Posts Tagged ‘Wills’

Handling Your Own Legal Work — Without a Lawyer

OCTOBER 12, 2015 VOLUME 22 NUMBER 37

Last week we wrote about when you might reasonably represent yourself — that is, when you might not need a lawyer for your legal work. We suggested that what lawyers do is not precisely brain surgery, and that reasonably intelligent, informed and diligent non-lawyers might well be able to handle a number of legal tasks on their own. But which tasks, particularly?

You know you’re not going to get a lawyer to answer that question without a number of disclaimers and qualifications. Let’s be clear about what we have to say here: this advice will not apply to every individual, or in every state, or in circumstances that seem similar to what we describe. Treat this advice like the dangerous information it is: we’re not giving you blanket permission to represent yourself in a range of legal issues, and if things go wrong we don’t want you complaining that we told you it would be fine. We mean no such thing.

The default choice you should make in every legal issue is to talk to one of the people who know legal matters best. There is a name for those people: they are called lawyers.

Are you worried about cost? Start the conversation with the lawyer you consult by insisting on knowing how charges will be calculated and how you can stop the cost if it begins to overwhelm. Are you worried about getting information you don’t want to hear? Then you really, really need to talk with a lawyer. Are you worried about people finding out just how much trouble you’re in? Your conversations with the lawyer are almost always completely privileged — no one is going to hear about the fact that you consulted the lawyer, much less what you talked about.

All that said, we know how people are. You want to do it yourself. You want to save money. You want to figure it out, just like you did when you built your house without a contractor, or fixed your car without a mechanic. OK — are there some legal tasks that are safer for you to tackle than others? Yes, there are.

Wills

Can you write your own will? Yes. There are lots of forms out there, and you can use software to do much of the work. As between those two choices, by the way, we prefer software; it will take you down a branching decision tree, and will reduce the likelihood that you will make a mistake. But not eliminate it.

We are fond of recalling the client who brought us his father’s will. Dad had found a form for a will for a single person, and had just scribbled out the provisions about being single and written in mom’s name. Then he had adjusted the other provisions for the fact of mom being in his life. Problem was, the whole thing no longer made sense. Property did not pass the way dad almost certainly intended. Yes, he saved a couple bucks on legal fees — but the cost to his family was much, much higher.

That story being told, the reality is that most people will do just fine if they write their own wills. The key word in that sentence is “most” — some will foul up their estates, and fantastically (and expensively). That won’t be you, though — right?

By the way, if you use software or a form you are giving up on the opportunity to have a conversation with someone who knows what they are doing. Maybe you don’t need to make provisions for your home, if you take advantage of Arizona’s “beneficiary deed” provision. Or maybe that isn’t the right choice for you. Will the computer chat with you about that, or about your wishes for end-of-life care, or — stuff you can’t even think of?

Trusts

Just talk with a lawyer, please. The forms and books you read will oversell trusts, and the number of steps you need to take will complicate things beyond most people’s ability to figure it out on their own.

If you insist on preparing a trust without a lawyer, once again we prefer software to books and forms. But don’t think you can prepare the trust using software and save a couple bucks by taking the completed form to the lawyer to review — it takes us just a little bit longer to review your document than it does to interview you, figure out what you need, and then prepare the right document in a format we’re familiar with. In other words, it actually costs more.

Probate

Can you handle the probate of your mother’s estate without a lawyer? Probably. Do you and your sister get along well? Is your mother’s estate all in Arizona? Is the will clearly valid (or are the heirs easy to figure out)? If so, the probate may not be that complicated.

Don’t expect to just drop by the courthouse and talk with the judge, or the probate clerk. You can talk with someone in the clerk’s office, but they won’t give you forms or any legal advice. They will tell you to go to the local bar office (or someplace similar) to pick up the forms (you’ll likely pay a few dollars for that) and fill them out.

The process won’t be any faster without a lawyer — in fact, it’ll probably take longer. It will be frustrating and you’ll feel like you’re having to do things that you shouldn’t have to do. But you’ll likely get through it just fine.

Planning on fighting with your brother, or your stepfather? Talk to a lawyer before filing a single thing.

Guardianship

The share of guardianships filed without a lawyer increases every year. That’s mostly OK — the process is complicated, but at least there are a couple of lawyers involved in most guardianship proceedings even if you don’t hire one. The judge, for one, is a lawyer. The subject of the guardianship will have a lawyer appointed to represent them. You’ll get feedback from those lawyers, and from the clerks and others in the system, that will keep you from going horribly wrong. Probably.

One piece of advice: if the court clerk stops, look at you quizzically and suggests you might want to talk with a lawyer — go talk with a lawyer. That is a clear indication that something about your case is out of the ordinary. While the court staff can’t give you legal advice, they are pretty good at body language.

Guardianships of minor children are even easier for most people to take care of on their own. In fact, lawyers are involved (in Arizona — very different answers might apply in other jurisdictions) in a minority of minor guardianship proceedings. But if things get peculiar, or you get anxious about whether you’ve done things right, talk with a lawyer. You might not need to turn the guardianship petition over to them, but make sure you’re in the clear.

Conservatorships

When handling someone else’s money is involved, you need legal advice. We’ve watched people actually go to jail for things that they thought were just fine — the court’s view of the conservatorship is much more restrictive than the view of many family members. Don’t risk it.

Remember that a conservatorship necessarily means that there is money to manage, and that your legal fees can likely be paid from that money. It’s just a good investment.

[Did we mention that we only mean this to apply in Arizona? Let us repeat that — and observe that even the words “guardianship” and “conservatorship” can mean something else in other states.]

We hope this helps. We really do favor people handling their own affairs when they can, and most lawyers agree: we will help you figure out whether you can do this yourself.

