Digital Assets in Estate Planning

By:  Chris Kelly

Times have changed.  In 2014, we now live in a fully digital world; computers are literally everywhere. Technology changes faster than we can keep up with, and we may not realize how that can affect our estate.

Twenty years ago, computers were giant machines kept in ventilated rooms; there was no Facebook, Pinterest, Instagram, PayPal, or even online banking for that matter.

Today, individuals compile a significant amount of digital DNA over a lifetime.  There are 3 types of digital assets: personal, business/financial, and social media.

Below are examples of typical digital "assets" contained in an average modern person's legacy:

• Social media profiles such as Facebook, LinkedIn, YouTube and a host of others
• Professional profiles [Linked In]
• Bank accounts, loan accounts, mortgage accounts
• Investment accounts such as eTrade or Ameritrade
• Uploaded photos
• Uploaded articles
• Education accounts, including alumni account profiles
• Gaming sites
• Email profiles and communications [Most people have at least two email accounts these days.]
• Digital media accounts, particularly streaming accounts such as Netflix or Hulu
• Cloud computing profiles or accounts
• On-line store accounts, particularly those with a social media angle such as iTunes and Amazon
• Music or movie files that were purchased and cloud-stored for on-demand downloading

So what happens to all of these digital assets -your electronic profile-  when you become incapacitated or pass away?

This is an interesting concept to think about, and one that has added a new twist to the estate planning industry. Many folks have online accounts with a plethora of websites such as PayPal, Ebay, Amazon, banks, credit unions, and on-line investment accounts.

 

While these electronic profiles have no value, often the accounts associated with them have significant funds on deposit.  Someone needs to be able to access these accounts in the event of a death or incapacity of the account holder.

One big red flag with this issue is Internet security. In order to protect these assets, someone has to have access to them. We are always told that our passwords should be updated frequently, and never to give them away.

So how do we safely give a spouse or family member access to these accounts without sacrificing Internet security?  It’s a tricky question to answer, but there are ways to provide this information without losing any security.

Often, a husband and wife share information, or have joint passwords or accounts. But in the event that they do not, or if someone does not have an individual they feel comfortable sharing this information with, there are websites that will assist.

There are Internet services where you can set up an account that will send you a message every month (or longer if you choose) asking you to confirm your password. By responding, you are confirming that you are still active in the account. If you don’t respond, the service will send a message to notify a person of your choice.

This notification may not give that person access to the account, but it will let them know that the account exists. This way, steps can be taken to make sure that the online accounts of the decedent do not just sit there languishing in cyber space for years.

Social media accounts can also come into play. Facebook, Instagram, Snapchat, and other similar websites have arguably become the new way of communication in this day and age. Although monetary estate issues may not arise from social media, we do share photos and videos on these websites that a family may want to obtain after the death of a loved one.

Dealing with digital assets is just one example of many complex and different areas of estate planning that are probably not taken into consideration by most people. To make sure this, and all areas of your estate are properly protected, it is imperative to seek the assistance of an attorney.

Our estate planning team offers free consultation on all estate planning matters. 

www.clarkstonlegal.com

info@clarkstonlegal.com

Proper Estate Planning is a Must

By:  Chris Kelly

We recently came across an article in New York’s Times Herald that highlighted the importance of a will, and how often the process of obtaining one is put on the back burner for many Americans. It is estimated that 65 percent of Americans do not have a will or basic estate planning documents in place. This is an alarming statistic, and the article touched on why the typical American chooses to put off such an important task.

   

Many individuals feel that a will or estate plan is only for the wealthy; this is simply not the case. A proper estate plan can ensure that the objects of your bounty are distributed to the right people.

This can save the headaches and confusion when an individual passes away, as well as help avoid potential feuds between family members.  No matter how big or small the estate, anyone with assets  needs to be protected; not just the wealthy.

Another common misconception is that an individual believes their finances are too meager for an estate plan.  Even the smallest of estates should be protected.  A proper estate plan will avoid the probate process which costs money and delays matters when most folks do not wish to be held up.

Furthermore, an estate plan is not all about money. If you have minor children, who will take care of them if a tragic event or unexpected death occurs? A guardian needs to be nominated for this possibility.

People do not like to think about the worst case scenario. An unexpected death can be very uncomfortable to plan for, and as a result many folks elect  to ignore it. This is a big contributing factor for  why so many Americans do not have a proper estate plan. The harsh reality is that these feelings need to be set aside in order to protect the best interests of your loved ones and your assets.

   

Procrastination. This seems to be the number one excuse for most people. They “haven’t had time to get to it”, or “it’s on the to-do list.” But what if that tragic event happens today? Sure, it’s morbid to think about, but the reality is everyone needs to be prepared for such a situation.

 

The only way to ensure that your possessions, and the well-being of your family is protected, is to be proactive and put a plan together sooner than later.

Putting together an estate plan can be very confusing, which is another reason some folks put off the task for another day that never comes.  Accordingly, it is best to seek the advice of an estate planning attorney.  

