Episode Transcript
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Speaker 1 (00:02):
Good morning everyone. Welcome to Life Happens Radio. Are you prepared?
This is our weekly radio program for individuals and their
families where we address the challenges we all face as
we age. We talk about aging as a lifestyle, the
issues that must be confronted, and the careful planning that's
required to avoid crises in the future.
Speaker 2 (00:20):
Life Happens will provide you.
Speaker 1 (00:21):
A tools to educate and prepare yourself for events like retirement,
protecting your income and assets, planning to pay for nursing,
home and home care, special needs, willson trusts, planning for
an untimely death, and resolving disputes in and out of court.
I'm Aaron Connor from Pure O'Connor and Strauss, joined this
week by Brent Stack.
Speaker 2 (00:40):
Good morning, Brent.
Speaker 3 (00:41):
Good morning, Aaron.
Speaker 2 (00:42):
If you don't know, Brent's been with us almost a
year now.
Speaker 3 (00:46):
Right, since July of twenty four.
Speaker 1 (00:48):
Yeah, so we're getting there. Brent does the litigation with me.
He probably more specializes in guardianships and trust litigation at
this point, but he's learning, learning.
Speaker 2 (01:04):
As we go.
Speaker 3 (01:05):
We do the messy stuff.
Speaker 1 (01:06):
That's right, you know, if you and your sister or
you and your brother don't like each other.
Speaker 2 (01:14):
Now while mom and dad are alive, it doesn't usually
get better.
Speaker 1 (01:22):
Mom and dad are usually kind of the referee in
that situation or like an anchor in it. Like I
don't mean that in a bad way, dragging you down.
I mean that like it's a kind of like the
sun with you know, pulling you in right.
Speaker 3 (01:35):
Yeah, the shatters that we've seen in families when mom
and dad go.
Speaker 1 (01:40):
Right because people don't necessarily have to behave anymore right
like people should behave. And sometimes it's justified, and sometimes
it's you've got a tricycle when you were three and
I did not, and it.
Speaker 2 (01:54):
Just never gets better.
Speaker 1 (01:55):
It honestly is amazing to me how many people like
actively keep score over their lifetime.
Speaker 3 (02:01):
Yeah, I agree, and I think a lot of these
people don't see it coming right, and it makes me,
you know, it's sad. I want to go home and
hug my sisters.
Speaker 2 (02:13):
Well.
Speaker 1 (02:13):
Obviously, having a good family dynamic is much better, right,
And one of the issues is the more people you have,
the harder it is to get along, just because there's
that many more personalities. You know, there may be five
of you and four of you get along great, but
then there's one person or I mean a lot of
(02:34):
times there's a component of mental illness to someone, right, Yeah,
for sure. And in the older generation a lot of
undiagnosed mental illness, untreated, medicated if that's the appropriate course,
but even lack of any kind of therapeutic and just acknowledgement.
(02:55):
And what I've seen is when people age, it doesn't
get better, it gets worse. Sure, So if that's out there,
you know, some things are unavoidable. We try to put
a plan in place that avoids every kind of strife possible.
Speaker 3 (03:10):
I think you're right, planning, planning, planning.
Speaker 1 (03:12):
And but ultimately I used to work for a guy
who would say you could sue the pope for adultery. Right,
you don't really have to have like a claim that
needs to make a lot of sense to make people's
lives difficult. Now, hopefully there's no lawyer is going to
take a case that doesn't really have any merit, But
that doesn't stop people from acting what we say is
(03:33):
pro se, meaning without a lawyer, which is kind of
the ultimate nightmare in a courtroom. We have at least
one large case with a pro se litigant, and that
has already gone on. I think since twenty eighteen. I
can't say for sure, but it makes it more difficult.
(03:56):
It certainly makes it almost impossible to settle anything, absolutely
because you can make a very good offer and there's
nobody to really guide that person to say what will
happen when you don't Yeah, I.
Speaker 3 (04:09):
Think the pro sate litigant is extraordinarily skeptical and.