When You Need to Talk With a Lawyer

OCTOBER 5, 2015 VOLUME 22 NUMBER 36

So often we field questions (on this website and in our practice) about whether people need to consult a lawyer. Unsurprisingly, perhaps, there is a terrific resistance to seeking legal advice. We lawyers don’t always help — our fees can be substantial, and unpredictable. We speak a language that sounds vaguely familiar but seems foreign to most people, and we often fail to translate — or even to recognize that our clients may not speak that language.

Too often lawyers treat the question dismissively. “Would you perform brain surgery on yourself?” we often ask. “Then why would you try to handle your own legal matter?”

That’s an unfair characterization. Legal help is seldom much like brain surgery. There are, of course, two big differences: brain surgery pretty much requires a patient who has been anesthetized, and it involves technical skills that are also unknown to most people, but also highly dangerous.

You can, in fact, handle most of your legal issues yourself. You are likely to do fairly well if you do, provided that you do plenty of research and have a basic understanding of the law before you start.

We don’t think most people should try to take care of their own legal matters, of course, and we’re not advocating it here. We just don’t want to terrorize you into hiring us. Instead, we want to convince you that legal representation is an expense worth incurring.

A better comparison might be with auto mechanics, or even plumbers. Can you change your own oil, or fix a leaky faucet? Of course you can. You will likely do just fine with either task. Similarly, you can probably find a health care power of attorney form online, fill it out and get it signed and witnessed. But there are some tasks — with your auto, with your plumbing, and with your legal affairs — better left to professionals.

So when do you need a lawyer? Of course it depends on your comfort level and time availability. I know how to change my car’s oil (it’s actually an electric car, but that’s a different story) but I choose not to do it. Why? Because I’d rather have it done professionally, and spend the extra time with my grandchildren, or finishing up the work I get paid for, or just raise a glass of wine instead. You might feel the same way about legal jobs — or you might not.

Before we leave the metaphor, let us make another observation: sometimes people who undertake their own auto maintenance (or plumbing, or legal work) mess it up. When that happens, the cost of fixing the problem may be well in excess of what it would have cost to turn the problem over to the professionals in the first place.

Some people take great pleasure in mastering disparate tasks for themselves. Others prefer to delegate when it makes good sense. When does it make sense in the legal world?

Complicated legal issues

Some things are harder to handle on your own, of course. You can figure out how to create a health care power of attorney, but are you as comfortable about your ability to create a living trust? Are you even sure you know whether you need a trust? How about funding of the trust? These issues are more complex than most simple documents.

High stakes

Your estate might be modest. Perhaps you own your house and a single bank account. Do you plan on leaving everything to your spouse, or to your only child? It’s hard to see how you will go very wrong by preparing your own will (though of course we have seen people who manage to do that). But if your estate is larger, or your family situation more complicated, you might benefit from getting legal advice.

Unusual legal problems

Do you need a guardianship or conservatorship for a family member who has become incapacitated? That’s a little out of the ordinary, and you will have a harder time finding help online or among your non-lawyer friends. Talk with a lawyer. Incidentally, the first thing the lawyer will probably do will be to explore alternatives to save you expense and legal complications. But that’s a point to be made later.

Why not hire a lawyer?

Most people are concerned about the likely cost of legal advice. Start your interview with a new lawyer by discussing fees. Will fees be flat or fixed? Or will they be hourly? If the latter, you have a harder time predicting the total fees (though they may ultimately be lower than flat fees). Ask the lawyer to honestly assess the likely total cost. Explore the possibility of setting a maximum fee, or terminating the representation if costs begin to escalate.

Interview more than one lawyer, but do it quickly. Make your first lawyer appointment and then immediately schedule a second (and maybe a third). Figure out which lawyer seems most responsive to your concerns, and most able to handle your legal problem. Ask friends and colleagues for their suggestions and for any experience they might have with your chosen lawyers.

Are you comfortable?

You might be talking with the best, the smartest, the most reasonably-priced lawyer in town. But if you don’t feel comfortable, the experience is not going to be positive. You should insist on getting calming assistance, and peace of mind — that’s a lawyer’s stock in trade.

[Next week: we’ll tackle which kinds of legal problems we most often see people foolishly trying to handle on their own.]

The “Spendthrift” Trust Explained

JULY 27, 2015 VOLUME 22 NUMBER 27

Lawyers love to name and categorize everything they deal with. It’s a useful way to group similar concepts, but it can lead to confusion and misunderstanding. That’s particularly true when a legal concept is non-exclusive — in other words, when one instrument can go by a number of different names. Let’s see if we can address one good example: the “spendthrift” trust.

You might reasonably ask: “is my trust a spendthrift trust?” It likely does not have the term in its name (no one wants to be a beneficiary of the “John Jones Spendthrift Trust” — not even John Jones). How will you know? Because it will have a paragraph somewhere in the trust that says something like this:

“Trustee shall not recognize any transfer, mortgage, pledge, hypothecation, assignment or order of a beneficiary which anticipates the payment of any part of the income or principal. The income and principal of the trust estate shall not be subject to attachment, garnishment, creditor’s bill or execution to satisfy any debt, obligation or tort of any beneficiary, nor shall any part of the trust estate pass to a trustee or receiver in any bankruptcy or insolvency proceeding initiated by or against any beneficiary.”

It might not read exactly like that (the sample is taken from one of our documents at Fleming & Curti, PLC, and lawyers tend to love tinkering with language like this). It might be identified as “Spendthrift Provision” — or it might not. In Arizona, just calling the trust a “spendthrift trust” is probably sufficient (though we’d never recommend relying solely on the designation).