There are many different factors that need to be taken into consideration, and each estate is different. Our law firm offers free consultation discuss different estate plan options. 

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Author Tom Clancy's Sizable Estate Demonstrates Need for Proper Estate Plan

By:  Chris Kelly

Recently, we came across an article published by the Wall Street Journal covering the contested will of deceased author, Tom Clancy.

Well known for his best-selling spy thrillers, Mr. Clancy amassed an estate in excess of $83 million. As with many estates that size, Clancy’s estate is now the subject of probate litigation in the form of a will contest.

   

In this particular case, Mr. Clancy’s widow is taking legal steps to shift all state and federal estate taxes to the portion of the estate willed to the author’s four children from Mr. Clancy’s first marriage.  The estate is spread all over the country, and consists of everything from rare World War II tanks, to a 12% stake in the Baltimore Orioles, valued at $65 million.

Ms. Clancy claims that the lawyer serving as the executor of the estate wrongfully concluded that $6 million of the tax burden should be borne by a family trust of which she is the primary beneficiary. She further claims that this was not what Mr. Clancy intended, and to enforce it would be unjust.

Clancy’s widow says her husband modified his will in 2013 so her share would pay zero in estate taxes, and that the portion he willed to his four adult children was to pay the entire amount.  Mr. Clancy’s children question the validity of the recent amendment, asserting his original estate plan should control. 

A contested will is something that happens frequently, and although it occurs on a much smaller scale, it can still be a frustrating and stressful situation.  Proper estate planning can serve to minimize will contests and most other probate litigation.

The first step in forming an effective estate plan is to seek the advice of a probate lawyer.  If you are involved in probate litigation, you should seek advice from an experienced litigator. 

  

Not all cases are the same, and attention to detail in examining the will, and any modifications made to it over the years are essential in determining the validity of the document. Such tasks must be performed by an experienced attorney to ensure that no mistakes are made.

The Wall Street Journal article on the Tom Clancy probate litigation is a prime example of what can happen with poor estate planning, especially when a second marriage is involved.  Whether your probate issue is large or small, our law firm offers free consultations to discuss these difficult situations and can assist in all probate matters, including estate planning, or defending or prosecuting litigation if things have gone too far.   

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Young Adults and Powers of Attorney

By: Chris Kelly

Recently, we came across an article in a publication put out by the Troy-based Kemp Klein law firm addressing the importance of powers of attorney for young adults.  This is an issue that many people, particularly parents, may not think about.

Once your child turns 18, they are no longer considered a minor in Michigan. Many parents may not realize it, but this also means they no longer have the power to obtain medical information or manage assets and bank accounts of their children.

This can result in a very uneasy feeling for a lot of parents, especially those whose children are just about to head off to college and live on their own for the first time. Fortunately, there are steps that can be taken to alleviate this unwanted stress.

First, a parent should obtain a Durable Power of Attorney. In doing so, parents are able to make financial decisions that they would otherwise be prohibited from doing for their now-emancipated child.

In many cases, an 18 year old still lacks the maturity to make important financial decisions on their own. With a Durable Power of Attorney, parents can put their mind at ease knowing that they still have the ability to make such important decisions in the event of their child’s incapacity.

The next step is to obtain a Patient Advocate Designation.  This document designates an adult to manage the care and medical treatment decisions of the young adult.  Once a child reaches the majority age of 18, he or she can designate their parent to serve as a patient advocate. By doing so, the parents now have the ability to make sure that their child is making the best decisions for their healthcare and medical treatment in the event of an incapacity.

Like financial decisions, medical decisions can be very important and have a significant impact on an individual’s life. By keeping parents involved in this process, it not only helps the young adult, but also gives the parents peace of mind knowing that the best care and treatment will be provided should an incapacity arise unexpectedly.

Most people avoid thinking about this unpleasant topic; very few even know these types of documents and powers exist for young adults.  When parents and their young adult children educate themselves on these basic probate planning precautions, medical and financial disasters for the young adult can be avoided.

Such forethought can ease the transition of the young adult from life under the protective umbrella, to living on their own.

This is a basic overview of these types of fiduciary powers and estate planning documents.  Our law firm offers a free consultation to discuss these documents and the estate planning process. 

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Guardianship During Divorce Proceedings

Divorce is difficult to be sure.  The divorce process is sometimes further complicated by the incapacity of one of the spouses.

Here is Michigan's legal definition of an incapacitated individual as set forth in the probate code known as EPIC [Estates and Protected Individuals Code]:

Incapacitated individual means an individual who is impaired by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication, or other cause, not including minority, to the extent of lacking sufficient understanding or capacity to make or communicate informed decisions.

Having a spouse with a guardian is a situation we have seen here at Clarkston Legal, both in our family law practice as well as in our probate docket.  The question is, if a spouse to a divorce proceeding needs a guardian, who should serve in that capacity?

The individual nominated to serve as guardian can be a parent, sibling, or even a trusted friend.  The nominated individual can also be selected from among the corps of active Public Administrators in the county taking direct appointments from the probate court judges.

