Estate Planning Bits

Pet trusts coming to Connecticut

When estate planning for pets was first introduced, there were no statutes or other legal standards in place to rely on when crafting a plan to provide ongoing care for pets after the death of the owner. Fortunately, pet trusts have become more widely recognized and desired, and many states are finally recognizing the validity of them. As of October 1, 2009, pet trusts will be valid in Connecticut.

The new Connecticut law allows pet owners to set up enforceable trusts to provide ongoing care for their animals. Such a trust would continue until the last surviving animal passes away. Under the statute, a pet owner must name a “trust protector,” who will act on behalf of the animals and ensure they receive proper care.

When planning for a pet, there are many concerns to be addressed. For example, it is important to determine who will serve as the pet’s caretaker, and if establishing a trust, who will act as the trust protector. It is also important to remember that a pet will pass through the owner’s estate as personal property; therefore, the owner’s Last Will and Testament may need to be updated. In addition, the plan should address the final disposition of the pet, including guidelines for when euthanasia would be appropriate.

If you’re interested in learning how to ensure that your pets are properly cared for upon your death or incapacity, it is important to consult a pet estate planning attorney who understands how to set up these complex trusts.

by: Gina M. Barry, Esq.

Demystifying terms used by estate planning attorneys

Agent: The person given legal authority to make financial decisions for a person through a durable power of attorney document or the legal authority to make health and medical decisions for a person through a health care proxy document.

Artificial Life Support: Medical equipment and other technology used to prolong the life of a person who is seriously ill by sustaining essential body functions, like breathing.

Assets: Personal possessions of value, including cash, bank accounts, real estate, vehicles and investments.

Beneficiaries: The people named in the will to receive the estate of the person upon his or her death.

Conservator: The person appointed by the courts to make financial decisions on behalf of a person.

Custody: Legal responsibility of a person.

DNR:  Stands for “Do not resuscitate” and refers to a person’s instructions that, if his or her heart or breathing stops, the doctor should not try to restart it.

Durable: When a power of attorney document is durable, it is valid even after the person with dementia can no longer make his or her own decisions.

Execute: To legally sign or “carry out” a legal document.

Executor: The person named in a will to manage the estate of the person upon his or her death.

Grantor: The person for whom a living trust is created.

Guardian: The person appointed by the courts to make health care decisions on behalf of a person (sometimes also includes financial decisions.)

Health care agent: The person given legal authority to make health care decisions for a person through a health care proxy document.

Legal capacity: The level of judgment and decision-making ability needed to sign official documents.

Probate:   The process used by the court to distribute the property of a person who has died.

Trustee: The individual or bank chosen to manage the property (assets) in the trust document of a person.



by: Todd C. Ratner, Esc.

Pet Estate Planning in the wake of the Helmsley bequest

On August 20, 2007, Leona Helmsley, the billionaire New York City hotel operator and real estate investor, died, leaving an estate estimated at more than $4 billion. As part of a carefully drawn estate plan, Leona’s treasured dog, a Maltese named Trouble, was left $12 million in a trust fund. This bequest has caused a frenzy of commentary. As a result, many more people are seeking information about how they can protect their animals should they pass away.

Although many states, including New York, recognize trusts that name an animal as the beneficiary, unfortunately, at this time, Massachusetts does not recognize such trusts. Fortunately, there are still options for the Massachusetts animal owner to consider.

If the animal owner truly desires a trust, while it is not possible to create an enforceable trust solely for the benefit of an animal, it is possible to create an enforceable trust for the benefit of your animal’s caretaker. Should you not be inclined to establish a trust for whatever reason, an outright bequest of the animal in your Will, along with a sum of money intended to allow the recipient to provide care for your animals is another option. This option works well if you are of modest means and name a trustworthy caretaker.

There are many considerations to be addressed when planning for your animals’ ongoing care. Choosing a proper caretaker is first and foremost. It is also important to determine the caretaker’s compensation or the cost if your animals are to be surrendered to a rescue or similar facility. Providing standards of care, such as delineating the expected veterinary, exercise and grooming schedule for your animal, is recommended. In addition, the final disposition of your animals and the set of circumstances in which euthanasia would be permitted should be addressed.

When you’ve established an estate plan that addresses the issues raised above, you have taken the steps necessary to ensure the ongoing care of your animals when you pass away. Without such a plan, the fate of your animals is at best uncertain, and at worst, unspeakable.

By: Gina M. Barry, Esquire

For more information about Gina's Pet Estate Planning expertise, please click here.

Who will care for your pets when you can’t?

"Many have forgotten this truth, but you must not forget it. You become responsible forever for what you have tamed.” Antoine de Saint-Exupery stated this in The Little Prince. Most people consider their pets to be members of their family, while others go to more extremes, yet the fact is there is a strong bond between pets and their owners. It has been said that 80% of pet owners brag about their pets to others, 79% allow their pets to sleep in bed with them, and 37% carry photos of their pets in their wallets. It is evident that there is an indescribable love between pets and their owners. A common issue that arises is, what happens to pets if the owner passes away or becomes sick and can no longer care for his or her pets?

If you passed away and did not have an estate plan for your pet, often they are euthanized, neglected or abandoned. To prevent these outcomes from happening, an estate plan is created, which provides for the proper care and love for your pet. Legally, an animal is considered tangible personal property, like your car, furniture, jewelry, and would pass down to heirs or beneficiaries of your estate who are entitled to your personal property. Your pet can be cared for through an estate or a trust.

The first step in planning for the estate of your pet is to select a caretaker. A caretaker is usually a person or organization that can provide for your pet when you no longer can. The process of selecting a caretaker can be challenging. When selecting one, you want to communicate your expectations and needs of the pet, you should allow the potential caretaker to spend time with your pet, and you should discuss any type of reimbursement or compensation. You should compile information about your pet such as identification, detailed instructions for care needs, veterinary information, and legal documents. Based on the circumstances, you may want to set aside caretaking funds necessary to cover expenses for your pet. An organization may also be a caretaker for your pet.

A “pet trust” is an arrangement whereby the caretaker’s right to receive any caretaking funds is limited. The term “pet trust” can include three different types of arrangements: honorary trusts, statutory pet trusts, and traditional legal trusts.

1. An honorary trust is a trust for the benefit of the pet. The caretaker may either honor the terms of the trust by using the funds or relinquish the funds to the beneficiary. An issue that arises is the remainder beneficiary is the only party that can enforce the honorary trust.
2. A statutory pet trust allows virtually any third party to compel the caretaker-trustee to use designated caretaking funds solely for the benefit of your pet. While a pet trust offers a level of protection, there are limitations as well. The court is allowed to reduce the amount of caretaking funds to what it sees reasonable.
3. A traditional legal trust can be established for your pet, which allows more flexibility than the other alternatives.
   

Pet trusts tend to be costly due to the fact that there is an attorney fee, annual administrative costs, and costs to cover care for the animal. There are a dozen or so states that allow pets to be named as beneficiaries of trusts, and enforce the trust with someone acting on the pet’s behalf. Besides estate documents, animal cards should be made. An animal card is a document that contains information about the animal and contact information for the party who has custody of the animal. Animal instruction documents contain the same information as the animal card, as well as the animal’s medical history and contact information for the veterinarian.

Start planning your pet estate so your furry, fluffy companions will be in good hands.

By: Gina M. Barry, Esquire