardian of the estate. ii. you may be able to acquire standing to contest Managing Conservatorship of the surviving parent under Section 102.003(4) of the Texas Family Code, if your client has named someone other than the surviving parent as guardian of the person or estate in their Will. (a) this is not a sure fire method to gain standing with the family court, so if your client is suffering from a terminal illness, it’s best to have them have a new managing conservator for the minor children named before their death. (b) remember: children at the age of 10 or older are able to file a written statement with the court as to the child’s choice of managing conservator. See § 153.008, Texas Family Code. The court will not be totally bound by the child’s request since the primary concern for the court is what is in the child’s best interest. See § 153.002, Texas Family Code. b. If client with minor child has not married and the paternity has not been established, consider recommending a paternity suit to client. A child may not inherit from a father unless the requirements of § 42 of the Texas Probate Code have been met. 2. Second marriages with step parent families a. Attorneys must be aware that relationships between the family of the testator’s first marriage and those of the surviving spouse, with or without children, which may be pleasant during the testator’s lifetime can deteriorate rapidly after the death of the testator. b. Determine the goals of the testator for the

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surviving spouse and children: i. Common goals are: (a) ensuring that a certain amount of funds will be available to the surviving spouse and/or the children from a prior marriage in the event of the testator’s death (b) minimizing conflicts during the estate administration between the surviving spouse and children from a prior marriage (c) minimizing conflicts between the children from a prior marriage and the surviving spouse after administration and during the surviving spouse’s lifetime c. For an excellent paper addressing this issue, See Kroney and Hopkins, “Estate Planning for the Second Marriage: Minimizing Conflicts Between the First and Second Families”, 6th Annual Advanced Drafting Estate Planing and Probate Course, State Bar of Texas, Oct. 26-27, 1995. 3. Lesbian/Gay couples (“Domestic Partners”) a. family hostility - the hidden agenda i. often domestic partners face a great deal of hostility from their respective biological families. Such hostility often results in: (a) Will contests (b) contests or challenges to selection or appointment of personal representatives to act on client’s behalf ii. other instances which raise problems occur at the death of one of the domestic partners when the biological family becomes aware for the first time that their son or daughter was gay or lesbian. b. your job as the estate planner: i. learn and understand the family dynamics to be able to properly suggest estate planning tools which will accomplish the client’s wishes ii. encourage your client to speak with his or her family about his/her sexual preference so that there is a lessening of the chance of a contest at the client’s death iii. develop an estate plan which will be the most likely to carry out your client’s wishes, but ALWAYS assume there will be a challenge to the Will and the agent designations during a client’s lifetime (a) consider the use of a revocable management trust (inter vivos trust) which becomes irrevocable on client’s death or incapacity (b) use all documents suggested in estate planning Section II.H., above (c) use survivorship tools to keep assets out of estate. If few assets in estate at death, you lessen the chance of a Will contest action by the client’s biological family. 4. Unmarried heterosexual couples a. See discussion of Lesbian and Gay couples above as many of the same issues apply b. if either person (or both clients if representing


both partners in the couple) has taxable estates, consider recommending marriage as an option to take advantage of estate tax savings for married couples. B. Taxable Estates

1. What constitutes a taxable estate?

a. Single person - $1,000,000 (under Texas and federal law) b. Married couple in Texas - $2 million (under Texas and federal law)

2. What to do about taxable estates?

a. Unless you have significant estate planning experience with substantial estate and gift tax knowledge, refer this estate plan to a knowledgeable estate planner. b. If you are interested in learning estate planning for large estates: i. consider asking the attorney (and client) you have referred the case to whether you can assist them to learn at no charge; ii. establish a network of estate planning attorneys whom you may call with questions; and iii. attend CLE seminars in advanced estate planning and drafting. C. Elder Law Issues 1. Ever-increasing elderly population a. Questions which arise for us as attorneys go beyond Wills, trusts and other estate planning documents. The areas in which you may be called on for expertise by i. health care issues; ii. residential issues; iii. financial issues; and iv. traditional legal issues b. Plan for future incapacity of client i. create powers of attorney, directive to physician, designation of guardian for client.

2. Is long term nursing home care a likelihood for your client?

a. if so, it is not covered by Medicare or Medi-Gap insurance, rather it is covered by Medicaid if client does not have either: I. long term care insurance (ii) the funds to pay for it b. there are extremely complex state and federal statutes and regulations if your client will need to comply with to receive financial assistance for nursing home care under Medicaid c. certain transfers which you might make for an elderly client to third parties into trust for the benefit of a client can cause the client to become ineligible for Medicaid assistance for nursing home care. Get help from an experienced elder law attorney or refer the case to an experienced elder law attorney for preparation of necessary documents. d. Miller Trust (Qualified Income Trusts) - Miller trusts are valid to qualify a client for Medicaid nursing home coverage, but extreme care needs to be used in the drafting


so that the trust will not be disqualified by Texas Department of Human Services representatives. i. A Miller trust works: If income of client exceeds the maximum allowable state cap to receive public assistance under Medicaid, a Miller trust may be used to receive all of the client’s income. After a small monthly payment to the client and payment of the client’s medical insurance, the balance of the trust goes to the nursing home or other medical care provider of the client and Medicaid picks up the rest of the cost of nursing home care each month. e. Spousal impoverishment rules may allow your client to make certain transfers of assets to the spouse not in need of nursing home care. Get help from an experienced elder law attorney or refer the case to an experienced elder law attorney for preparation of necessary documents. D. Disabled Individuals 1. Special Needs Trusts a. designed to permit an incapacitated person to receive public assistance, such as Medicaid benefits, and at the same time, be the beneficiary of a discretionary trust. b. can be court created trusts by or through a guardianship or under a personal injury settlement if the disabled individual’s funds are to be used to fund trust c. can be created by third party with funds not belonging to the disabled person such as a Trust created by parent solely for benefit of disabled child d. (i) does not disqualify a child from Medicaid benefits since it is created with assets of the parent rather than assets of the disabled person. 2. Pooled Asset Trusts a. trusts established and managed by nonprofit association for disabled applicants which allows money to be placed into the trust for the benefit of a disabled person during his/her lifetime. At death of the disabled person, assets not retained by the trust for administrative costs go to the state for reimbursement of medical assistance provided to disabled person. 3. Miller Trust (Qualified Income Trusts) Discussed above in Section IV(C)(2)(d) E. Non-United States Citizens 1. Right to inherit a. the alien has a right to take as a beneficiary or heir under §41(c) Texas Probate Code 2. Right to serve as executor a. the alien may not serve as the executor or administrator of an estate unless he/she has complied with the requirements of appointment of a resident agent and filing such appointment with the court See § 78(c) Texas Probate Code.


F. Family Issues likely to Cause a Will Contest 1. “Disinheriting” an Heir a. permitted by § 58(b) Texas Probate Code b. disinheriting an heir is likely to cause a disgruntled child or grandchild who will file a will contest action at the client’s death c. if disinheriting an heir is desired by the client, consider the following alternatives: i. stating why child is to be disinherited in Will - without testamentary libel ii. consider recommending the establishment of a revocable or irrevocable trust with the client’s assets if client feels a contest is very likely or inevitable iii. always use a “no contest” clause in Will 2. Step parents and Step Children a. see discussion in Section IV.A.2., above 3. Large Estates a. generally, very small or insolvent estates do not result in contest actions i. there are always exceptions to this rule when there is some item of property everyone wants. G. Capacity Issues 1. “Sound Mind” required a. Elements of testamentary capacity, testator must have: i. sufficient ability to understand the business in which he/she is engaged; ii. sufficient ability to understand the effect of his/her act in making a Will; iii. capacity to know the objects of his/her bounty; iv. capacity to understand the general nature and extent of his/her property; and v. memory sufficient to collect in his/her mind the elements of the business to be transacted, and to hold them long enough to perceive, at least their obvious relation to each other, and to be able to form a reasonable judgment as to them. See Prather v. McClelland, 13 S.W. 543 (Tex.1890) 2. Lucid intervals a. Testamentary capacity is required on the day the Will is executed. See Croucher v. Croucher, 660 S.W.2d 55 (Tex. 1983) 3. Insane delusions a. Even if testamentary capacity requirements are met, if insane delusion exists, Will can be held invalid. Insane delusion involves: i. testator laboring under the belief of a state of supposed facts that did not exist; and ii. no rational person could believe the facts 4. Practice pointers for capacity a. If testamentary capacity is a question, consider the following options:



i. have client see their medical doctor for an evaluation on capacity just before coming to your office to sign Will ii. if client in hospital or nursing home, have doctor examine client just before Will signing iii. use witnesses who are extremely familiar with testator and young enough to survive testator so that they can be used to testify in the even that a Will contest is filed (a) consider using more witnesses than the two required iv. carefully consider videotaping the Will execution ceremony (a) if client is shaky or nervous, it can appear to others at a later time that capacity is questionable V. PRACTICE POINTERS A. Fee Agreements 1. Always use a fee agreement a. flat fee b. hourly fee 2. Fee Agreement should include conflict disclosures and waivers a. if asked to represent husband and wife, multiple generations in a family, both partners of a domestic partnership, whether unmarried heterosexual or homosexual couples: i. explain conflict potentials in initial meeting with clients ii. get all clients to sign fee agreement which includes: (a) written disclosure of potential conflict (b) acknowledgment and waiver of potential conflict by all parties whom you agree to represent 3. Fee Agreement to include notice if another family member is paying your fees B. Non-Representation of Client and Others 1. Letters declining representation after review. When you have decided not to take an estate planning matter, you should send a non-representation letter to clarify to the client that you will not be handling this matter for them. 2. Letters to related parties to client whom you do not represent. If you are consulted by an adult son or daughter to help plan a parent’s estate, send a letter to the son or daughter making it clear you represent the parent. This is especially important if the son or daughter is paying your legal fees C. Setting Your Fees 1. Illegal fees or unconscionable fees prohibited a. DR-1.04(a) prohibits a lawyer from entering into an arrangement to charge or collect illegal fees or unconscionable fees


i. unconscionable fee defined as one that a competent lawyer could not form a reasonable belief that the fee is reasonable ii. see comment nos. 7 & 8 to DR-1.04 for more information on unconscionable fees 2. Factors to consider in determining reasonableness of fees a. DR-1.04 (b) states the factors include: i. time and labor required, novelty and difficulty of questions involved, and skill requisite to perform the legal service properly; ii. likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer; iii. fees customarily charges in the locality for similar services; iv. amount involved and the results obtained; v. time limitations imposed by the client or by the circumstances; vi. nature and length of the professional relationship with client; vii. experience, reputation, and ability of the lawyer performing the services; and viii. whether the fee is fixed or contingent on the results obtained or uncertainty of collection before the legal services have been rendered. 3. Flat fee vs. hourly fee a. Establish your fees at the completion of initial meeting with client i. complexity of estate will be known; and ii. number of documents you will be required to produce will be known b. Consider a combination of flat fee with hourly fee if time taken exceeds a set amount of hours i. clients generally prefer a flat fee so they will know amount up front ii. attorneys generally prefer an hourly fee so they do not lose money c. Remember that it is not unusual for a carefully thought about and created estate plan to take a minimum of 8 hours to complete from initial meeting to execution. Plan your fees accordingly while not scaring off the client with a fee which exceeds what they are willing to pay d. Whether or not you use a flat fee approach, consider advising a potential client that you will include the following documents in their estate planning package rather than setting a fee for creation of each document: i. Will or Revocable Trust ii. Statutory Durable Power of Attorney iii. Medical Power of Attorney iv. Directive to Physician v. Declaration of Guardian in the Event of Later Need


e. The statutory forms can easily be completed by a legal assistant or legal secretary after you have obtained the information from the client while reserving you the time to work on the Will or the trust on the client’s behalf. VI. CONCLUSION In this day and age of Will software and fill in the blank Will forms available at stationery stores, it is hard to convince a client to pay a reasonable fee for an estate plan. Advise the client that your job is to anticipate and avoid legal problems which will allow the client’s wishes to fulfilled if they become incapacitated, and at their death.


Appendix 1 - Will / Client Questionnaire

WILL PREPARATION

Client Information

1. Name:2. Address:

Ever lived in state other that Texas? If so, give details (where and when?)

3. Phone Number(s)a. Home: (____)_________________b. Office: (____)_________________c. Fax: (____)_________________

4. Marital Historya. Currently married? Yes______; No______. If yes, complete the following:

(1) Name of spouse: (2) Date of marriage:

b. Widowed? Yes______; No______. If yes, complete the following:(1) Deceased spouse's name: (2) Date of death: (3) Residence at date of death:

(4) Did spouse leave a will? Yes______; No______. If yes, get copy of will.c. Divorced? Yes______; No______. If yes, complete the following:

(1) Name of ex-spouse:(2) Date of divorce:(3) Place of divorce:

5. ChildrenList any children born to or adopted by client:

DateName of Birth Address Alive?

(1) (2) (3) (4) (5)

Are any of the above children from a prior marriage? If so, indicate which children.6. Is there anybody other than a spouse and children who client financially supports (for

example, a grandchild or parent)? If so, give details.


7. Assetsa. Real Property

(1) Residence(a) Address:

(b) Date acquired:(c) Mortgage? If so, what is balance owing?