This specific guardianship issue arose quite a while back in a 1998 divorce case from the Oakland County Family Court that was decided by the Michigan Court of Appeals in 2003.  The published thus binding case, Keller vs Keller, affirms the proposition that a spouse previously found incapacitated by the Oakland County Probate Court, can nevertheless direct her guardian to initiate, prosecute, and conclude divorce proceedings.

Although a protected individual under guardianship lacks capacity to enter into binding contracts, including a settlement agreement or consent judgment of divorce, the guardian functions as an "alternate decision maker".  Those decisions can include the myriad elections involved in the completion of a divorce proceeding.

Therefore, the guardian determines when alimony is sufficient, how long alimony should be paid, negotiates the property settlement, even determines a parenting schedule if the couple has minor children.  After the divorce, the guardian is also in charge of arranging a proper placement for the newly divorced ward.

If you know someone who is in a bad marriage, and who is not capable of managing their own affairs due to a suspected incapacity, contact  our law firm for a free consultation.

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Dead Man Standing

Dead Man Standing in Puerto Rico.
Murdered boxing champ posed by family.

This comes to us straight out of New Orleans. The story about families posing their dead at funerals was below the fold in today's Sunday NYT, yet this only-in-America tale still caught my eye.

The practice was bound to go viral at some point; leave it to the Big Easy.  The Charbonnet-Labat Funeral Home staged its second dead sit last Thursday when Miriam Burbank, deceased, was posed in her home, sitting at her kitchen table, beer glass in one hand, cigarette in the other.

New Orleans has always had a flair for funerals; think the colorful Creole funeral "parades".  But this is something altogether different; so different that the director of the 132-year old Charbonnet-Labat Funeral Home recently has been criticized for the practice by other funeral home directors who say the practice is improper, sacriligious, tasteless, immoral, and borderline illegal.

The rite of sitting or posing the dead began only very recently with a little Caribbean influence from San Juan, Puerto Rico in the Greater Antillies.  While the first cadaver poses took place at wakes around San Juan in 2008, by 2012, a law was passed in Puerto Rico formally legalizing the rite, provided the pose does not depict "immoral" conduct.  Well, we here at the electronic probate attorney find that qualification refreshing.

Whether the practice is legal here in Michigan or other states is questionable. If the rite catches on, or goes viral like Ms. Burbank in her kitchen, with her beer and cigarette, then the law will catch-up with it.

Defenders of the practice within the funeral industry point out they only execute "poses" at the very specific direction of the deceased's family; apparently the pose is what the deceased wanted, and perhaps made his or her wishes known.

As a matter of good probate estate planning, it is a "best practice" to include a specific clause in your will expressing whether, for example, you wish to be cremated, buried, or, posed before internment.

Here are some examples of rites of sitting the dead featured in the NYT article:

• A paramedic posed behind the wheel of his beloved ambulance; 
• A man sitting Indian-style, dressed like Che Guevara, with a cigar in hand; 
• A gambler posed at the wheel of his beloved Cadillac Seville, deck of cards in hand; 
• An elderly deceased woman greeted guests to her wake from the comfort of her rocking chair; 
• A 20-something murder victim was bolted to the wall, overseeing his wake; 
• Big Easy band leader Lionel Batiste stood with his cane, hat tipped to one side.

Death is in the eye of the beholder.  Should a family respect the decedent's wishes, even when they careen out of the bounds of decency?

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Dad's Memo Prevents Daughters From Getting Disinherited by Step-Mom

A secret memorandum that a concerned father passed to his daughters some 13-years prior to his death may have saved their sizable inheritance.  The memo was a key piece of evidence in resolving a trust dispute where the step-mother had exercised undue influence to claim her wealthy husband's entire estate, worth an estimated $5 million.

The identities of the parties to the case were kept private by the Michigan Lawyers Weekly, a newspaper that this Blog subscribes to in order to keep-up with probate legal trends and changes in the probate laws.  Some of the facts, however, are known, and they are instructive in combating this type of overreaching greed.

Apparently, the decedent knew what type of woman he married, taking steps to warn his two daughters that their step-mother may try to get him to sign away his estate from them to her when he was in a physically weakened state.  And this is just what the step-mother set out to do; we've seen this movie before here at this probate blog.

In this case, evidence surfaced in the probate court that step-mom exerted undue influence to re-write the decedent's trust such that half of his estate was transferred into her trust, with the decedent's daughters being only contingent beneficiaries on the other half; the step-mom was in control of the entire estate and could leave the decedent's daughters with nothing.

Our friend, probate attorney Alan May, uncovered a paper-trail of evidence on behalf of the decedent's daughters that demonstrated step-mom knew her husband, "could be pressured to sign things."  The paper-trail also yielded documentation between step-mom and her lawyers, plotting to defend against the inevitable "undue influence" challenge.

Perhaps the most significant and compelling evidence produced by Mr. May was a manipulated version of a keep estate planning document that was changed after the fact [i.e. after its execution] that modified significant terms in step-mother's favor.  When the document was compared to the original, the special pagination that probate lawyers use was not present, although it was on the original.  Busted...

