Monday, September 26, 2016
Susan N. Gary recently published a book entitled, Mediation for Estate Planners: Managing Family Conflict (2016). Provided below is a summary of the book:
This book represents an important new resource for attorneys to assist clients in resolving--and avoiding--disputes in an estate planning practice.
Estate planners and elder law practitioners are increasingly aware of the availability of mediation as a tool for resolving family disputes. Probate courts around the country are increasingly interested in encouraging parties to try mediation before resorting to litigation. But by the time a dispute reaches the probate court, damage to family relationships may have already occurred.
Mediation for Estate Planners: Managing Family Conflict provides the basic tools to understand and employ mediation within an estate planning practice and appreciate the usefulness of these alternative dispute resolution processes.
A lawyer familiar with mediation can help clients resolve disputes in a way that accomplishes the client's personal as well as legal goals. Written by an experienced team of attorneys and mediators, Mediation for Estate Planners:
- Supplies the basic tools to understand and employ mediation within an estate planning practice
- Provides guidance for lawyers in recommending mediation to clients at an early stage so that families are able to resolve disagreements with less damage to personal relationships
- Offers perspectives from both the mediator and the lawyer
- Considers the range of specific applications for mediation, including its use at the planning stage and after death; use in guardianship and conservatorship; end of life decision-making; and more
- Examines and explains the ways that mediation can help in family business succession planning, and much more!
Topics are organized in these sections for ease of use and reference:
- Understanding the essential elements of mediation
- Practical perspectives
- Specific applications in the estate planning and administration context
- Mediator as consultant: family business succession planning
- Resources for practice, including a Tool Kit, bibliography, and more
Richard B. Keeton recently published an Article entitled, Balancing Testamentary Incapacity and Undue Influence: How to Handle Will Contests of Testators with Diminishing Capacity, 57 S. Tex. L. Rev. 53 (2015). Provided below is a summary of the Article:
Lack of mental capacity is “the second most commonly alleged ground for setting aside a will.” This Article will explore these ever-increasingly common, yet intricate and complex scenarios. First, Part II of this Article will give the reader a broad overview of the requisite mental capacity to execute a will. Additionally, because each state has its own unique-- but similar--common law tests, sample case studies are provided for the jurisdictions of Missouri, New York, and Texas. Next, Part III will discuss the generally recognized presumption of requisite testamentary capacity--presumed across all jurisdictions--unless evidence is presented to show otherwise. Part IV of this Article will delve into various case law and common law tests used to prove the existence of undue influence in the execution of testamentary documents. Following, Part V attempts to answer the circular question challenging attorneys and courts of whether a testator can actually be unduly influenced if he or she lacked testamentary capacity. Upon conclusion, this Article will provide practical recommendations to consider when assisting persons with Alzheimer's disease and other forms of dementia execute testamentary instruments.
Friday, September 23, 2016
Stranger-originated life insurance (STOLI) is a scheme where someone purchases life insurance on the life of someone that they do not have an insurable interest on. One specific variant of this scheme sees the insured setting up a trust and owning the policy for a period of time while the premiums are paid for by a third-party lender. After a few years, the policy is sold to the lender with a substantial payment to the person on who the insurance was taken out. Now, STOLI arrangements are illegal in most states.
In Wells Fargo Bank v. Pruco Life Insurance Company, the court dealt with a policy that was issued pursuant to a STOLI arrangement. Florida law requires that an insurance company contest a life insurance policy within two years. The particular STOLI policy the court dealt with was contested after the two-year period. Accordingly, the question for the court was whether an illegal policy could nevertheless not be challenged after the two-year window. Ultimately, the court upheld the validity of the law, disallowing the insurance company to contest the policy after the two-year statute of limitations.
See Jeffrey Skatoff, Stranger Originated Life Insurance Survives Challenge in Florida, Florida Probate Lawyers, September 22, 2016.
Thursday, September 22, 2016
Lee Power, a wealthy widow, would eventually sign away more than $100 million in her will to a man she had known for two years, Alben Sagan or, as he was also known, The General. The two met in late 2008, and Sagan soon became her ever-present companion. Over the next few years, Sagan became the president of her real estate companies, negotiating multi-million-dollar sales. Upon Power’s death, her family was curious as to why 90% of her fortune was left to a man they barely knew. Shortly after, her sister wrote a scathing letter to the Manhattan Surrogate’s Court objecting to the will.
So who is Alben Sagan? Sagan was a ex-military officer who had given testimony on several organized crime figures, eventually forcing him into the witness protection program. Eventually, Sagan could not handle the lifestyle and reverted back to his old lifestyle in New York with longtime friends. Trying to keep his past a secret, he was unable to hide when he was set to inherit $100 million.
Currently, Sagan’s past life is at the forefront of a fierce legal battle over the validity of Power’s will. Lawyers for Power’s nieces allege that Sagan preyed on a wealthy woman suffering from dementia to gain control over her real estate portfolio, which is estimated to be worth around $80 to $120 million. Sagan claims that Power was of sound mind when she drafted her will.
