San Antonio Area Foundation v. Lang, 35 S.W.3d 636 (Tex. 2000).
Testatrix devised certain real property to Niece and Nephew. The
probate court ruled that assets related to that real property, such as
promissory notes, collections, and net profit interests, were not
encompassed by the term “real property” and thus they passed to the
residuary beneficiary. The probate court refused to admit extrinsic
evidence showing that Testatrix thought of the land, the notes, and the
profits as one “investment package” which she meant to pass by the
devise to Niece and Nephew. The appellate court in Lang v. San Antonio
Area Foundation, 5 S.W.3d 738 (Tex. App.—San Antonio 1999) reversed and
held that the probate court should have considered the extrinsic
evidence because the evidence created a fact issue regarding Testatrix’s
intent.
The Supreme Court of Texas in a unanimous opinion reversed the appellate
court and reinstated the probate court’s judgment in favor of the
residuary beneficiary. The court held that “extrinsic evidence is not
admissible to construe an unambiguous will provision.” San Antonio Area
Foundation at *1. The court recognized that evidence of a testator’s
situation and the surrounding circumstances may be considered but only
if the provision of the will is susceptible to more than one
construction. The term “real property” has a settled legal meaning and
thus the court may not look beyond the terms of the will to find
Testatrix’s intent.
The court also supported its opinion by using the Texas contents
statute, Probate Code § 58(c). A gift of real property does not include
any personal property located on or associated with the real property
unless the will specifically provides for inclusion. Testatrix’s will
did not so provide and thus associated personal property is not included
with the devise of real property.
Moral: Extrinsic evidence may not be used to create an ambiguity if the
language has a settled legal meaning. The term “real property” is one
such term. It is uncertain, however, which other terms the court will
deem to have a settled legal meaning vis-à-vis terms that are
susceptible to more than one construction. Accordingly, a will drafter
must still be careful in selecting will language to make certain the
testator’s intent is carried out.
San Antonio Area Foundation v. Lang, 35 S.W.3d 636 (Tex. 2000).
Testatrix specifically devised certain real property to Niece and
Nephew. After executing the will, Testatrix sold portions of the real
property in exchange for real estate lien notes, promissory notes, cash,
and net-profit agreements. The Supreme Court of Texas determined that
partial ademption occurred and thus Niece and Nephew were not entitled
to trace into the proceeds of the real property. The proceeds passed to
the remainder beneficiary. The court recognized that the doctrine of
ademption may be harsh in some circumstances but that the doctrine is
well-established in Texas law and can easily be avoid by including the
proper language in the will.
Moral: A testator who does not want ademption of a specific gift to
occur must expressly provide otherwise in the will.