The result of Mr. May's fine effort was a settlement that put $2.6 million into the daughter's coffers; an amount equal to able one-half of the decedent's estate.

If you are concerned that a loved one or family member may have fallen victim to undue influence, it is best to seek the advice of a probate attorney as soon as possible.  That way, preventative steps can be deployed or, as in this case, evidence can be brought to bear to expose the malfeasor, preventing unjust enrichment and producing a more favorable and just outcome.

A decedent's wishes must be honored, and another family member's greed should not affect the outcome of an estate plan.

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Decedent's Second Wife Forges Will and Revocation of Prenuptial Agreement

In a recent East-side case from Macomb County, two sons challenged the claims of their deceased father's second wife.  The case was sufficiently contentious to wind-up being tried before a jury in Macomb County Probate Judge Carl Marlinga's courtroom.

The couple had been married only five years and had executed a prenuptial agreement prior to their nuptials.  Wife claimed her deceased husband revoked the prenuptial agreement, and changed his will to favor his wife over his sons, but the jury found that she forged the revocation and exercised fraud and undue influence in the execution of the revised will and estate plan.

The sons' claims were that following a debilitating heart attack in 2007, their father's sizable estate was systematically depleted by his second wife.  The sons demonstrated that wife wire-transferred over $340,000 to her family in the Ukraine without her husband's knowledge.

The jury trial in this case took 3-weeks and resulted in a verdict for the estate of nearly $500,000.  With human nature being what it is, you just can never be too careful when a stranger links up with a beloved and well endowed family member.

There is indeed a fine-line between meddling in an elderly family members financial and private affairs, and protecting the loved one from financial abuse, greed and graft.  Keep a close eye on your loved ones folks.

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Michigan Legislature Addresses Digital Estates

It's a start.  The Michigan legislature now has a raft of bills assigned to the all-encompassing Judiciary Committee that would amend our current probate code to provide for handling of a deceased person's so-called digital assets.

Digital assets would include electronically stored photos, Facebook, iTunes, eTrade, data collections of any type, even including a person's email accounts.  If the bills pass, a personal representative could petition a county probate court for assess to these accounts.

Some legal experts, however, see problems with a conflict of laws.  Even if our state probate code, the Estates and Protected Individuals Code, is amended to provide for a personal representative's access to digital assets, federal laws prohibit such access by anyone other than the account holder.

In addition to complications from the federal Stored Communications Act, many of the specific terms-of-service for accounts prohibit access to a particular account by anyone other than the original account holder. There are also concerns arising from user consent to such disclosures in the privacy law context.  So the experts smell complicated litigation arising from the effects of these digital asset bills.

The proposed legislation also contains a provision that allows an interested party to file a petition seeking to limit or eliminate the power of the personal representative over the digital assets.  If the decedent has implicated family members in some of the electronically stored data, the situation is certainly ripe for some digital probate litigation.

So we will site back and see just where this legislation goes.  Stay tuned for future developments.

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Recently Deceased Celebrities Demonstrate Importance of Estate Planning

Paul Walker: Died too young, but with a trust.

Over the past few months, Paul Walker and Philip Seymour Hoffman both died in sudden and unexpected ways.  The latter, from an apparent overdose of heroin in January after decades of straight living; the former, ironically, in a flaming high-speed car crash last November.

At the time of his death, Walker had just turned 40; Hoffman was 46.  The untimeliness of the men's deaths left their respective movie projects incomplete.  Walker will appear posthumously in a futuristic thriller, Brick Mansions, set in Detroit, but his Fast and Furious sequel #7 scenes had not been completed at the time of his death. Hoffman will have to be written-out of the Hunger Games trilogy.

The untimeliness of the stars' deaths also highlights the importance of proper estate planning.  A comparison of the actors' estates -each worth well over $30 million- is instructive with regard to basic estate planning principles.

Last Will versus a Revocable Living Trust.
A proper estate plan, even for persons with a modest estate should include both a trust and what is known as a "pour over" will.  A trust is a private instrument while a will is a public instrument.  A trust, if funded properly, avoids a public probate process.

Walker had the foresight to execute a trust way back in 2001, when he was starting to hit it big in Hollywood in his break out role in the Fast and Furious series.  Hoffman, on the other hand, did not have a trust; merely a simple will.  Therefore, his entire estate will need to be probated because he died with a will and not a trust.  Hoffman's assets cannot be disbursed until they are probated; this process will cost money through probate and attorney fees, and will take time.

Funding the Trust.
When a trust is executed, it is simply a piece of paper unless properly funded.  Think of your trust as an empty bucket.  To fill that bucket with the assets from your estate, each asset must be re-titled in the name of your trust; otherwise, they will be probated in accord with your "pour-over" will; a document designed to catch any asset in your estate that may have been inadvertently left outside the trust.

An estate planning lawyer can help with timely funding your trust.  To be most effective, a trust should be fully funded during your life.

