In Re Estate of Potter
10 Fla. L. Weekly 1382, 1985 Fla. App. LEXIS 14338, 469 So.2d 957 (1985)
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Rule of Law:
When an estate's assets are insufficient to satisfy all testamentary gifts after payment of debts, a general devise of money from the estate's assets will abate before a specific devise of a particular piece of property.
Facts:
- Mildred D. Potter executed a will devising her residence at 14 Sunset Lane, Pompano Beach, Florida, to her daughter, Helen Potter Wanke, contingent on Potter's husband predeceasing her.
- The will specified that this devise of the residence was to be free of administrative expenses and estate taxes.
- Contemporaneously, Potter amended her inter vivos trust to direct the trustee to pay her son, Edwin E. Potter, Jr., a cash amount 'equivalent' to the value of the residence the daughter received.
- Both the will and the trust directed that estate debts, taxes, and administration expenses were to be paid from the assets of the trust.
- Mildred Potter's husband predeceased her, making the bequests to her children operative upon her death.
- After Mildred Potter's death, the assets in her trust were insufficient to both pay the estate's expenses and provide the son with a cash sum equivalent to the value of the residence.
Procedural Posture:
- The personal representative for the Estate of Mildred D. Potter petitioned the trial court for an interpretation of the decedent's will and trust.
- The trial court found an intent to treat the son and daughter equally and, due to insufficient assets, ordered the sale of the residence and an equal division of the remaining proceeds.
- The daughter, Helen Potter Wanke, as appellant, appealed the trial court's order to the District Court of Appeal of Florida, Fourth District.
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Issue:
Does a general devise of a sum of money from a trust abate before a specific devise of a particular residence from a will when the documents are construed together and the estate's assets are insufficient to satisfy both?
Opinions:
Majority - Walden, Judge
Yes. A general devise of money abates before a specific devise of real property when estate assets are insufficient to satisfy both. The court determined that the will and the trust should be construed together, making the trust's provisions testamentary in nature. The devise of the residence to the daughter was classified as a 'specific devise' because it was a gift of a particularly designated and identifiable piece of property. In contrast, the direction to pay the son an 'equivalent amount' in cash was classified as a 'general devise' because it was a gift of a designated quantity to be satisfied from the general assets of the estate. Under the established doctrine of abatement, codified in Florida statutes, general devises must be reduced or eliminated to satisfy estate debts and expenses before specific devises are touched. Therefore, the son's general legacy abated, and the daughter is entitled to receive the specific devise of the residence.
Analysis:
This case provides a clear application of the traditional rules of abatement in the context of a modern estate plan that utilizes both a will and a pour-over trust. It reaffirms the legal hierarchy that protects specific devises over general devises when an estate's value is less than anticipated. The decision underscores that the characterization of a bequest—as specific, general, or demonstrative—is a critical determination that can have dispositive consequences for beneficiaries. For future cases, this opinion solidifies the principle that even a clear intent to treat beneficiaries 'equally' through gifts of equivalent value can be overridden by the legal classification of those gifts if the estate proves insufficient.
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