Comprehensive Planning. Lifelong Solutions.

Changes in Virginia Law

June 1, 2012

I used the Memorial Day weekend for rest, family, and catching up on my reading. My reading included a review of recent changes to and developments in Virginia law. It is clear that most disability, estate, and financial plans should be reviewed and possibly amended due to these changes and developments.

The following is a sample of some of these developments and changes:

1.    LLC Membership Interests. The Virginia Supreme Court has recently held that a beneficiary of a Limited Liability Company (LLC) interest does not become a member and may not participate in LLC management without the consent of a majority of members. Anyone who owns LLC membership interests for business or investment purposes should have their estate plan reviewed.

2.    Civil Service Group Life Insurance. The Virginia Supreme Court has recently ruled that federal law preempts a state law concerning the beneficiary of civil service group life insurance following a divorce. Any civil service employee who has been divorced should have their designation of beneficiary reviewed.

3.    Contracts to Make Wills. The Virginia Supreme Court has recently ruled that mirror-image wills, without more, do not establish a binding contract to make a will. Anyone who is relying on his or her spouse or partner not to change his or her estate plan based on mirror image wills should have their estate plan reviewed.

4.    Distributions to Persons with Special Needs. When a beneficiary is under a disability and is entitled to receive up to $25,000 of cash or property, the commissioner of accounts may allow a fiduciary (i.e. executor or trustee) to distribute the cash or property to a third party solely for the beneficiary’s education, maintenance, and support, with the intervention of a fiduciary. Such property of an infant who is of sufficient age to use it judiciously may also be paid to the infant. Executors and trustees for persons with disabilities should meet with legal counsel to consider this new authority.

5.    Doctrine of Necessaries. The Virginia law protecting a spouse against liens arising out of a judgment under the doctrine of necessaries will continue to protect a married couple’s residence held as tenants by the entireties even after the death of one of them. Liabilities under the Doctrine of Necessaries frequently arise from uninsured medical bills and for care provided in an Assisted Living Facility or Nursing Home. Couples with large uninsured health or long term care bills should review this new protection.

6.    Powers of Attorney. Unless the power of attorney provides otherwise, an agent’s authority terminates not only on the filing of an action for divorce but also on filing an action for separate maintenance or for custody or visitation of a couple’s child. Anyone who is in the process of a divorce or action for separate maintenance should have his or her power of attorney reviewed.

7.    Estate Administration. An executor or trustee under a will probated in another state may convey Virginia real property without qualifying in Virginia. Anyone involved in an estate administration involving a will probated out of state with Virginia real property should review this new authority.

8.    Tax Exemptions for Disabled Veterans. Disabled veterans and their spouses are entitled to real estate tax exemptions for a principal residence held in any of several forms including a living trust or life estate. Disabled veterans and their spouses should review their entitlement to this exemption.

9.    Asset Protection. Virginia law will now permit you to create a trust for your benefit which will protect the trust assets from your creditors following a period of five years from the creation of the trust. Many persons with potential business or long term care liabilities will want to consider the creation of these trusts.

10. Trust Administration. Virginia law will now permit a trustee of an irrevocable trust to exercise discretionary power to make distributions to or for the benefit of a current beneficiary by appointing all or part of the trust principal or income in favor of a trustee of a new trust for the beneficiary. Anyone serving as trustee of a trust should review this new authority.

11. Medicaid Auxiliary Grants. The state Medicaid program provides assistance to persons in Assisted Living Facilities (ALF) under its auxiliary grant program. ALF’s may now accept payments from third parties. The Department of Social Services cannot count such payments as income in determining eligibility for the auxiliary grant. This change may increase the number of ALF’s that accept the auxiliary grant. Anyone with a low income family member requiring care in an ALF should consult with an Elder Law attorney.

12. Community-Based Continuing Care Providers (CBCC). CBCC’s must now register with the Virginia State Corporation Commission and provide clients with a disclosure statement. A CBCC is a program providing a range of services to an individual, other than one related by blood or marriage, pursuant to an agreement that is effective for the life of the individual or for a period in excess of one year, and in consideration of the payment of an entrance fee.

13. Judicial Authorization of Medical Treatment. A court may now authorize medical treatment for an incapacitated person when there is no available person with legal authority to make such decisions.

Announcments

Oast & Hook is proud to announce that it has partnered with Commonwealth Assisted Living to offer a series of seminars for veteran seniors and their families. Each seminar will cover veterans benefits, veteran’s aid and attendance, elder law, Medicare, and long-term care planning. The seminars will begin at 6:00 p.m. and will end at 7:00 p.m.. Below are the dates and locations of each seminar. Seating is limited. If you have any questions or if you would like to register for one of these seminars, then please phone Oast & Hook at 757-399-7506.

June 7, 2012
The Ballentine
7211 Granby Street
Norfolk, Virginia 23505
Tel: 757-440-7400

Speakers

If you are interested in having an Oast & Hook attorney speak at your event, phone Jennifer Pagano at 757-399-7506. Past topics include estate planning, long-term care planning and veterans benefits.

Distribution of This Newsletter
Oast & Hook encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Oast & Hook, P.C. If you are interested in a free subscription to the Oast & Hook News, then please e-mail us at mail@oasthook.com , telephone us at 757-399-7506, or fax us at 757-397-1267. 

This newsletter is not intended as a substitute for legal counsel. While every precaution has been taken to make this newsletter accurate, we assume no responsibility for errors, omissions, or damages resulting from the use of the information in this newsletter.

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