Speaker 2 (04:17):
They don't know what they don't know about procedure. Right.
Procedure is very.
Speaker 1 (04:23):
Important in a court, and that means how you initiate
a case in a lot of ways. Right, So whether
it's a complaint or a petition, and serving people, serving
the right people, serving them timely, having the contents of
a petition or a complaint that actually have.
Speaker 2 (04:42):
To be there, which in a lot of ways is.
Speaker 1 (04:47):
Not terribly difficult in the Internet era, but sometimes like
fraud for instance, has a higher pleading requirement, certain things
like that. But service is usually a big trip for
even serving the right people.
Speaker 3 (05:03):
Yeah, it is specialized. I mean we did learn something
in law school, correct. I mean there's a reason that
we that we exist in this field. There's a reason
that the courts, you know, appreciate our skill set our specialty.
Speaker 1 (05:21):
I mean, we're not even talking about like substantive stuff
right Exactly, you actually have a case, can you get
into the court right and before a.
Speaker 3 (05:29):
Judge exactly, because we're not talking merits here, we're talking.
Speaker 1 (05:33):
Right basics, right, Because I've seen lots of these just
get rejected out right because they don't meet the filing requirements.
The filing fee doesn't get paid, people don't get served,
and you only get so many cracks at this exactly.
Sometimes you only get one crack. So it's important to
(05:53):
have some some guidance and some knowledge and to have
a case ultimately right. But if you do end up
in a situation where it's sibling versus sibling, I hope
for your sake that everybody has their own counsel, because
it just makes things extraordinarily difficult.
Speaker 3 (06:12):
Yeah, there's a lot of pitfalls before you can get
to merits. I think. I think that's the point that
we're trying to make here, And.
Speaker 1 (06:19):
People tend to dismiss the counselor part of being a lawyer.
A lot of what we are doing is really counseling
people on what the best course of action is, and
they're free not to take our advice. I'm often surprised
how many people pay me and then don't do what
I tell them to do. Right, you're paying for my advice, and.
Speaker 2 (06:40):
You know you're you have agency, You're free to do
what you want to do.
Speaker 3 (06:44):
But I think you're you're exactly right. I mean, I've
found myself a lot in the last few weeks, just
those making those difficult phone calls, just saying, hey, this
is this is where we might get to, but this
is where we should go. And and well, winning a
court case is not necessarily the end of anything, right, absolutely,
(07:05):
because people have the right to appeal, and appeals can
go on not forever, but basically forever, and it's not
good for anyone. I spend a lot of my time
talking clients about the emotional damage or cost of continuing.
And if this is a case where someone has died,
(07:29):
you're likely not even grieving that because you are continuing
to plow through this.
Speaker 1 (07:34):
And sometimes that may be necessary. But when we can
get to a point where it's just about as good
as it's going.
Speaker 2 (07:39):
To get, we have to be realistic.
Speaker 1 (07:42):
And I'm sure everyone listening understands this, but Brett and
I do not work for free, and the longer that
we work, the less you are recovering, generally speaking from
the same pool of money.
Speaker 3 (07:55):
That's absolutely the case. Yes, some you know, some of
our unfortunate clients have have jumped immediately into litigation following
the death of a loved one, and I can guarantee
that they have not grieved because they've been in the
fight since since that day. And you know, I think
(08:16):
it's just the further it drags out. I think the
larger the emotional toll it plays on the entire family.
And you know, I think our clients say a lot
of times, you know, I can't wait to take so
and so to court. But that's that's really not what
you want.
Speaker 1 (08:35):
Is really, and we say it all the time. The
only people who went in court are the lawyers, right,
And we do get good results for our clients. We
do time, we do, but sometimes it's better to negotiate
that ahead of time.
Speaker 3 (08:50):
Sometimes you get that person in the you know, sometimes
you do get that person to court and the judge
will say, go out in the hallway and figure this out.
And that's not what people want to hear. They that
court is where you know, they can strike someone down
with a lightning bolt, and they think.
