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Top 10 Ways to Protect Yourself Against Claims of Undue Influence

If you are taking care of your elderly mother or father, especially if your parent is living in your house with you, pay attention: Your siblings will claim that you exerted undue influence on your parent. I am probably being a little overly cynical, but claims of undue influence, both before and after mom or dad have passed away, happen all the time and keep many lawyers in business with tens of thousands of dollars in legal fees paid pursuing and defending against claims of undue influence.

Unfortunately, the elderly in our society are susceptible to influence. In general, the elderly want to be liked and do not want to upset their children by disagreeing with something that the child proposes, particularly if the elderly parent is living with or dependent upon the child. Even when the child has no bad intentions, suggesting a course of action that the parent would not agree with is a type of influencing of the parent. And, even when the child has no bad intent at all, a suspicious or jealous sibling will do everything in his power to make those actions look as nefarious as possible.

If you are the primary caregiver for your parent or if your elderly parent lives with you, here, then, is the top 10 list¹⁾Given the limitations of this medium, you will just need to imagine me throwing a note card/the crashing glass sound upon completion of each point of things that you absolutely must do to protect yourself from the inevitable claims that you have unduly influenced your parent²⁾"Paul, hit the music!" and stay tuned next week for a our new segment "Will this legal concept float?".

The Top 10 Ways to Avoid an Undue Influence Claim Against You

#1: Be Transparent

Undue influence and particularly the suspicion of undue influence, grow in the shadows. Your siblings will become more and more suspicious if they have no idea what is happening with your parent’s health care and financial situations. Share financial statements and medical information with your siblings. “But wait a minute,” you say. “This is none of their business. What Mom and I do with her money is her business. I don’t have to tell my brother what we are doing.” You may feel this way and you may be right. However, if you choose to keep your siblings in the dark about mom’s health care and finances because it is not their “business,” just know that an eager lawyer will make it their business soon enough.

#2: Have a Written Agreement

You might think this is silly and overly formal, but make a written agreement with your parent about your arrangement with him/her. If Mom is going to contribute $200 per week for the joint household expenses, write it in an agreement. If Dad is going to pay you $1,000 per month for your caregiver services, write it in an agreement. If Mom and Dad are paying you back for expenses you incurred, write it in an agreement. When your brother sues you for undue influence (and he will) and the only thing that he sees is a check coming out of Mom or Dad’s checkbook written to you, he will naturally assume you were just cashing in at Mom or Dad’s expense. You might be able to convince the judge, eventually, that the arrangement with Mom and Dad was always on the up-and-up, but it will cost you much more in legal fees to do so than Mom or Dad ever paid to you. Write it down, have everyone sign it, and preferably have an independent third party (someone outside the family) be a witness to the agreement.

#3: Keep a Paper Trail

Receipts, receipts, receipts. Keep a receipt for every penny of your mom’s money that is spent. If Mom likes to pay with cash only, make sure you get a receipt for every cash purchase. If checks are written, make sure there is written documentation of the purpose of the check, especially if the check is to you³⁾see #2 above, your spouse, or to another person that would not be obvious what the check is for.

#4: Do Not Use Cash

Many elderly people like to operate only in cash. Trust me: cash causes problems. The only thing that your sister sees when she claims to everyone on Facebook that you are exploiting Mom is a bank account statement showing hundreds or thousands of dollars in ATM cash withdrawals every month. Sister is also likely to claim that you were the one using Mom’s debit card to make the withdrawals (which is probably true). It looks bad for you even if you did nothing wrong and even if you really did give all of the cash to Mom. Strongly encourage Mom to use a debit card or write checks⁴⁾I know, I’m old fashioned. A debit card purchase will at least show the payee on the bank statement if you forget my advice in #3 to keep receipts. If Mom insists on using cash, remember to keep receipts for every penny.

#5 Document Gifts or Avoid Gifts Altogether

Just as cash causes problems, so too do gifts. Mom may want to give you a couple hundred dollars here or there to thank you for your hard work. Or, Mom may give you an item of jewelry (usually the coveted diamond wedding ring). It is best to avoid gifts prior to death altogether, but if Mom insists on giving you something (whether it has a lot of value or just sentimental value) you need to protect yourself because Sister is not going to be happy when you claim that Mom gave you the diamond ring. Make written documentation of the gift and have Mom sign it. Document what the item is, when Mom gave it to you, and, in the best case scenario, a statement of why she is giving you the gift. More importantly, have an independent third party (someone outside the family, like an attorney, and preferably not one of your friends) also sign a statement about the gift. It would be most effective if the third party witness talked with Mom outside of your presence about the gift and could sign a statement explaining why Mom is making the gift. The more documentation you have, the better it will be for you when Sister sues you for taking Mom’s jewelry or stealing Mom’s cash.

