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Executor or Trustee of a Family Member’s Estate or Trust? Be careful.

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By Sarah Schmidt, Esq.

The role of an executor or trustee is often misunderstood by lay people who have never served as an executor or trustee. Beneficiaries of an estate often litigate or argue over who should serve as the executor, administrator or trustee. Lawyers, and those who have served in such a capacity, know all too well that being an executor is a difficult job which comes with a great deal of obligation and responsibility. If not handled properly, it can even subject the executor/trustee to personal liability.

I always tell my clients, colloquially, it is not fun to be an executor. Your mother, father, or close friend most likely named you as an executor, because you are responsible and someone they trust, but they did not do you a favor by naming you. You will be charged with paying final debts and expenses, filing final tax returns, properly distributing any assets according to law, and filing inventories and accountings with the Commissioner of Accounts who, by the way, will oversee all of your work.

Because executors are a fiduciary and held to that standard under the law, it is of the utmost importance that, if you are serving in such a capacity, you seek the advice of legal counsel as to your actions.  The best course of action for a great majority of issues you will face can be easily explained by a trust and estate attorney. And where the law is unclear, a trust and estates attorney can assist you in seeking guidance from the court concerning the best course of action.  The Virginia Supreme Court has explained, “in all cases of doubt as to what the law is, and what their conduct ought to be under it, [trustees] are entitled to direction and instruction from the court.” Gooch v. Old Dominion Trust Co., 121 Va. 29 (1917).

If you’re currently serving as an executor or trustee, I highly recommend you contact an attorney to seek out advice and counsel regarding your duties and obligations. As an executor, administrator, or trustee, it is best to ask for permission, rather than forgiveness.

 

Kit KatAsk Kit KatPet Trusts Update

Hook Law Center: Kit Kat, what can you tell us about pet trusts and some things to include so they are done the correct way?

Kit Kat: Well, yes, it can be difficult to plan for the care of one’s pet after one has died. However, with some planning, your pet can be taken care of as you have instructed. Legal experts recommend a pet trust. It has several advantages to just leaving instructions as part of a will. Probating a will can be a lengthy process, during which time, the pet’s care would be in limbo. With a trust, provisions can be made for care of the pet to begin immediately upon incapacitation or death. According to Judy Mandell, an author on the subject of pet trusts, “A pet trust is a legal way to provide for your pet and is the option that allows you to directly give pets anything, since many states consider them personal property, no different from your fine jewelry, antiques, computers, or cars.” In addition she continues, “With pet trusts, a trustee is appointed to hold property and cash and make payments for the benefit of the pet upon the disability of the grantor. Trusts continue for the life of the pet or 21 years, depending on which comes first, although rules may vary by state.” As a cat, I would say we cats would be in favor of the up-to-21-year-provision, since we tend to live longer than our canine friends. My parents had a cat who lived to age 19, and I myself will be 15 in August.

The only caveat for a pet trust is to make sure you have secured a trustee who is willing to assume this responsibility. Also, include in the trust, direction as to what should be done with any remaining money in the trust, after the pet dies. Many decide to leave any balance in the trust to an organization like the Humane Society or the ASPCA.

Some have gone to extravagant lengths to care for their pets. In one situation, a home in Texas valued at $1 million was left as the residence for the deceased’s 10 cats. The appointed caretaker was given a salary of $50,000 per year to live in the house and take care of them. In another, a New York attorney was asked to ensure that the deceased’s cat would be buried in a custom-made wooden coffin.

So whatever your wishes, incorporate them in a pet trust. Your pet will thank you! (Judy Mandell, “The Pets Are All Right (Even Though You’re Gone), The New York Times, May 24, 2018)

 

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Posted on Thursday, June 7th, 2018. Filed under Senior Law News.
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Ask Kit Kat: Pet advice and wisdom as Kit Kat sees it.

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