Wills, Trusts & Estates Prof Blog

Article on Property, Exclusivity, and Jurisdiction

James Y. Stern (William & Mary Law School) recently published an article entitled, Property, Exclusivity, and Jurisdiction, (March 11, 2014). Virginia Law Review, Vol. 100, 2014; William & Mary Law School Research Paper No. 09-272. Provided below is the abstract to the article:

Property has always been treated somewhat exceptionally in the realm of conflict of laws, but today conflicts rules for property are more unusual than ever — not because they have changed, but because they haven’t. Decades ago, most states discarded the general body of traditional conflict-of-laws doctrines, a transformation referred to as the Conflicts Revolution. Property, however, remains mysteriously untouched. The basic common-law principle is that property is governed by the law of its location — the situs rule. Despite persistent academic criticism, the situs rule is still followed in every state.

This article argues certain structural features of property support the situs rule, notwithstanding the Conflicts Revolution. Theorists have increasingly stressed property’s “in rem” quality — the idea that property is “good against the world.” This article shows how that feature creates a special need for uniform treatment across jurisdictions, such that a single, exclusive source of law is applicable to questions concerning the division of rights in a given asset. Property’s in rem character is a consequence of the allocational model used as the central organizing concept in property law. That model treats each property entitlement as part of a zero-sum game, in that one person’s entitlement to an asset means no one else can validly hold an incompatible claim to the same asset. Using different rules to resolve the same legal issue both aggravates the information cost problems generated by such a system and undermines its overall coherence. The situs rule in turn responds to the elevated need for uniformity in the property context by creating a focal point that enables states to coordinate their conflicts rules. The article shows how uniformity devices pervade property, including intellectual property and even other fields with certain formal resemblances, such as marriage and corporations law. Beyond its implications for issues of property jurisdiction, this article helps show where property’s much discussed “in rem” character comes from, what it really means, and how it distinguishes property from other private law fields like contract and tort.

CLE on Planning Techniques for Large Estates

The American Law Institute Continuing Legal Education (ALI CLE) is presenting a CLE entitled, Planning Techniques for Large Estates, on Wednesday-Friday, April 23-25, 2014.  Provided below is a description of the event:

Register today for this intensive program that consistently ranks as one of the highest rated estate planning programs. Get the tools you need to excel in high net-worth planning!

Our faculty of seasoned practitioners will conduct discussions on a transactional basis, with an emphasis on changing factual patterns rather than on bare principles of law or statute. Instruction will cover the most practical and useful planning tips, including alternative approaches that may suit your clients’ needs best.

Alzheimer's and Estate Planning

Alzheimer’s disease will affect one in eight American families.  Here are a few things you should keep in mind if you ever fear being diagnosed with Alzheimer’s:

• Collect Documents.  Keep all of your estate planning documents in one place and tell a trusted person exactly where they are and what is included. 
• Property Management.  Hire a financial professional to help create a plan for managing and disposing property as you become further incapacitated.  
• Advance Directives.  Make your health care decisions early on with a durable power of attorney, a living will, and a do-not-resuscitate order if you wish. 
• Living Trusts.  This versatile tool can be tailor made for the needs of an Alzheimer’s patient.

See Tom Nawrocki, 4 Things to Know About Alzheimer’s and Estate Planning, LifeHealthPro, March 11, 2014.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

IRA Planning Not a Priority Survey Says

According to TIAA-CREF’s annual IRA survey, only 15% of adults have allotted two or more hours to planning an IRA investment.  25% of the adults surveyed spent this amount of time selecting a restaurant while 21% allocated this time to buying a TV and 16% allocated this time to buying a tablet.

TIAA_CREF reports that only one in five Americans are currently contributing to an IRA.

See Michael Giardina, Restaurant Hunting Takes Up More Time Than IRA Planning: Survey, Employee Benefit News, March 27, 2014.

Article on Anti-Lapse Statutes

Eloisa C. Rodriguez-Dod (Florida International University (FIU) – College of Law) recently published an article entitled, ‘I’m Not Quite Dead Yet!’: Rethinking the Anti-Lapse Redistribution of a Dead Beneficiary’s Gift, Cleveland State Law Review, Vol. 61, No. 4, 2013.  Provided below is the abstract from SSRN:

This Article critically examines the tension between an individual’s autonomy and societal goals in the context of anti-lapse statutes applicable to wills and trusts. It scrutinizes the current rules of construction regarding anti-lapse statutes and identifies their deficiencies in their application to wills and trusts. Anti-lapse statutes create a category of substitute takers when a beneficiary prematurely dies. They are based on the legislature’s presumption of how a testator or settlor would want his property distributed in these circumstances. However, a testator’s or settlor’s intent may effectively be frustrated by this presumed intent. This Article analyzes and identifies the deficiencies encountered in the common law, state statutes, Uniform Probate Code, and Uniform Trust Code, and proposes possible solutions. Finally, it questions the need for anti-lapse statutes and considers application of the doctrine of reformation in their stead.