#6: No Joint Bank Accounts

If Dad suggests that he wants to add your name to his bank account, urge him not to do so. When a bank account is held in joint ownership and one of the joint owners dies, the law presumes that the surviving joint owner is the 100% legal owner of the bank account and has no legal obligation to share the account with anyone else. Brother will claim that you wrongfully convinced Dad to put your name on the bank account so that you could claim surviving ownership of the account when that is not what Dad intended. Instead of joint bank accounts, Dad should consider adding your name to the account as a power-of-attorney⁵⁾but remember that all authority as power of attorney terminates upon Dad’s death, or Dad may consider creating a revocable living trust and placing the account in the trust with you as a trustee. Which brings me to …

#7: Proper Estate Planning

Hopefully, far in advance of you taking care of Mom full time or having Mom live with you, Mom established a relationship with a good estate planning attorney and has signed power of attorney documents and possibly, created a revocable living trust. If Mom has not yet done so, Mom should do so as soon as possible. WARNING: This is a sticky process. If you find the attorney for Mom, set up the appointment with the attorney, drive Mom to the appointment, or sit in with Mom and the attorney in the consultation and signing appointments, these facts will be used as evidence that you unduly influenced Mom to make the power of attorney, will, and/or trust that benefits you. Be helpful, but not overreaching. If Mom does need help getting to the attorney’s office for the meeting, do not sit in any meeting with Mom and the attorney. If Mom disinherits any of your siblings after she has started to live with you or after you are her caregiver, just know that you will be sued for undue influence even if you had nothing to do with the decision or process of your Mom disinheriting your sibling. I repeat, if Mom disinherits one of your siblings, you will be sued. In any event, even with potential problems, it is far better for Mom to have met independently with a good estate planning attorney who can do an independent analysis of Mom’s situation and assist her in making her wishes known.

#8: Do Not Use Fill in the Blank Estate Planning Forms

Dad probably does not want to pay for an expensive attorney to do estate planning for him (see #7). You cannot make him do so. But, please do not make the situation worse by buying Dad the fill-in-the-blank forms that are available at office supply stores. More often than not, these forms are completed incorrectly or signed, notarized, or witnessed incorrectly, both of which could cause the forms to be invalid. In any event, Sister will claim that you unduly influenced Dad to sign these forms, especially when everything is filled in in your handwriting, not Dad’s.

#9: Do Not Isolate Your Parents

It is crucial that you allow your siblings access to your parent, including phone access, email access, and in-person access. Even if you cannot stand to see your brother’s face, if he feels like you are preventing him from seeing Mom, he will sue you for undue influence. Be overly accommodating and go out of your way to make time for Mom to spend time with your siblings or to speak with them on the phone. To protect yourself even further, keep a log if your mother’s visits with her other children and keep track of the phone records that show calls to and from Mom with her other children.

#10 Repair Relationships

This may be the most difficult advice to give and for you to receive. If you are reading this blog post, and you are concerned about what your siblings will claim about you and your relationship with your parents, then you might have a dysfunctional relationship with your siblings. These could be deep-rooted issues and you may not like each other as much as you used to. As much as we all dislike minor children being a pawn in a divorce proceeding, it is equally bad when an elderly parent is used as a pawn in a power struggle between feuding adult siblings⁶⁾who often times are not acting very much like adults. This is a great opportunity to heal with your siblings and bring everyone around to supporting Mom or Dad in their later years. Swallow the bitter pill, be the better person, and make that most difficult first phone call to bury the hatchet⁷⁾It seems so much worse in theory than in practice. If you think your relationship with your siblings is bad before Mom or Dad pass away, just wait until Mom or Dad have died and you are sued for undue influence to see how much worse it can get.

Unfortunately, most people who care for their parents as a primary caregiver, or who have their parents living with them, are unaware of the undue influence risk. Relying on the well-worn statement of “I didn’t put a gun to her head” is not a very effective defense when your siblings – or rather your siblings’ attorney – come calling to claim that you exerted undue influence on your parent. The last person you will want to see while grieving your loss is a process server.

