It's The Law
You Might Gift a Job in a Will
I work for a company. The owner says he will guarantee my employment for life by giving me a job through his Last Will and Testament. Can he do that?
It is possible to gift a job through one's Last Will and Testament. The devil is in the details. If the other beneficiaries are not happy with your gifted job, the exact wording will be critical.
In any challenge to the provisions of a Will, the court looks for intent of the testator. The court will look at both wording of a specific clause and how it fits with the rest of the Will. The court does not try to find implied intent from unstated words or silence. It relies on what was actually said.
In addition to determining the testator's intent, the court will also apply public policy and other principles. In one Florida case, the Will directed the personal representative to hire a specific lawyer. In another case, the Will mandated retention of a specific real estate agent. The courts in both cases held the Will could not mandate the personal representative hire a specific lawyer or real estate agent because those persons would be acting in a fiduciary capacity and in a confidential relationship with the personal representative. Those cases have been interpreted to mean a Will cannot force employment where it involves a fiduciary relationship.
Courts in other states have ruled that a Will may direct employment if the employment is in a non-fiduciary relationship. And, some cases weighed in on the issue of contingent employment by a company owned by the testator.
In the Oregon case of In re: Pittock's Will, the testator owned a majority of shares in a company and left them in trust. The Will directed the trustees to elect themselves as directors and requested that two long-term employees be retained. The court held the direction to vote the stock to elect the trustees as directors was valid, but that the direction to employ the two employees was only a request and not mandatory. The court ruling implied that the Will provision was for benefit of the corporation and was therefore subject to the judgment of the trustees.
In the North Carolina case of Howell v. Sykes, the sole shareholder of a corporation left her stock to her nieces, subject to an agreement that the testator had made with one of her employees that the employee receive his same annual salary for life. The corporation and one of the nieces brought suit. The court ruled the testator's gift of stock to the nieces was subject to a lien on the stock guaranteeing the employee his salary for life. The corporation argued the condition meant the officers and directors of the corporation could be violating their fiduciary duty to the corporation. The trial court virtually ignored that argument explaining that it imposed a lien on the stock and not on the corporation. It explained that the condition did not require the corporation to provide lifetime support and benefits to the employee, but only requested that from the nieces inheriting the stock.
The only Florida appellate case involving this issue appears to be the case of Grant v. Bessemer Trust Company, decided on July 3, 2013. In that case, the testator wanted his son to work in an extremely large company owned by the testator. The son had worked for the company for 15 years at the time of the testator's death, but there was some testimony that the testator was concerned with the son's business abilities. The Will included a provision addressing the personal representative's powers with respect to employment which generally empowered the personal representative to act as a stock holder or director and to hire or fire employees of the company specifically including "any person who is beneficiary under this will." Some years later, the testator was diagnosed with a terminal illness and revisited his will. A codicil (amendment) to the will was prepared which read as follows:
Employment provision for (my son). It is my intention that (my son) continue to be employed in a suitable and reasonable position in connection with the operation and management of my … (company). Accordingly, I hereby direct my Personal Representatives to make the necessary arrangements with the Business Trustee to ensure such employment and to ensure that his annual salary shall be …. per year, appropriately adjusted for annual cost of living increases.
The Court ruled that the employment codicil was not a direction for lifetime employment because of the evidence concerning the testator's concern with his son's management ability. It noted that the testator could have prepared an employment contract before he died, for lifetime employment, but did not do so. And, the codicil indicated the testator's intent for his son to be employed in a "suitable position," evidencing it was the testator's desire, not a mandate.
The Grant decision and those from other states indicate it is possible to gift a job through one's will. However, that result is not guaranteed. If your employer is sincere about his intent, and you wish to confirm the result, you should discuss possible options with an experienced attorney. The option of a guaranteed contract with a company would seem preferable to hoping a will provision will be enforced. In any event, the particular facts and circumstances of your case will determine the outcome.
By: William G. Morris, Esquire
William G. Morris is an attorney with offices at 247 North Collier Boulevard on Marco Island, Florida. His practice covers a broad range of subjects, including civil litigation, real estate, business and corporate law, estate planning and probate, domestic relations and contracts. He writes this column periodically with respect to legal matters that frequently affect non-lawyers. The information contained in this column is not intended as legal advice and, of necessity, is generalized. For questions about specific circumstances, the reader should consult a qualified attorney.
Questions for this column can be sent to: William G. Morris, e-mail: firstname.lastname@example.org or by fax, (239) 642-0722 or
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