John Carter

John Carter is Disney’s adaptation of Edgar Rice Burroughs’ Barsoom works, drawing mostly from the first book, A Princess of Mars. Actually, it’s really Andrew Stanton’s adaptation, he of WALL-E fame, because it doesn’t seem like Disney had any actual input, into the film or its marketing. The result is… problematic. But lo and behold, they’ve got a lawyer character who winds up touching on a bit of estate law. So we’ll take a look at that. Some pretty significant spoilers follow.

I. The Operation of the Will

As reviews indicate, which exactly is the framing story and which is the actual narrative are… confusing, if not downright confused. We start on Mars at some point in the indefinite but presumably recent past, go to 1881, then to 1868, and… look, it’s a hot mess. The basic gist seems to be that Edgar Burroughs has been summoned to his uncle’s estate, only to find that his uncle has expired just before his arrival. This is something of a nod to the framing stories in the Barsoom books, which are generally presented as Burroughs relating the stories of his uncle, John Carter. In the film, Burroughs is greeted by his uncle’s attorney, who almost immediately reads Burroughs his uncle’s will.

John Carter has put his apparently substantial fortune in trust for Burroughs, either for twenty-five years or until such time as Burroughs should reach twenty-five years of age (the author forgets precisely which), and the interest is to be used for Burrough’s benefit. At the end of that period, whichever it is, the principal “reverts” to Burroughs in fee simple.

Trusts are a real thing, namely the transfer of property from one party to another for the benefit of a third.* The person creating the trust and contributing the property is known as the “settlor,” the person to whom the property is entrusted is known as the “trustee,” and the person on whose behalf the property is being held is known as the “beneficiary.” What we’ve got here is the species of trust known as a “testamentary trust,” i.e., a trust created by a will. Trusts may also be created by a written instrument which is not a will, in the case of inter vivos trusts, or by oral declaration. A court may also create a trust. This sometimes happens, for example, in divorce cases where the judge wants to make sure the kids are taken care of, or where the plaintiff in a personal injury case is a minor and the judge doesn’t trust the parents.

*Mostly anyway. It’s now possible to create a trust without the use of a trustee, i.e., a person can declare that their property is now being held in trust for a beneficiary

Regardless, Carter’s trust is, broadly speaking, okay. So John Carter seems to have settled a trust upon Burroughs, the beneficiary, presumably with the lawyer acting as trustee, as part of his will. One quibble though. The attorney says that the principle of the trust will “revert” to Burroughs at the end of the trust period. This is not precisely what happens, as “reversion“, as such, only happens when property returns to a grantor. If the principal truly “reverted,” it would go to Carter, not Burroughs. No, this would more properly be “distribution”.

But the basic idea is sound.

II. Complications

Except for the fact that this is, in reality, an inter vivos trust, because (spoiler!) Carter isn’t actually dead. He fakes his death to draw out a Thern to steal an amulet to get back to Barsoom. Look, it makes sense in context. Sort of. More or less. In any case, Carter is pronounced dead but was really only sleeping, having apparently ingested pufferfish venom. It’s entirely unclear that pufferfish venom actually does that, but whatever. Carter comes back, kills his Thern, and goes into his tomb where his body can be safe while he is projected to Mars. Because apparently that’s how that works. The long and short of it is that Carter isn’t dead.

In one sense, this matters a great deal, because wills have utterly no legal effect until the testator, i.e., the person making the will, dies. Carter, being alive, thus can’t create a trust for Burroughs by the operation of his will. He can, however, do so with an inter vivos trust, so it’s not like faking his death was strictly necessary. Convenient, perhaps, and effective at drawing out the Thern, but the law wouldn’t actually have any problem with him just setting up the trust and disappearing. He’d be declared legally dead in seven-odd years anyway.

But the fact that Carter has faked his death puts Burroughs in something of a weird position. If it is ever discovered that Carter is still alive, the trust has the potential to dissolve, with the principal reverting to Carter. But Carter doesn’t seem the kind to use his nephew so badly (i.e. we assume he would then set up a proper inter vivos trust), and no one else would seem to have standing to complain.

Even if Carter leaves Burroughs in the lurch then Burroughs wouldn’t necessarily have a cause of action unless the promise of the trust foreseeably induced him to reasonably rely on the trust’s existence to his detriment (e.g. if he took out a loan depending on income from the trust to repay it) and enforcement of the trust is necessary to avoid injustice.  This is called promissory estoppel, and it can be used to enforce an otherwise unenforceable promise (e.g. a promise to give a gift).  See, e.g, Williams v. Eason, 49 A.D.3d 866, 868 (2008) (“The elements of a cause of action based upon promissory estoppel are a clear and unambiguous promise, reasonable and foreseeable reliance by the party to whom the promise is made, and an injury sustained in reliance on that promise.”).  A court could enforce the promise by creating a constructive trust.  Carter would be the trustee, holding the property for Burroughs’s benefit until the trust terminates.

If we take things one step further, from foreseeable reliance to intentional reliance, then Burroughs could even have an action against Carter for fraud.  But there’s no indication that Carter intended for Burroughs to be harmed by the scheme.

