Writing Wisconsin's New Probate Code

By David W. Reinecke

When the new Probate Code takes effect on Jan. 1, 1999, it will have been 30 years since the substantive law of probate received a thorough review and revision in Wisconsin. The new code is the culmination of almost seven years of study and drafting by numerous dedicated and talented practitioners and others from all over the state.

The project began in 1992 when Jackson Bruce, a prominent Milwaukee estate planning and probate attorney, contacted U.W. Law School Prof. Howard S. Erlanger to suggest that he spearhead an effort to adopt the 1990 Uniform Probate Code (UPC) in Wisconsin. Bruce served as a member of the UPC Joint Editorial Board, which had just completed the revised UPC on behalf of the National Commissioners on Uniform Laws.

Bruce also contacted the State Bar Real Property, Probate and Trust Law Section to elicit its support and to obtain legislation drafting authority for this project. The section appointed David W. Reinecke to chair what came to be known as the UPC Article II Committee, which Prof. Erlanger refers to as the "Drafting Committee." Other committee members included: R. Christian Davis, vice president of the Trust Division for Firstar Bank Madison; Kathleen A. Gray, partner with Quarles & Brady, Milwaukee; Brent E. Gregory, partner with Wrenn, Wille, Gregory & Lundeen, Milwaukee; Robert L. Kamholz Jr., partner with Godfrey & Kahn, Milwaukee; and Diane K. O'Connor, partner with O'Connor & Sachs, Mequon. Prof. Erlanger served as reporter and academic liaison to the committee, and Ann J. Flynn provided research assistance. Before drafting the legislation, the committee's proposed revisions were approved by the Wisconsin Practitioner's Review Committee, a group of more than 20 prominent Wisconsin probate practitioners. In addition, the final draft of the legislation was approved by the Real Property, Probate and Trust Law Section Board of Directors.

The person most responsible for the successful conclusion of the project is Prof. Erlanger. He worked countless hours consulting with and researching for the committee and worked tirelessly in drafting the legislation needed to enact the substantive changes adopted by the committee. He also prepared the committee's commentary to the new code.

Prof. Erlanger also has authored a book entitled Wisconsin's New Probate Code, which will be available for purchase very soon. The book will be used as course materials for a State Bar CLE seminar to be held live on Nov. 18, 1998, in Brookfield, with video replays statewide on Dec. 22. Prof. Erlanger's book is a very readable, yet comprehensive explanation of Wisconsin's new Probate Code. It explains in an easy-to-understand manner all aspects of the new law, how it differs from prior law, and why the changes were needed or desired. Attorneys who practice estate planning and probate will find the book to be an essential and invaluable reference.

Obviously, much has happened in the 30 years since Wisconsin's prior Probate Code was enacted. The committee, with Prof. Erlanger and Ann Flynn's assistance, spent countless hours comparing the 1990 UPC to the law in Wisconsin and crafting new substantive provisions that use the best aspects of each. To illustrate the need to update the prior Probate Code, consider one of the more important aspects of this project: "unification" of the law relating to the distribution and interpretation of probate and nonprobate transfers.

By one account, when Wisconsin's old code was enacted in 1969, approximately 80 percent of wealth that changed hands at death passed via the probate process, with the remaining 20 percent passing under various forms of nonprobate transfers. Today, with increased use of revocable trusts and other nonprobate transfers and with larger amounts of wealth being accumulated in retirement accounts, annuities, and insurance products, those percentages have reversed; it is now estimated that more than 80 percent of wealth that changes hands at death passes outside the probate process, with this percentage projected to increase even more in the future. (These statistics are taken from a presentation by Prof. David English to the American College of Trust and Estate Counsel in the Fall of 1997.)

With this reality, the committee asked: Although Wisconsin's prior code had detailed statutory provisions regarding antilapse (where a named beneficiary has died but no secondary beneficiary was named), ademption (where a specific item is left to someone - for example, by a provision in a revocable trust - but the item cannot be found at death), abatement (relating to what property bears certain burdens when the available assets are insufficient), and advancement (where a beneficiary received a "down payment" on his or her inheritance by way of a lifetime gift) in the context of probate transfers, why were there no parallel provisions to deal with those same issues vis a vis nonprobate transfers of wealth? Without such parallel provisions, the bulk of wealth, almost four-to-one, went uncovered when these problems arose, a paradox time will only exacerbate. Likewise, why did the prior code automatically revoke probate transfers to a divorced spouse, but not nonprobate transfers to the former spouse? Why did the old law have defined terms, disclaimer rules, survivorship rules, and slayer rules that differed as between probate and nonprobate property? The new code removes these dichotomies so that such rules apply to all forms of wealth transfers at death, probate and nonprobate. Similarly, why did Wisconsin's old code require strict compliance with witnessing formalities to create or change a will, whereas an effective revocable trust - quickly becoming the centerpiece of estate planning - could be scratched out on a napkin with no adherence to formalities? Although the new code does not erase this particular dichotomy completely, it does bring closer together the law regarding adherence to formalities in the context of probate and nonprobate transfers.

Although the new code is modeled after the 1990 UPC, there are several important differences. In this writer's opinion, many of the departures from the 1990 UPC relate to differences between a practitioner's view of the world as contrasted to an academic's point of view. The committee's goal was to use the extensive knowledge, expertise, and effort of the country's foremost experts on the law of probate (such as David English, John Langbein, Richard Wellman, Lawrence Waggoner, and many others of national reputation), by granting a presumption in favor of the 1990 UPC, yet not lose sight of the fact that the substantive law must be "user friendly" for practitioners and the public. For example, the 1990 UPC would admit into probate any written document shown to reflect the decedent's testamentary intent. Although such a provision can be strongly supported from the standpoint of achieving the decedent's intent, the committee believed it could result in excessive litigation; as a result, the committee did not adopt that particular UPC rule.

Finally, attorneys should keep one thing in mind as they study the new code: No one will agree with every change enacted; indeed, no member of the committee agrees with every change. However, there is little doubt that, overall, the new code represents a substantial improvement in Wisconsin's substantive law of probate.

Wisconsin Lawyer