Footnotes[+]

Footnotes
↑1	Given the limitations of this medium, you will just need to imagine me throwing a note card/the crashing glass sound upon completion of each point
↑2	"Paul, hit the music!" and stay tuned next week for a our new segment "Will this legal concept float?"
↑3	see #2 above
↑4	I know, I’m old fashioned
↑5	but remember that all authority as power of attorney terminates upon Dad’s death
↑6	who often times are not acting very much like adults
↑7	It seems so much worse in theory than in practice

Estate Planning / General Interest / Probate - 09/02/2015

digital property, computer files, probate, estate planning

What Happens to Your Digital Property After You Die?

Our digital worlds (and digital property) are ever expanding. From Facebook, Twitter, and Instagram to downloaded music and movies, many people have a considerable amount of information stored online that needs to be accounted for after death. May these accounts, music or movies be passed to your surviving heirs or beneficiary? The answer depends upon the digital property in question.

Most of the information and accounts on social networking sites such as Facebook, Twitter and Instagram is not owned by the individual but licensed for his or her use. The license is not transferable, and thus, may not be willed or transferred upon death. Each site has different regulations on how it handles the license upon the death of a user. Facebook for example, will allow for the account to go into “memorial” status and allow others to view the account for some time after your passing.

For all social media accounts and emails, list all the accounts, users name, and passwords in your testamentary document or on a separate document, in order for your executor or administrator to have easy access to the accounts. You can instruct your executor or administrator to notify your followers of your death and possibly have your executor post your obituary or final words to the social network site.

Digital Property like Music, Movies and Photos

Music and Movies are increasingly purchased on the internet and downloaded to a computer or a cloud-based service. Some collections can be quiet extensive and worth a considerable amount of money. You want to be sure to make these collections available to your heirs and beneficiaries. For content that is downloaded and stored on your computer or external hard drive, those items will be easily transferable to your beneficiaries. Your testamentary documents can specifically list albums or movies to be distributed or just generally as percentage to your beneficiaries. For the content stored in cloud based services, it is important that you list the account name and password in the testamentary document or separate document for easy access and distribution to your beneficiaries.

Financial Accounts and Utilities

A very difficult part of initiating a probate proceeding is gathering the valuation of the assets of the estate. In this day and age, there are few individuals that receive in the mail a paper statement from the bank each month detailing the account balance and activities. Statements are now delivered via email or an email notification is sent that the statement is now available online. In order to initiate a probate proceeding, the executor or the administrator will need to prove to the court the value of the estate assets. Banks have implemented very strict privacy regulations that make it very difficult to receive any account information unless you are listed on the account. Therefore, in order to help your executor or administrator, it would be extremely helpful to document each account with accompanying user name and password for easy access. Your executor would then be able to print off a statement of the account to prove to the court the value of the accounts and potentially save your estate further probate expense.

With the ever changing internet landscape, it is important to have a well-drafted will or trust to assist your executor on distributing your digital property in the manner you desire. If you feel that you need direction or assistance with creating a testamentary document to help facilitate the distribution of your internet content, please contact us for a free consultation.

Estate Planning / Probate - 08/24/2015

Help! My Trustee has Gone Rogue

What is a rogue trustee and how can s/he be stopped? A rogue trustee is someone who stops following the instructions set forth in the trust documents¹⁾Contrary to popular belief, a rogue trustee is not necessarily from Alaska. In legal terms, the failure to follow the trust is termed a “breach of fiduciary duties.” In such cases, the beneficiaries of the trust are responsible for holding the rogue trustee responsible. If the trustee refuses to admit and correct the breach, this process will require the Court’s intervention. The following brief article provides some background on trusts that I hope will protect you from the actions of a rogue trustee.

A rogue trustee: what to do next

After reviewing their options, the majority of my estate planning clients choose to prepare a revocable living trust as a means of distributing their property upon their passing. A trust is the best estate planning vehicle for many folks because it does not require probate for the estate to be distributed, and because it is more flexible than other estate planning options. Trusts are flexible, in part, because they allow for the appointment of a successor trustee; an individual who will administer the trust upon the passing of the clients if the primary is unable or unwilling to do so. A trust empowers a trustee to exercise his or her discretion to achieve the objectives of the trust. However, generally, a trustee may not simply decide what s/he would like to do and disregard the instructions of the trust entirely. A trustee who has substituted his or her own wishes in place of the instructions of the trust is a rogue trustee.