See James Fanelli, How a Mob Informant Who Left Witness Protection Got $100M from a Widow, dna info, September 20, 2016.
Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.
Monday, September 19, 2016
The American College of Trust and Estate Counsel (ACTEC) is launching the first two in a series of YouTube videos briefs created to offer the public insight into the fundamentals of wills and trusts. The ACTEC Family Estate Planning Guide provides essential information to help families protect their financial interests.
The series debuts with two 10-minute talks presented by ACTEC Fellows and Elder Law experts Bernard A. Krooks and Professor Mary F. Radford who speak to a live audience highlighting common questions and worse case scenarios that illustrate the value of preparing an estate plan customized to the needs of a family. The speakers offer insights targeted to help families plan and protect their assets and personal well-being and explain terms to help viewers engage in an informed discussion with their lawyer or advisor.
"The video series gives ACTEC a platform to address frequently-asked questions and share the vast experience of our practitioners directly with consumers," said ACTEC President Cynda C. Ottaway. "ACTEC members serve a spectrum of clients - from individuals of modest wealth to large family businesses with complex interests – and our goal is to offer an educational resource to encourage planning for families of any means."
Wednesday, September 14, 2016
A non-blood related beneficiary can increase the possibility of lawsuits. One of the biggest concerns when naming an individual who is not a natural heir is elder abuse and protection. Because elder financial exploitation is on the rise, it is important to ensure protection of that elder beneficiary through specified provisions. Additionally, you should have an expert determine the capacity of the testator. This will decrease the possibility of will contests if heirs are aware of the testator’s capacity at the time of will execution. We each have rights to distribute wealth in accordance with our wishes, so it is important to properly plan for your estate in these ways.
See What Issues Are Raised When an Inheritance Passes Outside the Family?, Wealth Management, September 7, 2016.
Thursday, September 1, 2016
Financial advisors are slowly being viewed as the orchestrators of all the various financial planning components of a client’s life, such as asset management, estate planning, legacy building, long-term care planning, and insurance. There are two main principals driving this change—advisors wishing to differentiate themselves and retirees entering the distribution phase of their financial life cycle. Accordingly, there are four ways that advisors can be of value to their aging clients.
First, advisors can provide a holistic view of insurance, helping clients plan for every stage of their insurance needs, especially long-term care and health insurance. Second, estate planning is an essential aspect of post-retirement; therefore, advisors should be able to provide robust estate planning capabilities. Third, clients at this stage will need to prepare for any possible disability care, which will give clients a sense of empowerment over their inevitable futures. Finally, advisors should help wealthy clients apply tax-advantageous strategies to reach their charitable goals and legacy aspirations.
See Richard Whitworth, Looking Beyond Asset Management: Top Four Ways Financial Advisors Add Value for Aging Clients, Wealth Management, August 31, 2016.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Saturday, August 27, 2016
Arlene G. Dubin & Rebecca A. Provder (Moses and Single LLP) recently published an Article entitled, The Gray Divorce Phenomenon, (2016). Provided below is a summary of the Article:
An 82 year old client wanted a divorce from her husband of 57 years. When asked why, she responded, “I want to live a little before I die.”
A study conducted in 2014 reveals that the divorce rate for individuals 50 and older has doubled in the last 20 years. Two decades ago, individuals 50 and older accounted for about 10% of divorces. Recently, the divorce rate for this age group spiked to approximately 25%. What’s more, approximately half of those divorces occurred in first marriages.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Wednesday, August 24, 2016
InnovAge is a company that uses private equity money to aggressively expand a Medicare program, Program of All-Inclusive Care for the Elderly (PACE), that keeps older and disabled people out of nursing homes. Before, only nonprofits were allowed to run this type of program, but the gates have opened to for-profit companies with the hope of expanding the services faster. In exchange for monthly payments from Medicare and Medicaid, PACE programs pay for all doctor’s visits, medications, rehabilitation, daily needs, and hospitalization. This capped monthly payment forces organizations to invest in maintaining a patient’s health to avoid large hospital bills. Critics, however, note that caring for elders is full of abuse, something that is correlated with increased commercialization of the industry.
See Sarah Varney, Private Equity Pursues Profits in Keeping the Elderly at Home, NY Times, August 20, 2016.
Special thanks to Lewis Saret (Attorney, Washington, D.C.) for bringing this article to my attention.
Monday, August 8, 2016
As of Saturday, a new Medicare law is in force that requires hospitals to notify patients of the possibility that they could incur substantial out-of-pocket medical costs if their stay is more than 24 hours without being formally admitted. The problem stems from patients who are under “observation”—for fear of Medicare penalizing over inappropriate admissions—making them liable for large hospital bills; further, Medicare will not pay for any subsequent nursing home care, unless the patient was an inpatient for three consecutive days. Patients can expect to start receiving these warnings in January. With this new law, the estimated notices per year are 1.4 million.
See Robert Pear, New Medicare Law to Notify Patients of Loophole in Nursing Home Coverage, NY Times, August 6, 2016.
Special thanks to Jerry Borison (Professor of Law, University of Denver Strum College of Law) for bringing this article to my attention.