(2) Other(a) Address:

(b) Date acquired: (c) Mortgage? If so, what is balance owing?

b. Cash(1) On Hand? Amount: ________________________________(2) Savings/Bank Accounts

(a) Institution: Amount: Name on account:

(b) Institution: Amount: Name on account:

c. Business InterestsDescribe any such interest:

d. Life InsuranceList all policies owned by client or spouse of client:

Date FaceCompany Policy No. Acquired Insured Amount

(1) (2) (3)

e. Retirement Plans (Including IRAs)(1) Institution:

Amount: Name on Account: Beneficiary:

(2) Institution: Amount: Name on Account: Beneficiary:

f. Automobiles and Vehicles (Including boats and trailers)Date Amount

Make ID No. Acquired Owner Owing

(1) (2) (3)


(4)

g. Furniture, Household goods, and Personal EffectsDescribe any items of particular sentimental or economic value:

h. Other

8. Will Provisionsa. Executor (person who will administer estate)

(1) PrimaryName: Address:

Relationship to client: (2) First Alternate

Name: Address:

Relationship to client: (3) Second Alternate

Name: Address:

Relationship to client:

b. Guardian (person who will care for minor children) (co-guardians must be married)(1) Primary

Name: Address:


Name: Address:


c. Beneficiaries of Estate (Give alternates)(1) Personal Property (including vehicles). Give name of beneficiary and what

item(s) each person is to receive. Do not list specific items if all suchproperty is to be given to a single person or to a class of persons (forexample, "all to my children who survive me in equal shares").

(2) Other Assets


(3) Rest of Estate

9. Funeral/Burial Instructions? Also inform next of kin.

10. Other Estate Planning Documents you should consider completing at time you do your Will:a. Statutory Durable Power of Attorney: This document allows your designated agentto handle all of your personal affairs, including the execution of contracts, motor vehicleregistrations, bank account transactions, etc. This document can be made effective at thetime you sign it or become effective only when you are determined to be mentally physicallyincompetent.



Name: Address:


Name: Address:


b. Health Care Power of Attorney: This document allows your designated agent tomake decisions on your behalf regarding your health care in the event you cannot makethem. It becomes effective only upon your incapacity as certified by your physician.


Relationship to client: Telephone #:

(2) First AlternateName: Address:


(3) Second AlternateName:


Address:


c. Directive to Physicians: This document is also referred to as a "living will." Itinstructs physician(s) and hospitals not to use any artificial life support in the event you arediagnosed with a terminal illness or condition and your death is imminent. This documentallows you to appoint an agent to make those decisions if you are not able, however,appointing an agent is optional. We can discuss this more fully when we meet.

d. Appointment of Agent to Control Disposition of Remains: This document allows youragent to have control over your remains after your death. The person to whom you givecontrol will be held financially responsible for the costs associated with the disposition ofyour remains so you will want to make sure that this person also has access to funds tohandle the disposition as you have requested.



Name: Address:


Name: Address:


e. Declaration of Guardian in the Event Need Arises: This document allows you todesignate who you want to serve as your guardian in the event a guardianship is instituted.The purpose of the Statutory Durable Power of Attorney is to avoid a costly guardianship,however, if one is instituted, the durable power of attorney is automatically revoked. Thebest part of this document is that you can designate who you do not want to serve as yourguardian and the judge cannot appoint those persons you excluded as your guardian. Underlaw, if you have not completed this document, a guardian will be appointed under thefollowing order: (1) spouse, (2) parent, (3) adult child, (4) adult sibling, or (5) other qualifiedperson.

(1) Names of persons you would want to serve as a guardian for you (in order ofchoice):(a) (b) (c)

(2) Names of all persons you would NOT want to serve as a guardian for you:(a) (b) (c)


Appendix 2 - Checklist for Estate Planning

CHECKLIST FOR ESTATE PLANNING

SIMPLE WILL FORM (Without Contingent Trust)

Introductory ClauseName of TestatorAlso known as County of Residence

SECTION I Identity of Testator’s Family

Chose one of the following categories:

Spouse & ChildrenName of Spouse Names & Birthdates of children

Divorced, SingleFormerly married to Date of Divorce ________________________ Court of ___________________ County, ______________ (state)Names & Birth dates of children

Divorced, RemarriedName of Present Spouse Formerly married to Date of Divorce ________________________ Court of ___________________ County, ______________ (state)Names & Birth dates of children

Widowed, SingleFormerly married to Date of Spouse’s death


Widowed, RemarriedName of Present Spouse Formerly married to Date of Spouse’s death Names & Birthdates of children

Single PersonNames and addresses of all immediate family members(Indicate whether alive or deceased on each)

SECTION 2 Payment of Debts and Expenses

(Check all that apply)__________ Direction to Pay All Debts and Expenses from Residuary Estate__________ Discretionary Refinancing by Executor__________ Apportion taxes

SECTION 3 Gifts of Personalty

Pecuniary Legacy to Individual (cash gift)Name of Legatee Address Amount Pecuniary Legacy Shall Bear Interest? __________ (yes or no)

Pecuniary Legacy to Charity (cash gift)Name of Charity Amount Pecuniary Legacy Shall Bear Interest? ____________ (yes or no)

Specific Bequest of Personal PropertyName of Donee Address Description of Item(s)

Contingent Donee, if any Address Is packing and shipping to be charged against estate as an expense of administration?

______________ (yes or no)


Specific Bequest of Personal PropertyName of Donee Address Description of Item

Contingent Donee, if any Address Is packing and shipping to be charged against estate as an expense of administration?

______________ (yes or no)

(Choose one of the following)General Bequest of Balance of Tangible Personal Property to My Spouse and Then to

My Children (in Equal Shares)

General Bequest of Balance of Tangible Personal Property to My Spouse and ThenTo My Lineal Descendants

General Bequest of All Tangible Personal Property to My Spouse and Then to My Children(in Equal Shares)

General Bequest of All Tangible Personal Property to My Spouse and Then to My LinealDescendants

(Use if client wants to make list of gifts to persons & entities)Precatory Gift of Personalty by Written Memorandum

SECTION 4 Gifts of Realty

Specific Devise of Principal Residence to SpouseIs specific devise of residence to be an exonerated gift (paid out of other assets of the estate)?________ (yes or no)

Specific Devise of Other Real PropertyName of Devisee Address Brief Description Is specific devise of this real property to be an exonerated gift? ________ (yes or no)

SECTION 5 Residuary Estate

Choose one of the following:

Outright Gift of All Property to Spouse, Contingent Gift to Children and Their Issueadd if applicable:Alternatively, to Other Named BeneficiariesNames of Beneficiaries


Outright Gift of All Property to Children and Their Issueadd if applicable:Alternatively, to Other Named BeneficiariesNames of Beneficiaries

Outright Gift of All Property to Other Named BeneficiariesNames of Beneficiaries

SECTION 6 EXECUTORS

Choose one of the following:Naming Spouse as Executor with Two SubstitutesName of 1st Substitute Address Name of 2nd Substitute Address:

Naming Corporate ExecutorName of Corporate Executor Address:

Naming Spouse and Other as Co-ExecutorName of Co-Executor Address:

Naming Co-ExecutorsName of 1st Co-ExecutorAddress:

Name of 2nd Co-Executor Address:

Name of Substitute Co-Executor Address:

Add provisions regarding the following:

Inventory, Appraisement and List of Claims (Mandatory)

Ancillary Appointment (Mandatory)


SECTION 7 Guardians

Naming of Guardian of the Person with Two Substitutes 1st Guardian City, State 2nd Guardian City, State 3rd Guardian City, State

Naming of Guardian of the Estate with Two Substitutes 1st Guardian City, State 2nd Guardian City, State 3rd Guardian City, State __________________________________________________

Powers of Guardian (List powers desired)

SECTION 8 Definitions

(Check all that are necessary)_______ Definition of Fiduciaries

_______ Definition of Adopted Children

_______ Definition of Child in Gestation

_______ Definition of Tangible Personal Property

_______ Definition of Residuary Estate

_______ Definition of Beneficiaries

_______ Definition of Issue

SECTION 9 Presumptive Order of Death

Common Disaster Provision Presuming Beneficiary Predeceased TestatorSurvival provision


SECTION 10 General Provisions and PowersCheck all that apply

_______ Powers Conferred on Trustees by Texas Trust Act

_______ List of Enumerated Powers in Addition to Those Granted by Law

_______ Compensation for Fiduciary

_______ Waiver of Bond for Fiduciary

_______ Acts of Prior Fiduciaries

_______ Texas Law to Govern

_______ Will Not Contractual

_______ Effect of Inoperative, Invalid or Illegal Provision

_______ Headings

_______ Number and Gender Defined

SECTION 11 Distributions

Authorized Distributions for Beneficiaries (Check all that apply)

_______ (1) to or for the benefit of the beneficiary_______ (2) directly to the beneficiary_______ (3) on behalf of the beneficiary for the beneficiary's benefit_______ (4) to any account in a bank or savings institution either in the name of the beneficiary

or in a form reserving title, management and custody of the account to a suitableperson for the use of the beneficiary

_______ (5) in any form of annuity_______ (6) in all ways provided by laws dealing with gifts or distributions to or for minors

(including, but not limited to, the Texas Uniform Gift to Minors Act) or persons underdisability

_______ (7) to any suitable person with whom the beneficiary resides or who has the care orcontrol of the beneficiary

SECTION 12 Testimonium Clause

SECTION 13 Attestation Clause

SECTION 14 Self-Proving Affidavit


OTHER ESTATE PLANNING DOCUMENTS

1. Statutory Durable Power of Attorney:(1) Primary

Name: Address:


Name: Address:


Name: Address:


2. Health Care Power of Attorney:(1) Primary

Name: Address:




(3) Second AlternateName: Address:


3. Directive to Physicians:NOTE: If agent to be appointed DO NOT CONFLICT WITH HEALTH CARE P.O.A..






(3) Second AlternateName: Address:


4. Appointment of Agent to Control Disposition of Remains: (1) Primary

Name: (2) First Alternate

Name: (3) Second Alternate

Name:

5. Declaration of Guardian in the Event of Incapacity or Need of Guardian:(1) Names of persons to serve as a guardian for person (in order of choice):

(a) (b) (c)

(2) Names of persons to serve as a guardian of estate (in order of choice):(a) (b) (c)

(3) Names of all persons client would NOT want to serve as a guardian of person:(a) (b) (c)

(4) Names of all persons client would NOT want to serve as a guardian of estate:(a) (b) (c)


Appendix 3 - Fee Agreement

[LETTERHEAD]

Date

[Name & Address]

AGREEMENT FOR LEGAL SERVICES

STATE OF TEXASCOUNTY OF TRAVIS

_______________, ("Client") hereby employs _________________________ (the "Firm")to provide legal services in connection with the creation of an estate plan on behalf of__________________________(Name[s] of Client[s]).

Client shall pay for all costs and expenses incurred by the Firm, including filing fees,photocopies, postage and delivery charges, and long distance calls upon receipt of a statementfrom the Firm unless other arrangements are made. Client agrees that he/she will be charged forcopies made by the Firm at the rate of 10¢ per copy. Client agrees that he/she will be charged forlong distance phone calls and long distance telecopier calls at the actual cost of the long distancecall.

In consideration of the services to be rendered, Client shall pay the Firm reasonableattorney's fees in cash to be determined as follows: a flat fee of $__________ OR a basic fee equalto the total hours expended by _____________ multiplied by the rate of $___ per hour. Fees fornon-attorney paralegal work will be determined at the rate of $__ per hour; and fees for law clerkwork will be determined at the rate of $__ per hour.

Responsibility to provide legal services will be accepted and work will begin when the Firmreceives a signed copy of this agreement and the retainer fee described below. The Firm will sendmonthly statements to the Client showing total amount of attorney's fees and expenses to suchdate. The balance shall be paid on receipt of the statement unless the Client makes otherarrangements with the Firm.

Client agrees to immediately notify the Firm of any changes in his/her residence,employment, residential telephone number and office telephone number. The Firm shall have theright to cease legal work if Client does not furnish the Firm with the necessary, complete and truthfulinformation and documents and/or if Client does not cooperate fully with the Firm in the handling ofthis matter.

It is understood and agreed that Client may terminate this agreement at any time. However,termination shall not diminish the liability of Client to pay the Firm all fees, costs and expensesaccrued prior to that time. All fees, costs and expenses are payable to the Firm at its offices in__(city)__, ___(county)___, Texas.


CONFLICT OF INTEREST DISCLOSURE

Client has been notified by the Firm that an attorney is under an obligation refuse to handle a matterin which the clients have a conflict of interest. Client has requested that the Firm prepare estate plans forClient and (name of other Client). The Client has informed the Firm that a conflict between Client and(name of other Client) does not exist. The Firm has explained to Client that although a conflict does notexist at the present time, a conflict could arise between the Client and (name of other Client) in the eventthat the Clients’ decisions regarding his/her recommended estate plan becomes adverse or opposed to therecommended estate plan of (name of other client). A conflict of interest can arise if the Client and (nameof other client) cannot agree on the disposition of property jointly owned by the parties. A conflict of interestis automatic if the (marriage/relationship) between the Client and (name of other client) ends in(divorce/termination).

Client further understands that in order for the Firm to adequately represent Client’s interest inpreparing the Client’s estate plan and the estate plan of (name of other Client), the Firm will need full andaccurate disclosure of information from Client and from (name of other Client). The Firm may not be ablekeep communications between Client and the Firm confidential from (name of other client). In the eventthat a conflict arises between Client and (name of other Client), the Firm must withdraw from representationof both Client and (name of other Client).