The point is that the trust’s beneficiary can not sell or transfer their right to receive future distributions from the trust. If there is a provision with similar language, the trust might reasonably be called a “spendthrift” trust. That, in turn, raises other questions:

Does the beneficiary have to be a spendthrift for such a provision to be useful? No. Plenty of very reasonable people, conservative in their financial arrangements and thoughtful about expenditures, get in financial trouble. Or they might be involved in a lawsuit. Or a messy divorce. The spendthrift provision is helpful to keep the beneficiary’s interest in the trust away from those creditors, current or future.

Can I put a spendthrift provision in my own trust? Yes, and we routinely do. But it likely won’t be effective to protect your own assets from your own creditors. The general legal principle is that you can’t shelter your assets from current or future creditors, though there are some exceptions to that rule. This is also one topic on which state laws vary considerably. Ask your lawyer if you are eager to seek protection for your own assets.

Does the spendthrift provision require that someone else be trustee? Wouldn’t it be great if you could set up a trust for your daughter, make her the trustee, and include a spendthrift provision to protect against her creditors? That way she could have complete control of the funds, make decisions about when to distribute money to herself, and still keep her inheritance secure. Turns out you can do just that — at least in most circumstances and in most states.

To keep the protection from slipping away, most of the time lawyers suggest that someone else be trustee of your daughter’s inheritance. It’s not uncommon, though, for your son to be trust of her trust, and for her to be trustee of his trust. That way they can continue to communicate and work with one another, they can help protect one another, and the decisions can stay within the family. Of course, everyone’s situation — assets, family dynamics, family structure — is different, so talk with your estate planning attorney.

Is there anyone who can pierce the spendthrift provision? There might be, depending on state law. Arizona law, for instance, creates a possibility that spendthrift trusts might be reachable for child support payments.

One other possible exception: if the trust requires distributions on a regular schedule, a creditor might be able to collect those future mandatory distributions. But the exceptions are usually very narrow — spendthrift trusts are very effective most of the time.

How likely is it that my trust is not a spendthrift trust? Not very likely. The vast majority of trusts in the U.S. include spendthrift language — or at least the vast majority of lawyer-drafted trusts do.

Should there be a spendthrift provision in my will? It’s a different question for wills, since they usually direct the distribution of all assets outright to beneficiaries in a relatively short period of time. But if your will includes a trust for one or more beneficiaries, you might want spendthrift language in those “testamentary” trusts. Talk with your lawyer about this issue.

We hope this helps. The language can be a little daunting, but lawyers’ categorizations (and labels) are actually understandable and helpful — even by real people.

Top Ten Reasons to Skip the Living Trust and Sign a Will Instead

FEBRUARY 2, 2015 VOLUME 22 NUMBER 5

Last week we suggested some of the reasons why you might think about having a revocable living trust as part of your estate planning documents. This week we’ll try to turn it around, and give you ten reasons why you might prefer to have a will (“just” a will) instead.

Let us be clear about two important points before we begin. First, our views are not shared by all lawyers. Some — especially those practicing in states with famously simple probate procedures — are vigorously opposed to revocable living trusts. Arizona’s probate procedures are quite simple; they are much simpler, actually, than most people think they will be. We are not opposed to revocable living trust, though. We tend to think of the question as a cost/benefit analysis. The trust will almost always be a more efficient plan, but the initial costs may not be justifiable in your circumstances.

Which leads to our second point: the cost of establishing a revocable living trust will almost always be considerably higher than the cost of preparing a will instead. How much more costly will depend on your situation and will vary quite a lot from lawyer to lawyer, but the benefits of living trust need to outweigh those costs before you make the plunge.

With that background let’s see if we can come up with ten reasons to favor a will rather than a living trust:

  • 10.There’s some reason you really ought to subject your estate to the probate process. Probate in Arizona is much less formidable than people think, but most people still want to avoid it. But there are two good things that happen with probate: (1) court supervision of the management and distribution of your assets, which might actually be beneficial in some cases, and (2) clear resolution of any remaining claims against your estate. That last one is usually more important for professionals — if you are a doctor, or lawyer, or architect, it might be advantageous to intentionally require a probate of your estate to get protection against possible lingering malpractice actions, for instance.
  • 9. You really want to understand your estate planning documents. Trusts actually can be a little daunting to understand. We take pride in our ability to write legally sufficient provisions in something approximating the English language, but we know that even our documents can be hard to understand. That’s a bigger problem for trusts than for wills. We can overcome this problem, of course, but only if you want to participate.
  • 8. Your personal situation is completely stable. You say you’re widowed, and have just one completely child? And that your child is completely trustworthy, has already provided for her own children’s educations, and doesn’t need any help or support from you? Great. Your plan is likely to be very uncomplicated, and we probably can come up with a way to execute it without the cost or hassle of creating a trust. Of course, things change — let us know if your child’s situation changes or the simplicity of your personal and financial situations unravel.
  • 7. You love paper, and take good care of it. Do you have a notebook that includes recent statements from all of your accounts, together with your accountant’s, your financial planner’s, your attorney’s and all your doctors’ names and contact information. We love you. You might not need a trust because you’ve already done a lot of the organizational work for your family. Please keep that notebook up to date.
  • 6. You hate paper. Maybe you are the opposite of the person described above. You can’t even remember all of your bank and investment accounts, and have a big, unsorted pile of paper sitting on the floor next to the desk in your office. In that case, the creation of the trust — and the important task of transferring assets to it — might overwhelm you, and make the will a more attractive option. Of course, you are the person who would benefit most from the organizational structure of creating and funding a trust, but there’s no magical incantation we can attach to the trust to make it happen automatically.
  • 5.  You are thrifty. Do you think regular lawyer visits and the cost of estate planning are just too high? Do you suspect that all of this is just an attempt to get you to part with your hard-earned money? You might benefit from a trust, but you might also be anxious about whether you are being oversold. Even if a trust is a slightly better option, your desire to save the extra costs needs to be acknowledged.
  • 4. You have already completed beneficiary designations for everything. Great! You might well have worked around the value of a living trust, and at a much lower cost. Of course, you need to think about future changes. What happens if a named beneficiary dies? What about the possibility that you spend more from your bank savings than from your brokerage account in the next ten years? Or the reverse? What if there’s a new grandchild, or a marriage or divorce, in your family? Of course changes happen whether you have a will, a trust or beneficiary designations — but in the case of beneficiary designations, you might need to make changes to a dozen different accounts/assets. And you need to actually do it, promptly and completely. Beneficiary designations are a great alternative, but require your continued diligence.
  • 3. Your assets are uncomplicated. Maybe you have only a few different assets, and they are typical. You have a house, a single bank account, an IRA, a car and a single brokerage account? That’s pretty uncomplicated, and there might be other options (beneficiary designations, for instance). Oh, wait — you also have life insurance, and a half dozen government bonds? That starts getting a little more complicated. A small art collection? Three different banks? Hmmm.
  • 2. Your estate is worth less than $75,000. That’s a magic number in Arizona. That’s how much your beneficiaries can collect without having to do a probate proceeding. More good news: that figure is the amount subject to the probate process that you can transfer. In other words, if your house has a beneficiary designation, and your bank account has a POD (pay on death) entry, then your heirs can use the $75,000 rule to collect your car and that small credit union account. You might not need a trust to avoid probate.
  • 1. The odds of your estate plan “maturing” (that is, the odds of you dying) in the next, say, five years are very slight. If you are 25, married, and leaving everything to your spouse, most of the benefits of a living trust will only appear if the two of you die at about the same time. While that could happen, it’s not too likely. The additional cost of a living trust might not make any sense in your circumstances.