If Carter returns to public life after the trust terminates and Burroughs owns the property outright, then it could be very difficult for him to get the property back, even if he could avoid the promissory estoppel argument.

So this entire gambit, while sketchy in the extreme, isn’t necessarily illegal. No harm, no foul.

III. Conclusion

The movie is worth seeing, if for no other reason that it has Detective McNulty and Walter White in it. Neither gets much in the way of screen time, but hey, there they are. And though the writers flubbed a legal term, the situation they set up does seem to work, whether or not the fraud is discovered.

14 Responses to John Carter

  1. I don’t see how Burroughs has much risk here. A doctor declared Carter to be dead, so there was no reason for the lawyers to question the will. Burroughs is the only person who knows Carter is still alive, and Carter’s body is locked unconscious in a tomb that is unlikely to ever be opened, so probably noone else will ever know. Carter obviously intended for Burroughs to have the money, and has no obvious intention to ever return to Earth, so Burroughs really has no moral obligation to not accept the money. The will stipulated that the money be held in trust for 25 years before the total sum is distributed to Burroughs – so Carter has plenty of time to return and take the money back if he wants, and if he doesn’t, that’s pretty good evidence that he isn’t going to. By then, he would have long since been declared legally dead even if a doctor had not already done so.
    So, as far as everyone (except Burroughs) knows, everything about this will is legit. At worst, Burroughs could consider the trust to be his payment for helping Carter get the amulet (which, in fact, it is).

  2. I’m not so sure the writers of the film made a mistake in their use of the words “reverts” or “reversion.” I have not seen the film, but from your post, I gather that John Carter is dead (or presumed dead). So a reversion back to Carter is a reversion to the estate. If Carter’s estate passes to Burroughs (and from your post, it appears Burroughs is the sole heir of the will), then it would be correct to say that the money does “revert” to Burroughs; he simply takes it as heir instead of taking it as beneficiary of the trust. I’m sure there are tax implications to that, and perhaps they would convince an estate lawyer that the reversion is “wrong,” but I don’t think the term was necessarily misused. But if I’ve misunderstood either the law or the movie I am happy to be corrected.

    • Reversion is the correct term in some property law contexts. For example, if the will had simply given the property to Burroughs outright “for life,” then that would be a life estate for Burroughs followed by a reversion back to Carter’s estate.

      But this was in the context of a trust, and in a trust assets are distributed. This includes a final distribution made when the trust is terminated.

      It’s weird and arbitrary, I know, but the law loves to make up new terms for what appear to be almost identical concepts.

  3. If Carter is completely incapacitated and incapable of directing his own affairs, who controls his assets? Wouldn’t it be Burroughs (as fiduciary), as closest of kin? (provided he accepts, of course, and no creditor objects (and your narrative discloses no creditors, save possibly the trustee).)

  4. I’m wondering about preventing a promissory estoppel claim. I’m thinking of 2 approaches and wondering if they would work:

    1) Simply banning activities that would allow for the claim: “The beneficiary shall not engage in any agreement depending upon the future disbursement of the trust. Should that rule be broken, the trust immediately reverses to the estate of John Carter” or something like that. So that way, if Burroughs tries to claim promisory estoppel, he has to admit breaking the rules of the trust and immediately loses it.

    2) A probabilistic disbursement. Something along the line of: “Every year past the beneficiary’s 25th birthday, the trustee shall flip a coin. If it comes as heads, the disbursement happens, otherwise, we try again next year” So you can say: “Look, he probably would have gotten the trust eventually, but there was still a chance that he would not. So he could not really have relied upon getting the trust.”

    • An interesting set of suggestions, but problematic. Two things:

      First of all, the first suggestion is probably not going to work because it frustrates the purpose of the trust. One of the things Burroughs is probably going to have to do is make promises against the trust principal to carry out his obligations under the terms of the trust. Carving out an allowance for that without giving away the fact that Carter is still alive is going to be very difficult. Burroughs is, after all, going to have to provide for the general maintenance of the estate and his occupancy therein if he wants to protect Carter’s crypt. Drawing a hard-and-fast legal rule between that and Burroughs just using the money for his own purposes is going to be very, very difficult, and a court that didn’t know the real purpose of the trust might well disregard such a requirement. Of course, a court that did know the real purpose of the trust was probably going to be annoyed anyway. So that’s a problem.

      But both are probably void for violating the Rule Against Perpetuities, which provides that a future interest in property must vest within twenty-one years of the end of a life currently extant. The trust as set up in the movie works, because there’s a definite point in which it vests, even if it’s a ways out there. It definitely goes to Burroughs, or to his heirs if Burroughs dies.

      But the first suggestion is problematic because there’s this reversionary interest tacked on which might “trigger” after Burroughs dies. A court might take a look at that and say “Look, we’re going to let you set this thing up so that it distributes a ways down the road, but we’re not going to let you put any kind of reversionary interest on it that goes that far out.”

