Attorney Could Testify as to Testator’s Intent on Property Distribution

By Joe Forward, Legal Writer, State Bar of Wisconsin

Sept. 12, 2012 – An attorney who drafted a will was allowed to testify about his client’s property distribution intent after the client died, according to a state appeals court.

Ramona Czaplewski argued that attorney Karl Dovnik’s testimony was inadmissible hearsay under Wisconsin’s dead man’s statute, Wis. Stat. section 885.16, which limits the ability of a witness to testify about communications with a person before the person died.

Dovnik testified that his client, Donald Shepherd (Ramona’s father), intended by will to give one-third of his property to each of his two sons, and divide the remaining one- third equally between Ramona and Ramona’s two daughters (Donald Shepherd’s granddaughters).

However, the will did not specifically reference Donald’s power of appointment to make this distribution, and a Marital Settlement Agreement (MSA) that Donald entered into with his late wife required a surviving spouse’s will to specifically reference the power of appointment.

The MSA determined that Ramona, along with her two brothers, would each receive one-third if a surviving spouse did not specifically exercise a power of appointment. Thus, Ramona argued the MSA controlled, and she (and she alone) was entitled to one-third of the property.

However, the District II Wisconsin Court of Appeals in Czaplewski v. Shepherd, 2011AP2521 (Sept. 12, 2012), ruled that Donald Shepherd’s will controlled the distribution, the attorney could testify, and Wisconsin’s power of appointment statute did not demand a different result.

Power of Appointment and Dead Man’s Statutes

Wis. Stat. section 702.03(1), if a donor requires an instrument to specifically reference a power of appointment, “the donor's intention in requiring the reference is presumed to be to prevent an inadvertent exercise of the power.” Extrinsic evidence may be used to construe intent.

However, the appeals court explained that the presumption “can be overcome if it can be demonstrated that the donee had knowledge of and intended to exercise the power.”

After his wife died in 2005, Donald Shepherd invoked his power of appointment specifically through a will executed in 2007. The 2007 will altered the MSA by giving a one-ninth property interest to each of his granddaughters, Ramona’s two daughters.

In 2010, Donald executed a codicil that changed his personal representative from one son to the other. Less than a month later, Donald executed another will, the 2010 will, which revoked all previous wills and codicils. The 2010 will changed the personal representative back again, but the distribution plan remained the same as the 2007 will.

Unlike the 2007 will, the 2010 will did not make a specific reference to Donald’s power of appointment under the MSA. Dovnik admitted this inadvertent omission, but testified that Donald intended the distribution plan to be the same as the 2007 will.

Ramona argued that without the specific reference to Donald’s power of appointment granted in the MSA, the will was invalid and the MSA controlled. The appeals court disagreed.

“Insofar as Ramona contends that the current statute still requires an express reference to the power of appointment, we disagree,” wrote Judge Lisa Neubauer for a three-judge panel, noting legislative changes in 2008 that focused on giving effect to a testator’s intent.

The extrinsic evidence, the appeals court explained, established that Donald knew of and intended to exercise the power of appointment through the 2010 will.

The appeals court also rejected Ramona’s argument that Dovnik was barred from testifying as to Donald’s intent. It ruled that the circumstances surrounding execution of the will created ambiguity and thus use of extrinsic evidence was appropriate.

“[T]he drafting attorney’s testimony concerning the statements the testator made is admissible as extrinsic evidence of the testator’s intent,” Judge Neubauer wrote.

The state’s dead man’s statute did not bar the testimony as hearsay, the appeals court explained, noting that “Ramona ignores established Wisconsin law recognizing that the testimony of a drafting attorney as to the statements made to him or her by the testator are admissible on the question of intent once such extrinsic evidence becomes admissible.”