Does that help? We hope so. We do want to help demystify this decision.

Managing Your Digital Assets With an Eye on Mortality

SEPTEMBER 22, 2014 VOLUME 21 NUMBER 34

For a while it was just an interesting academic problem: what would happen to your Facebook page, your Instagram photos, and your Pinterest collection if you died? And what about your e-mail account(s), your shopping login information and the passwords for all of those different online arrangements?

It became less of an esoteric question when several things started happening:

  1. More and more, people organize their entire lives online. You may be paying your bills, ordering medications, managing bank and brokerage accounts, and even posting automatic updates at various websites.
  2. Suddenly, some of those digital assets started having real economic value. Not only your airline frequent flyer miles, but the real dollar income from linking your Pinterest account (like pilot Dan Ashbach did) can add up.
  3. People started dying. Well, truth be told, they have been dying for a long time. But now some of them have LinkedIn, PayPal and Google Plus accounts. What happens to those accounts?
  4. Other people started losing the ability to manage their own affairs (again, that’s been going on for more than just a few years) — and family members started figuring out how to manage accounts, pay bills, and (oops) take money out of accounts online, anonymously and without any legal authority or oversight.

What does all this mean for your estate planning? It should be clear that you need to think about your online and electronic presence, and how to allow someone to take the appropriate actions when you become disabled or upon your death. “Appropriate” may mean something different to you than it does to your neighbor, and so it is also important that you make clear what you want done with your digital assets, and that you know about any legal constraints or limitations.

Let’s start with passwords. You know that you’re not supposed to reuse passwords, and that you should change your passwords on a regular basis. Maybe you have made the decision not to change the password for your favorite sandwich shop ordering site every sixty days, or to use the same password for your car rental and airline reservation accounts. Even so, you probably have a lot of passwords, and a challenging problem managing them.

Now think about getting those passwords to your spouse, or child, or successor trustee. Do you write them down somewhere? That would be very insecure, and a lot of work — you need to update the list every time you change a password (or add a new account). Where can you keep it that it is available and secure? A password-protected file on your computer? Which computer, and how hard is it to break the password protection on your favorite word processor, and what happens if your computer hard drive fails (as it most assuredly will, sooner or later)?

Take a look at password utility programs, like LastPass, or RoboForm, or Password Box (there are dozens of others). There are free ones (or at least free versions), but you might have to pay a few dollars (or even a few dollars a year). The best of them keep your passwords in an encrypted online space, and install in your local browser. Most even work on your iPhone or Android phone or tablet. Now you only have one password to remember, change and pass along — the password manager takes care of those changes for all the other passwords.

How do you pass along the password information on death or disability — without giving anyone access right now? Look into something called a “dead man’s switch.” The concept is borrowed from train locomotives. In the electronic world, it works like this: you set up an account, and it sends you a message every 30 (or 60, or 90 — you usually can change the the timing) days. You respond by telling the program that you’re still OK, and nothing happens for another cycle. But if you don’t respond, it decides something has happened to you, and it sends a message (which you have written in advance) to the recipient(s) of your choice.

You can see how that might make sense. You write a message telling your daughter the login information for your password management program, and a list of major accounts for her to look into. All you have to do is remember to update that message each time you change your password, and respond to the messages you get every month. The rest takes care of itself.

You can look into “dead man’s switches” at Stochastic Technologies, or the eponymous Deadman. Google even has one built into its accounts, called the “inactive account manager.” It’s not easy to find or activate (at least it seemed unnecessarily difficult to us), but it’s free and does just what we’re looking for, at least for one account.

Think about what documents and arrangements you need to prepare in advance. Should there be a provision in your power of attorney, your trust and/or your will about digital assets? Probably, but recognize that the law is still unsettled. One theory is that the person acting on your behalf may violate federal law if they log in as you — no one seems to know of any prosecutions for actions authorized by the account owner, but lawyers still hesitate to recommend that people skip across the law’s boundaries.

A good start: prepare an inventory of your digital assets. Do you have photos online? Documents? What is your password recording scheme? One of the best starter kits for dealing with digital assets is, surprisingly, a four-year-old article (as this is being written) laying out some of these issues. You can read Missouri lawyer Dennis Kennedy‘s practical suggestions from an American Bar Association magazine called Law Practice Today to get you started.