Speaker 1 (09:05):
It's going to be like a law and Order episode, right,
and in reverse, we're going to court first and they'll
go to jails.
Speaker 3 (09:11):
Right exactly. So it's we're here to help you resolve
your own disputes, but ultimately you're gonna need to participate
in resolving your own disputes with your with your loved
ones and with others.
Speaker 1 (09:26):
And I will say this, there are people who sometimes
contact us and they say, can.
Speaker 2 (09:30):
You write my sister a letter? We absolutely will not do.
Speaker 1 (09:33):
Okay, that is fruitless, nasty gram No, don't do it.
Speaker 2 (09:37):
Not interested, gets no results. Just so, we usually do.
Speaker 1 (09:42):
Want to be in a court context sooner rather than later,
because nothing gets resolved outside of that. But how we
get there, and kind of the tenor of how we
get there is important as well.
Speaker 3 (09:55):
It is helpful when you when you get that man
or woman in a robe in the room, absolutely because
everyone kind of they'll.
Speaker 1 (10:02):
Say, this is your problem, and this is your problem,
and I'm not making a decision, but you you both
have problems.
Speaker 3 (10:10):
It's helpful for you and I to get a judge involved.
Speaker 1 (10:14):
It's very rare that they say you are great, and
you are terrible.
Speaker 2 (10:18):
That very rarely happens.
Speaker 3 (10:21):
Exactly. We stay in the gray an awful lot.
Speaker 1 (10:26):
But so if you're looking for complete vindication, the courtroom
is generally not right.
Speaker 3 (10:31):
Yeah, yeah, right, yeah, exactly. I think you're right. No
one's going to get one hundred percent win. We see
that very rarely. I mean it's not it would take years.
Speaker 1 (10:40):
It would take years and thousands upon thousands of dollars
to do that. And it's really the judge is not
interested in that either. The judge is interested in solving
the problem in a fairly reasonable and quick way. So
we're coming up on our first break. When we come back,
we're going to continue you and talk about state litigation
(11:01):
and trust litigation. This is Life Happens Radio, and we'll
be back after this. Welcome back to Life Happens Radio.
I am Aaron Connor from Peer O'Connor and Strauss. We
are in a state planning law firm. We do also
do medicaid work, in guardianship work, and a state and
trust litigation.
Speaker 2 (11:21):
I'm joined by Brent Stack. He is also a litigator
by trade. So we are.
Speaker 1 (11:27):
Talking about litigation shocking. We were talking about some of
the problems that can't be solved by litigation. In the
first segment, there are problems that can be solved by
litigation too.
Speaker 3 (11:38):
Yes, sometimes it is necessary.
Speaker 1 (11:40):
Unfortunately it's unpleasant and stressful, but there are sometimes that
it's just not going to get done otherwise. And these
can be in estates, they can be in trusts, they
can be in a guardianship. So a lot of times
this happens when mom or dad is alive, right, Usually
(12:02):
not both right. I have had a rare occasion where
we have alleged that both mom and dad are incapacitated,
but that's unusual. Usually it's the survivor, and it may
be that they're not taking care of themselves. This could be,
you know, house could be in disrepair. We've seen all
sorts of garbage and animals and infestation.
Speaker 3 (12:25):
And a lot of financial abuse. Also, we see a
lot of financial abuse where that's the more you know,
these these scams will it whether it be online scams
or phone scams. We've seen a lot of of our
alleged incapacitated people being taken financially being taken advantage of
(12:48):
financially right.
Speaker 1 (12:49):
And most of these cases are not clearly incapacitated person.
Speaker 2 (12:56):
Right, I mean.
Speaker 3 (12:57):
Good days, good days and bad days.
Speaker 1 (12:59):
When it's clear that someone is incapacitated, it's a very
easy is not the right word, but it's not as
difficult as it is when we have waning capacity, correct, Right,
because having been a court evaluator, right, and the person
that is a court evaluator, their role in a guardianship
(13:20):
is to interview people and review documents and see what
the facts are and see what capacity is like, and
to come to a set of recommendations. That is someone
appointed by the court who is a neutral and Brent,
you've been in that role.