      The second suggestion is even more problematic, because the interest has no specific date at which it will vest! It might not ever do so. Of course, the odds are good that it’ll vest within a year or three after the trust period ends, but there’s no guarantee of that. The RAP was created to promote certainty in property transactions as much as anything else, and neither a court faced with the provision nor the Recorder’s Office is not going to like what introducing a coin flip is going to do to the title.

    • OK, this is interesting. First, on my first crazy idea. What if you make the trustee responsible for taking care of the estate? That way, the beneficiary doesn’t have to do anything. All they do is wait. I could actually see some good reasons for doing this. Let’s say you have a 20-year old kid and you are afraid that if you leave them $1 million, they’re going to do a very poor job of managing it and probably lose it all by age 20 + 3 days. But you expect that by age 30 they will become responsible enough to handle that money. So you put it in a trust with a disbursement on their 30th birthday. But if they can borrow $900,000 against the disbursement, that defeats the point. I assume somebody has come up with a solution for that problem and that we could use the same solution (or a variation) here.

      On the coin flip, let’s imagine that instead we put a limitation. After 20 years, if the coin has still not come up heads, (1/1,048,576) the trust is all donated to the Treasury department. Does that work?

      • Ken Arromdee

        If they can borrow $900000 against the disbursement, that means that the lender thinks they probably will *not* lose it all by age 20 + 3 days. If the lender is right, then the market has just corrected your bad decision. And lenders who are wrong in such matters go out of business fairly quickly.

      • You are wrong. If they borrow $900,000 against the future disbursement and use it to buy 3 custom Ferraris (I think that’s the going price) and throws them off a cliff, the disbursement will still be there to be collected by the bank 10 years from now. The bank took very little risk. I on the other hand as the father might actually want to give $1 million for the purposes of ensuring my son enjoys economic security and not to feed his Ferrari crashing fantasies.

  5. Suppose the trust were written with a reversionary clause that provided that, in case of resurrection of the settlor, settlor could reclaim the principal assets? Obviously, a court would ignore such an interest after the trust matured and control of the body of the trust were transferred to the beneficiary, but, assuming neither the trustee nor the beneficiary objected to the clause and accepted the trust as is*. Would such a clause in a trust be politely ignored but permitted to remain in effect, even though nobody involved believes it possible to ever have effect (except the settlor, obviously) or would it be stricken immediately and never permitted to have effect? Or would it depend on the tolerance for whimsy of the particular court reading the document? Or do we just not know, such a clause never having been contested?

    * I can see this coming about in an inter vivos trust like this: The settlor inserts what appears to be a ridiculous item into the documents creating the trust. The trustee goes along with it, because they want the business of managing the trust assets. The beneficiary goes along with it, afraid that if they make any noise about the creation of the trust, an alternate beneficiary will be selected. Thus, nobody’s unhappy at the time of the creation of the trust… the unhappiness surfaces when the resurrected/returned from the unknown regions settlor returns and attempts to dissolve the trust and recover the assets…

    • Melanie Koleini

      In real life, a few people have contracted to have themselves frozen after death, with the idea that they will be brought back to life at some future date (cryogenics). I can see a person in this situation trying to add a ‘resurrection of the settlor’ clause into a trust.

      • James Pollock

        Yeah, this is a different set of problems, though, with, I think, a simple solution. An attempt to create an open-ended trust that holds assets for the eventual return to the settlor upon return to life will be challenged successfully by the heirs in short order. Note that the trust described above has a sunset date, at which the corpus goes to Burroughs… I was suggesting that in this type of trust, a “resurrection” clause might be effective because the assets hadn’t yet been transferred ot the beneficiary but there is a definite end date to the trust.

        So, how to get around this? Make a large payment to the cryogenic facilty against future costs of preservation, with a contractual provision that, in the event of a successful resuscitation, those prepaid fees will be refunded in full. This is NOT an indefinite trust, as if there is no resuscitation, those fees will be earned by the service provider. It’s not certain that a provision structured like this will prevail, as there are lots of ways to challenge it, but it won’t fail automatically because of being an indefinite trust.

  6. TimothyAWiseman

    As usual an excellent post. But there is one thing that is probably worth some expansion regarding promissory estoppels. When estoppels is used the recovery can sometimes be limited.

    For instance, if a grandfather says “When you turn twenty one, I will give you a million dollars.” The Grandson might gratefully say he will use that money to finance his college. If the grandson goes off to college, takes on student loans expecting to be able to pay them with his grandfather’s gift, he has acted in reliance on the promise. If the grandfather then reneges, the grandson would likely have a good cause of action. But the judge may equitably declare the damages to be only the student loans taken in reliance of the promise and award only enough to repay those rather than the full million.

    • “But the judge may equitably declare the damages to be only the student loans taken in reliance of the promise and award only enough to repay those rather than the full million.”

      Read that as “the judge WILL declare damages to be less than one million; the question is how much less. The plaintiff is only entitled to reliance damages, not the amount promised. and the judge may reduce THOSE equitably. In the case of student loans, this would be likely, under the theory that grandson might have gone to college anyway even without the promise. AND, if the reliance wasn’t reasonable (say, if grandson knew that grandfather didn’t actually have a spare million sitting around) then the recovery would be zero.

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