There are some new developments on the horizon. A national group, the Uniform Laws Commission, is proposing model legislation that would make it clear that you have the ability to give authority to someone else to manage your digital assets. For that matter, it would be a welcome addition to have a definition of “digital assets.” The proposed Uniform Fiduciary Access to Digital Assets Act is in the drafting stages now, and will need to be adopted in a number of states before it has any significant effect on practices. We’ll update you as that process develops.

Will Contests Must Be Based on Actual Evidence

APRIL 28, 2014 VOLUME 21 NUMBER 16

We have written before about the fact that, despite popular notions, will contests are actually quite rare. We have explained to our readers that mounting a will contest can be an expensive proposition, and that the likelihood of success is usually slight. Those observations remain true today, but that doesn’t stop family members (and even non-family claimants) from insisting that a loved one’s will is invalid because, well, it just is.

A recent Arizona appellate decision highlights the kind of objections we sometimes see. The case involves the estate of a man we’re going to call Ralph Dobson, who died in 2013.

Ralph had signed a will in 2010, naming his caretaker Margie as personal representative of his estate and his primary beneficiary. He did not name any of his children; an earlier, 2002 will had named his son Barney as personal representative and provided for the division of his estate into equal shares among his children. Margie, in addition to being Ralph’s caretaker, was also Barney’s ex-wife.

Barney objected to the admission of the 2010 will to probate. He argued that it was the product of undue influence, that Ralph had obviously not understood what he was signing (the will even made an error in Ralph’s full legal name), and that the witnesses could not even identify a photo of his father. He represented himself in the probate proceeding, challenged his ex-wife’s witnesses and exhibits, and explained his objections to the probate judge. He did not call any witnesses (other than giving his own testimony).

At the end of the trial in probate court, the judge found the 2010 will was valid and that it revoked the 2002 will. That meant Margie would be personal representative of the estate, and that the estate would go to her under the later will.

Barney appealed. He still represented himself, and he clearly did not understand how the appellate process worked. He attached exhibits to his appeal, apparently thinking the appellate judges would decide for themselves whether Ralph knew what he was doing. His appeals brief did not comply with the rule requirements. Ultimately, the Court of Appeals gave up, ruled that Barney had waived all his arguments and simply affirmed the probate judge’s determination that the 2010 will was Ralph’s final will. Estate of Demaree, April 18, 2014.

As we said, this new case does not break up any unplowed ground. There is nothing profound in the court’s holding, and no greater truth immediately apparent. What it does do, though, is to give us a chance to repeat this notion: will contests are difficult to sustain, they are infrequently filed, and they seldom succeed.

Would Barney have done better if he had hired a lawyer? Probably. We simply don’t have enough information to know whether there were facts to support his position, or whether a lawyer would have been able to ferret them out and produce the evidence the court would need to rule in his favor. We do know, though, that Barney was poorly equipped to see what information was truly relevant and even persuasive, and he did not do a great job of getting the important parts before the probate judge (and, later, the Court of Appeals).

Would a lawyer have been interested in Barney’s case? It’s impossible to be sure based on the record available, but it would not be too surprising if the answer turned out to be “no”.

Here are some of the notions that we often see among family members (which are, we might immediately note, not correct, at least in Arizona):

  • A will has to leave something to family members. Not true. You are completely free to disinherit your spouse, your children, even your minor children (caution: this principle is not the same in every state — we are talking here about Arizona). If you do, they might be entitled to a very small portion of your estate anyway — but that does not mean your disinheritance is invalid. You do not even need to name your children, and you certainly do not need to leave them even a nominal amount.
  • A will leaving everything to a non-family member is automatically suspect. Not true. While caretakers are often situated so that they are able to exercise undue influence, they are also often in a position to enjoy the genuine gratitude and affection of the person they were caring for. A good lawyer will insist on more information about the relationship before making any assumptions about a will challenge.
  • If a family member challenges the will, they will be entitled to receive something. This one is really hard for people to grasp sometimes. If you die without a will, your estate will usually pass to your children and your surviving spouse, in some proportions (it depends, in Arizona, on whether the children are all also your spouse’s children). If your will is invalid, and there is not an earlier will, then you died without a will. So there is simply no reason for your second cousin to want to challenge your will — even if it is completely invalid he will not receive anything from your estate (assuming you have any descendants or closer relatives).
  • Lawyers love to challenge wills. Nope, we don’t. It’s hard to do, and success rates are not high. Few lawyers will take on will contests on a contingency fee basis (though some might, depending on the facts) — so that means you’ll be writing checks every month to maintain any will contest, too.
  • When it’s obvious to everyone in the family that undue influence was exerted, that will be enough to challenge the will. Nope. The burden of proving undue influence is usually on the person challenging the will, and they have to show clear and convincing evidence of the undue influence. There is a rule that reverses the burden of proof in some cases, but it is not automatically triggered, and it’s not all that clear that it changes much about the requirements for challenging a will.
  • If the family can show that mom (or dad) was confused and disoriented, that will be all that it takes to defeat the will. Not at all. People with marginal capacity (or even largely incapacitated adults) may well be able to sign a will. All they have to have is the ability to identify at least some family members, to recognize that they have assets, and to understand that a will operates to pass assets at death. That’s not a very high barrier. And there’s something in the law called the “lucid moment” concept: people are presumed to be able to have a lucid moment even in a heavily foggy patch.

The lesson here: if you believe a spouse or parent was unduly influenced, you need to get good legal advice right away. Expect to pay for it — but if you don’t get counsel, you are much more likely to end up in the same position as Barney.