If, after reading the above disclosure, Client would like to have the Firm represent both Client and(name of other Client), your signature below indicates that Client recognizes the potential for a conflict ofinterest, Client has been advised about the possible consequences of dual representation, and Client stillwishes for the Firm to prepare the estate plans for Client and (name of other Client.

The Client is encouraged to consult with another attorney about any of the terms or disclosures inthis Agreement for Legal Services

If this letter accurately sets forth the terms of our agreement, please sign and return the enclosedcopy of this letter together with a check in the amount of $____________, made payable to________________________, Trustee. The firm will draw on this retainer to meet the fees and expensesoutlined above. Any unused portion of this retainer shall be returned to you. Each month you shall receivean itemized accounting of time spent and expenses incurred.

Each of the undersigned have read the above agreement and agree to each of the terms andconditions stated above.

[LAW FIRM]

By: [Attorney]

CLIENT:

_______________________________________[Client name]Date:___________________________________

NOTICE TO CLIENTS: The State Bar of Texas investigates and prosecutes professional misconductcommitted by Texas attorneys. Although not every complaint against or dispute with a lawyer involvesprofessional misconduct, the State Bar's Chief Disciplinary Counsel will provide you with information abouthow to file a complaint. Please call 1-877-953-5535 toll-free for more information.


Appendix 4 - Letter Declining Representation

[LETTERHEAD]

December 15, 1996

Fred and Ethel Mertz100 Television WayHollywood, TX 77777

Re: Preparation of Estate Planning documents

Dear Mr. and Mrs. Mertz: I appreciate the opportunity to meet and discuss with you the possibility of representing you inpreparing your estate plans. After reviewing this matter, I have concluded that this firm is not theappropriate firm to represent you in this matter. I am returning the documents your provided to mewith this letter.

In declining to accept this matter, this firm is not expressing an opinion that you do not needassistance in creating an estate plan. On the contrary, I recommend you contact another attorneyimmediately to assist you with the preparation of your estate documents. (NOTE: If you arereferring to another attorney, put in names and telephone numbers here)

In accordance with our standard policy, we are not charging you for any legal fees. We charge forevaluation of a matter only when we express an opinion about the matter. If you need legalassistance in the future, we would be happy to discuss the possibility of representing you in othermatters.

Sincerely,

[Attorney]

(Enclosure: LIST OF DOCUMENTS RETURNED)

THE CLIENT INTERVIEW PROBATE Holly J. Gilman Gilman & Associates, P.C.

WILLS AND PROBATE i

Table of Contents I. INITIAL INTERVIEW WITH CLIENT .........................................................................................1 A. Dealing With a Grief Stricken Client......................................................................1 B. Determination of Conflicts of Interests ................................................................1 C. Gathering the Documents ......................................................................................2 D. Gathering Information From the Client.................................................................3 E. Advise the Client About Costs Associated With the Probate Process.............5 II. REVIEW OF THE WILL .............................................................................................................6 A. Read the Will Carefully ...........................................................................................6 B. Determine if Any Ambiguities in Will ....................................................................6 C. Determine if Proper Self-Proving Affidavit TEX. PROB. CODE ANN. § 59 ............6 D. Determine Whether Will Disposes of Entire Estate .............................................6 E. Determine Whether Guardianship Proceeding Necessary ................................7 F. Lost Original Will .....................................................................................................7 G. Determine Compensation to Fiduciaries, If Any..................................................7 III. ADVISING THE CLIENT ...........................................................................................................7 A. Advise Client of Types of Probate Options ..........................................................7 B. Advise Client of Responsibilities as a Fiduciary...............................................11 IV. CREDITOR CLAIMS ...............................................................................................................14 A. Determine Date of Death of Decedent ................................................................14 B. Homestead, Exempt Personal Property, and Family Allowance .....................14 C. Notice to Creditors ................................................................................................15 D. Presentment of Claims by Creditors ...................................................................16 E. Allowing or Rejecting Claims - Dependent ........................................................17 F. Suit After Rejection of Claim................................................................................17 G. Payment of Creditor Claims - Dependent and Independent Administrations .....................................................................................................17 V. CLOSING THE ESTATE .........................................................................................................18 A. Dependent Administrations .................................................................................18 B. Independent Administrations ..............................................................................19 VI. PRACTICE POINTERS ...........................................................................................................19 A. Fee Agreements.....................................................................................................19 B. Declining Representation .....................................................................................19 C. Setting Your Fees ..................................................................................................19 EXHIBITS: 1 Motion to Open Safe Deposit Box and to Examine Papers Pursuant to Section 36b, Texas Probate Code ...............................................................................21 2 Order Authorizing Opening of Safe Deposit Box and Examination of Papers Pursuant to Section 36b, Texas Probate Code .............................................23 3 Estate Inventory and Tax Questionnaire ....................................................................25 4 Appointment of Resident Agent to Accept Service ..................................................33 5 Fee Agreement - Sole Independent Executor ............................................................35 6 Fee Agreement - Co-Executors....................................................................................37 7 Fee Agreement - Guardianship ....................................................................................41 8 Engagement Contract and Power of Attorney ...........................................................43 9 Fee Agreement - Contingent ........................................................................................45 10 Sample Letter Declining Representation....................................................................49

ii STATE BAR OF TEXAS p TEXAS BAR CLE

WILLS AND PROBATE 1

I. INITIAL INTERVIEW WITH CLIENT How Do I Counsel a Client Who Has Just Lost a Loved One?

A. Dealing with a Grief Stricken Client

What Are the Ethical Issues in Representing a Client in the Administration of an Estate?

B. Determination of Conflicts of Interests 1. Representing the Executor or the Estate a. Determine whom you want to represent so you will know your responsibilities as the attorney for your client b. Advise the client of your determination of representation c. Recommendation: represent the executor i. you are finished with your responsibilities when the estate when the executor of the estate is discharged ii. you are not held to the same fiduciary standard as the executor when dealing with the creditors and beneficiaries of the estate 2. Multi-party Representation a. Representing co-executors i. Co-executors can become adverse in what they believe to be their responsibilities in handling the estate ii. The fee agreement with your clients should include a conflict of interest provision making them aware of the potential conflict and advising them that you will have to withdraw if the clients take positions which are adverse to each other during the administration of the estate iii. Get written consents from co-executors b. Representing the Executor who is also a Beneficiary i. Your client needs to understand his or her responsibilities to the estate (a) you must advise a client of his/her fiduciary responsibilities to the creditors of the estate and the possible personal liability if the client breaches his/her fiduciaries to the creditors (b) explain to your client that the role of executor often requires the client to put the interest of creditors ahead of the client’s own interest as a beneficiary and make sure they are willing to comply c. Representing the Executor and a Creditor i. Determine whether you or anyone in your firm has represented a creditor of the estate. If so, determine whether or not the estate is able to pay its debts to determine whether or not a conflict is likely before accepting the probate administration ii. put conflict disclosures in writing and get signed consents d. Representing the Executor and Another Beneficiary i. no prohibition, but try to determine if a conflict is possible before accepting representation of both


parties ii. put conflict disclosures in writing and get signed consents 3. Will Contests a. Do not draft a Will and later represent a party to set aside the Will. This is an obvious conflict of interest under Rule 1.09 of the Texas Disciplinary Rules of Professional Conduct (hereinafter “DR”) because your former client, now the decedent, cannot consent to your representation. b. If a Will contest is likely, consider not representing the named Executor in the Will if you are likely to have to testify. An attorney should refuse representation or withdraw from representation if he/she will be a witness necessary to establish an essential fact. See DR-3.08(a)

What Documents Will I Need To Begin the Probate Process?

C. Gathering the Documents 1. Original Will a. In order to begin the probate process, you will need the original Will of the decedent. Request the client bring the original with them when he/she has the initial meeting with you. b. If no original provided by client, determine the whereabouts of original from your client. i. Will located in safe deposit box (a) examine Will with court order TEX. PROB. CODE ANN. § 36B (b) delivery of Will with court order TEX. PROB. CODE ANN. § 36C (c) examine Will without court order TEX. PROB. CODE ANN. §36D (d) delivery of Will without court order TEX. PROB. CODE ANN. § 36D (e) See Exhibit 1 for motion and order to enter safe deposit box for Will ii. Will located in person’s custody other than executor or spouse who will not turn Will over (a) consider acquiring a show cause order under TEX. PROB. CODE ANN. § 75 iii. Whereabouts unknown by client (a) determine whether Will deposited with county clerk during testator’s lifetime under TEX. PROB. CODE ANN. § 71 (b) contact attorney who drafted Will if name is known by client. Many attorneys will volunteer to keep the client’s original Will after drafting 2. Death Certificate a. generally acquired by client from funeral home b. additional copies of certificates can be secured from appropriate agencies i. city health department in many cities ii. Justice of Peace’s office who issued certificate in smaller communities c. original death certificate needs to be submitted

WILLS AND PROBATE 3

with application to probate d. death certificate contains information which will be included in application: i. date of death of decedent ii. full name of decedent iii. social security number of decedent iv. county of residence of decedent v. cause of death (a) knowing the cause of death may be helpful if Will contest occurs 3. Copies of any trust documents of decedent 4. Any Declaration of Appointment of Guardian for Minor Children completed by decedent

What Information Should I Gather From My Client To Prepare for Probate?

D. Gathering Information From the Client 1. Consider use of an estate administration questionnaire 2. Determination of date of death a. Date of death is critical in many probate options available to you because there is a 4 year statute of limitations from date of death in which to probate an estate TEX. PROB. CODE ANN. § 73 b. Date of Death can be determined from: i. client ii. death certificate 3. Initial inventory of assets a. Necessary to determine general value of estate

i. Are federal estate taxes and state inheritance taxes likely? If so,

(a) work with a CPA on estate unless you extremely familiar with federal estate and gift tax law (b) determine if there are ways to reduce taxes 4. Determination of executor or administrator

a. Is there an executor named in the Will? i. If yes, is he/she/it willing to perform?

(a) If executor not willing to perform, and successor executor is willing, have first named executor execute a verified refusal to serve as executor document to be filed with the probate court

b. Is executor disqualified? Those disqualified under TEX. PROB. CODE ANN. §78:

i. incapacitated persons; ii. convicted felons; iii. non-resident of Texas who has not appointed a resident agent; See Exhibit 3 for form to appoint a resident agent iv. corporation not authorized to act as a fiduciary; and v. person whom the court finds unsuitable

c. If no executor named, who can serve as executor?

i. If no executor is named in the Will, your client, assuming he/she is party interested in the estate, may apply for: (a) an order admitting the Will to probate (b) for the appointment of an executor (c) for the appointment of an administrator TEX. PROB. CODE ANN. § 76 d. Order of persons qualified to serve TEX. PROB. CODE ANN. § 77


i. person named as executor in Will; ii. surviving spouse; iii. principal devisee or legatee of testator; iv. any devisee or legatee of testator; v. next of kin of the deceased, in order of nearest descent; vi. as a creditor of deceased; vii. any person of good character residing in the county who applies therefor; and viii. any other person who is not disqualified.

e. Is the executor independent?

i. If executor not independent in Will, you can make him/her/it independent if you choose: (a) All distributees of testator must agree to independent administration by executor and sign the application so requesting an independent administration. TEX. PROB. CODE ANN. § 145(c)

ii. Are there situations where you would not want an independent executor?

(a) Where the estate may be insolvent with many more debts than assets, you want to protect your executor from claims by the creditors of the estate by having the court oversee the administration of the estate and your client acting pursuant to as a court order in payment of claims and debts of the estate; and (b) When someone such as creditor or non-related party is serving as executor of the estate. 5. Determination of creditors, if any, and solvency of estate a. Determine debts of estate i. If no debts other than liens on real property, consider probating estate as a muniment of title ii. If more debts than assets of the estate, decide if there is as a reason to probate the estate. b. Reasons to probate include: i. real property owned by estate and surviving spouse and/or minor children need to continue to live in home ii. bank accounts owned by the decedent which are not held as survivorship or payment on death accounts iii. money or debts owed to the estate which can be used to pay surviving spouse allowance 6. Determine if Temporary Administrator needed

a. Is there an ongoing business needing immediate attention, a pending lawsuit against the decedent which is active, or wasting of a decedent’s assets which requiring immediate attention?

i. If yes, consider applying for the appointment of a temporary administrator to handle the business affairs, lawsuit, or assets of the decedent until the estate can be administered. TEX. PROB. CODE ANN. § 131A ii. Requirements for temporary administration: (a) application containing all information which is required under TEX. PROB. CODE ANN. §§ 82 and 131A(b); (b) determination by county judge the interest of the estate requires the immediate appointment of as a temporary administrator;

WILLS AND PROBATE 5

(c) judge sets forth limited powers for temporary administrator; (d) duration of appointment cannot exceed 180 days iii. Temporary administrations also likely where there is as a Will contest which has been filed 7. Determine whether Will disinherits any heirs to determine likelihood of contest a. If yes, get information from client regarding: i. reasons heir disinherited; ii. facts and circumstances surrounding the execution of Will by the testator; and iii. information of other assets which may have been received by disinherited heir (e.g. insurance proceeds, retirement benefits, etc.) E. Advise the Client About Costs Associated with the Probate Process 1. Legal fees a. Explain your attorney’s fees i. flat fee ii. hourly fee iii. fixed fee with hourly charges for consultations 2. Fees associated with the probate process a. Estimate fees for the probate process i. filing fees for the application and all other documents generally filed with the probate clerk ii. fees for publication of notice to creditors iii. fees for acquiring letters testamentary and certified or exemplified copies of documents

Will an attorney ad litem need to be appointed?

