Wednesday, September 28, 2016
On Monday, David Bowie’s contemporary art collection was previewed at Sotheby’s. This comes ahead of the auction that is set to take place in November. The auction will be selling 350 items worth approximately $13 million to $19.5 million. The sale will be divided into three—two modern and contemporary art sales, and a post-modern Italian design sale. One particular piece by Jean-Michael Basquiat titled, “Air Power,” is estimated at $3.3 million to $4.6 million.
See David Bowie’s Art Collection Arrives in NY Ahead of November Sale, Reuters, September 26, 2016.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Danica J. Brustkern recently published an Article entitled, With Great Power Comes Great Culpability: Addressing Agency Costs in Durable Powers of Attorney, 50 Real Prop. Tr. & Est. L.J. 463 (2016). Provided below is an abstract of the Article:
This Article discusses alternative methods for monitoring those who become agents under durable powers of attorney. A durable power of attorney presents an easily abused principal/agent relationship because the principal is unable to monitor the agent once the principal has lost capacity. Because durable powers of attorney involve agency costs that are similar to those seen in the context of trusts and guardianships, this Article looks to the methods of monitoring the “agents” in each of those relationships and discusses whether these methods could--or should--be adopted for use in the context of durable powers of attorney. Ultimately, this Article finds that adapting the concept of a “trust protector” to durable powers of attorney could address the agency costs in these relationships with minimal sacrifice of the aspects of durable powers that made them so popular and useful to begin with.
Tuesday, September 27, 2016
Domingo P. Such, III & Tina D. Milligan recently published an Article entitled, Understanding the Regulations Affecting the Deductibility of Investment Advisory Expenses by Individuals, Estates and Non-grantor Trusts, 50 Real Prop. Tr. & Est. L.J. 439 (2016). Provided below is an abstract of the Article:
This Article addresses the new 2015 federal income tax rules governing the deductibility of investment advisory expenses and the confusion surrounding them. Specifically, the Article provides the context and impact of these new regulations, clarifies the current classification of investment advisory expenses, outlines methodologies for fiduciaries in unbundling fiduciary and investment advisory fees, and explains the limitations under current law. The Article also addresses the confusion surrounding the new rules for corporate fiduciaries, which require the “unbundling” of investment advisory fees when comingled with fiduciary fees using “any reasonable method.” The Article concludes that taxpayers should consult with their financial advisors and tax professionals to minimize the impact of deductibility limitations.
On Thursday, a new cache of leaked offshore corporate documents were made public from the Bahamas, marking the latest setback for international financial transparency. The same group that released the Panama Papers has now brought documents containing information about 175,000 Bahamian companies to light. The information from these documents is more basic but nevertheless, still enlightening with links to prime ministers, cabinet officials, princes, and convicted felons.
See David H. Lenok, ‘Bahamas Papers’ Are Latest Chink in Offshore Armor, Wealth Management, September 22, 2016.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
New York is now allowing pet owners to be buried with the cremated remains of their pet. Governor Cuomo signed the proposal into law on Monday. Cemeteries do not have to offer the option, and religious cemeteries are forbidden from offering it. This law comes at the tail end of a series of measures that honor the bond between human and beast in New York.
See Forever with Fido: New York to Allow People to Be Buried with Pets, NBC New York, September 27, 2016.
Bradley E.S. Fogel recently published an Article entitled, Terminating or Modifying Irrevocable Trusts by Consent of the Beneficiaries – A Proposal to Respect the Primacy of the Settlor’s Intent, 50 Real Prop. Tr. & Est. L.J. 337 (2016). Provided below is an abstract of the Article:
In most states, an otherwise irrevocable trust may be terminated or modified by all of the beneficiaries as long as the trust does not have an unfulfilled material purpose. With few exceptions, however, a settlor of a trust is allowed to put whatever conditions she likes on her largesse. The beneficiaries might dislike the trust terms or wish they were different, but they are merely looking a gift horse in the mouth. After all, it was the settlor's choice to make the gift in the first place. The wants of the beneficiaries are only relevant to the extent that the settlor decided to make them relevant. Thus, trust termination by consent of the beneficiaries is inapposite in American trust law.
Trust modification or termination by consent of the beneficiaries should be abandoned in favor of the doctrine of equitable deviation. Equitable deviation allows trust modification (or even termination) based on circumstances not anticipated by the settlor. Such changes are made to better effect the settlor's intent. Equitable deviation respects the primacy of the settlor's intent and recognizes that, due to unanticipated circumstances, trust modification or termination may improve the trust's efficacy in effecting that intent.
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
Estate sales are different from your regular garage sale, promising nicer items and the potential for rare finds. Estate sales agents exist in an unregulated market and ask for fees around 35% of the sale total. It is important to get a copy of your estate sales agent’s contract and notice any red flags upfront. The Article explains common problems with estate sales agents, such as bouncing checks, accepting too little for certain belongings, and not taking items to auctions as promised.
See Paul Sullivan, It Pays to Be Wary When Hiring an Estate Sales Agent, NY Times, September 23, 2016.
Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.
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.
Alex M. Johnson, Jr. recently published an Article entitled, Is It Time for Irrevocable Wills?, 53 U. Louisville L. Rev. 393 (2016). Provided below is a summary of the Article:
Almost everyone knows that inter vivos trusts can be made revocable or irrevocable. And the reference to “inter vivos” as opposed to “testamentary” trusts is intentional. Testamentary trusts become effective only upon the death of the settlor by establishing a valid trust in his or her will and, as a result, are by definition irrevocable upon creation (the testator cannot die again nor can he or she undo his or her death to somehow later repudiate the creation of the trust). Hence, it is more precise to say that inter vivos and testamentary trusts may be made irrevocable, but only inter vivos trusts may be made revocable.
Although at one time the default rule in most states was that an inter vivos trust was irrevocable unless the settlor expressly retained the right to later revoke the trust, the modern and current majority view is the opposite: That is, trusts are revocable unless explicitly made irrevocable. Whatever the default rule, it is important to emphasize that inter vivos trusts come in two flavors or varieties: revocable and irrevocable.
Compare, however, wills that become effective only upon the death ofthe testator. By definition and in every jurisdiction, wills are ambulatory documents and can always be revoked prior to death. Indeed, there is no way for a putative testator to make an irrevocable will, meaning that there is no legal method by which an individual can commit to execute a will that is going to be effective upon that individual's death. In a legal regime that has as one of its primary goals the validation of the will maker's freedom of testation or disposition, it is somewhat surprising that individuals have no option to commit their future selves to a will executed by their present self.