A warranty deed can be executed to transfer the ownership of your home, for example, from you as an individual, to you as the trustee of your revocable living trust.  Your financial advisor can assist you with re-titling your brokerage accounts into the trust with a medallion certificate.

Updating Your Estate Plan.
After important life-events, it is critical to update your estate plan.  For example, when you have additional children that were not born at the time you initially executed your estate plan, you should update.  Or when you become married, and your estate plan was executed when you were single.  The death of a spouse is another crucial time when an estate plan should be re-examined.

In Hoffman's case, his will was nearly a decade old and only referenced the oldest of his three children.  Similarly, in Walker's case, his trust was over a decade old.  Hoffman's oversight will now cause his oldest son to be treated differently than his two younger children to the extent that the oldest inherits his share through his mother, while the younger children will receive a direct inheritance.

Probably not what the actor intended; his younger children, still minors, take a direct inheritance while his oldest, also a minor, gets his money through his mother.

These are just some of the basics.  In order to properly plan your estate, you should make an appointment with an estate planning attorney.

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Guardians Can Now Execute DNR Orders

As a Public Administrator, a professional fiduciary serving Oakland County, the issue of executing a DNR order [Do Not Resuscitate] continually arises in my law practice.  The issue has been politically charged for years.

DNRs have been governed until this week by the "Do-Not-Resuscitate" Procedure Act.  The DNR Act is now supplemented by Public Act 155; passed last November and taking effect tomorrow.

Here is the crux of problem faced by court-appointed fiduciaries and care facilities:

On the one hand, the Estates and Protected Individuals Code [EPIC], Michigan's probate code, in the chapter on Guardianships, indicates that the guardian must take necessary steps to respect the protected individual's wishes, and to provide them with proper medical care.  Guardians have been guided by an ethics opinion issued by the Attorney General in 2003 that proscribed fiduciaries from executing a DNR order relative to their wards, unless such an order was issued by the probate court.

On the other hand, in many cases, licensed care facilities that receive incapacitated individuals require that the protected individual have an executed DNR before they will accept the  person into their facility.  Meanwhile, the hospital wants the recuperating individual discharged to the care facility asap given the exorbitant per diem costs of care.

The care facility, especially in terminal cases, does not want to incur the cost to administer the inevitable ER run back to the hospital in a few days, or even hours, of a ward's return to the facility.

Procedural Problem: getting before a probate judge on a petition for authority to execute a DNR order takes 14-days, unless you can convince the court that your specific circumstances constitute an "emergency".  Often, the hospital's fiscal pain does not equate to an emergency in the court's eyes.

In one recent case that this Public Administrator experienced, I visited my ward in an area hospital who was in the throes of terminal kidney failure and was non-communicative; there was no advanced directive [living will].  The hospital wanted her gone; her former care facility would not take her back without an executed DNR.

My staff immediately petitioned the court but we were unsuccessful in obtaining an emergency hearing date thus, we began a 14-day wait period during which the ward died.    Our objective was to provide our ward with the most comfortable and dignified setting possible.  Anyone would agree that was not on the floor of a hospital.

The new law allows a guardian to execute a DNR order outside a hospital setting, provided the protected individual's treating physician also signs the order.  In our recent case, the ward's former care facility would have taken her back if I would have had the authority to execute DNR without first seeking court approval.  Now, guardians have that power, provided the decision is endorsed by the treating physician.

The legislative analysis summarizes the new law as follows:

• Expands the power and authority of a Guardian to execute or revoke a DNR order; 
• Revises the definition of a DNR order to make such an order applicable to all places outside a hospital; 
• Provides for the voiding of a revoked DNR order, not for the destruction of such an order [i.e. the word "VOID" is to be stamped on each page of the DNR order];
• Revises the information that is required to be on the DNR order; and 
• Requires a Guardian Ad Litem to advise the allegedly protected individual that is the subject of a guardianship proceeding that an appointed Guardian will now have the power to execute a DNR order on behalf of that individual.

Prior to becoming law back in November, the bill received broad support from probate judges, the probate bar, Michigan Right to Life, and a broad mix of lobby groups.  For non-related court-appointed fiduciaries, this new law is a welcome improvement to how things were done in the past.

Guardianship Bills Seek to Prevent Elder Abuse

By:  Timothy P. Flynn

An adult guardianship is a probate court proceeding that protects an individual that cannot take care of his own affairs by appointing a fiduciary -a guardian or conservator- to care for the incapacitated individual.  In our free-society founded on individual liberties, guardianships although disfavored as a legal status, are sometimes necessary to protect individuals made vulnerable through age or mental illness.

As a Public Administrator, I have served the Oakland County Probate Court by accepting appointments as the guardian and conservator for individuals deemed by a judge to be incapacitated, but who do not have suitable family members to serve as their fiduciary.  Currently serving as guardian for just over 75 protected individuals, and for hundreds over the past decade, I have acquired vast experience in dealing with all aspects of adult guardianships and conservatorships.