3. Fees associated with an attorney ad litem a. payable by the estate b. attorney entitled to “reasonable compensation for services” c. an attorney ad litem can be appointed to represent the interest of as a person: i. under as a legal disability ii. who is as a nonresident iii. who is unborn, unascertained person or an unknown heir TEX. PROB. CODE ANN. § 34A

Is a bond required? 4. Bond of Personal Representatives of Estates

a. Executor to Serve Without Bond i. If as a Will provides that the executor shall serve without bond, none will be necessary TEX. PROB. CODE ANN. § 195(a) ii. Corporate Fiduciary - Bond not required TEX. PROB. CODE ANN. § 195(b) iii. All other situations bond for as a personal representative required under TEX. PROB. CODE ANN. § 194 b. Amount of Bond - sufficient to protect the


estate and its creditors TEX. PROB. CODE ANN. §194(1) Does a C.P.A. need to be hired to complete tax returns on behalf of estate and/or decedent’s final return?

5. Taxable estates a. require the filing of federal estate tax returns and state inheritance tax returns within 9 months of as a decedent’s death b. determine if client has as a relationship with as a CPA who does estate taxes and will work on the return. If so, client can pay directly. c. If not, you may want to recommend as a CPA you trust and determine the costs to complete the returns to be approved by the client

Will appraisers need to be hired to value assets?

6. Appraisers a. always use in taxable estates b. regularly used when estate includes valuable: i. artwotk ii. antiques iii. jewelry iv. real estate (when its value cannot be easily determined) v. oil & gas interests II. REVIEW OF THE WILL A. Read the Will Carefully 1. Sounds simple, but many attorneys do not carefully read the Will. 2. Benefits a. you can answer questions which client will ask b. you can determine if problems exist which can be cleared up at or before the probate hearing c. you won’t look stupid to judge and your client in probate court if you have carefully read Will, anticipated problems and dealt with those problems B. Determine if Any Ambiguities In Will 1. If language is ambiguous, consider Will construction suit a. under Declaratory Judgment Act, TEX. CIV. PRAC. & REM. CODE ANN. § 37.004(a) C. Determine If Proper Self-Proving Affidavit TEX. PROB. CODE ANN. § 59 1. If Will not self-proved or defective affidavit:

a. Is there a subscribing witness to testify?

i. If yes, they need to attend court and give an affidavit. TEX. PROB. CODE ANN. § 849(b)(1) ii. If no subscribing witnesses, find two disinterested witnesses to testify to signature of testator, and soundness of mind. TEX. PROB. CODE ANN. § 849(b)(3) D. Determine Whether Will Disposes of Entire Estate 1. If incomplete disposition of estate: a. may need: determination of heirship TEX.

WILLS AND PROBATE 7

PROB. CODE ANN. § 48 et seq. b. may need: dependent administration of assets not disposed of by Will TEX. PROB. CODE ANN. § 178 et seq. E. Determine Whether Guardianship Proceeding Necessary

1. Did minor children survive parents?

a. Does Will provide for guardianship?

Will should be filed for probate so that the parents choice of guardian is clear to court. The same is true of an incapacitated adult child for whom no guardianship already exists.

2. Is decedent is sole remaining surviving parent of minor children?

a. Declaration of Appointment of Guardian for Children, no need to probate Will first before seeking guardianship. F. Lost Original Will 1. Determine facts regarding its whereabouts a. if original Will cannot be found, presumed to be revoked b. file application to probate lost Will if not revoked by testator i. requirements of admission of lost Will to probate TEX. PROB. CODE ANN. § 85 (a) all that is required for Will produced under TEX. PROB. CODE ANN. § 81 (b) cause of non-production must be proved and cause must be sufficient to satisfy the court that it cannot be produced by reasonable diligence (c) contents of Will must be substantially proved by credible person who has read it or heard it read

How does the Executor Get Paid?

G. Determine Compensation to Fiduciaries, if Any

1. Does Will Provide for Compensation to Executor?

a. If no, explain to client that executor cannot be compensated for acting as the executor b. If yes, determine if amount of compensation is stated in Will or not. i. if compensation amount not stated in Will, executor entitled to five percent of cash received by the estate and five percent of cash paid out of the estate TEX. PROB. CODE ANN. § 241 III. ADVISING THE CLIENT A. Advise Client of Types of Probate Options. 1. Independent Administration. a. Generally: An independent administration is available when a decedent dies testate or intestate. An independent administration is usually preferable to a dependent administration because it allows the administrator to proceed with minimal court involvement which, in most, cases will save the client both time and


money. An independent executor may generally act independently of the Probate Court's control, except with respect to the following: • Filing the will for probate; • Being appointed as independent executor; • Publishing a general notice to

creditors of the decedent; • Notifying all secured creditor's of

the executor's appointment; and • Preparing and filing an Inventory,

Appraisement and List of Claims (which we will discuss later).

b. Powers. An independent co-executor has broad powers, limited only by the will and the Texas Probate Code. As such, an independent executor is authorized to do, without court approval, all things authorized by the will and all things which an ordinary executor would be permitted to do only with court approval. c. Requirements. An independent administration is possible when: • The testator provides in his or her

will that the executor should be "independent" or words to the effect that no other action shall be had in the county court in relation to the settlement of the decedent's estate than the probating and recording of the will, and the return of an inventory, appraisement, and list of claims of the estate. TEX. PROB. CODE ANN. § 145(b).

• The will names a personal representative but fails to provide that he or she should be "independent"; however, all of the distributees of the estate agree and petition the court for the appointment of an independent administrator. TEX. PROB. CODE ANN. ANN. § 145(c) (Vernon 1980).

• No executor is named in the Will or the executor named is deceased or disqualified and all of the distributees of the estate can agree and petition the court for the appointment of an independent administrator. TEX. PROB. CODE ANN. § 145(d).

• All of the distributees of a decedent dying intestate agree and petition the court for the appointment of an independent administrator. TEX. PROB. CODE ANN. § 145(e).

2. Will as Muniment of Title. a. Generally: A will can be probated as a muniment of title if one or more named beneficiaries wish to probate the will to establish ownership or title to real or

WILLS AND PROBATE 9

personal property but no other administration is necessary. The typical situation is one in which the beneficiary under a will inherits an interest in real property and desires to probate the will to clear title in his or her name. The order admitting a will to probate as a muniment of title is sufficient legal authority for persons holding estate assets to deliver such assets to the person or persons named in the will as the beneficiary of such property. See TEX. PROB. CODE ANN. §§ 89A-89C. The advantage of this type of probate is that it results in an order which third parties can rely on to deliver estate property to the proper beneficiaries while avoiding the duties and requirements imposed on a personal representative and saving both time and money. The disadvantage of this type of administration is that a personal representative is not appointed. Therefore, this may not be a viable option in a situation in which it is necessary to have a personal representative appointed. b. Powers: Because no personal representative is appointed, no one person or entity has the power to act on behalf of the estate. However, a beneficiary named in the will admitted to probate as a muniment of title has the right to bring suit individually in the same manner as if the record title was held in his or her name. c. Requirements: The requirements include all of the following: • The court is satisfied that the Will

should be admitted to probate; • There are no unpaid debts owing

by the estate of the testator, other than debts secured by liens on real property; and

• The court finds that there is no necessity for administration of the estate. TEX. PROB. CODE ANN. § 89A (Vernon 1980).

Note that, the statute requires an applicant to file within 180 days of a will being admitted to probate as a muniment of title, a sworn affidavit stating which terms of the will have been fulfilled and which have not. A court may waive this requirement. Also, some courts require the filing of an Inventory, Appraisement, and List of Claims and other courts do not. 3. Dependent Administration. a. Generally: A dependent administration is available whether a decedent dies testate or intestate. The typical situation is one in which the decedent dies intestate and an administration is required because the decedent owes two or more debts. A dependent administration is a more restrictive method of administering a decedent's estate in that the estate's representative is at all times subject to direct court control and supervision. The two types of dependent administrations are with will annexed and due to intestacy. • With Will Annexed. A dependent


administration is not usually one of first choice, however, there are factors which may be present to make this selection appropriate and will allow the administrator to use the court's supervision powers as a shield. Such factors include where an estate is insolvent, or potentially insolvent, or where substantial conflicts exist between the named executor and the heirs or legatees.

• Intestacy. When a decedent dies intestate and all of the distributees of his or her estate cannot agree on an independent administrator, a dependent administration will most likely result.

b. Powers: Generally, all of a dependent executor or administrator's actions and powers are subject to court approval and with a court order. c. Requirements. The paramount requirement is that the court finds that there is a necessity for administration of the estate. TEX. PROB. CODE ANN. § 88(d) (Vernon 1980). Reasons for administration may include; (i) the heirs are unknown, (ii) a death tax return may be required, (iii) there is a claim of adoption by estoppel, (iv) the estate has several creditors, and (v) to bring or defend a claim. 4. Determination of Heirship. a. Generally: If an individual dies intestate, i.e., because the decedent never executed a will, failed to execute the will properly, or the will was lost and cannot be proven under TEX. PROB. CODE ANN. § 85 , in such cases, the court will need to determine the lawful heirs of the decedent and their share of the decedent's estate. b. Powers: Because no personal representative is appointed, no one person or entity has the power to act on behalf of the estate. However, an heir has the right to bring suit individually in his or her name relating to his or her interest in the estate. c. Requirements: A proceeding to declare heirship can be initiated in the following situations: • When a person dies intestate

owning or entitled to real or personal property in Texas and there has been no administration upon his estate in this State.

• When a will has been probated, in Texas or elsewhere, and any real or personal property located in Texas has been omitted from the will.

• When an administration upon the estate of the decedent has taken place in Texas, and any real or personal property in Texas has been omitted from the administration. TEX. PROB. CODE ANN. § 48(a) (Vernon 1980).


5. Small Estate Affidavit. a. Generally: It may be possible for the heirs of a decedent who dies intestate to file an affidavit with the court which will entitle them to receive their distribution, to the extent that the estate assets (exclusive of homestead and exempt property) exceeds the known liabilities of the estate (exclusive of liabilities secured by homestead and exempt property) without the appointment a personal representative. TEX. PROB. CODE ANN. § 137. This allows heirs of small estates to avoid the cost of seeking an heirship. b. Powers: Because no personal representative is appointed, no one person or entity has the power to act on behalf of the estate. However, similar to an heirship, a distributee under a small estate's affidavit should have the right to bring suit individually in his or her name relating to his or her interest in the estate. c. Requirements: In order for an estate to qualify as a small estate for purposes of filing the affidavit, all of the following conditions must exist: • No petition for the appointment of a personal representative can be pending or have been granted. • Thirty (30) days must have lapsed since the death of the decedent. • The value of the entire estate, not including homestead and exempt property, must not exceed $50,000. • An affidavit must be filed with the clerk of the court, sworn to by two disinterested witnesses, by all of the distributees, and the affidavit must show the foregoing conditions, and include a list of all of the known assets and liabilities of the estate, the names and addresses of the distributees, and the distributees' right to receive money or property from the estate. TEX. PROP. CODE ANN. § 137. B. Advise Client of Responsibilities as a Fiduciary. 1. Gather and Protect Assets of the Estate: Anyone considering serving as a fiduciary should be advised of his or her responsibilities and potential liability before he or she is appointed. The client must be advised that as a fiduciary it is his or her responsibility to gather, collect, and preserve the assets of the estate. It is important for the person to gain exclusive control of all of the assets of the estate to prevent theft or waste. The executor or administrator will be held to high standard of care and must take care of the property of the estate as a prudent man would take care of his own property. TEX. PROP. CODE ANN. § 230. The following is a nonexclusive list of actions which a client should be advised to take as soon as he or she is appointed and has qualified as an executor or administrator • Change the locks on any house,

apartment or storage facility. • Change the mailing address so that

any of the decedent's mail comes to client.


• Contact all of the decedent's asset holders and request that any accounts be secured until he or she is able to arrange to collect them.

• Establish separate interest-bearing accounts which estate money can be placed into. Additionally, the account should be established at a federally insured institution and the funds on deposit should not exceed the maximum insured amount.

• Collect personal and financial records which pertain to the decedent's estate.

• Make sure all of the estate's personal and real property is insured.

2. Complete Inventory, Appraisement and List of Claims Generally, within ninety (90) days of being appointed as an executor or administrator, an Inventory, Appraisement and List of Claims will need to be filed with the court. See TEX. PROB. CODE ANN. § 250. The Inventory, Appraisement and List of Claims should contain the following: • The fair market value of all the

estate's real property that is located in the state of Texas and what portion is separate and community property.

• The fair market value of all the estate's personal property wherever located and what portion is separate and community property.

• The name, nature, date and amount of any debt owing the estate and what portion of the claim is held in common with others. It is not necessary to include debts owned by the decedent.

3. Pay Creditors a. Requirements: Generally, the client should be advised that payment on a claim should only be made when: • The claim is not barred by any

applicable statute of limitation. TEX. PROB. CODE ANN. § 298.

