Limitations on Charitable Giving
By Richard R. Hammar, J.D., LL.M., CPA
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A few states1 have laws limiting the right of persons to leave property to religious organizations by a will or deed executed within a specified period prior to death. The purpose of such laws is to prevent “deathbed” gifts to religious organizations by persons who might be unduly influenced by religious considerations. More generally, such laws are intended to protect a donor's family from disinheritance due to charitable gifts made either without proper deliberation or as a result of “undue influence.” Several states have had such laws in the past. They often are referred to as “mortmain” laws. Most of these laws either have been rescinded by state legislatures, or invalidated by the courts.
In a leading case, the Florida Supreme Court struck down a state law that permitted certain heirs to challenge gifts made to churches and other charities in a will executed within six months of a person's death.2 Prior to this ruling, Florida law permitted a spouse or “lineal descendent” to challenge a will of a decedent who died within 6 months after executing a will leaving all or part of his or her estate to a religious or charitable organization. An elderly Florida resident executed a will leaving most of her estate to a charity. The woman's will left only a token gift to her sole surviving daughter since the daughter “has not shown or indicated the slightest affection or gratitude to me” and since “I have contributed substantially during my life for her education and subsequent monies I have been required to expend primarily due to her promiscuous type of life.” The woman died two months later, survived only by her daughter. The daughter immediately challenged her mother's will on the basis of the state law permitting lineal descendants to challenge charitable gifts made in their parents' wills if executed within six months of death. The charity opposed the daughter's action on the ground that the state law violated the constitutional guaranty of the “equal protection of the laws.” A trial court agreed with the charity, but a state appeals court agreed with the daughter. The case was appealed to the state supreme court, which ruled that the state law was unconstitutional. The court began its opinion by observing that statutes restricting charitable gifts originated in feudal England “as part of the struggle for power and wealth between the king and the organized church.” As feudalism declined, the justification for these laws became the protection of surviving family members against disinheritance caused by the undue influence of religious organizations. In rejecting this rationale, the court observed that “it is unreasonable to presume, as the statute seems to do, that all lineal descendants are dependents, in need, or are not otherwise provided for.” The court emphasized that state law has ample protections against undue influence and fraud that can be used by disinherited family members without the need for a specific statute. Further, the court observed that “the charitable gift restriction fails to protect against windfalls by lineal descendants who have had no contact with the decedent but who may benefit from the avoidance of a charitable gift.” Since the statute was not “reasonably necessary to accomplish the asserted state goals,” it violated the state constitution. Further, the statute violated the federal and state constitutional protections of the “equal protection of the laws,” since it treated gifts made to charitable and religious organizations within six months of death less favorably than other gifts without any rational justification. The fact that a gift is made within six months of death is not in itself sufficient proof of undue influence, noted the court, since most gifts made within six months of death are not the product of undue influence and some gifts made more than six months prior to death are. Accordingly, the six--month rule was arbitrary and treated charities less favorably than other citizens or organizations without adequate justification. One dissenting justice cautioned that the law might still serve a valuable purpose in appropriate cases: “Surely one would have to say that, had the [decedent] succumbed to a television evangelist's call to be with the Lord by delivering her property to his church and thus leave unprotected a physically handicapped child, a rationale basis for the statute would exist.” In conclusion, note that the court observed that there are only three other states that have laws invalidating charitable gifts made within a specified time prior to death—Georgia, Idaho, and Mississippi.
In another significant decision, the Supreme Court of Pennsylvania struck down a state law invalidating any testamentary gift for religious or charitable purposes included in a will executed within 30 days of the death of the donor.1 The court reasoned that the fourteenth amendment to the United States Constitution, which prohibits states from denying to any persons the “equal protection of the laws,” requires that statutory classifications must be “reasonable, not arbitrary, and must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, so that all persons similarly circumstanced shall be treated alike.”2 The Pennsylvania statute, concluded the court, divided donors into two classes, one class being composed of donors whose wills provided for charitable gifts and who died within 30 days of executing their wills, and the other of donors who either made no charitable gifts in their wills or who survived the execution of their wills by at least 30 days. Gifts made by a donor in the first class were nullified by the statute, while gifts made by donors in the second class were permitted.
Such a classification, concluded the court, violated the fourteenth amendment's equal protection clause and therefore was impermissible:
Clearly, the statutory classification bears only the most tenuous relation to the legislative purpose. The statute strikes down the charitable gifts of one in the best of health at the time of the execution of his will and regardless of age if he chances to die in an accident 29 days later. On the other hand, it leaves untouched the charitable bequests of another, aged and suffering from a terminal disease, who survives the execution of his will by 31 days. Such a combination of results can only be characterized as arbitrary.3
The court also observed that although the legislative purpose was to protect a donor's immediate family, the statute sought to nullify testamentary gifts to charity even where the donor left no immediate family. Protection of distant relatives with whom a donor may have had little if any contact during his life was not consistent with the statute's purpose, the court concluded.
Other courts have reached similar results. A District of Columbia statute invalidating any gift to a clergyman or religious organization made in a will executed less than 30 days prior to a donor's death was struck down on the ground that it arbitrarily discriminated against clergymen and religious organizations. A court emphasized that the law did not invalidate gifts to nonreligious charitable organizations that were in an equal position with religious organizations to influence a donor.4
One judge has observed that laws limiting the right of religious organizations to receive testamentary gifts are invalid if they are based on a desire to prevent clergy from influencing the dying by holding out “hopes of salvation or avoidance of damnation” in return for generous gifts to further the practice of religion. Such an objective “is precisely what the `free exercise' of religion clause of the first amendment forbids, for it is premised upon the assumption that such representations are false and hence Congress can enact safeguards against their effect.”5 Another court held that a state's adoption of the Uniform Probate Code by implication repealed a law limiting testamentary gifts to charity.6
It seems likely that statutory limitations on the right of charitable organizations to receive testamentary gifts will be viewed with disfavor by courts and legislatures alike. The repeal of such statutes has the salutary effect of abolishing the irrebuttable presumption that certain gifts to charity are the product of undue influence, and of compelling disinherited heirs to prove undue influence in order to invalidate testamentary gifts to charity.
For related information on this topic see the following articles:Regulation of Charitable Solicitations
Federal and State Securities Laws
Judicial Resolution of Church Disputes
The Civil Rights Restoration Act of 1987
Americans with Disabilities Act
Political Activities by Churches and Other Religious Organizations