A lawsuit brought
by Duke University has brought media attention to charitable pledges and
whether they are enforceable against an estate.
It is common for wealthy people to make pledges to donate
money to charity at some future date. Doing so gives the wealthy person time to
come up with the liquid assets to donate, if necessary, and lets the charity
know when to expect donations.
It also allows donors to keep their assets and profit off
them in the time between when the pledge is made and when it is fulfilled.
However, what happens if the pledge is not fulfilled?
The answer to that question has been in the news recently as
Duke University filed a lawsuit against the estate of Aubrey McClendon and her $10
million unfulfilled pledge.
The Wills, Trusts & Estates Prof Blog looked at
some ways a court might decide to enforce the pledge in "History
of Charitable Pledges."
Basically, courts will first look to see if there is an
enforceable contract, either bilateral or unilateral. Failing that, the court
might try to use a legal doctrine known as “promissory estoppel.” In layman's
language that means something like, "You made a promise and the other
party relied on it. You received some benefit from your promise, so you should
not be able to disavow it."
The bottom line is that the legal system has a public policy
preference of seeing that charitable pledges are fulfilled and will seek legal
ways they can be enforced. If you have questions about a charitable gift trust
in California, please visit our website at www.OCElderLaw.com
and schedule a private consultation with one of our trust attorneys in Orange
County, Corona, Long Beach, Palm Springs or Palm Desert. We have certified
Elder Law Attorneys on staff available to help. Call 800-220-4205 for a
consultation.
Reference: Wills, Trusts & Estates Prof Blog
(Oct. 9, 2016) "History
of Charitable Pledges."
No comments:
Post a Comment