• The claim has been properly authenticated. TEX. PROB. CODE ANN. § 301.

• The claim has been approved by the court. TEX. PROB. CODE ANN. § 319.

b. Order of Payment. Claims should be paid in the following order: • All debts due to the Untied States must be paid first. See 31 U.S.C.A. § 3713; Federal Reserve Bank v. Mylie, 134 S.W.2d 838 (Tex. Civ. App.--Amarillo 1939, no writ). • Funeral expenses and those of

last sickness (not to exceed $5,000).



• Allowances to surviving spouse and children.

• Expenses incurred in the administration, preservation, safekeeping, and management of the estate.

• Other claims in the order of their classification. TEX. PROB. CODE ANN. § 320(a).

4. File Any Necessary Tax Returns and Pay Taxes There are several tax returns which may need to be filed by the estate's representative. They include: • A Federal estate tax return is

generally required when the gross estate of a decedent, plus any adjusted taxable gifts, exceed $600,000.

• A Texas inheritance tax return. • Decedent's final income tax return. • An estate income tax return. • A gift tax return if the decedent made

any taxable gifts during the last year, or in years past (and a return was not timely filed).

5. Distribution of Property to Beneficiaries. a. When: Usually, an estate is kept open until all debts have been provided for and all matters which must be attended to, including filing any death tax returns, have been completed. Once this occurs, the administration should be closed when no further necessity exists for the administration to continue. TEX. PROB. CODE ANN. § 404(a)(1). In a dependent administration, the administrator or executor must apply to the court to distribute any assets. Generally this is done in conjunction with the dependent administrator or executor's final account. If the court approves the administrator's final account, the court must enter an order directing that the representative distribute to all entitled persons any of the remaining estate assets. However, prior to the closing of the estate, it is possible to make partial distributions to beneficiaries. In particular, specific bequests and pecuniary bequests which are not required to bear tax pursuant to the terms of the Will can be distributed promptly. A "independent" executor, may make distributions at anytime during the administration provided he or she has provided for the payment of creditors, including the I.R.S. b. Procedure: Generally, the representative will deliver to the persons named in the will, assets which are remaining in his or her hands. An executor or administrator should always request a receipt from all persons to whom property is distributed. 6. Payment of Fiduciaries A fiduciary may be entitled to compensation under statutory law or the terms of a decedent's will. The compensation is paid by the estate using the estate assets. a. Will: A testator can set the amount, if any, that the fiduciary is entitled to receive as compensation for


serving in such a capacity. The attorney should review the will and advise the client of his or her right to be compensated. b. Probate Code: If a decedent's will is silent or if he or she died intestate, Section 241 of the Texas Probate Code authorizes a fiduciary to receive a commission equal to five percent (5%) of all sums of cash received (other than cash or cash equivalent on hand or collecting the death benefits under a life insurance policy) and all cash paid out (other than distributions to estate beneficiaries). The commission may not exceed five percent (5%) of the gross value of the estate. TEX. PROB. CODE ANN. § 241 (Vernon Supp. 1997). IV. CREDIT OR CLAIMS A. Determine Date of Death of Decedent 1. Statute of Limitations to probate an estate - 4 years from date of death 2. Death prior to January 1, 1996 a. Old probate code sections apply 3. Death on or after January 1, 1996 a. New probate code sections apply

Does the Surviving Spouse or Family Need to Set Aside Exempt Property and/or Request a Family Allowance?

B. Homestead, Exempt Personal Property, and Family Allowance 1. Homestead a. Texas Constitution provides for a life estate for surviving spouse or guardian of minor children for so long as occupied as a homestead. See Tex. Const. Art. XVI § 52 (1987) b. Homestead cannot be partitioned among the heirs during the life of the surviving spouse if he/she elects to continue to occupy it as a homestead TEX. PROB. CODE ANN. § 284 c. If homestead separate property of decedent, surviving spouse still have right to occupy the home during his or her lifetime TEX. PROB. CODE ANN. § 282 d. Homestead not liable for debts of decedent’s estate, except: i. purchase money liens; ii. ad valorem taxes; and iii. materialmen or mechanic’s liens TEX. PROB. CODE ANN. § 270 2. Exempt personal property a. Value of exempt personal property may not exceed $60,000 TEX. PROP. CODE ANN. § 42.001 b. Personal property which is exempt is set forth in TEX. PROP. CODE ANN. § 42.002 c. If estate is insolvent, title to personal property set aside as exempt for surviving spouse and children becomes absolute and cannot be taken for any of the debts of the estate TEX. PROB. CODE ANN. § 279 i. Exception: can be liable for funeral and


last illness expenses if claim submitted timely TEX. PROB. CODE ANN. § 281 3. Family allowance a. Allowance to surviving spouse and minor children of the decedent, separate and independent of homestead and exempt property set asides. TEX. PROB. CODE ANN. § 286 b. Amount of allowance - sufficient to maintain the surviving spouse and minor children for one year TEX. PROB. CODE ANN. § 286 c. Allowance can be paid in lump sum or in installment payments TEX. PROB. CODE ANN. § 287 C. Notice to Creditors 1. Independent Administration and Dependent Administration a. Unsecured creditors - mandatory notice - TEX. PROB. CODE ANN. § 294(a) must give notice within one month after receiving Letters Testamentary by: (i) publication in newspaper of general circulation in county where probate filed notice requiring all persons who have claims against the estate to present their claims (ii) file proof of publication in court where probate case is pending TEX. PROB. CODE ANN. § 294(b)

Can an Unsecured Creditor’s Claim Be Barred?

b. Unsecured creditors - permissive notice. If you wish to bar a creditor’s claim in an independent or dependent administration, you must strictly follow the notice provisions of TEX. PROB. CODE ANN. § 294(d) in order to bar the claim. Requirements of § 294(d) are: (i) give notice to the unsecured creditor by registered mail or certified mail, return receipt requested, before closing the estate by expressly stating that the creditor must present a claim within four months after the date of the receipt of the notice or the claim is barred. Notice must include: (a) date of issuance of letters testamentary held by executor; (b) address to which the claims may be presented; and (c) instruction of the executor that the claim be addressed in care of: (1) the executor, (2) the executor’s attorney, or (3) the estate c. Secured creditors - mandatory notice (i) give notice to the secured creditors by registered mail or certified mail, return receipt requested within two months after receiving letters testamentary - TEX. PROB. CODE ANN. § 295(a)&(b) (ii) file proof of notice to secured creditors with court where probate case pending. TEX. PROB. CODE ANN. § 295(c) d. Comptroller of the State of Texas - mandatory notice


(i) give notice within one month of letters issuing by registered or certified mail, return receipt requested. TEX. PROB. CODE ANN. § 294(a) e. Penalty for failure to give notice to creditors - TEX. PROB. CODE ANN. § 297 (i) executor or personal representative personally liable for damages suffered by creditors ii. surety on executor’s bond can be held liable D. Presentment of Claims by Creditors 1. Time to present claim a. Dependent Administration (TEX. PROB. CODE ANN. § 298) & Independent Administration (TEX. PROB. CODE ANN. § 146) i. unsecured creditors (a) before estate has closed (b) if unsecured creditor received notice under TEX. PROB. CODE ANN. § 294(d), creditor must present within four months of receipt of notice or it is barred 2. Method to Present Claims a. Dependent administration i. Money claims - TEX. PROB. CODE ANN. § 301 (a) must be authenticated or executor and court not permitted to approve (b) to authenticate, include an affidavit with copy written instrument stating: (1) that claim is just and true, and (2) that all legal offsets, payments, and credits known to the affiant have been allowed (3) if claim not in writing, must also include in affidavit facts upon which the claim is founded ii. Non-liquidated claims - no requirement to authenticate (a) should be settled or suit filed within 6 months of grant of letters in order to maintain priority under TEX. PROB. CODE ANN. §322 (b) settlement of claim requires court approval under TEX. PROB. CODE ANN. § 34(a)(4) iii. Secured claims - Creditor election must be made to: (a) have claim allowed a matured secured claim to be paid in the due course of administration; or (b) have claim allowed as a preferred debt and lien against the specific property securing the indebtedness TEX. PROB. CODE ANN. § 306 Texas Probate Code b. Independent administration i. no requirement that the creditor’s claim be presented in any particular form as required in dependent administrations. See, Bunting v. Pearson, 430 S.W.2d 470 (Tex. 1968)



ii. no requirement that a claim must be presented before it can be sued upon as required in dependent administrations 3. Where to present claims a. Dependent Administration i. to the executor at address he/she has provided in notice to creditors or ii. creditor can deposit a claim with clerk of court - TEX. PROB. CODE ANN. § 308 b. Independent Administration i. to the executor at address he/she has provided in notice to creditors E. Allowing or Rejecting Claims - Dependent 1. Dependent Administration a. When duly authenticated claim is presented, executor has 30 days to allow the claim, reject the claim, or to state which portion the executor allows or rejects - TEX. PROB. CODE ANN. § 309 b. Failure of executor to act within 30 days - claim deemed rejected - TEX. PROB. CODE ANN. § 310 c. Must file claim with clerk after allowance or rejection - TEX. PROB. CODE ANN. § 311 d. Executor should never allow a claim on which the statute of limitations has run - TEX. PROB. CODE ANN. § 298(b) 2. Independent Administration a. No requirement that claim be authenticated F. Suit after rejection of claim 1. Dependent Administration a. creditor with rejected claim can file suit in: i. probate case or ii. court of competent jurisdiction - TEX. PROB. CODE ANN. § 313 b. time to file - within 90 days after rejection c. contest of claims - TEX. PROB. CODE ANN. § 312 2. Independent Administration a. no requirement to submit claim before suit can be filed by creditor G. Payment of Creditor Claims - Dependent and Independent Administrations 1. Order of payment of claims a. Priority of payments - TEX. PROB. CODE ANN. § 320 i. funeral expenses and expenses of last illness not to exceed $15,000 ii. allowances to surviving spouse and children, or either iii. expenses of administration and expenses incurred in the preservation, safekeeping, and management of the estate


iv. other claims in order of their classification 2. Classification of creditor claims - TEX. PROB. CODE ANN. § 322 a. Class 1 - funeral expenses and last illness expenses in an amount not to exceed $5,000 b. Class 2 - expenses of administration and expenses of safe keeping & management of estate c. Class 3 - secured claims for money such as mortgages and tax liens d. Class 4 - claims for principal and accrued interest on child support e. Class 5 - claims for taxes penalties and interest under various Texas laws f. Class 6 - claims for the cost of confinement by Texas Dept. of Corrections g. Class 7 - claims for repayment of medical assistance under state Medicaid programs h. Class 8 - all other claims Claims of creditors are classified and have priority of payment according to their class as set forth above 3. Proration of Claims a. when estate not sufficient to pay all claims of the same class, the claims are to be paid on a pro rata basis TEX. PROB. CODE ANN. § 321 b. pro rata payment does not apply to secured claims V. CLOSING THE ESTATE A. Dependent Administrations 1. Required: When handling a Dependent Administration, you must file a final account and get your client discharged to have bond released. Account for Final Settlement must include: a. List of property coming into hands of administrator or executor b. Debts which have been paid c. Debts & expenses still owing, if any d. Property of estate still in hands of executor or administrator e. Persons entitled to receive property f. Advancements made, if any g. Tax returns due or taxes owed which have been paid and to whom h. Bond premium information, including statement they have been paid. TEX. PROB. CODE ANN. §§ 404-405 2. Deliver property to heirs 3. Serve all heirs or beneficiaries by certified mail, return receipt requested unless otherwise instructed by the Court TEX. PROB. CODE ANN. § 407 4. Pay out funds as ordered by the Court TEX. PROB. CODE ANN. § 408


B. Independent Administrations 1. Court Discharge: Independent Executor or Administrator may seek to get himself or herself discharged from liability involving matters relating to the administration of the estate by filing a Declaratory Judgment under Chapter 3t of the Civil Practices and Remedies Code. TEX. PROB. CODE ANN. § 149E. 2. Closing by Affidavit: Independent Executor or Administrator may file an Affidavit to close the independent administration when all bills have been paid and acknowledging the property to be delivered to the distributees of the estate. TEX. PROB. CODE ANN. § 151. 3. Closing By Distributee: A distributee of the estate can seek to close the estate and terminate the powers of the independent executor under TEX. PROB. CODE ANN. § 152. V. PRACTICE POINTERS A. Fee Agreements: Written fee agreements recommended B. Declining Representation: Letter declining representation recommended C. Setting Your Fees

1. What is a Reasonable Fee?

a. In determining how to set your fees regarding the administration of an estate, you need to have a thorough understanding of the property of the estate and its value as well as the debts owed by the estate i. dependent administrations, insolvent estates, and taxable estates generally take the most time and work by the attorney ii. muniment of title and independent administration of solvent, non-taxable estates take the least attorney time 2. Flat fee vs. hourly fee for probate matters a. use a flat fee agreement only when you know what kind of time you will be spending on a matter i. flat fees generally good only in muniment of title cases b. hourly fees better for all other estate administration cases 3. Combination of fixed fees and hourly fees Consider a combination of fees to give the client some idea of the cost of probate a. Fixed fee for: i. filing application to probate ii. attending hearing to admit Will to probate and qualify executor iii. preparing Inventory, Appraisement and List of Claims, and b. Hourly fee for: i. consultations with client


ii. preparation of any tax returns iii. preparation of any documents transferring property (e.g. deeds, stock powers, automobile title transfers, etc.)