Two weeks ago, companion bills were introduced in the Michigan Senate to amend the guardianship provisions of the Estates and Protected Individuals Code -Michigan's probate code- to adopt the Uniform Guardianship Jurisdiction Act.  The companion bills seek to restrict the subject matter jurisdiction of the county probate courts by adopting a complicated three-tier test to ascertain the allegedly incapacitated individual's contacts with the forum state prior to granting a guardianship.

Under the present probate code, a guardianship can be granted for any incapacitated individual physically present in Michigan.   One benefit touted by supporters of the Senate bills is prevention of conduct known as "grannysnatching" whereby a person takes a vulnerable individual into Michigan from another state and immediately files for guardianship in order to control the person's income and assets, and to prevent contact by other family members.

If adopted, the Senate bills would revise our guardianship act, making the initial establishment of a guardianship much more difficult, and complicated.  Under the present guardianship procedures there are effective safeguards already in place.  For example, prior to the establishment of a guardianship, a Guardian Ad Litem is appointed by the probate court to function as the "eyes and ears" of the court; to investigate the guardianship petition and make a recommendation to the judge.

Also, under the present law, all "interested persons" -other family members- must be served with a copy of the petition and can appear at the hearing on the petition and object to the guardianship or to the appointment of the nominated individual.  Such notice provisions, along with the GAL's report to the probate judge, operate as an effective set of safeguards against cases of reprehensible "grannysnatching".

We here at the Law Blogger see these companion bills, SB 465 and SB 466, as more trouble than they are worth.  If adopted, probate court staffs across the state will need to absorb and digest the complex provisions of the Uniform Guardianship Jurisdiction Act and the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act; this will require staff training and increase the administrative costs associated with the delivery of these public services.

Such cost and complication will come just as the Oakland County Probate Court has managed to trim staff and control expenses to stay on-track with Oakland County's perennially-balanced budget; a rarity in this day and age, especially considering that the services provided by the probate administrative staff have remained first-rate.

For these reasons, we say "no" to the companion bills and urge the Michigan Senate to leave well enough alone.  The present guardianship system in Michigan is not broken thus, it does not need to be "fixed" by a uniform act.

Related Note:  A documentary on elder abuse titled, Last Will and Embezzlement, was profiled in today's Freep.  The film, which takes a look at the ways criminals take advantage of the elderly, is playing in Clinton Township and West Bloomfield.

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The Problem With Executing Two Successive Wills

Ms. Haguette Clark

...is that your family will fight over the money in your estate.  This appears to be happening right now in New York to the deceased multimillionairess Huguette Clark.

The problem with this estate arose, as is so often the case, toward the end of the decedent's life.  Ms. Clark, the daughter of copper magnate and Montana Senator, William Andrews Clark, and a private person to begin with, lived the last decades of her life in a New York hospital surrounded by her care-providers but largely estranged from her distant relatives.

In 2005, Clark executed two successive wills within six weeks.  The first will was garden-variety, leaving the bulk of her estimated $300 million dollar estate to her surviving albeit distant family members; a collection of grandnieces, grandnephews, great-grandnieces and great-grandnephews, all of whom apparently have standing as heirs-at-law in New York to challenge the probated will.

In the suspicious second will, hastily executed just 6-weeks after the first, Ms. Clark apparently had a sudden and massive change of heart, leaving the bulk of her estate to her lawyer, her accountant, and her care provider, and establishing a foundation for the arts with generous funding.  The second will contains the following language of disinheritance:

I intentionally make no provision in this may Last Will Testament for any members of my family, whether on my paternal or maternal side, having had minimal contacts with them over the years. The persons and institution named herein as beneficiaries of my Estate are the true objects of my bounty.

The collection of 20 distant relatives are not taking this second will sitting down; they have lawyered-up, Manhattan style.  Discovery in the case, largely consisting of desperate attempts by the family member litigants to prove their paper thin contacts with the wealthy decedent, has been completed and a jury is scheduled to be selected tomorrow.

Greed abounds on both sides of the caption in this case.  Did Ms. Clark really intend to disinherit her family members in favor of her lawyer and accountant?  What was the nature of the contact between Ms. Clark and her distant relatives?  Did she even know who they were?

The moral of this tale is to make a viable well-thought-out estate plan early in life.  As things in your life change, and perhaps you acquire a larger estate, amendments to your estate plan can be executed.

All too often, we see professionals take advantage of their elderly clients, putting themselves in a position of financial gain through undue influence.

Contact our law firm for a free estate planning consult and you can avoid the type of litigation that now threatens to define Ms. Clark's once proud legacy.

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Tony Soprano's Estate Plan

James Gandolfini

Actor James Gandolfini played New Jersey mob boss Tony Soprano on the long-running HBO series The Sopranos.  I was a fan and thus, very disappointed at the news of his early demise.

In the stream of media obituaries that followed his death, it was no surprise to me that Gandolfini was considered an actor's actor; he studied his craft and brought great skill to his roles.