Some Often Forgotten Retirement Planning Details

Here are seven often forgotten details you should be factoring into your retirement plan:

1. Will you need to support your parents and/or children?
2. Is your family prepared for your retirement too?
3. Should you be jumping into another line of work instead of retiring?
4. Have you included infrequent but periodic purchases to your expenses?
5. Have you planned for inflation?
6. Do you know how your sources of retirement income will be taxed?
7. Do you know how cash flow and income will be affected if your spouse dies prematurely?

See David Ning, 7 Commonly Missed Retirement Planning Details, U.S. News, March 26, 2014.

Saving Funeral Costs

Funerals can cost over $27,000 these days.  Even the least expensive funerals, costing around $2,000, can be too much for some families.  Here are six ways you can save on funeral expenses: 

1. Compare online.  Websites like FuneralDecisions.com offer free instant quotes to help consumers find low-cost funeral services in their area.
2. Forgo embalming.  State law doesn’t require embalming, which has a median cost of $700.  Ask the funeral home if refrigeration is an option, which can be as low as $50 a day.
3. Decline the “protective” casket.  Some caskets are equipped with a rubber gasket meant to protect the body from the elements.  This “protective” addition could raise the price of the casket by $800 and doesn’t actually preserve the body.
4. Buy elsewhere.  Most states don’t require you to purchase your casket or urn from a funeral home, and funeral homes aren’t allowed to charge you a handling fee if you’ve purchased from somewhere else, such as a warehouse club.
5. Have a home funeral.  It’s legal in most states to care for the body at home and take it yourself to its final resting place.
6. Donate.  Donating your body to a medical school normally incurs no costs for the family.  Cremated remains are returned within two years. 

See Kaitlyn Wells, 7 Ways to Save on Funeral Costs, MarketWatch, March 27, 2014.

PM Cameron Speaks Out Against Assisted Dying

British Prime Minister David Cameron has confirmed that he will vote against any move to legalize assisted dying, saying it could unfairly pressure people into ending their lives.

Cameron’s comments against assisted dying came after Liberal Democrat Care Minister Norman Lamb spoke out in favor of reform, claiming it has “widespread public support.”  For now, assisted suicide in England and Wales remains a criminal offense punishable by up to 14 years in prison.  However, the Director of Public Prosecutions indicated in 2010 that anyone “acting with compassion on the will of a dying person was unlikely to face criminal charges.”

See Daniel Martin, David Cameron Says He’ll Vote Against Assisted Dying, Daily Mail, March 25, 2014.

 

CLE on What It Means To Be A Fiduciary

The American Bar Association is sponsoring a CLE entitled, What It Means To Be A Fiduciary, on April 15, 2014 at 1:00 pm ET.  Provided below is a description of the event:

Trustees are the stewards of the grantor’s legacy. They are required by law to fulfill the wishes of the grantor who set up the trust, to invest responsibly, and to always put the needs of the trust and its beneficiaries above their own.

However, serving as a trustee is increasingly risky. Beneficiaries have discovered that the courts are a place where they can seek redress for actual or perceived wrongs. Even conservative and cautious trustees can stumble over the execution of their fiduciary duties when dealing with real people and their complicated circumstances.

Knowing the trust instrument and your core duties and responsibilities as a trustee are key.

Following consistent processes for administration and decision-making often will lead to a better substantive result and not just liability mitigation (Need to go beyond policies and procedures manual). Good communication with beneficiaries is absolutely critical. Involve all the right people and experts in decision-making. Learn when you have entered risky territory. Practice good risk management to avoid or at least mitigate future challenges.

Good results are the product of a consistent and thoughtful process.

 

6 Advantages a Will Does Not Give You

A will is an effective estate planning document. Adding a trust to your will is important to give you the following benefits and protections:

1. Avoid probate- A trust will bypass probate, which will save your family members money.
2. Provide for a person with special needs-Dependants with special needs can protect assets without ruining eligibility for government benefits.
3. Privacy-A trust is private. 
4. Blended families- A trust provides flexibility for blended families.
5. Out-of-State property- If you own real property in another state transferring the property using a trust is easier than transferring property in a will.
6. Asset protection - Using a trust will protect your assets from creditors.

See Bonnie Bowies, 6 Ways a Trust is Better Than A Will, Denver Estate Planning Examiner, Mar. 18, 2014.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.