APPENDIX 1 - EXHIBITS

Exhibit 1 - Motion To Open Safe Deposit Box And To ExaminePapers Pursuant To Section 36b, Texas Probate Code

[STYLE]

MOTION TO OPEN SAFE DEPOSIT BOX AND TO EXAMINEPAPERS PURSUANT TO SECTION 36B, TEXAS PROBATE CODE

TO THE HONORABLE PROBATE COURT NO.:

("Movant"), files this Motion To Open Safe Deposit Box and to Examine Papers

Pursuant to Section 36B, Texas Probate Code, and would respectfully show the Court the following:

1.

(the "Decedent") died on , , 19 . This Court has jurisdiction and venue

over the Decedent's estate as _he resided and was domiciled in County, Texas.

2.

The Decedent was predeceased by h spouse, . Movant is the Decedent's only

child and is believed to be named as the executor of the Decedent's will and estate.

3.

At the time of h death, the Decedent leased safe deposit box number at Bank,

, , Texas . Movant believes that the safe deposit box may contain the Decedent's will.

Movant respectfully requests that the Court order Bank to open the safe deposit box and

permit Movant to examine the contents of the box and remove the Decedent's will and any codicils

thereto. See TEX. PROB. CODE ANN. § 36B. Movant will promptly deliver any will or codicils of the

Decedent located in the safe deposit box to the Clerk of the Probate Court of County, Texas.

See TEX. PROB. CODE ANN. § 36C(b).

WHEREFORE, PREMISES CONSIDERED, Movant respectfully requests that (i) the Court

order Bank to open safe deposit box number and allow Movant to examine the contents,

(ii) the Court authorize Movant to remove the Decedent's will and any codicils thereto for delivery

to the Clerk of the Probate Court of County, Texas, and (iii) for such further relief to which _he

may show h self justly entitled.


Respectfully submitted,

BY: BILLY BOB SMITH (TBA #00000000) 1234 Tumbleweed Backwater, Texas 77777 Telephone (999) 123-4567 Facsimile (999) 123-4567

Attorney for Movant

SWORN AND SUBSCRIBED TO BEFORE ME, on this the _____ day of___________________________, 19 .

(SEAL)

NOTARY PUBLIC IN AND FORTHE STATE OF TEXAS


Exhibit 2 - Order Authorizing Opening Of Safe Deposit Box And Examination Of Papers Pursuant To Section 36b, Texas Probate Code

[STYLE]

ORDER AUTHORIZING OPENING OF SAFE DEPOSIT BOX AND EXAMINATIONOF PAPERS PURSUANT TO SECTION 36B, TEXAS PROBATE CODE

On this day, the Court considered the Motion To Open Safe Deposit Box and to Examine

Papers Pursuant to Section 36B, Texas Probate Code (the "Motion," which is incorporated by this

reference, and to the salient provisions of which, including the defined terms therein, reference is

hereby made) of , and the Court, having heard the evidence finds that the allegations

contained in such motion are true and that it should be granted. It is therefore,

ORDERED, that Bank, , , Texas, , permit Movant to examine safe

deposit box number it holds in the name of in the presence of an officer of

Bank , who is hereby appointed as an agent of this Court. It is further,

ORDERED, that if such safe deposit contains the Decedent's will, and any codicils thereto,

Bank shall, upon proper receipt from Movant, deliver to Movant any such purported will or

codicils. It is further,

ORDERED, that Movant shall promptly deliver any will or codicils of the Decedent located

in the safe deposit box to the Clerk of the Probate Court of County, Texas.

SIGNED on the _____ day of ________________, 19 .

JUDGE PRESIDING

APPROVED AS TO FORM:

BY: ______________________________BILLY BOB SMITH (TBA #00000000)1234 TumbleweedBackwater, Texas 77777Telephone (999) 123-4567Facsimile (999) 123-4567

Attorney for Movant


Exhibit 3 - Estate Inventory And Tax Questionnaire

[STYLE]

ESTATE INVENTORY AND TAX QUESTIONNAIREFOR

THE ESTATE OF MRS. SMITH

General Information

I. Please list the following general information about Mrs. Smith:A. What was Mrs. Smith's citizenship? _______ USA _______ Other

___________________________(Citizenship)

B. 1. Was Mrs. Smith born in Texas? Yes _____ No _____2. If Mrs. Smith was not born in Texas, please state the year Mrs. Smith moved

to Texas. _________

C. 1. What was Mrs. Smith's occupation at the time of her death?

2. What was Mrs. Smith's business address:

D. If retired, what was Mrs. Smith's former occupation?

E. Please list the names and address of Mrs. Smith's physicians at the time of her death.Name Address

1.

2.

3.

F. 1. Was Mrs. Smith confined in a hospital during her last illness? Yes ________ No _______2. If so, please list the name of the hospital:

G. 1. Does Mrs. Smith have a safe deposit box either alone or jointly with another? Yes _______ No ________

2. If so, please state the name of the Bank where the box is located:

3. Attach a list of the contents of the safe deposit box.

H. Was Mrs. Smith a veteran? Yes _______ No ________


I. 1. Mrs. Smith's Marital Status at date of death:______ Married ______ Single ______ Legally Separated______ Widow or Widower ______ Divorced

2. If Mrs. Smith was a widow, widower or divorced, please list:(a) Name of former spouse: (b) Approximate date of termination of prior marriage:

J. Mrs. Smith's children:1. Total number children ever born to or adopted by Mrs. Smith:

2. Number of children now surviving Mrs. Smith:

K. 1. Did Mrs. Smith have an accountant or bookkeeper assist with the preparation ofMrs. Smith's Federal Income Tax Returns? Yes _______ No _______

2. If so, please give us such person's name, address and telephone number:Name: Address:

Phone:

L. 1. Did Mrs. Smith own any interest in a business, joint venture or partnership?Yes ______ No ______

2. If so, please describe:

M. Mrs. Smith's Social Security Number:

II. Please list the following general information about yourself:A. Your name and address:

B. Home Telephone Number: Business Telephone Number:

C. Business Address:

D. Your Social Security Number:

III. Please list Mrs. Smith's property below and on the following pages. Note that Mrs. Smith'sproperty includes everything owned by Mrs. Smith, either alone or jointly with another, at death:

A. REAL ESTATEIf Mrs. Smith owns any real estate, please list all of the real estate as follows (list anyadditional real estate on the back of this page).

Property A Property B1. Location

2. DateAcquired


3. How Acquired (Purchase, inheritance or gift)

4. If purchased, state the original cost$

5. (a) Have substantial improvements been made since acquired by Mrs. Smith? _____ Yes ____ No _____ Yes _____ No

(b) If so, describe

(c) Approximate cost of improvements$

B. MINERAL AND ROYALTY INTERESTSDid Mrs. Smith own any mineral or royalty interests in oil, gas, coal or other minerals?_____ Yes _____ NoIf so, please list the following information:

Property A Property B Property C1. Description

2. Date acquired 3. How acquired: Purchase, Inheritance, or Gift

4. If purchased, Mrs. Smith's cost

5. Was the property producing income on date of Mrs. Smith's death

___Yes ___No ___Yes ___No ___Yes ___No6. If so, list total income from the property in year preceding Mrs. Smith's death

C. STOCKS AND BONDSIf Mrs. Smith owns any stocks or bonds at death, please list the information below:

Description (Name Number Name(s) in whichof Stock or Bond) of Shares Certificate is held

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18.


19. 20.

Please state the name and telephone number of Mrs. Smith's stock broker:

Firm:

D. CASH, BANK ACCOUNTS, AND PROMISSORY NOTESPlease list the information below:1. Bank Accounts

Balance on Name of Bank Type of Account Holders Date of Deatha. $b. $c. $d. $e. $f. $g. $h. $i. $j. $

2. Certificates of Deposit: Names

Date Due Interest in which Name of Bank Acquired Date Rate CD is held Amount

a. b. c. d.

3. Cash on Hand:List any other cash Mrs. Smith may have had on hand or on her person on the date of her death.

Location Amounta. $b. $

4. Promissory Notes: Did Mrs. Smith own or hold any promissory note at the time of death? _____ Yes ______No. Ifso, please describe:

Interest Amount nowName of Potential Debtor Date of Note Rate Remaining Due

a. % $ b. % $ c. % $

E. LIFE INSURANCEPlease list the following if there was any life insurance on Mrs. Smith's life:

DatePolicy

Name of Insurance Company Policy No. Acquired Beneficiary Amount


1. $2. $3. $4. $

5. $6. $7. $8. $9. $10. $

F. OTHER MISCELLANEOUS PROPERTYPlease list ALL other property owned by Mrs. Smith or in which she has an interest.

Approximate value Description on date of death

1. Automobiles:a.

(Year) (Make) (Model)b.

(Year) (Make) (Model)c.

(Year) (Make) (Model)

2. Household Furnishings (other than antiques) $ 3. Antiques and other articles of intrinsic value (coin or stamp collections, guns, etc.)

a. $ b. $ c. $ d. $

4. Accounts receivable (money owed Mrs. Smith on date of death)a. $

(Debtor’s Name)b. $

(Debtor's Name)c. $

(Debtor's Name)5. Uncashed checks held by Mrs. Smith on date of death

a. $ b. $ c $ d. $ e. $

6. Any business interest, partnership or joint venturea. $ b. $

7. Any other property owned by Mrs. Smitha. $ b. $ c. $ d. $ e. $


f. $ g. $ h. $ i. $ j. $

G. RETIREMENT BENEFITS1. Was Mrs. Smith a participant in any pension or profit sharing plan?

_____ Yes _____ No2. (a) Is anyone receiving a monthly pension from Mrs. Smith's employer following Mrs.

Smith's death? _____ Yes _____ No(b) If so, name of recipient

monthly amount $

H. ANNUITIES1. Was Mrs. Smith receiving an annuity at death? _____ Yes _____ No2. If so, did the annuity continue to pay any benefit to a designated beneficiary after Mrs.

Smith's death? ______ Yes ______ No

I. DEBTSPlease list all of Mrs. Smith's alleged debts. Such debts should include all charge accounts,household utilities, city and state taxes on the any real estate, car notes, boat loans, and anyother indebtedness of Mrs. Smith.

Description Loan Collateral, if any Amount Due

1. $2. $3. $4. $5. $6. $7. $8. $9. $10. $11. $12. $13. $14. $15. $16. $17. $18. $19. $20. $

Is there any credit life insurance on any of the above debts? ____Yes ____NoIf so, please list the item numbers of all debts covered by credit life:


MiscellaneousIV. If you have not already done so, please send us the following documents:

A. Mrs. Smith's Death Certificate.B. All life insurance policies (i) insuring Mrs. Smith's life, and (ii) owned by Mrs. Smith at her

death.C. List of contents of safe deposit box.D. Deeds to any real estate, and related loan documents, and a copy of the title policy and

any closing statement relating to Mrs. Smith's purchase of the property.E. Mrs. Smith's Federal Income Tax Returns for the current year (if it has been prepared),

and for the last 3 years.

F. Certificates of Title to any automobiles, mobile homes, tractors, trailers, or boats.G. Financial statements and tax returns for any business, joint venture or partnership for

the current year, if any, and for the last 5 years.H. Copy of Mrs. Smith's Will.I. Copies of statements of account for each of Mrs. Smith's bank accounts at her date of

death.J. Copies of statements of account for each of Mrs. Smith's brokerage accounts at her

date of death. K. Copies of statements of account for all of Mrs. Smith's Debts, mortgages (copy of

amortization schedule) and charge accounts at her date of death.


Exhibit 4 - Appointment Of Resident Agent To Accept Service

[STYLE]

APPOINTMENT OF RESIDENT AGENT TO ACCEPT SERVICE

WHEREAS, the original of an instrument purporting to be the Last Will and Testament of

("Decedent") has been filed herewith with the Probate Clerk of County, Texas;

WHEREAS, the undersigned was named as an Independent Executor under the Will and of the

estate of Decedent;

WHEREAS, the undersigned is a non-resident of the State of Texas, and has filed an Applica-

tion in the above Court for appointment as an Independent Executor and desires to be qualified to

serve in such capacity; and

NOW, THEREFORE, known to all men by these presents that the undersigned hereby appoints

Billy Bob Smith, whose domicile is in County, Texas, and whose address is 1234 Tumbleweed,

Backwater, Texas 77777 as h resident agent to accept service of process in all actions and

proceedings with respect to such estate.

[APPLICANT]

THE STATE OF TEXAS §§

COUNTY OF §

BEFORE ME, the undersigned, on this day personally appeared , known to me tobe the person whose name is subscribed to the foregoing instrument and acknowledged that _heexecuted the same for the purposes and consideration therein expressed.

GIVEN UNDER MY HAND AND SEAL OF OFFICE, on this the ____ day of____________________, 19 .

(SEAL) NOTARY PUBLIC IN AND FORTHE STATE OF TEXAS


Exhibit 5 - Fee Agreement - Sole Independent Executor

FEE AGREEMENT - SOLE INDEPENDENT EXECUTOR

, 19

M_. [CLIENTS NAME] , Texas

Re: Estate of , Deceased

Dear M_. :

This letter will confirm that I will represent you with respect to the settlement of 's estatein your capacity as independent executor. This letter is also our agreement with respect to thedetails of my representation, inclusive of my fees. My representation with respect to these matterswill include advising and counseling you, processing matters relating to the probate of the Will of , and assisting you with the legal aspects of all other estate matters. My representationwill not, however, extend to income tax issues.