Speaker 3 (13:36):
Yeah, kind of the eyes in the ears of the court, right,
take all take the entire story and present it to
the court with a set of recommendations.
Speaker 2 (13:45):
Because the truth is usually somewhere in between. Absolutely, you
get a petition that says X, Y, and z, you're
going to get an answer that says, probably that none
of that is true other than the person's name and
birth date, right, and maybe the kids are right. So,
but and then you usually when you get a good
court evaluator, they see this person more than one time. Yes,
(14:07):
because I've seen it many times. Someone with waning capacity
can turn it on for a short period of time.
Speaker 3 (14:15):
Yeah, capacity is a tough issue. You want to have
a conversation that lasts more than ten minutes because you
can you can see some of these people oriented to
time place who the president is. But then all of
a sudden, you know, things start to slip, And I
(14:39):
think that's tough for family members. They don't they don't
see that. I think, like you said, with waning capacity,
it's it's almost like when you you're driving your car
in your own breaks start to go. You know, you
just press a little bit harder on the pedal each time,
and you don't really comprehend that things have gotten out
of control.
Speaker 1 (15:01):
Right, and by the time you're Fred Flintstone stopping the
car with your feet, we've got a real.
Speaker 3 (15:05):
Problem, exactly, right, exactly, And unfortunately that's that's where we
come in. But you know, we can come in then
and help you sort through your your incapacity issues in
terms of getting a guardian appointed for your loved one.
And there are a lot of things that a guardian
(15:25):
can do to kind of right these wrongs. You take
over financial control, you can stop that financial abuse, you
can get more of protection against whoever the financial abuser is,
we can help with nursing home placement. The guardian can
can do nursing home placement, I think the only thing
that And it's important to note there are limitations on guardianship.
(15:46):
You can't place your loved one in a mental institution
or a drug and alcohol facility, and you can't you
can't write a new will.
Speaker 2 (15:56):
Yeah.
Speaker 1 (15:56):
I mean a lot of times people come to us
and they're trying to get guardian ship over a relative,
usually who has mental illness, and it is very difficult
unless that person is willing to give you guardianship. The
problem with even with that, though, is if they change
their mind, it can be a big problem. A little
(16:18):
known kind of provision of the guardianship world is that
if you want to terminate a guardianship, the burden is
on the person who wants to keep the guardianship, not
the person who's under a guardianship right, And in my opinion,
that's probably the pendulum swinging too much, too far to
the rights of the incapacitated person, because we're talking about
(16:41):
a person at that point who's already been determined in capacity.
There's no allegation they've gone through a factual hearing or
they've agreed, which is a little bit different than they're
technically a person in need.
Speaker 2 (16:53):
Of a guardian.
Speaker 1 (16:55):
But so maybe under those circumstances it makes a little
more sense. But predominantly we don't agree to person in
need of guardian. We're agreeing to.
Speaker 2 (17:05):
You know, a lot of the contest is over who
the guardian.
Speaker 3 (17:10):
Is a lot most of the time.
Speaker 1 (17:13):
There's occasional cases where capacity is an issue and the
person alleged to be incapacitated is fighting, but usually that
doesn't win.
Speaker 3 (17:26):
Out right, and it's it's a tough it's a tough
hearing when you know, when you're alleging that your loved
one is a person in need of a guardian, you
have to put on proof in front of them, correct,
you know they're at the hearing, you're alleging all of
their functional limitations, and it's very uncomfortable. So oftentimes we
(17:50):
find that, you know, a more favorable outcome is someone
agreeing to being a person needing a guardian right, not
an incapacitated person.
Speaker 1 (18:02):
And they tend to like that better as well, because
they're not deemed incapacity.
Speaker 3 (18:07):
Absolutely, and and I do think you know, when you
are determined to be an incapacitated person. I think that
the court has as some reporting requirements. I think that
you kind of you might be flagged as a person
who's incapacitated rather than a person who's consented to having
a guardian, right, and so there are there are future consequences.
