Why Gift Planners Need to Know About the Harmless Error Rule

Probate courts decide which wills are valid and which are not.  Thanks largely to the (British) Wills Act of 1837, which has been adopted in many countries and virtually every American jurisdiction, it is dogma that a will prepared by a competent, non-coerced testator will be given effect if it is in writing and signed by the testator in the presence of two subscribing witnesses.  Documents that do not meet those requirements will not be treated as wills.

Historically, the only major exception to enforcement of these formalities has been the handwritten, unwitnessed (“holographic”) will.  Even so, only about half the states have recognized that deviation from long-standing requirements for wills.

As the Wills Act approaches its bicentennial, there is growing resistance to its formalism.  The Uniform Probate Code, a “model” law prepared by experts and recommended to the states for adoption, permits a court to excuse noncompliance with the Wills Act “if the proponent of the document or writing establishes by clear and convincing evidence that the decedent intended the document or writing to constitute [a testamentary document].”

This provision, known as the “harmless error” rule, is designed to favor substance over form when it comes to the admission of wills presented for probate.  The harmless error rule has been adopted in whole or in part by a dozen states containing 25 percent of the country’s population.¹

Is the Harmless Error Rule Really That Revolutionary?

Yes!  It has the potential to stand centuries of probate litigation on its head.  The Ehrlich case from New Jersey is a good, if extreme, example.

Ehrlich was an estate planning lawyer who had never prepared a will of his own.  At his death, his papers included a document entitled “Last Will and Testament.”  It contained provisions disposing of his considerable assets.  It was not signed by Ehrlich or by any witnesses.  There was a handwritten notation by Ehrlich on the document referring to an “original” of the document, but that never surfaced.

Assessing the overall evidentiary record, the court was satisfied that “clear and convincing” proof existed to support a determination that the draft document represented Ehrlich’s final wishes.  A strict application of the Wills Act would clearly dictate a different result.  See In re Estate of Ehrlich, 427 N.J. Super. 64, 47 A.3d 12 (App. Div. 2012).

Has Section 2-503 Generated Much Litigation in the States that Have Adopted the Provision?

No.  There have been a handful of cases but nothing that amounts to a tsunami or even a tropical storm.  We attribute this to the fact that estate planners, as well as reputable online estate planning tools, will continue to adhere to the provisions of the Wills Act, which remain “on the books” and will likely not be repealed or even substantially modified.  The harmless error statute is meant as a lifeline for the noncomplying testator.

So Then Why Should the Gift Planner Care About This?

An illustrative example is the best way to answer this question.  Joe Johnson is a gift planner for the Foundation.  For years, he has courted Sarah Smith, a wealthy heiress living in seclusion at her estate in New Jersey.  Although Sarah made generous annual gifts to the Foundation, she always made it clear that her enormous fortune would be left to her niece, whom she loved dearly.

Joe was therefore shocked to receive a letter from Sarah informing him that she had decided to disown the niece and leave her estate to the Foundation.  She was planning to visit her estate planner in a few weeks to revise her documents.  Unfortunately, fate intervened and the day she wrote and mailed the letter, Sarah choked on an oversized almond that had found its way into a candy bar.

POINT TO PONDER:  Could the Foundation rely on the Ehrlich case and assert that the letter to Joe amounted to a new will, thereby revoking the old one?  It is difficult to imagine how the Foundation could lose that case.

Okay, So What Are the Takeaways for Gift Planners?

We believe that there are a few:

• The existence of the harmless error rule is another reason to maintain meticulous files (and even retain original correspondence), at least on prospects for larger bequests.
• It would be ideal if major (favorable) changes in estate plans could be communicated to a charity in writing, at least until they are incorporated into formal estate documents.
  • Planners need to be wary of over-encouragement of written confirmation of estate planning intentions. There is often a fine line between encouragement and undue influence.
  • Emails and text messages may be sufficient to qualify as testamentary documents, especially in view of the developing acceptance of electronic wills. This is a developing area of probate law.
• Planners should not limit their “lookout” for harmless error to the listed 12 states.  While rare, it is not unheard of for courts in other states to find ways to implement testator intent even where documents are not in compliance with the Wills Act.  See, e.g., In Re Snide, 418 N.E.2d 656 (N.Y. 1981).

Note

¹ At this writing, the adopting states were California, Colorado, Hawaii, Michigan, Minnesota, Montana, New Jersey, Ohio, Oregon, South Dakota, Utah, and Virginia.  As mentioned, the adoption has not been uniform.  The most significant variance is between states that will recognize an unsigned document versus those that continue to require the actual signature of the testator.  Surprisingly, there are more states in the former category.