Michigan Elder Law Blog

There were a couple interesting articles in the Wall Street Journal recently regarding estate planning. The first article deals with the implications leaving your heirs different amounts in your estate plan. People leave different amounts to different heirs for a variety of reasons - one heir may be more successful than the others and thus have a perceived lack of need for additional money; while another heir may receive less because they live out of town and aren't as actively involved in their loved ones lives due to the physical distance.

The article cautions individuals to make sure any disparate treatment of heirs is based on sound reasoning and not spite. Individuals should view their estate plan as a legacy they want to leave to their heirs and should be think about what potential unequal distributions could do to future family discord.

The best way to avoid this problem is to have good communication with your heirs about the division your estate. This will take away the element of surprise after your passing and will often put your heirs at ease.

The second article deals with who will take care of your minor child or children if you pass away. Frequently, couples with minor children are hesitant to draft an estate plan because they are early in their careers, have a sense of immortality, and may have little disposable income. However, it is at this time that having an estate plan is imperative.

First, while couples with minor children may not have a lot cash on hand, they tend to have a significant amount of life insurance. In these situations, if something happened to both parents, the life insurance would pay to the minor children. However, since the children are minors, their share of the insurance proceeds will be tied up in probate court until they reach the age of 18. Upon attaining the age of 18, the court turns over any remaining monies to the children outright.

There are two problems with this:
1) by having the money tied up in probate court, the family will incur years of attorney fees; and
2) when the child reaches the age of 18, they will receive outright whatever is left. The child can then use the money as they please.

Both of these problems can be avoid through proper planning and the use of well crafted estate planning documents.

Second, who will take care of your minor children in the event of your passing? The article gives some helpful pointers for choosing who to appoint as guardian of your minor child. For example, you may want to consider that while grandma and grandpa are good guardians now, they may not be in ten years as they age.

You can appoint a guardian of your minor children in your estate plan. If something happens to you, the court will place great weight on your wishes so it is important that the appointment of a guardian for minor children be a part of any estate plan where minor children are involved.

Continue reading "Estate Planning in Michigan: Unequal Distribution and Minor Children" »

Tommasso, who was once a stray cat on the streets of Rome, is now the world's richest cat.

Maria Assunta, Tommasso's owner, recently passed away at the age of 94. Maria was the wife of a wealthy Italian property tycoon. She did not have any children.

Maria left her entire estate to Tommasso, via her nurse, because she could not find a group that could take care of Tommasso. Maria's estate is valued at $13 million dollars, which includes cash and properties in Rome, Milan, and Calabria. This brings new meaning to the old saying "dogs have masters, cats have servants."

While uncommon, individuals can make provisions in the their estate plans for their beloved four legged friends. This can be accomplished be setting aside a sum of money in trust for their pets, with instructions to the caretaker that the money to be used for their care and maintenance. Under these circumstances, individuals need to appoint a custodian for their pet, much like people do with minor children. Additionally, the individual can stipulate where the remaining assets, if any, will go, when their pet passes away.

Continue reading "How to Leave Your Estate to Your Pets" »

Jani Lane, of the rock band Warrant, passed away in August at the age of 47 of alcohol poisoning. He was survived by his wife and four children - two step daughters and two daughters from a previous marriage. However, Jani did not leave behind a Will.

It is estimated that Jani's Estate is valued at around $600,000.00. This does not include future royalties from such Warrant classics as "Cherry Pie". Since Jani did not leave behind a Will, the court will decide how his estate will be administered.

In Michigan, when an individual passes away without a Will, they are considered to have died "intestate." This means that the deceased individual's estate would pass to his or her heirs at law. In the case of Jani Lane, his estate will pass to his natural born daughters (not his step-daughters unless he legally adopted them) and his wife. The Court will also appoint the administrator (a Personal Representative in MIchigan) of Jani Lane's estate.

Since he did not execute a Will, Jani Lane effectively left it up to the Court to decide how his estate will be divided and who will administrator it. We will never know if he wanted leave a larger portion of his estate to one daughter, if he wanted to include his step-daughters, or who he wanted to administer his estate.

Additionally, if either of Jani's daughters are minors, their share of his Estate will be tied up in Probate Court until they reach the age of 18. At that time, if there is any money left, they will receive their share outright.

By not executing a Will, Jani has lost control of his estate. He has lost his privacy by exposing his estate to the Probate Court system, which is a matter of public record. Most importantly, he's increased the odds of infighting amongst his heirs, thereby prolong the administration of his estate.

If Jani Lane had executed a Will, he would have controlled the administration of his estate and the court would have been bound by its terms, absence a showing of undue influence or lack of capacity to execute the Will. Better yet, Jani Lane should have executed a Revocable Living Trust to keep his estate out of Probate, his affairs private and in the long run reduced his estate's legal fees.

Continue reading "The Importance of Having a Will" »

As experienced Michigan elder law attorneys, clients often come to us when they are considering placing a loved one in a nursing home. This is not an easy decision to make. Unfortunately, it is one that many of us will have to make; as the time may come when a loved one needs care that can only be provided in a long term skilled care facility, such as a nursing home.

One of the first questions a client will ask is "how do I pick the right nursing home?" The Detroit Free Press recently ran an extensive special report on nursing homes in the state of Michigan. This special report included tips on how to pick the right nursing home. The article provides families a helpful score card to help them evaluate nursing homes and decide which one would be best for their loved one. Some important factors to consider are: what are the state inspection reports; does the facility meets your loved ones needs (ex if your loved one has Alzheimer's, do they have a track record of residents wandering away?); and how much input will the family have in the care plan, of their loved one.

Another question client's often ask ish "how will we pay for nursing home care?" With the cost of long term skilled care in Michigan costing approximately $7,000.00 per month, many families are worried that placing a loved one in the nursing home will effectively bankrupt them, particular the spouse that remains in the community. However, there are strategies that families can be implement to protect and preserve their assets, while at the same time ensuring that their loved one receives the greatest quality of care at the least possible cost to their family.

Continue reading "How to Choose the Right Nursing Home in Michigan" »

I just read an interesting article regarding the estate of Huguette Clark. Ms. Clark passed away in May at the age of 104. She was a part of what is often referred to as New York's "Gilded Age", along with the Rockefellers, Astors and Vanderbilts.

Ms. Clark's relatives are accusing her co-executors, attorney William Bock and accountant Irving Kamsler of plundering her fortune during her lifetime while Ms. Clark was hospitalized. While she was confined to her hospital room, her spending amounted to $1 million dollars per month. A court ordered accounting of the heiress' finances over the last 15 years has raised allegations of misspending, mismanagement and misappropriation of her funds, according the family's attorney.

Ms. Clark signed a will in March 2005 which left most of her estate to 21 of her relatives. In April 2005, she signed a will, which by contrast gives her family nothing and leaving her vast estate to her nurse, a charity for the arts, and her co-executors.

There are a couple of interesting issues that the court will have to decide in this case. First, was Ms. Clark's estate mismanaged during her lifetime? While $1million is certainly a significant amount of money to spend in a month, Ms. Clark was receiving 24 hour care in a private hospital. Additional, there had to be a sizeable amount of money being spent to maintain her vast real estate holdings. If the court finds that Messrs. Bock and Kamsler acting inappropriately, they could be subject to civil liability as well as be subject to an investigation for professional misconduct by their respective professional licensing boards.

Continue reading "Estate Planning: The Impact of Undue Influence and Lack of Capacity" »