MUTUAL WILLS

Mutual wills (called a joint will where only one document is used) are not irrevocable, but they may give rise to a constructive trust which is irrevocable. The term mutual wills refers to wills that dispose of property belonging to two persons (usually husband and wife), who may have agreed to pool their property and to provide, by their wills, for its disposition according to an agreed scheme. By one typical arrangement, a reciprocal benefit (usually a life interest) is conferred on the survivor, and, after the death of the survivor, the mutual property is distributed to other persons as the parties have agreed. Persons who make mutual wills may agree not to alter or revoke them without the other's consent, and it is out of this agreement not to revoke that a constructive trust may arise. Such an agreement, however, cannot deprive an individual testator of the right to revoke his or her will. The agreement not to revoke may be incorporated in the will by recital or otherwise, or may be established outside of the will. The agreement not to revoke is to be taken to refer not only to intentional revocation but also to automatic revocation by marriage. Any resulting trust is imposed either on the survivor as trustee, or on his or her personal representatives. In either case, and to the extent possible, the court will direct that the property be distributed in equity according to the agreement although the survivor may have altered his or her will.

There are at least two conditions for the enforcement of a mutual wills agreements:

(a)  the mutual agreement itself not to revoke individual wills; and

(b)  the first deceased must have died without having revoked or changed his or her will.

There is some doubt about the existence of a third requirement, namely, that the survivor has to be unjustly enriched by his or her breaching the agreement subsequent to the death of the first deceased.

An agreement not to revoke is not to be inferred from the mere fact of making mutual wills, nor from the fact that mutual benefits are conferred by the dispositions. The agreement not to revoke can be inferred from the terms of the mutual wills, but all the circumstances surrounding their making may provide satisfactory evidence that the wills were executed in pursuance of an enforceable agreement. In the absence of an express provision to the contrary, the agreement not to revoke, and the accompanying will, will not be interpreted to include after-acquired property, but only to include property owned by the parties at the time the mutual wills were made.

With regard to the property forming part of the estate of the party who dies first, where such property is given to the survivor absolutely, the survivor may be free to deal with it as he or she pleases during his or her lifetime and defeat any agreement for a gift over to a third party. In such a case, the trust is not imposed on the survivor, so as to prevent him or her from disposing of the property during his or her life time, but rather on his or her personal representatives on his or her death with regard to property remaining from the mutual agreement.