Our firm once represented a beneficiary of a trust who was the victim of a rogue trustee. Shortly after our client’s mother passed away, the trustee sent out a letter stating that she was in charge and that she could decide who got how much money and the conditions from which the listed beneficiaries would receive the gifts. The trustee withheld money from our client and our client’s daughter because the trustee felt like the beneficiaries were ungrateful, and because they refused to do exactly what was demanded of them. The problem was, of course, the trustee's actions were contrary to the language contained in the trust²⁾The trust contained no language requiring our client-beneficiaries to make the trustee feel appreciated. As to if this type of condition is legally legitimate is another matter. To make matters worse, the rogue trustee took money from the trust and purchased a property for herself. Immediately upon recognizing the problem, we filed a petition to the Court asking that she be removed as trustee and otherwise held accountable for her actions. The Court forced her to provide an accounting showing how she had managed the money. Once the Court saw the extent of her breaches of fiduciary duties, the Court also removed her as trustee and appointed our client in her place.

If you or anyone you know is the beneficiary of a trust, and you are concerned that the trustee is not doing as instructed by the trust's terms, please let us review the situation to ensure that a trustee has not gone rogue.

Footnotes[+]

Footnotes
↑1	Contrary to popular belief, a rogue trustee is not necessarily from Alaska
↑2	The trust contained no language requiring our client-beneficiaries to make the trustee feel appreciated. As to if this type of condition is legally legitimate is another matter

Estate Planning / Probate / Trusts - 07/28/2015

trust, probate, revocable living trust, estate planning

A Trusted Way to Circumvent Probate

A trust is a legal document that provides for an individual’s testamentary wishes. There are many benefits to creating a trust, irrevocable or revocable, that will aid the family or beneficiaries of the Decedent. This post will highlight only the benefits of creating a revocable living trust.

The main purpose, and likely most popular reason for creating a trust, is that a trust will allow for the transfer of assets upon the death of an individual without the necessity of probate. Probate can be a dreaded word for some, and a trust circumvents the entire probate process. Probate can be time consuming and expensive, even with a trusted and experienced law firm such as Clear Counsel Law Group. A trust will facilitate the distribution and transfer of assets from a decedent’s estate to his designated beneficiaries without the hassle and expense of probate.

A trust illustration

For a more illustrative view of trusts, think of a trust as a large box. The language of the instrument dictates who is to be in charge after the death of the grantor or trustee, (the successor trustee), and who is to receive assets from the grantor’s trust, (the beneficiaries). However, the trust terms apply only to assets that are placed inside the box. Missing this step of actually placing the assets inside of the box can have disastrous consequences for the beneficiaries. An asset that is not placed inside the box will not be under the purview of the trust, and in order for the asset to be transferred to the designated beneficiary, a probate estate would be required in the county that the individual died.

Personal property, such as home furnishings, paintings, televisions, electronics and jewelry are easily transferred into the trust, or placed in the box, without any effort. However, bank accounts or brokerage accounts and real property¹⁾real estate require a bit more effort. In order to move these latter assets into the box, a change of title on the financial account and a change of ownership on the deed is necessary to transfer these assets into a trust. The grantor will have the same power and authority to transfer, mortgage, or sell the assets, but now the assets are owned by the grantor as trustee of the trust.

A properly funded trust will allow for grieving family and friends to fulfill the final wishes of the decedent without the cost and time of a probate.

If you would like to speak with an experienced estate planning attorney about establishing a trust, or if you set up a trust years ago and would like a review of the your trust documents, please do not hesitate to contact Clear Counsel Law Group for a free consultation.

Footnotes[+]

Footnotes
↑1	real estate

Estate Planning / Probate - 06/18/2015

What Are Probate Assets?

After a love one has passed away, one item that most people do not want to think about is probate, but undoubtedly it may be one of the first things on his or her mind.

One important question regarding probate is: what is a probate asset? Or, What assets are included in the probate estate?

Assets belonging to an individual when he or she dies can be titled in a variety of ways. The characterization of the assets will determine if the assets will need to be included in probate or if it will be excluded from probate administration.

Decedent’s Name in Probate

All assets that are titled in the name of the decedent only will be included as a probate asset. For example, if the decedent, Joe Smith, dies leaving a bank account that is titled as “Joe Smith” this account is an estate asset. In order for the bank to release the contents of the account to the heirs or beneficiaries of the estate, the bank will require an order signed by the court that specifically designates who has the authority to collect the funds.

The same rules apply for real property that is titled in the name of the decedent at the time of his passing. By way of example, if Joe Smith dies owning real property and the property is titled as “Joe Smith,” then the real property would be an asset of the estate and county recorder and assessor would need an order signed by the court that designates who is to receive the property or an order that authorizes the sale of the property.