 

 

Here’s a Project For You: Write Your Own Obituary

APRIL 14, 2014 VOLUME 21 NUMBER 14

I have a new aspiration. I want my obituary to appear (at the appropriate time, of course — not before) in someone’s blog, newsletter, book or other publication as “one of the best obituaries ever” — maybe even to “go viral.” I’m just not sure I can count on my family to understand the importance of this goal. Maybe I need to write my own obituary now.

Turns out that idea is not novel. The recent death of Walter George Bruhl, Jr., in Florida highlighted the trend. Read Mr. Bruhl’s obituary, and the story about its preparation, and you will have to acknowledge that you wish you’d met him.

Of course excellent obituaries can be written by family members. Consider the moving and excellent obituary of Harry Weathersby Stamps, who died in March, 2013, in Mississippi. And note that it appears online on a site called “ObitOfTheDay.com” — the internet is truly a wonderful invention (one wonders whether Al Gore might be working on his own obituary). But back to Mr. Stamps: his wonderful obituary was written by his daughter, Amanda Lewis, a Texas attorney with a wonderful sense of humor and fond recollections about her father’s strengths and eccentricities. There are definitely benefits for family members who write memorable obituaries, but still there is something to be said for preparing your own.

So how to get started with writing one’s own obituary? It turns out that there are plenty of prompts, suggestions and ideas available. One online resource for the self-written obituary project suggests the question: “what do I want people to remember about me?” as a straightforward prompt. The result need not be humorous or whimsical — it might be heartfelt and moving (like actor James Rebhorn’s self-written obituary). It might be wry and revealing (like engineer Val Patterson’s contribution to the genre). Maybe you prefer mostly factual, with the occasional sly aside (like former Marine and ad man John E. Holden — whose short obituary generated enough interest to occasion a longer, much more detailed reminiscence from his local newspaper).

Something similar happened with Jane Catherine Lotter’s self-written obituary. After her death in Seattle in 2013, her obituary “went viral” and resulted in a New York Times article about her life, her death and her writing.

Here’s an interesting idea: try starting with a very simple statement, limited to just six words. That’s the premise behind “Not Quite What I Was Planning,” a 2008 collection of “six-word memoirs” from various contributors. There are even follow-ups: “It All Changed in an Instant” and other volumes in the series.

Most people, though, will want to write a longer version. Advice from one source: just get started. According to Obituary Guide (a resource for writing your own or a loved one’s obituary), getting your own on paper can be a help for family members and a chance to say what you want said about yourself. It also can be part of your end-of-life planning, including your living will, health care power of attorney, durable financial power of attorney, will and other documents.

It turns out that the self-written obituary is a trend. You can even order a book to help you get started (called, cleverly, ObitKit) and join “the hottest thing in dying.” Happy writing.

The iWill — Might It Be the Future of Probate and Estate Planning?

FEBRUARY 24, 2014 VOLUME 21 NUMBER 8

News reached us this month of a November, 2013, probate court order in Australia admitting an unusual will to probate, and it made us wonder if we should anticipate a digital future for estate planning. An Australian probate decision would have to be pretty unusual to get noticed around the world, but this one qualifies. The judge in Brisbane determined that the decedent’s last will was valid — though it was only on his iPhone.

Karter Yu committed suicide in September of 2011. Shortly before his death he created a number of documents on his iPhone, most of which were apparently farewell letters. One, however, looked very much like a will. It began with “This is the last Will and Testament of Karter Yu,” and it contained all of the provisions that one would expect to see in a will. It named an executor (what we in Arizona would call a personal representative), it included his address, and it gave directions for the distribution of his property. In the space where one might expect to see a signature on a printed document, Mr. Yu had typed his name, added the date and listed his address again for identification.

Queensland probate law, like Arizona’s (and most U.S. states’ laws), is descended from English common law. The old common law approach was clear: a will, to be valid, must be signed by the testator (the legal term for a person making a will) and witnessed by two individuals — and it must clearly indicate that it is intended to dispose of property at death of the signer. There may be additional details required in individual cases, and there are sometimes a handful of exceptions, but those remain the basic rules for making a valid will in most jurisdictions operating under English common law principles.

In Queensland, however, there is a relatively new variation. A document that does not meet the formal will requirements may still be admitted as the decedent’s will if:

  1. It exists as a document — and that includes any computer file stored on disc, tape or otherwise, provided that it can be produced or reproduced (i.e.: printed, or copied, or presumably even e-mailed), and
  2. It states the testamentary intentions of the decedent, and
  3. There is sufficient evidence that the decedent intended the document to be his or her will.

Looking at Mr. Yu’s iPhone document, the probate judge in Brisbane had no trouble determining that all three conditions were met. The will was admitted to probate, and his nominated executor appointed to administer his estate. Re: Yu, November 6, 2013.

This result might seem surprising to an Arizona probate judge — or lawyer — but was not necessarily a major extension in Australia. Just a year earlier, in a somewhat similar case, a New South Wales probate judge had admitted a word processing document to probate in Yazbek v. Yazbek, June 1, 2012. The decedent’s parents (who would have taken his estate if he had no will) insisted that he must have printed and signed the will document, then destroyed it — effectively revoking it as his will. The probate court found otherwise, and the unprinted document was admitted as the decedent’s last will.

Is a similar trend likely to develop in Arizona? Not likely, or at least not any time soon. Arizona’s probate law still adheres to the old English requirement: a valid will must be on paper (well, we suppose it could be on another medium — but it would have to be printed out), signed by the testator and witnessed. One notable exception, the “holographic” will, need not be witnessed — but it must be in the handwriting of the testator.

