Articles Posted in Probate

The New York City Bar Association’s “Committee on Animal Law” recently released a helpful report on the many different legal issues to consider regarding the care of your pet in an uncertain future. The document offers a comprehensive examination of a wide range of issues which many fail to consider. It is worthwhile to review the whole thing if you are interested in some of the more detailed aspects of estate planning with pets in mind. A free .pdf copy of the report can be viewed online here.

The sad reality is that most pet owners give only cursory thought to what might happen to their furry friend in the event of a death or hospitalization. In most cases the extent of the planning is when an elderly individual or one with a serious illness considers another person to take ownership. Obviously that is a good first step, but it is important to ensure those wishes are actually guaranteed via legal documents. Also, identifying a new owner is just the beginning of effective planning for pets.

For example, many problems arise in the time period between an owner’s death and the admission of a Will to probate. Even if a Will includes specifics about new ownership and the providing of provisions, the intermediary time may be left open. This can cause serious problems, which provide immense stress on the animal as well as those working to handle affairs in the aftermath of the passing. Similarly, the provisions of a Will are of little use if an owner is hospitalized and alternative pet care needs to be arranged.

Earlier this month we discussed the unique estate issues connected to the murder of a wealthy investor named Raveesh Kumra. Mr. Kumra was murdered during a robbery late last year. It has since been learned that the suspects include several men with connections to alleged prostitutes with whom Kumra apparently was connected. It is a tragic situations all the way around, and the man’s family was understandably blindsided by the situation.

Making matters worse, a significant battle over Kumra’s estate has been waged by various parties since the death. It is an example of the unique court challenges that often result when comprehensive estate planning is not conducted and all possible issues are not analyzed as part of that plan.

Out-of-Wedlock Children

Estate planning attorneys frequently urge residents to be careful about creating long-term plans to avoid family feuding. Careful consideration of inheritances, open communication between families, and prudent use of tools like trusts are usually the best way to ensure that families are not torn apart after a passing.

Some seniors appreciate certain inherent conflicts within the family and work to counter those risks. However, many others assume that such feuding only affects “others” and their family members would never fall into arguments and ruin relationships over property or other end-of-life matters. The reality is that no one knows for sure how things might play out. Reactions to the loss of a relative often spur deep psychological impulses with emotions askew. That can spur problems for even the most stable families.

Estate Planning Murder Plot

If you pass away without a will designating how you’d like your affairs to be handled, you are deemed to have died “intestate.” Some of the most significant legal battles and family feuding occurs in those situation because it is essentially a free-for-all. Generic legal rules apply, but without any indication of how to handle property distribution and other matters, all interested parties may decide to pursue different legal avenues to maximize their own interests. Legal fights can still occur when a will exists (often referred to a “will contests”), but the possibility of one’s wishes being completely upended are far lower when at least some documentation exists.

Interestingly, it is not uncommon for various documents purporting to explain one’s wishes to pop up later on–in the midst of a legal dispute. For obvious reasons, these documents should be examined with much scrutiny, but they still may influence a legal case.

New Document in Lottery Winner’s Estate Feud

Feuding after a death has been common for centuries. However, observers point out that in recent years estate battles have actually grown and more frequent. The trend is noted for all families, both those with sizeable wealth and those of much smaller estates. It is a crucial reminder for residents to take action now to eliminate uncertainty and confusion and ensure in-fighting doesn’t tear a family apart following a passing.

Last week the Telegraph published a story on the topic, pointing to data showing an uptick in legal battles over inheritance disputes. The most common explanation for the change is the recession which devastated many families over the past seven to eight years. One observer explained that in tough economic times, “more people are hoping to receive an inheritance and there can be a great deal of trouble if their hopes are disappointed. People are more litigious in general and more willing to assert their rights.”

Undoubtedly, the recession acted as a spur, influencing some to start a legal fight in order to secure funds that they desperately needed and might assume are owed to them. However, money troubles aren’t the only cause in the change. After all, financial incentives exist even in relatively prosperous times.

One common excuse for putting off basic estate planning is the assumption that others–spouse, children, siblings, close friends–already know exactly what you want, and so there is little need to go through the legal hoops to solidify it. Sadly, in the aftermath of a passing, there is no way to know exactly what those in control of a situation might do unless there is legal backing to it. That obviously applies with distribution of property, but it also applies to more ceremonial aspects to a passing, like funeral and burial wishes.

Don’t Leave it to Chance

For many, their faith dictates how they chose to have their passing honored (or not honored). From deciding what to do with remains or where to be buried, it is critical that desires be set forth clearly. It is a mistake to underestimate the significance of these details or the in-fighting that may bubble up where there is disagreement about how to handle these matters.

Drafting a will can be a delicate process, because various legal requirements must be met before the document will have any legal effect. Cases abound of wills which were thrown out because they did not conform to the technical requirements. Ensuring that everything will be done pursuant to legal rules is one key reason to have the aid of an estate planning attorney.

Beyond that, when planning professionals are not involved in these matters, there is a far greater chance that fraudulent and illegal practices might be undertaken. When money is on the line, sometimes the worst characteristics in everyone seeps out. For one thing, it is not uncommon for entire wills to be forged, and when outside observers to the planning are few and far between, those forgeries sometimes even work.

Forged Will

Timing is of critical importance with estate planning matters. Obviously, a plan must be in place early enough to be of use before one falls ill or suffers from mental issues. For example, creating a will or trust may be impossible after one suffers a stroke or succumbs to serious effects of Alzheimers. This is why we continue to encourage residents to make plans early and consistently update them.

Time also factors into matters after a death. Many beneficiaries may face hardship if they are forced to wait months (or even years) to have an estate settled. One of the key benefits of an inheritance plan is to minimize the risk of a long delay between the actual passing on of assets, often focused on avoiding probate and preventing feuding.

Celebrity Example

One of the many goals of proper estate planning is to prevent family feuding. This is obviously to ensure that the worry, stress, and cost of these legal battles is avoided. But on top of that, done right, avoiding costly disputes saves an immense amount of time. It is well known that the legal system often does not act swiftly. It is important not to underestimate the simple benefit of having property matter resolved right away after a passing, instead of making surviving loved ones wait months or even years–preventing them from obtaining necessary funds and moving on with their lives.

The prolonged nature of the resolution exists anytime there is no estate planning (probate takes time). But the delay is especially pronounced where there is feuding and legal battles are fought.

For example, the Patch recently reported on a delay in a hearing for one high-profile estate fight over the property of painter Thomas Kinkade. We have previously blogged about the legal fight between Kinkade’s estranged wife, four children, and live-in girlfriend. The girlfriend has produced two handwritten wills which seem to leave Kinkade’s house to her while establishing a museum. The wife and children contest the wills.

The heirs of art dealer Illena Sonnabend faced a very unique problem after the woman’s death in 2007. One the most valuable pieces of her estate was a work by Robert Rauschenbeg known as “Canyon.” The 1959 piece of art is a collage that include various three dimensional materials, including a stuffed bald eagle. Canyon would prove to be a sticking point in the heir’s attempt to settle the estate–a process which ultimately dragged on for five years.

Taxes Always Due

For estate tax purposes, the value of artwork in an estate is appraised and the tax is owed based on the total appraisal value. Sonnabend’s estate had a significant number of pieces and the artwork taken together was valued at over $1 billion. According to a Wall Street Journal story on the case, this led to an estate tax bill of about $471 million. The two heirs to the estate sold about $600 million of the artwork to pay for that bill.

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