I just completed another trial involving family members who fought over an estate. It seems like a good time to emphasize the importance of preparing a clear plan that will be upheld in court if it is challenged.
In this last case, a widow with one child had a will and a trust, and left everything she had to her niece. Nothing was left to her child. As you might expect, the child, a son, contested that arrangement after his mother died. He claimed that his mother was not competent to understand what she did, that she was unduly influenced by her niece, and that she was coerced into making this plan.
A good lawyer would make the plan as ironclad as possible, with significant precautions and redundancies, carefully documented. He or she would anticipate that the son would challenge the plan. However, in this case, no lawyer was involved in drafting the will. The widow did it on her own.
She obtained a form will online and asked her niece’s (yes, the beneficiary) daughter to fill it in. Although there were two witnesses to the will, as required in New York, one had already died by the time the will was presented for probate. The other witness was the niece’s other daughter, hardly what would be called a disinterested witness, since she stood to receive part of the estate if her mother predeceased the widow.
Without giving a play-by-play of the contested probate process, suffice it to say that the dispute cost both sides a great deal of money in legal fees. The matter was settled at the end of the trial, just before the court was to reach a decision. A compromise was reached – something that the widow likely did not intend.
The widow had never signed a power of attorney or a health care proxy. Although these documents are only applicable during lifetime, and are worth their weight in gold if the need arises, they sometimes can help to shed some light on a person’s intent by clarifying whom he or she trusts. If the niece, for example, had been the widow’s agent under a power of attorney prepared by a lawyer, and/or had authority to sign on the widow’s bank accounts, those facts might help to convince a court in a close case that the niece was the widow’s trusted agent. Of more significance, if the widow had authorized gifting to the niece under the power of attorney and/or had made the niece her beneficiary on bank accounts, those facts could have been persuasive.
The point is that a good estate plan should be comprehensive – well thought through. It does not have to be expensive, just able to stand up to scrutiny. That is the value of having an experienced lawyer prepare it.
You might be wondering about the trust I mentioned earlier. The niece was the sole beneficiary and became the trustee upon the widow’s death, so that fit the widow’s plan of giving everything to her. It was prepared by a lawyer years before the will. We presume a will was signed at the time that the trust was created, although none could be found, and our search to find the lawyer was not successful.
So, what was in the trust? Nothing! The widow – who held her cards close to her chest – apparently on her own removed her assets from the trust years before her death. Why? We’ll never know.
Copyright 2016 Joseph A. Bollhofer, Esq.
Joseph A. Bollhofer, Esq., is an attorney who practices law in the areas of elder law, Medicaid, estate and business planning and administration, and real estate. He is a member of the National Academy of Elder Law Attorneys, and of the Elder Law, Real Property, and Surrogate’s Court Committees of the Suffolk County Bar Association and of the Elder Law, Trusts & Estates Law and Real Property Law Sections of the New York State Bar Association. He has been serving area residents since 1985 and is admitted to practice law in New York and New Jersey. His office is located at 291 Lake Ave., St. James, NY. (584-0100). For reprints of this article and others concerning Medicaid, Elder Law and Estate Planning, send a request to firstname.lastname@example.org or visit www.bollhoferlaw.com.