With respect to my professional services, I will bill you monthly on a time expended basis. Thebasis of my bills to you will relate to the time I expend on your behalf on an hourly rate basis. Mycurrent hourly rate is $ an hour.

In addition to my fees, I anticipate incurring certain expenses on your behalf. Those expensesmay include court filing fees, photocopying expenses, messenger services, travel expenses,facsimile charges, and long distance telephone charges. These expenses will be listed separatelyon each invoice, and I agree with you and you with me that those matters shall be handled in thesame manner as my fees discussed above.

Invoices are due and payable each month as they are sent. All amounts which remain unpaidat thirty (30) days following the date of the invoice shall bear interest at the rate of 10 percent perannum from the date which falls thirty (30) days after the date of the invoice until paid.

It is also expressly agreed that you have the right to terminate my employment at any time andI have the right to resign as your attorney at any time. However, any such termination shall notconstitute a release or waiver of any of the remaining provisions of this fee agreement, nor will I bereleased from any remaining ethical duties toward you such as the duty of maintaining theconfidentiality of my communications with you.

Any dispute that may arise with respect to any aspect of this agreement shall, on the writtenrequest of either party, be submitted to arbitration in accordance with appropriate statutes of thestate of Texas and the Commercial Arbitration Rules of the American Arbitration Association.Judgment upon the award rendered by the arbitrators may be entered in any court havingappropriate jurisdiction. Each party shall appoint one person as arbitrator, and a third arbitrator shallbe chosen by the two arbitrators previously selected by the parties; provided that, if there is noagreement as to the third arbitrator within sixty (60) days after the notice of arbitration is served, thenthe third arbitrator shall be selected by a district or probate judge in County, Texas, having


subject matter jurisdiction over the dispute. It is further agreed that the expenses of arbitration shallbe paid in such proportions as the arbitrators decide, except that the successful party in any suchproceeding seeking enforcement of the provisions of this agreement shall be entitled to receive fromthe party not prevailing reasonable and necessary attorney's fees and expenses, in addition to anyother sums to which such successful party may be entitled. The arbitrators shall decide the identityof the successful party for purposes of the preceding sentence. It is also agreed that each of thearbitrators shall be either (i) Board Certified as an Estate Planning and Probate Law specialist bythe State Bar of Texas, or (ii) a Fellow of the American College of Trust and Estate Counsel, whois not under any conflict of interest in this matter.

As suggested by the Code of Professional Responsibility for Attorneys, I am enclosing abrochure from the State Bar of Texas which advises you of your more significant rights with respectto our attorney/client relationship. I advise you to read it at your convenience and let me know if youhave any questions.

I want you to know that every effort will be made to expedite your case promptly and efficientlyaccording to the highest legal and ethical standards. I shall keep you well informed as to theprogress of your case.

Your signature below will evidence your agreement to each and every term of this feeagreement.

I sincerely appreciate having this opportunity to be of service to you and I hope my services willbe performed to your satisfaction.

Very truly yours,

BILLY BOB SMITH

I, , hereby agree to the engagement of , , Texas, as my attorney withrespect to the above referenced matters, and I agree to the conditions and terms of the foregoingletter pertaining to the representation by , including the payment of fees and expensescharged by h .

Date:______________________ BY:


Exhibit 6 - Fee Agreement - Co-Executors

FEE AGREEMENT - CO-EXECUTORS

, 19



Re: Estate of , Deceased

Dear and :

I appreciate the opportunity to represent you with respect to the settlement of 's estate("the Estate"). This will confirm that I will be representing both of you in your fiduciary capacities asindependent co-executors of the Estate. At this early stage of my engagement, I believe it is helpfulfor us to set forth the roles and responsibilities of both myself as your lawyer and you. Therefore,this letter serves as our agreement with respect to these details, inclusive of my fees and expenses.

With regard to my joint representation of you, I believe it is advisable and necessary, under theTexas Rules of Professional Conduct ("Disciplinary Rules") which govern my profession, to makefull and adequate disclosure to a client regarding joint representation. You will recall we had adiscussion about the benefits and potential issues which may arise relating to my jointrepresentation of you. In this regard, it is imperative for you to understand that there will be disclo-sures and exchanges of information and communications that I receive from either of you to theother of you. Upon conclusion of this engagement, which will occur when the Estate has beensettled, and all related documents you have asked me to prepare on your behalf have been preparedand implemented, my joint representation of you on this matter shall be concluded, and yourconsent to my disclosure and exchange of information (and my obligation to disclose and exchangesuch information) shall end.

Further, Rule 1.07 of the Disciplinary Rules requires that I inform you that conflicts of interestbetween you could arise when I address your fiduciary objectives during this joint representation.Under the Disciplinary Rules, my role in the event of a material conflict of interest between you isthat of an "intermediary," and I cannot advocate the interests of one of you against the other. In anysuch circumstance, you should understand that either of you may retain separate, independent legalcounsel. Furthermore, either of you may want to obtain separate, independent counsel to representyour individual interests.

Based on our discussions to date, I reasonably believe that all matters relating to the settlementof 's Estate can be resolved by your common representation. However, should you feel thatjoint representation is not advisable, either now or in the future, please notify me immediately andI will withdraw as both of your counsel and cease representing both parties.

During the course of my representation of both of you as co-executors, I will be acting as yourlegal counsel on Estate matters; however, I will be coordinating my representation with


who currently represents you in certain tax and accounting matters. With regard to any tax oraccounting issues, I understand that M_. will be assuming primary responsibility.

Generally, my representation with respect to this matter will include advising, counseling, andassisting you with the settlement of the Estate. I will also negotiate, investigate, research, prose-cute, and defend any non-tortious claims by or against you, as co-executors, with respect to theEstate. I will represent you before any court in any proceeding relating to any non-tortious aspectof the settlement of the Estate. My representation will not, however, extend to income tax issuesraised or income tax compliance matters as M_. will be representing you in these matters.

Further, in order to enable me to render effective legal services, you agree to keep me apprisedof all facts and developments relating to the settlement of 's Estate. This is very importantas any advice I give must be based on accurate and complete facts and information. Of course,I shall also keep you well informed as to the progress of the Estate and you should know that everyeffort will be made to expedite your case promptly and efficiently according to the highest legal andethical standards.

With respect to my professional services, I will bill you monthly on a time expended basis. Iagree to look first to 's Estate for payment of my legal fees. You agree, however, to beindividually responsible for these fees if I am unable to secure payment from 's Estate. Thebasis of my bills to you will relate to the time I expend on your behalf on an hourly rate basis. Mycurrently hourly rate is $ . I review my rates each January and sometimes raise them, and youagree that I may do so, but you may terminate this agreement if you decide any new rate is unsatis-factory with you.

In addition to my fees, I anticipate incurring certain expenses on your behalf. Those expensesmay include court filing fees, photocopying and facsimile expenses, expert witnesses, bondpremiums, depositions, messenger services, travel expenses, and long distance telephonecharges. These expenses will be listed separately on each invoice, and I agree with you and youwith us that I will look first to the Estate for the payment of these expenses; however, similar to thefees, you are also individually responsible for the payment of these expenses to the extent that theyare not paid from the Estate.

Generally, I will invoice you monthly and these invoices are due and payable each month asthey are sent. All amounts which remain unpaid at thirty (30) days following the date of the invoiceshall bear interest at the rate of ten percent (10%) per annum from the date which falls thirty (30)days after the date of the invoice until paid.

It is also expressly agreed that I have the right to resign as your attorney at any time, and youhave the right to terminate my employment at any time. However, any such termination shall notconstitute a release or waiver of any of the remaining provisions of this fee agreement, nor will I bereleased from any remaining ethical duties toward you such as the duty of maintaining theconfidentiality of my communications with you and yours with me.

Any dispute that may arise with respect to any aspect of this agreement shall, on the writtenrequest of either party, be submitted to arbitration in accordance with appropriate statutes of thestate of Texas and the Commercial Arbitration Rules of the American Arbitration Association.Judgment upon the award rendered by the arbitrators may be entered in any court havingappropriate jurisdiction. Each party shall appoint one person as arbitrator, and a third arbitrator shallbe chosen by the two arbitrators previously selected by the parties; provided that, if there is noagreement as to the third arbitrator within sixty (60) days after the notice of arbitration is served, thenthe third arbitrator shall be selected by a district or probate judge in County, Texas, havingsubject matter jurisdiction over the dispute. It is further agreed that the expenses of arbitration shallbe paid in such proportions as the arbitrators decide, except that the successful party in any suchproceeding seeking enforcement of the provisions of this agreement shall be entitled to receive fromthe party not prevailing reasonable and necessary attorney's fees and expenses, in addition to any


other sums to which such successful party may be entitled. The arbitrators shall decide the identityof the successful party for purposes of the preceding sentence. It is also agreed that each of thearbitrators shall be either (i) Board Certified as an Estate Planning and Probate Law specialist bythe State Bar of Texas, or (ii) a Fellow of the American College of Trust and Estate Counsel, whois not under any conflict of interest in this matter.

As suggested by the Code of Professional Responsibility for Attorneys, I am enclosing abrochure from the State Bar of Texas which advises you of your more significant rights with respectto our attorney/client relationship. I advise you to read it at your convenience, and let me know if youhave any questions.

Your signature below will evidence your agreement to the terms of this fee agreement. Isincerely appreciate having this opportunity to be of service to you and I trust that my services willbe performed to your satisfaction.

Very truly yours,

BY: BILLY BOB SMITH

I, , hereby agree to the engagement of , , Texas, as my attorney withrespect to the above-referenced matters, and I agree to the conditions and terms of the foregoingletter pertaining to the representation of , including the payment of fees and expensescharged by h .

Date: , Co-Executor of theEstate of , Deceased

I, , hereby agree to the engagement of , , Texas, as my attorney withrespect to the above-referenced matters, and I agree to the conditions and terms of the foregoingletter pertaining to the representation of , including the payment of fees and expensescharged by h .

Date: , Co-Executor of theEstate of , Deceased


Exhibit 7 - Fee Agreement - Guardianship

FEE AGREEMENT - GUARDIANSHIP

, 19


Re: Guardianship of , an Incapacitated Person

Dear M_. :

This letter will confirm that I will represent you with respect to your application for temporary andpermanent guardianship of . This letter also serves as our agreement with respect to thedetails of my representation, inclusive of my fees and expenses. My representation with respectto these matters will include advising, counseling, processing, litigating, and assisting you with theguardianship applications. My services will also include assisting you with any settlement that isreached among the interested parties; and, if necessary, I will also defend you from any claimsagainst you that relate to your guardianship applications and that may arise during the litigation. Myrepresentation will not, however, extend to income tax issues raised or tax compliance matters.

With respect to my professional services, I will bill you monthly on a time expended basis. Iagree to look first to 's estate for payment of my legal fees which exceed the fee advance of$ discussed below. You agree, however, to be individually responsible for these fees if I amunable to secure payment from 's estate. The basis of my bills to you will relate to the timeI expend on your behalf on an hourly rate basis. My current hourly rate is $ . I review my rateseach January and sometimes raise them and you agree that I may do so, but you may terminatethis agreement if you decide the new rate is unsatisfactory with you.

In addition to my fees, I anticipate incurring certain expenses on your behalf. Those expensesmay include court filing fees, photocopying expenses, expert witnesses, bond premiums,depositions, messenger services, travel expenses, facsimile charges, and long distance telephonecharges. These expenses will be listed separately on each invoice, and I agree with you and youwith myself that I will look first to the estate for the payment of these expenses, however similar tothe fees, you are also individually responsible for the payment of these expenses.

It is my policy to obtain a fee advance in all instances when there are contested issues involved.In this instance, I am asking that you advance the sum of $ toward the payment of my lastinvoice on this matter. The advance payment will be held in an interest bearing separate trust bankaccount. Generally, I invoice my clients monthly. However, because I will be applying to the probatecourt for payment of my fees and expenses, I will forward you a copy of my invoice for your reviewbut you will not be responsible for the payment unless the court refuses to allow my fees from 's estate. In the event the court does not allow the payment of my fees and expenses from h estate, I will invoice you monthly and these invoices are due and payable each month as they aresent. All amounts which remain unpaid at thirty (30) days following the date of the invoice shall bearinterest at the rate of 10 percent per annum from the date which falls thirty (30) days after the dateof the invoice until paid.


It is also expressly agreed that I have the right to resign as your attorney at any time, and youalso have the right to terminate my employment at any time. However, any such termination shallnot constitute a release or waiver of any of the remaining provisions of this fee agreement, nor willI be released from any remaining ethical duties toward you such as the duty of maintaining theconfidentiality of my communications with you.

I want you to know that every effort will be made to expedite your case promptly and efficientlyaccording to the highest legal and ethical standards. I shall keep you well informed as to theprogress of your case.