There is, though, a larger trend toward liberalizing the requirements for validity of wills. The National Conference of Commissioners on Uniform State Laws (NCCUSL) has developed and promoted the Uniform Probate Code — in fact, Arizona was one of the first states to adopt the UPC, in 1973. Though the UPC has been adopted in only a handful of states, it has been tinkered with regularly; the general trend in that tinkering has been to make it easier to approve questioned documents. The current (2011) version of the UPC permits the probate court to admit a “document or writing” that doesn’t comply with the requirements of English common law if there is clear and convincing evidence that the decedent had wanted the document or writing to be a will, a revocation, an amendment or a revival of a previous will.

Arizona has updated much of its version of the Uniform Probate Code, but not this provision (which, if you’re curious, is section 5-203 of the 2011 UPC). A handful of states have adopted the current version. Would Mr. Yu’s “iWill” be admissible in those states? It’s hard to be certain, but probably not — not because the idea would be unimaginable but because it’s likely that the file on the iPhone would not be characterized as a “document or writing.” But as public thinking about computer and internet files continues to evolve, you might reasonably expect that to change.

What does this mean for someone who wants to create a will on his or her iPhone? Don’t try it. The only thing certain is that you will assure the beneficiaries of your estate a high legal bill for the proceedings to determine what it means. Print the thing out, sign it before witnesses, and have them sign it, too. Better yet, hire someone who knows how to make sure your will is valid — like a lawyer — to prepare the will and supervise its execution.

Of course if you’re an Android user, everything is different. Just kidding.

Definitions For Common Estate Planning Terms

FEBRUARY 3, 2014 VOLUME 21 NUMBER 5

Judging from the questions we field online and from clients, there is a lot of confusion about some of the basic terms commonly used in estate planning. We thought maybe we could do a service (and make our own explanations a little easier) by collecting some of the more-common ones — and defining them. Feel free to suggest additional terms or quibble with our definitions:

Will — this is the starting point for estate planning. It is the document by which you declare who will receive your property, and who will be in charge of handling your estate. Note, though, that if you have a “living trust” (see below), your will may actually be the least important document in your estate planning bundle.

Personal representative — this is the person you put in charge of probating your estate. It is an umbrella of a name, encompassing what we used to call executors, executrixes, administrators, administratrixes and other, less-common, terms. If you use one of the old-fashioned terms in your will, that probably won’t be a problem — we’ll just call them your “personal representative” when the time comes. Note that your personal representative has absolutely no authority until you have died and your will has been admitted to probate.

Devisee — that’s what we call each of the people (or organizations) your will names as receiving something.

Heir — if you didn’t have a will, your relatives would take your property in a specified order (see “intestate succession” below). The people who would get something if you hadn’t signed a will are your “heirs.” Note that some people can be both heirs and devisees.

Intestate succession — every state has a rule of intestate succession, and they are mostly pretty similar. The list of relatives is your legislature’s best guess of who most people would want to leave their estates to. Think of it as a sort of a default will — in Arizona, for instance, the principles of intestate succession are set out in Arizona Revised Statutes Title 14, Chapter 2, Article 1, beginning with section 14-2101 (keep clicking on “next document” to scroll through the relevant statutes).

Escheat — that’s the term lawyers use to describe the situation where you leave no close relatives, or all the people named in your will have died before you. Escheat is very, very rare, incidentally. Note that the Arizona statute eschews “escheat” in favor of “unclaimed estate.” There is a different, but related, concept in the statutes, too: if an heir or devisee exists but can’t be found, the property they would receive can be distributed to the state to be held until someone steps forward to claim their share. That is not an unclaimed estate, but an unclaimed asset.

Pourover will — when you create a living trust (see below), you usually mean to avoid having your estate go through probate at all. If everything works just right your will won’t ever be filed, and no probate proceeding will be necessary. Just in case, though, we will probably have you sign a will that leaves everything to your trust — we hope not to use it, but if we have to then the will directs that all of your assets be poured into the trust.

Trust — a trust is a separate entity, governed by its own rules and providing (usually) for who will receive assets or income upon the happening of specified events. Think of a trust as a sort of corporation (though of course it is not, and it is not subject to all of the rules governing corporations). It owns property and has an operating agreement — the trust document itself. There are a lot of different types of trusts, and usually the names are just shorthand ways of describing some of the trust’s characteristics.

Testamentary trust — the first kind of trust, and the oldest, is a trust created in a will. Of course, a testamentary trust will not exist until your estate has been probated, so it is of no use in any attempt to avoid probate. But  you can put a trust provision in your will so that any property going to particular beneficiaries will be managed according to rules you spell out. Testamentary trusts are relatively rare these days, but they still have a place in some estate plans.

Living trust — pretty much any trust that is not a testamentary trust can be called a living trust. The term really just means that the trust exists during the life of the person establishing the trust. If you sign a trust declaration or agreement, and you transfer no assets (or nominal assets) to it but provide that it will receive an insurance payout, or a share of your probate estate, it is still a living trust — it is just an unfunded living trust until assets arrive.

Trustee — this is the person who is in charge of a trust. Usually we say “trustee” for the person who is in charge now, and “successor trustee” for the person who will take over when some event (typically the death, resignation or incapacity of the current trustee) occurs. There can, of course, be co-trustees — multiple trustees with shared authority. Sometimes co-trustee are permitted to act independently, and sometimes they must all act together (or a majority of them must agree). The trust document should spell out which approach will apply, and how everyone will know that the successor trustee or trustees have taken over.

Grantor trust — this is a term mostly used in connection with the federal income tax code, but sometimes used more widely. In tax law, it means that the trust will be ignored for income tax purposes, and the grantor (or grantors) will be treated as owning the assets directly. Most living trusts funded during the life of the person signing the trust will be grantor trusts — but not all of them. Outside of tax settings the term “grantor trust” is often used more loosely, and it can sometimes mean any living trust whose grantor is still alive.

Revocable trust — means exactly what it sounds like. Someone (usually, but not always, the person who established the trust) has the power to revoke the trust. Sometimes that includes the power to designate where trust assets will go, but usually the trust just provides that upon revocation the assets go back to the person who contributed them to the trust.

