Samuel Goldwyn once said, “An oral contract is as good as the paper it’s written on.” But is this always the case? The truth is a legal document can be binding and effective even if it isn’t perfectly drafted and neatly printed up on expensive paper.
Would you believe a will can be valid if it’s handwritten on a big piece of wood? That’s what happened with the Last Will and Testament of Marilyn S. Rhodeback, of Johnstown, New Jersey. Ms. Rhodeback passed away earlier this year and her will, which was handwritten on a 14” by 14” piece of wood, was accepted as valid by the county probate court. Despite being presented in a highly original form, the will was in Ms. Rhodeback’s handwriting, and it met New Jersey’s requirements for a holographic will.
A holographic will is one that is fully handwritten by the testator. Not all jurisdictions accept holographic wills as valid, but of those that do, most require that:
- The will be signed by the testator
- There is proof that the testator actually wrote the will
- There is proof that the testator was mentally competent to write the will (and not under duress)
- And that will actually contain instructions distributing the testator’s property to his or her heirs
So, we know that holographic wills might be okay in some states, but what about Mr. Goldwyn’s statement about contracts? As long as all the elements are there, a contract can be written on a napkin or a scrap of paper – and, as long the subject matter is does not come under the requirements of the Statute of Frauds (such as real estate), a contract doesn’t have to be written at all.
In Texaco v. Pennzoil, Pennzoil bought Getty Oil in a handshake deal. Later, Texaco made a better offer and the company was sold to Texaco instead. Pennzoil filed suit on the theory of tortuous interference with contract. The Pennzoil – Getty oral contract was held to be valid, and Pennzoil won billions of dollars in damages.
While legal documents don’t necessarily have to be perfectly drawn up, signed, and labeled, it’s always best to remove doubt by doing things the “right” way. When it comes to preparing an estate plan, this means making a traditional will or trust, with the appropriate statutory requirements. It’s often best to notarize the document, even though that may not be required by the statute. A prudent estate planning attorney may even go beyond the statutory minimum requirements.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
6050 Santo Rd., Ste. 240
San Diego, CA 92124
(800) 846-1555
www.aaepa.com
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