One piece that I encountered about the late actor, from the New York Daily News, drilled into his estate plan.  Apparently, Gandolfini's estate plan was a train wreck, disaster, and a nightmare on tax street, all rolled into one.

Apparently, the problem arises where he left 80% of his sizable estate [over $70 million dollars] to his sister and infant daughter, subjecting this portion of his estate to New York's 55% estate tax rate.  His widow was covered by a trust, but she is only slated to receive 20% of his estate; but she only taxes her twenty percent net of all estate taxes.

Perhaps the actor wanted it this way, but the estate could have been planned in such a way to avoid such steep estate taxes.  Tax and estate planning lawyers sometimes have clients that simply do not want their assets tied-up in complicated trusts or tax-avoidance schemes.

Really, it is the legislators and their penchant to create an endless supply of loopholes that is the real culprit in these cases, not the estate planning attorney.

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Google Rolls-Out Social Media & Digital Estate Plan

Truly, Google is everywhere.  Now, the Big Data company is looking to get into your [digital] estate plan; and with some good reason.

Right around tax-time last month, Google rolled out its "digital afterlife" feature -technically and officially known as the inactive account manager.  This tool allows Google users to provide Google with specific instructions about what to do with their Google data when they die.

Google has billed this feature as something to make it easier for a user or a user's personal representative to manage a person's personal data -one's "digital estate"- after death.  The inactive account manager was initially touted in the Google Public Policy Blog.

Nearly everyone has a Google account.  Many of us have developed complex electronic profiles over the past decade; some of those profiles even have value.

The law has not caught-up with our electronic profiles.  To date, only five states -Connecticut, Idaho, Rhode Island, Indiana, and Oklahoma have estate laws addressing digital assets.  Not to worry, however, as the Uniform Law Commission has set about drafting a proposed uniform digital estate law that will make it much easier for other states, including Michigan, to adopt the appropriate legislation.

As time marches on, Google's inactive account manager is banking on the specter that a majority of their user's will want to preserve, protect or direct their data profiles.  The inactive account manager is designed to aid in this task.

It is a very 21st Century concept.  We here at the electronic  probate attorney wonder what this account manager will look like in, say, 100-years from now.

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Heirs-at-Law Discovered via Facebook

Recently at our law firm, we have had a few cases where personal representatives and other fiduciaries have located heirs-at-law through Facebook.  In some of these cases, nothing was known about the heirs and resources were about to be expended with an expert skip-tracer.

Alert family members were tipped off and/or obtained information through their FB friends or "friends-of-friends".  In turn, this provided the probate lawyers of our firm with some basic contact information.

Under the applicable court rules, lawyers are still limited to "old school" methods of transmitting messages and documents; not even email is permissible under the court rules.  Informally,  however, modern practitioners are utilizing a variety of social media and data directories to locate heirs.

Once the interested parties are identified, the process of identifying the various claims and other issues of probate estate administration can commence.

Slowly, probate courts across the country are implementing an electronic infrastructure and promulgating electronic filing standards.  Both Wayne and Oakland County Probate Courts have made great strides in this area.

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The Veterans Administration and the Aid & Attendance Benefit

The VA provides a little known benefit called the Aid & Attendance benefit available to qualified veterans.  The service requirements to qualify for this benefit include serving at least 90-days of active duty with one day during a war-time period.  A dishonorable discharge disqualifies the veteran from receiving the benefit.

If qualified, the maximum annual pension is up to $1,644 per month; a veteran and his or her spouse may receive up to $1,949 per month; a surviving spouse of a veteran could receive up to $1,056 per month.

The veteran does not need to be suffering with limited assets in order to qualify.  Depending on the circumstances, a veteran and their spouse could have assets of $80,000 and a single veteran or surviving spouse could have assets valued at $40,000.

The VA does not count the veteran's home within the asset calculation; nor does the veteran have to sell their home to qualify for the benefit.

The asset threshhold be met with proper financial and estate planning.  You may find the assistance of a VA accredited attorney, or other qualified professional to ascertain your eligibility.

Unlike Medicaid, the current law does not apply a “look back” test for asset transfers, nor is there a “penalty period” for gifts or transfers to qualify for the Aid & Attendance benefits.

You will not be required to invest a large portion of your asset portfolio to qualify for the Aid and Attendance benefit.  While that strategy is employed by some organizations, you do not need to utilize annuities in order to qualify for VA benefits.

A veteran can expect about a 9 to 11-month wait for benefits to commence once the application has been submitted to the VA.  However, the VA pays benefits retroactively back to the month after the application is filed, provided the applicant is still living.

For assistance, contact the VA for accredited lawyers near you.

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Widows Experience High Foreclosure Rate

One of the lingering twists to the real estate recession of the past five-years is that widows over the age of 50 are experiencing drastically increased foreclosures according to the AARP.  This glitch in the foreclosure crisis arises due to the prevalence of mortgage notes obligating husbands-only; when they die, their widows often do not qualify to refinance the mortgage note.  