Irrevocable trust — a trust that is not a revocable trust. Oddly, though, a trust can have “revocable” in its name and be irrevocable — if, for example, Dave and Sally Jones create the “Jones Family Revocable Trust,” it probably becomes irrevocable after Dave and Sally die. Its name doesn’t change, however.

Special needs trust — any trust with provisions for dealing with the actual or potential disability of a beneficiary can be said to be a special needs trust. Usually, but not always, a special needs trust is designed to provide benefits for someone who is on Supplemental Security Income (SSI), Social Security Disability (SSD) or other government programs. Sometimes the money comes from the beneficiary, and sometimes from family members or others wanting to provide for the beneficiary.

There’s more. A lot more, actually. Has this been helpful? Let us know and we’ll add to it in coming weeks. In the meantime, a reminder: ask your estate planning lawyer for help with these concepts. Don’t be embarrassed that they seem complicated — they are complicated.

Can You Change Your Will By Writing On It?

NOVEMBER 18, 2013 VOLUME 20 NUMBER 44

So you have a will, and you want to make some changes. Can you just write in the new provisions? How about if you sign somewhere on the document?Can it be a copy of your will, or does it have to be on the original to be effective? Do you need witnesses?

The correct answer: don’t make changes that way. There are too many variables, too many interpretations, too many ways for those changes to just add cost to the probate of your estate while not effecting the result you intend. Talk to your lawyer, get changes made formally, and have a new will drawn up. Can it just be a codicil? Yes, but there is frankly almost no reason in this age of computerization to ever sign a codicil to your will — just sign a new will. One drafted by your lawyer.

Sometimes, though, time just gets away from you. If you want to make changes, you probably ought not wait until just before your 100th birthday. That’s probably the biggest mistake Jenny Travis (not her real name) made.

Ms. Travis had signed a will in 2002, and a codicil a few months later in 2003. In 2010 she had her caretaker call her lawyer, asking him to make a visit to review her estate plan.

The lawyer made a photocopy of Ms. Travis’ existing will and codicil, and went to her home to discuss them with her. During their meeting, he hand-wrote several changes in the margins of his copy of her existing will. As she described the changes, he scratched out two individuals’ names next to a bequest and wrote in two replacements. In another place he deleted a paragraph, and in another made modifications to the way a bequest would be handled. Another was changed from $10,000 to $42,000, again in the lawyer’s handwriting. Finally, the two charities who were scheduled to get the remainder of her estate in the 2010 will were crossed out and replaced with Ms. Travis’ brother.

At this point the lawyer had Ms. Travis sign her name by each of the changes, and he signed as a witness. Then he wrote a note to his secretary at the top: “Linda, do a codicil that changes” the affected sections of the 2002 will and 2003 codicil. He took the document back to his office with him, and a codicil was prepared. Unfortunately, though, Ms. Travis died six weeks after her lawyer’s visit, without ever having signed the new, formally prepared codicil.

Did those handwritten changes constitute a will or a codicil? Not according to the Pennsylvania probate office, which declined to admit the handwritten changes to probate (but did admit the 2002 will and 2003 codicil).

Ms. Travis’ lawyer appealed, and the Superior Court (the second-tier appellate court in Pennsylvania) viewed things differently. The appellate judges ruled that Ms. Travis’ changes might be a codicil to her will — and that the probate court should conduct a hearing to determine whether that was what she intended when she signed (and her lawyer witnessed) beside each change. One of the nine judges considering the case would have gone further — he would have ordered the handwritten notes admitted to probate without any further testimony. Still, it seems likely from the language of the opinion that the lawyer’s notes will ultimately be given effect — it will just have taken a trip to the appellate court and a delay of several years before the issue is resolved. In Re Estate of Tyler, November 13, 2013.

Assuming that Ms. Travis really did want to make the changes her lawyer wrote down, what might have been done differently to make sure her wishes were carried out? And would the same result be reached if Ms. Travis had lived and died in Arizona?

One obvious thing to consider would have been to make the changes earlier. By the time of her death Ms. Travis was 100 years old — if she had been thinking about making the changes for very long, she probably should have called her lawyer earlier. Perhaps, though, she had just recently made up her mind about the changes when she met with her lawyer.

Apparently Pennsylvania law permits changes to a will to be effective if written by someone else and signed by the person making the changes. It may not even have been necessary for her lawyer to sign as a witness (we don’t practice Pennsylvania law, so we might have gotten that wrong). The same is not true in Arizona — changes like those made by Ms. Travis’ lawyer would require her signature and two witnesses in Arizona. It’s not even completely clear that the changes would have been accepted then, since there does not seem to have been any indication in the written notes that the changes were intended to be a will or codicil, and they were made on a photocopy of her old will.

In Arizona it would have been better for the lawyer to write out a separate document describing what it was and the intended effect, and to have Ms. Travis sign it in front of two witnesses. Such a document would probably have been effective. Another alternative, since Arizona permits “holographic” wills, would have been for Ms. Travis to write out her changes in her own handwriting, and to sign that document (no witnesses would have been required) — though that creates plenty of opportunity for her to get the changes jumbled, or leave out portions or make mistakes. Presumably the lawyer, familiar with will drafting, would have had an easier time making the changes correctly.

Of course it would have been wonderful if the lawyer could have returned to Ms. Travis’ home with a beautifully typed new will (again, just forget codicils) the next day and had her sign in front of two witnesses. It is unclear why that did not happen — whether Ms. Travis was unable to discuss her wishes shortly after the initial visit, or the lawyer’s secretary Linda was out sick the next day, or what else might have intervened. The central lesson: if you want to make changes to your estate plan, get to it promptly, and talk with your lawyer right away.

©2017 Fleming & Curti, PLC