Designated Beneficiaries

Most financial accounts allow for the owner of the account to list or designate a pay on death beneficiary (POD) or a transfer upon death beneficiary (TOD). If the designation is completed prior to the decedent’s death and while the decedent has his mental capacity¹⁾among other conditions, then the asset will pass to the beneficiaries listed and will not be subject to the probate estate or the court’s jurisdiction.

Joint Ownership

Jointly owed accounts will become the sole property of the surviving joint owner. Many financial accounts and real property are owned as joint tenants with the decedent’s significant other or a business partner. By operation of law, the survivor of the joint owners will have complete control and ownership of the asset at the time of the decedent’s death. The asset will pass to the survivor and would do so outside of the probate estate.

For example, if Joe Smith owned his home with his wife Jane Smith and the title of the home was Joe Smith and Jane Smith as joint tenants, then at the time of Joe Smith’s passing, Jane Smith would be the sole owner of the property. Joe Smith’s interest in the property would not be subject to the probate estate.

Footnotes[+]

Footnotes
↑1	among other conditions

Probate - 06/11/2015

Slayer Rule Part II: This Time for Keeps

Previously in Part I, we discussed what happens to the dispensation of an estate if a beneficiary happens to have killed the grantor. You may recall that the rule preventing the murdering-beneficiary from receiving any estate assets is called the “Slayer Rule.” Now that we know why and how the transfer of assets to the sinning beneficiary is prohibited, it may be a good time to discuss what happens if the killer transfers or sells the property to another party? Does the acquiring party have to give the asset back? Is the acquiring party liable to be sued for value of the asset that he or she has no legal right to? We will now unpack the rest of Chapter 41B of the Nevada Revised Statutes, and find out how the slayer rule applies.

So you bought property from a killer, how will the slayer rule affect you?

So you have come across a hot deal for land, a home, or a valuable asset¹⁾please do not interpret this to mean that the assets we are discussing have to be worth a lot of money, and you did what most Americans do when offered such a deal, acted quickly and snatched it up. The next day you are sitting at home, reading the paper, and see a picture of the person you purchased the asset from on the front page. Turns out the seller happened to have murdered the person who granted him the property to sell. Because you are a loyal reader of the Clear Counsel law blog, your mind immediately thinks of the slayer rule. Now what happens? Let us take a look at the end of Chapter 41B of the NRS:

NRS 41B.400 Payor or other third person who pays or transfers forfeited property, interest or benefit. Except as otherwise provided by specific statute, if a payor or other third person, in good faith, pays or transfers any property, interest or benefit to a beneficiary in accordance with the provisions of a governing instrument, the payor or other third person is not liable to another person who alleges that the payment or transfer to the beneficiary violated the provisions of this chapter unless, before the payment or transfer, the payor or other third person had actual knowledge that the beneficiary was prohibited from acquiring or receiving the property, interest or benefit pursuant to the provisions of this chapter.

(Added to NRS by 1999, 1354)

NRS 41B.410 Person who acquires or receives forfeited property, interest or benefit without legal right or authorization.

1. Except as otherwise provided in subsection 2, if a person, without legal right or authorization, acquires or receives any property, interest or benefit forfeited by a killer pursuant to the provisions of this chapter, the person is required to transfer the property, interest or benefit to the beneficiary who is entitled to it pursuant to the provisions of this chapter, or the person is liable to such beneficiary for the value of the property, interest or benefit.

2. The provisions of subsection 1 do not apply to a person who:

(a) Acquired the property, interest or benefit for value and without notice; or

(b) Received the property, interest or benefit in full or partial satisfaction of a legally enforceable obligation and without notice.

(Added to NRS by 1999, 1354)

Ok, let us start here. A quick definition: a payor is “one who pays, or who is to make a payment; particularly the person who is to make payment of a bill or note.”²⁾Black’s Law Dictionary. If you are wondering why a distinction needs to be made between someone who pays, and someone who “acquires or receives,” remember that a person may be a payor for a third party.

Neither a payor or receiver of the property in question is liable to the rightful owner³⁾the proper beneficiary of the gift now that the killer no longer has legal rights to the property if:

The acquisition is done in good faith
The purchaser/receiver does not know that the property in question may not be sold or transferred by the killer
He or she pays more than a nominal amount for the property

Whew, that is good to know. Carry yourself above board, and everything should be alright.

Does the slayer rule protect the beneficiaries?

But what about the poor beneficiaries left in the will that have lost a valuable asset that they should have been entitled to. What recourse do they have?

NRS 41B.420 Killer who transfers forfeited property, interest or benefit to third person; effect of preemption by federal law.