Any dispute that may arise with respect to any aspect of this agreement shall, on the writtenrequest of either party, be submitted to arbitration in accordance with appropriate statutes of thestate of Texas and the Commercial Arbitration Rules of the American Arbitration Association.Judgment upon the award rendered by the arbitrators may be entered in any court havingappropriate jurisdiction. Each party shall appoint one person as arbitrator, and a third arbitrator shallbe chosen by the two arbitrators previously selected by the parties; provided that, if there is noagreement as to the third arbitrator within sixty (60) days after the notice of arbitration is served, thenthe third arbitrator shall be selected by a district or probate judge in Harris County, Texas, havingsubject matter jurisdiction over the dispute. It is further agreed that the expenses of arbitration shallbe paid in such proportions as the arbitrators decide, except that the successful party in any suchproceeding seeking enforcement of the provisions of this agreement shall be entitled to receive fromthe party not prevailing reasonable and necessary attorney's fees and expenses, in addition to anyother sums to which such successful party may be entitled. The arbitrators shall decide the identityof the successful party for purposes of the preceding sentence. It is also agreed that each of thearbitrators shall be either (i) Board Certified as an Estate Planning and Probate Law specialist bythe State Bar of Texas, or (ii) a Fellow of the American College of Trust and Estate Counsel, whois not under any conflict of interest in this matter.

As suggested by the Code of Professional Responsibility for Attorneys, I am enclosing abrochure from the State Bar of Texas which advises you of your more significant rights with respectto our attorney/client relationship. I advise you toread it at your convenience and let me know if you have any questions.

Your signature below will evidence your agreement to the terms of this fee agreement.

I sincerely appreciate having this opportunity to be of service to you and I hope my services willbe performed to your satisfaction.

Very truly yours,

BY: BILLY BOB SMITH

I, , hereby agree to the engagement of , , Texas, as my attorneywith respect to the above referenced matters, and I agree to the conditions and terms of theforegoing letter pertaining to the representation of , including the payment of fees andexpenses charged by them.

Date:______________________[CLIENTS SIGNATURE]


Exhibit 8 - Engagement Contract And Power Of Attorney

ENGAGEMENT CONTRACTAND

POWER OF ATTORNEY

CLIENT: (Name of Executor)(Address of Executor)

ATTORNEY: Holly J. GilmanGilman, Nichols & Ballard, L.L.P.812 San Antonio St., Suite 525Austin, TX 78701

ENGAGEMENT: Client employs Attorney to assist Client with the preparation of an estate plan onbehalf of Client.

COMPENSATION: (Hourly rate) or (flat fee) for preparation of (Will or Trust), various powers ofattorney, Directive to Physician, Declarartion of Guardianship, including all consulation with client,review of documents. (If using flat fee, consider addition of the following language: If the timerequired for the prepration of the estate plan exceeds 10/15?? hours, the excess will be billed as“other services” as described below.

All other services such as transfers of ownership, securing appraisals of property or otherdetermination of value, preparation of tax returns or consultation with CPA working with estate, andassistance with claims due to or owing by the estate will be performed at Attorney’s basic hourlyrate of $150.00, to be billed on a monthly basis.

Client shall pay for all costs and expenses incurred by the Attorney, including court costs, requiredpublications in newspaper, reproductions, postage and delivery charges, long distance calls, travelexpenses, food and lodging outside of Austin, Travis County, Texas, all of which shall be paid byClient upon receipt of a statement. Client agrees that he/she/it will be charged for copies made bythe Firm at the rate of 10¢ per copy. Client agrees that he/she/it will be charged for long distancephone calls and long distance telecopier calls at the actual cost of the long distance call.

WITHDRAWAL OR TERMINATION: Attorney will have the right to withdraw from representation ifinvoices for services and/or costs are not timely paid by Client. The Attorney shall have the rightto cease legal work and withdraw from representation if Client does not furnish the Attorney with thenecessary, complete and truthful information and documents and/or if Client does not cooperatefully with the Attorney in the handling of the Estate. Client may terminate this agreement at any time.However, termination shall not diminish the liability of Client to pay the Attorney all fees, costs andexpenses accrued prior to that time. If Client discharges the Attorney and does not have asubstitute counsel prepare for withdrawal and substitution of counsel, Client shall be liable for theAttorney’s cost and expenses, including attorney time incurred in withdrawing as Client's counsel.

POWER OF ATTORNEY: This contract will evidence the authority of Attorney to act for Client inobtaining information and in all other matters pertaining to the probate, administration, andsettlement of the Estate.

DISCLOSURE: Attorney has disclosed information needed by Attorney from Client in the form of theEstate Inventory and Tax Questionnaire submitted to Client as part of this contract. Client is


responsible for the timely disclosure and delivery of the information and documents listed on theQuestionnaire to Attorney.

OTHER MATTERS: This contract is formed under the laws of the State of Texas. Venue of anydispute under the contract shall be in Travis County, Texas. Attorney and Client agree to seekmediation of any fee disputes before filing suit in a court of competent jurisdiction.

INDEPENDENT COUNSEL: Client should feel free to consult any independent legal counsel as toany question involving the fairness of this contract or any other issue which merits the opinion ofindependent legal counsel.

Effective Date: ________________, 199___

CLIENT: __________________________________________(typed name)

ATTORNEY: __________________________________________Holly J. Gilman FEE AGREEMENT - GUARDIANSHIP


Exhibit 9 - Fee Agreement - Contingent

FEE AGREEMENT - CONTINGENT

AGREEMENT

This is an agreement between (" ") and , which agreement pertains to

the employment of for purposes of legal representation with respect to the Estate of

, Deceased ("the Estate").

I.

agrees to and does hereby hire to represent h with respect to (i) the recovery

of h interest in the Estate, and (ii) the recovery of any assets payable upon or as a result of the

death of but which do not pass pursuant to any will of , such as insurance and/or joint

tenancy property ("the non-probate assets"). This representation shall specifically include legal

representation of in the will contest proceeding which is now pending with respect to the

Estate. hereby agrees to provide such legal representation to as provided by this

agreement.

II.

is fully authorized to sue on behalf of and to seek the probate of the 19 will

of and bring, file and defend any and all actions, claims and causes of action necessary to

recover 's interests in the Estate and the non-probate assets that are lawfully payable to

. Such employment shall also include without limitation the power to negotiate settlement of any

and all such claims, but it is distinctly understood that no settlement shall be made by without

the prior express written approval of , and shall not settle h claims without the prior

express written approval of .

III.

In the event that this case is settled before the inception of a trial of the disputed issues of fact

and law, and agree to be bound by the following contingent fee agreement:

hereby grants, sells, assigns, and conveys to as consideration for the legal services rendered

by for in this case an undivided forty percent (40%) interest in and to: (i) any and all

amounts recovered or received by from the Estate, and (ii) all non-probate assets received

by by reason of any such settlement, including but not limited to by will, intestacy, beneficiary

designation, right of survivorship, or otherwise. Any expenses of litigation incurred after the execu-

tion of this Agreement shall be advanced by , but born by upon settlement or judgment.

The payment of any such expenses shall be in addition to the above forty percent (40%) interest.

agrees to inform promptly, and no later than fifteen (15) days after receipt, of any pay-

ments or property received by .


IV.

In the event that the case is litigated through a trial of the disputed issues of fact and law, or if

the case is settled during any such trial, or if a trial is started but a mistrial is declared, and

agree to be bound by the following contingent fee agreement: hereby grants, sells,

assigns, and conveys to as consideration for the legal services rendered by for

in this case an undivided forty percent (40%) interest in and to: (i) any and all amounts recov-

ered or received by from the Estate, and (ii) all non-probate assets received by by

reason of any such trial or settlement, including but not limited to by will, intestacy, beneficiary

designation, right of survivorship, or otherwise. Any expenses of litigation incurred shall be ad-

vanced by , but born by upon settlement. The payment of any such expenses shall be

in addition to the above forty percent (40%) interest. agrees to inform promptly, and no

later than fifteen (15) days after receipt, of any payments or property received by .

V.

In the event there is a recovery for and there is also an award of attorneys' fees to

or out of either (i) the Estate, or (ii) any non-probate assets received by reason of a

judgment entered in the trial of the case, shall not be entitled to retain both the attorneys' fees

award and the above described contingent fee; but instead, shall retain as its fee the greater

of the attorneys fee award or the contingent fee. If there is a recovery of attorney's fees for or

from sources other than the Estate, such fees shall be added to 's recovery and

shall retain a contingent fee interest in any such fees.

VI.

In the event fails to recover anything from the Estate of , Deceased, or by

reason of h death, will owe nothing as a fee, but shall nevertheless be entitled

to recover any and all amounts awarded either to or as attorney's fees in the will

contest litigation.

VII.

In the event payment of fees and expenses have not been tendered to within thirty (30)

days of the date the judgment of the trial court becomes final, interest on the amount of unpaid fees

and expenses owed to will accrue at the rate of ten percent (10%) per annum (compounded

monthly) on the unpaid balance of the attorneys fees beginning on the date which is thirty (30) days

after the date the judgment becomes final and ending on the date of payment.

VIII.

states that expenses will be incurred in prosecuting this litigation. The term "expenses"

as used in this Agreement and its attachments shall refer to deposition costs, filing fees, and other

court costs, photocopying expenses, messenger services, facsimile charges, long distance

telephone charges, postage, expert witness fees and expenses, mediation fees, and any other out-


of-pocket expenses paid or incurred by in this case. expressly agrees that will

advance expenses but it is reimbursed to upon settlement or judgment.

IX.

It is also expressly agreed that shall have the right to resign as 's attorneys at any

time, and also has the right to terminate 's employment at any time. However, any such

termination shall not constitute a release or waiver of this contingent fee agreement of any of the

remaining provisions of this fee agreement, nor will be released from any remaining ethical

duties toward such as the duty of maintaining the confidentiality of communications.

X.

Any dispute that may arise with respect to any aspect of this agreement shall, on the written

request of either party, be submitted to arbitration in accordance with appropriate statutes of the

state of Texas and the Commercial Arbitration Rules of the American Arbitration Association and

judgment upon the award rendered by the arbitrators may be entered in any court having appropriate

jurisdiction. Each party shall appoint one person as arbitrator, and a third arbitrator shall be chosen

by the two arbitrators previously selected by the parties; provided that, if there is no agreement as

to the third arbitrator within sixty (60) days after the notice of arbitration is served, then the third arbi-

trator shall be selected by a district judge in County, Texas, having subject matter jurisdiction

over the dispute. We further agree that the expenses of arbitration shall be paid in such proportions

as the arbitrators decide, except that the successful party in any such proceeding seeking enforce-

ment of the provisions of this agreement shall be entitled to receive from the party not prevailing

reasonable and necessary attorney's fees and expenses, in addition to any other sums to which

such successful party may be entitled. The arbitrators shall decide the identity of the successful

party for purposes of the preceding sentence. The parties also agree that each of the arbitrators

shall be either (i) Board Certified as an Estate Planning and Probate Law specialist by the State Bar

of Texas, or (ii) a Fellow of the American College of Trust and Estate Counsel.

XI.

If 's recovery consists of property other than cash, or part cash and part non-cash,

will be paid by from the recovery as follows:

(a) From cash;

(b) If the above is insufficient to pay , from stocks and bonds;

(c) If the above is insufficient to pay , from any other readily marketable personal

property; and

(d) If the above is insufficient to pay , agrees to move to sell any other personal

or real property received as part of the recovery and pay from the sales proceeds.

XII.


In the event 's claim is finally resolved whereby there is no method to mathematically

ascertain the contingent fee or a fair distribution between and , the parties agree that the

fee will be determined, first by agreement of the parties, and if agreement cannot be reached within

sixty (60) days of a final judgment or settlement of 's claim then by means of mediation

whereby each party selects one mediator who will then negotiate with the other party's mediator.

If mediation in that manner fails, then the mediators shall select a mutually agreeable third party.

The two mediators and the third party shall then each evaluate the fair market value of the attorneys'

fee in dollars and cents (taking into account all of the relevant factors for determining attorneys fees

set out by the applicable code of conduct for Texas attorneys), and the attorneys' fee shall be

determined by averaging the three opinions. and shall each pay the expenses of their

mediator and shall each pay one-half (1/2) of the cost of third mediator.

EXECUTED on this the ______ day of , 19 .

,Individually, as named Executor u/w/o ,Deceased, as Proponent, and as Beneficiary

BY:BILLY BOB SMITH


Exhibit 10 - Sample Letter Declining Representation

[LETTERHEAD]

[Date]

Ms. Ethel Mertz100 Television WayHollywood, TX 77777

Re: Estate of Fred Mertz

Dear Ms. Mertz: Please accept my sincere condolences over the loss of your husband, Fred. I appreciate theopportunity to meet and discuss with you the possibility of representing you as the executor in theadministration of your husband’s estate. After reviewing this matter, I have concluded that this firmis not the appropriate firm to represent you in this matter. I am returning the documents yourprovided to me with this letter.

In declining to accept this matter, this firm is not expressing an opinion that you do not need toprobate your husband’s estate or seek legal counsel to assist you with this matter. On the contrary,I recommend you contact another attorney immediately to assist you with the necessary formalitiesrequired by the court in the probate of an estate. (NOTE: If you are referring to another attorney,put in names and telephone numbers here)

In accordance with our standard policy, we are not charging you for any legal fees. We charge forevaluation of a matter only when we express an opinion about the matter. If you need legalassistance in the future, we would be happy to discuss the possibility of representing you in othermatters.

Sincerely,

[Attorney]

(Enclosure: LIST OF DOCUMENTS RETURNED)