According to the AARP study, the mortgage foreclosure rate for persons over 50 rose by 23% between 2007 and 2011.  The causes are believed to be the surviving spouse's fixed income, the increased cost of needed medication, and the small print on the couple's mortgage note.

Our rapidly aging population is also to blame.  This demographic has produced a disturbing Catch-22: to stay in the home, the widow must take over the mortgage payments; but in order to do that, the payments must be up-to-date.  In many cases where the wage-earning husband dies, especially following a long illness, the unsuspecting widow finds that the mortgage is already significantly behind.

Add to his dynamic the fact that, in general, elderly Americans are saving less and spending more.  Our elders between the ages of 65 to 74 are becoming indebted at the fastest rate of any other age-group.

In the case of a widow in poor health, the application process alone can be hazardous to one's health.  As veterans of the process can attest, the process features unanswered phone calls, and repeated requests by loan servicers for the same documentation.

The lesson implied in this ominous trend is to get your house in order, literally, prior to the death of one of the spouses.  This means that a married couple should make every attempt to place both spouses on the mortgage note so that refinancing the marital home is not necessary following the death of one spouse.

Another "best practice" is to have each spouse participate in paying the bills and managing the mortgage when one of the partners attains age 50.  Traditionally, one spouse takes primary responsibility over the bill-paying tasks.  Familiarity with the process will reduce stress levels when, for example, a widow finds herself as the only one left to keep the mortgage on track.

Finally, having an executed estate plan will reduce stress when a spouse dies.  Consult with an estate planning attorney in your  community to learn more about your options.  Good luck out there; if you don't look out for yourself, no one else will.

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Frozen Sperm and the Social Security Administration

The Michigan Supreme Court heard oral arguments mid-Month in a very interesting case of first impression involving frozen sperm and Michigan's laws of intestacy.  The certified question before our High Court  is whether frozen sperm equates to "children" under the intestacy statute.

In this case, the procedure is as unusual as the fact pattern.  The case comes to the Supreme Court on a certified question from the United States District Court for the Western District of Michigan.  The case took more than five-years to get to the state court.

The case arose when the Mattisons, a married couple, arranged for Mr. Mattison to bank his frozen sperm in order to preserve it for later impregnation and prior to receiving chemotherapy to treat his cancer.  The couple desired to preserve their ability to have children but were worried that Mr. Mattison's chemotherapy would damage his sperm, complicating their efforts to conceive a child.

After actively preparing his wife to receive his frozen sperm, Mr. Mattison died back in 2001.  Ms. Mattison subsequently was implanted with her deceased husband's frozen sperm, conceived and gave birth to twins.

Ms. Mattison's application on behalf of the twins for survivor benefits was denied by the Social Security Administration.  The SSA took the position that the children did not survive their wage-earner father under the definition of the terms "child" and "survive" in Michigan's probate code; the Estates and Protected Individuals Code.

In listening to oral arguments in the case, it did not appear that the High Court Justices, particularly Justices Robert Young and Stephen Markman, were very receptive to Ms. Mattison's position.  Justice Young exhibited palpable irritation that the certified question, which appears to have no statutory support in EPIC, took so long to make it's way to the Michigan Supreme Court.

Although many other states are considering similar questions, we here at the Law Blogger predict that our Supreme Court will decide in this case that the Mattison twins are not entitled to receive the survivor benefits from their deceased wage-earning father on the basis that they simply did not exist at the time of their father's death.

Toward the end of the very brief oral arguments, one of the Justices asked Ms. Mattison's attorney whether he had considered raising the frozen sperm survivorship issue with the Michigan Legislature.  We agree with Justice Young when, during oral argument, he wondered aloud whether the certification of this particular question was essentially a violation of the constitutional separation of  powers.

Unfortunately for the Mattisons, Courts cannot legislate from the bench.

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Consumer Reports Reviews Self-Help Probate Legal Sites

In today's world, everybody wants to be the lawyer; especially their own probate lawyer.

Consumer Reports, that trusty publication that does in-depth research on products that we consumers know little about, has targeted three of the most popular self-help legal websites in the attached report.  The web sites reviewed are Legal Zoom; Nolo; and Rocket Lawyer.

The most popular of the three sites is Legal Zoom, founded by Los Angeles lawyer Robert Shapiro, and hawked by the likes of Rush Limbaugh.  The site attracts many people interested in completing their own estate plan.

The CP review of the sites is luke warm, as you may expect.  The general conclusion is that, if you have a very simple matter, these sites are "better than nothing."  If you have any complexity to your legal matter, however, you will be better off hiring a lawyer.

As any lawyer knows, the devil is in the details in any legal situation.  One-form-fits-all simply does not work in the law. Sure, lawyers are trained to use checklists and forms, but every document drafted must be customized to some extent to ensure that the client's objective is completed within the four corners of a document.

These days, with on-line review services and easily accessible electronic profiles, you can do a lot of preliminary groundwork and research at your computer.  This is true of your specific legal issue, as well as for the lawyers who are in the best position to handle your matter.

So take a look at the linked report before paying fees to one of these sites.  And be careful out there...

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