1. If a killer, for value or otherwise, transfers to a third person any property, interest or benefit forfeited by the killer pursuant to the provisions of this chapter, the killer is required to recover and transfer the property, interest or benefit to the beneficiary who is entitled to it pursuant to the provisions of this chapter, or the killer is liable to such beneficiary for the value of the property, interest or benefit.

It is always nice when the law is just. The killer is liable for the value of the forfeited property, meaning he or she can reacquire the property and transfer it to the rightful owner or be sued for the value by the asset by the remaining, legitimate beneficiaries.

Crime continues not to pay, at least here in Nevada.

Footnotes[+]

Footnotes
↑1	please do not interpret this to mean that the assets we are discussing have to be worth a lot of money
↑2	Black’s Law Dictionary
↑3	the proper beneficiary of the gift now that the killer no longer has legal rights to the property

Probate - 06/03/2015

The Slayer Rule in the News

A couple of weeks ago, we all lost one of the great musicians of American history ¹⁾and a personal hero of mine. Although his greatness and legacy cannot be tarnished, there has been an unfortunate development with reference to the distribution of his estate. ²⁾This is not a discussion of the specifics of that case, but a general discussion of the law. Beneficiaries of his estate have stated publicly that other potential beneficiaries murdered the deceased whose estate is now in question. Although I have no personal knowledge of the circumstances, this may be an opportune time to discuss, hypothetically, what happens if a beneficiary of an estate murders the grantor (the original owner of the estate assets).

The slayer rule

The law regarding the hypothetical above goes back a long way. In 1886, the U.S. Supreme Court first established what is called the “Slayer Rule.” ³⁾Mutual Life v. Armstrong 117 U.S. 591, 600. In 19^th century language, the court stated that is against the interests of public policy for a murderer to profit from his crime. The law caught on in popularity; as of now, forty-eight states have some version of a slayer rule.

In Nevada, Chapter 41B of the Nevada Revised Statutes codifies the principles of the ‘Slayer Rule’⁴⁾See Holliday v. McMullen, 104 Nev. 294, 296, 756 P.2d 1179, 1179 (1988) for a common law example of Nevada’s slayer rule; it states in pertinent part:

NRS 41B.200 General rule; killer cannot profit or benefit from wrong; anti-lapse statute and right of representation; contingent, residuary and other beneficiaries; common law.

1. Notwithstanding any other provision of law, the provisions of this chapter apply to any appointment, nomination, power, right, property, interest or benefit that accrues or devolves to a killer of a decedent based upon the death of the decedent. If any such appointment, nomination, power, right, property, interest or benefit is not expressly covered by the provisions of this chapter, it must be treated in accordance with the principle that a killer cannot profit or benefit from his or her wrong.

Simple enough, the law states that the “killer cannot profit or benefit” from the crime. But does the murderer need to be convicted of the crime before above statute applies? Not necessarily.

The plot thickens with respect to the slayer rule

Am I claiming then that if a beneficiary is accused of murder then he or she will lose interest in the estate? No. The answer is a bit more nuanced. Later in Chapter 41B, there is clarification on this point:

  NRS 41B.260 Civil action: Parties; burden of proof; evidence; stay of proceedings; limitation on time for commencement.

      1. For the purposes of this chapter, an interested person may bring a civil action alleging that a person was a culpable actor in the felonious and intentional killing of a decedent. An interested person may bring such a civil action whether or not any person who is alleged to be a killer in the civil action or any other person is or has been, in a separate criminal action, charged with or convicted or acquitted of being:

      (a) A culpable actor in the felonious and intentional killing of the decedent; or

      (b) A culpable actor in any other offense arising out of the facts surrounding the killing of the decedent.

      2. If an interested person brings a civil action pursuant to this section, the court shall determine, by a preponderance of the evidence, whether a person who is alleged to be a killer of the decedent was a culpable actor in the felonious and intentional killing of the decedent. If the court finds by a preponderance of the evidence that a person who is alleged to be a killer of the decedent was a culpable actor in the felonious and intentional killing of the decedent:

      (a) The finding of the court conclusively establishes for the purposes of this chapter that the person feloniously and intentionally killed the decedent; and

      (b) The person shall be deemed to be a killer of the decedent.

      3. If, in a separate criminal action, a person is charged with being a culpable actor in the felonious and intentional killing of a decedent or with any other offense arising out of the facts surrounding the killing of the decedent and:

      (a) The person is acquitted of the charge;

      (b) The charge is dismissed; or

      (c) A verdict or judgment is not reached or entered on the charge for any reason, evidence concerning any such matter is not admissible in a civil action brought pursuant to this section.

      4. Upon its own motion or the motion of an interested person, the court may, in whole or in part, stay the proceedings in a civil action brought pursuant to this section during the pendency of any separate criminal action that has been brought against a person who is alleged to be a killer in the civil action. The provisions of this subsection do not limit the power of the court to stay the proceedings in the civil action for any other reason.

Subsection 1 states that a beneficiary may lose interest in the estate if he or she has been “charged with or convicted or acquitted” of murder of the estate’s grantor. Subsection 1(b) expands the possibilities further to include a “culpable actor…arising out of the facts surrounding the killing.” As you can see, charged with and acquitted, are standards far less strenuous than a conviction.

Subsection 2 establishes that a court shall use a “preponderance of the evidence” standard ⁵⁾meaning the event occurred more likely than not in determining if Chapter 41B shall be applied to exclude the murdering beneficiary from the will. If you are attempting to think of an example of when a murderer could be acquitted, but still found culpable by a preponderance of the evidence, think of a certain Heisman Trophy winner currently in a Nevada prison.

Subsection 4 allows the court to pause the proceedings if the judge cannot make a preponderance determination at present time to allow the criminal proceedings to continue, in hopes that more evidence may come to light.

These probate challenges are as sensitive as they are complicated. With a large enough estate, a 41B slayer rule challenge could contest a serious amount of money.

Footnotes[+]

Footnotes
↑1	and a personal hero of mine
↑2	This is not a discussion of the specifics of that case, but a general discussion of the law
↑3	Mutual Life v. Armstrong 117 U.S. 591, 600
↑4	See Holliday v. McMullen, 104 Nev. 294, 296, 756 P.2d 1179, 1179 (1988) for a common law example of Nevada’s slayer rule
↑5	meaning the event occurred more likely than not

Nevada Law / Probate - 06/02/2015

What Does an Estate Planning Attorney Do?

Most of us prefer not to think about death, or the its implications for our possessions and finances. However, it happens to everyone eventually, and if you are not prepared, you could find that your belongings and wealth go to the state, rather than to your loved ones. One of the best ways to ensure that this does not happen is to work with an estate planning attorney. What do these lawyers do? Actually, they can provide a very broad range of services depending on your situation, your needs, and how diverse your assets are.

Services Offered by an Estate Planning Attorney

While most estate planning attorneys will provide the services discussed below, all do not, necessarily. You will need to consult with individual lawyers in your area on the services offered, and how they can help you plan your estate.

Estate Tax

One of the most important reasons to work with a competent estate planning attorney is to mitigate or even eliminate the estate tax. This is the money due from your estate at your death to the state and federal governments. With the proper planning and smart decisions in terms of estate vehicles, you can limit your tax liability, or even eliminate it completely in some instances. A qualified attorney will be able to explain your options, as well as the limits of tax liability mitigation.

Accounts and Plans

Chances are good that you have an IRA, a 401(k), or some other type of retirement plan. You may also have a brokerage account, a valuable insurance policy and other assets. These can and should be put into trusts or other entities so that they can be transferred to your beneficiaries with the least amount of difficulty. The right structure is required, and a qualified attorney will be able to explain what is necessary and create the best trust for your situation.

Property Disbursement

An estate planning attorney can help create the right plan for distributing your property to those you care most about. If you do not have a plan in place, this will be left to a probate attorney, and there is no guarantee that the distribution will be equitable or in line with your final wishes.

Specialty Trusts

There is no one-size-fits-all solution when it comes to trusts, and you may need to create any number of special forms, from irrevocable trusts to many others. Your attorney can explain the benefits of each type and help craft the best estate plan for your specific situation.

Meet State Guidelines

All estates must meet specific state guidelines and regulations. If they do not, then you will incur additional costs and additional time will be needed to disburse your estate. It is even possible that your estate will end up in probate. A skilled estate planning attorney can help ensure that all government regulations and requirements are met to avoid these pitfalls.

These are just a few of the areas that a skilled estate planning attorney can assist you. The most important takeaway is to find a qualified, understanding lawyer that can best assist you in getting that estate plan in order.

Estate Planning - 05/20/2015

What Is a Totten Trust?

In 1904, the New York Court of Appeals ruled that individuals could name a beneficiary to an upon-death bank account. The case was referred to as Matter of Totten, which is where this trust got its name. While a totten trust does not meet the formal requirements to be considered a traditional trust, the courts ruled that because these types of bank accounts usually held smaller amounts of money, the practice could continue.

How to Open a Totten Trust

If you are in the process of planning your estate, you may be wondering what will happen to your bank accounts once you die. In most situations, bank accounts are jointly held between two people within marriage. When one person dies, the surviving spouse will become the sole owner of the account, and the account will not need to go through the probate process. However, if you are the sole owner of a bank account, then you will need to take other steps to ensure that your bank account is transferred to the individual you prefer.

A totten trust is basically a “payable-on-death” account, where a named beneficiary will take sole ownership of the account upon your death. In order for the beneficiary to receive the funds in the account, this individual will need to present a certified copy of your death certificate, along with valid identification to prove that he or she is the beneficiary.

To name a beneficiary to a totten account, you will need to go to your bank and ask for the appropriate forms, fill them out, and then turn them in at your bank. Be sure that your bank receives these completed forms, as it is not enough to simply fill them out and keep them with your important documents. The bank will need to have this information prior to your death.

It is important to know that you can revoke or change the trust at any time during your life. This means that you can withdraw the trust or change the beneficiary if you need to. If you do not name a beneficiary to your bank accounts, the accounts will go through probate upon your death and the court will decide who will receive your money. If you do name a beneficiary, this person will only have access to your account after your death. The named beneficiary will not have access to your account while you are alive, not even to inquire about the funds in the account.

Upon your death, the beneficiary will be contacted and will typically receive the funds within a short period; the account will not have to go through the probate process.

Contact an Estate Attorney

If you are interested in beginning the estate planning process, contact the estate attorneys at Clear Counsel Law Group. The attorneys at Clear Counsel understand the importance of financial planning and securing your family’s financial well-being. Call today to set up a consultation.

Estate Planning - 12/08/2014

Estate Planning and Probate for Timeshares

Timeshares can be a headache for estate planning and probate attorneys as well as their clients! If not treated appropriately they can cause excess time and fees for everyone involved.

Many timeshares are real estate interests which means that they are deeded. Other timeshares are a contractual “right to use”. If a person dies with a timeshare interest in his or her name, there may have to be an additional probate in the state where the timeshare is located. This is called an ancillary probate and can cost up to several thousand dollars in attorney fees and court costs.

Nevada Probate and Timeshares

In Nevada, if the timeshare is a deeded interest there must be a probate in Nevada because the interest is real property. However, if the value of the timeshare (or the entire estate in Nevada) is less than $100,000, a special petition to the court by the beneficiary may allow the estate to be “set aside” and distribution made without further court proceedings. If the timeshare is a contractual “right to use” and the value of the timeshare is less than $20,000, the beneficiary can use an Affidavit of Entitlement without any court proceedings to transfer the timeshare to his or her name. However, the rules are different in each jurisdiction. Therefore, you should consult an attorney in the city where the timeshare is located to ensure the probate is done correctly.

Avoiding Probate

The easiest way to avoid this problem is to set up a revocable living trust for your assets. An estate planning attorney can assist you in creating the trust. Once the trust is created, you will transfer the timeshare interest into the trust and the trust becomes the legal owner of the timeshare. As the living beneficiary of the trust, you can use the timeshare while you are alive. Upon death, the trust continues to be the owner and probate is not required. The timeshare interest will then be transferred to the death beneficiary according to the terms of the trust.

Maintenance Fees for Timeshares After Death

It is important to keep in mind that all timeshares come with a maintenance fee obligation whereby the owner is required to pay annual fees to maintain the timeshare. If a person dies without a trust, the obligation to pay the maintenance fees transfers to the estate and then to the person who inherits the timeshare. With a living trust, the obligation to pay the fees stays with the trust but then transfers to the death beneficiary. Oftentimes the person who inherits the timeshare doesn’t want the property. A beneficiary can refuse the inheritance. The timeshare will remain the property of the estate or the trust and the timeshare company will foreclose if the maintenance fees are not paid. If the beneficiary has taken title but doesn’t want the property, the best solution is for the new owner to contact the timeshare company and try to give the property back to the timeshare company. The new owner will not receive any funds but he or she will be relieved of the maintenance fee obligation. If the property is in a valuable location, the new owner may be able to sell it for a small value on a resale website or rent the unit to cover the costs of the maintenance fees. Beware of any companies that offer to assist in selling timeshare interests for an upfront fee. They are almost always scams.

If you own a timeshare, it is important to contact an estate planning attorney and put the timeshare in a living trust so you do not inadvertently burden your loved ones. If you have inherited a timeshare, it is important to contact an attorney in the jurisdiction where the timeshare is located to determine your options.

Estate Planning / Probate - 07/25/2014

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