(18:31):
And also, yes, these these proceedings are uncomfortable for families.
It's not a situation you want to have yourself involved in.
So that's why we often recommend that you get yourself
lined up with a health care proxy and a power
of attorney. The court at a bare minimum, the courts
(18:53):
will not appoint a guardian for you if you have
those things in place. So I think it's recommended that
all families, as people age, you do your planning, You
get your health care proxy, you get your power attorney,
you set up your trusts, you get your wills in order,
(19:14):
and then you can avoid avoid coming into court under
these unfortunate circumstances.
Speaker 2 (19:19):
Right.
Speaker 1 (19:21):
The best guardianships if you will are Mom or Dad
agrees to who the guardian should be, and it really
can be like a ten or fifteen minute hearing. Absolutely, yeah,
that's the best it gets and those happen. But to
be fair, we've probably spent close to ten thousand dollars
(19:42):
to get to that point. So you know, I'm not
going to say what a power of attorney and health
care proxy costs, but as well less than ten thousand,
absolutely right, So you don't want to be there if
you don't have to, it's better to you pick who
you want to be in charge. That's the other thing
(20:04):
that maybe people don't consider is that in a guardianship,
the person in charge isn't necessarily the person you would
have been appointed, right, right, maybe the person with a
better lawyer.
Speaker 2 (20:16):
Right.
Speaker 1 (20:17):
It may be that the person you would have appointed
has some issue right that you could have appointed.
Speaker 2 (20:27):
So I don't know.
Speaker 1 (20:28):
Let's say five years ago, it was a complete bar
if a person had a felony to be in a
guardian right, and I certainly understand the thinking, But relatively
recently in the legal world that was changed to it's
a factor, but it's not a complete bar. And it
(20:50):
may be some kind of felony that's I don't know,
not related to the types of things that would matter, right.
Speaker 3 (20:56):
I think it's yeah, I think you've got uh County
Department of Social Services is your guardian of last resort.
They're overwhelmed. Yeah, you don't with that with guardianships, they're
short on staff. It's not it's not ideal for your
(21:17):
loved one to have the Commissioner of Social Services become
their guardian, right.
Speaker 1 (21:21):
Which really means that an attorney in that department.
Speaker 3 (21:25):
Is probably there, right, and a social worker. Yeah, and
you're gonna your minimum visits per year, et cetera.
Speaker 2 (21:33):
There's just four, right, which isn't a lot.
Speaker 3 (21:35):
It's it's not a lot. You've got your there's a
it's it's called the Part thirty six list, which is.
Speaker 2 (21:43):
It's the turn number of choice.
Speaker 1 (21:44):
It's the thirty sixth choice that you would actually want
to be your Guardian's.
Speaker 3 (21:49):
Called that, and that's not a great result. So the
courts have loosened the the prohibition on felon's sometimes your
family Sometimes your family felon is uh is a better
guardian than social services or a Part thirty six lists.
Speaker 1 (22:10):
So I mean, if the felony is embezzlement and mom
or dad has some money, they're not going to get appointed.
Speaker 3 (22:16):
Typically yeah, without a bound typically financial uh, any any
sort of theft fraud or physical abuse would probably be
a bar if it's a felony.
Speaker 2 (22:27):
Right, elder abuse.
Speaker 3 (22:29):
Elder abuse certainly would be seen as a problem by
the courts. But but yes, you you know, something like
arson if it's okay, all right with that, Yeah, that's okay.
But but but again that's why you said. And and
you know, I think we've in your power of attorney
(22:51):
you can state this is who, uh you know, I
point as my my power of attorney, my attorney in fact,
to be my agent. And I don't want a guardian.
But should I need a guardian, this is who I
want to become my guardian. That's something that you can
do to appoint to avoid the family felon becoming your guardian.
(23:11):
So again, I think it just it all comes down
to careful planning. Do it when you don't think you
need to do it. That's probably Actually when you need
to do it is when you don't think you need
to do it.
Speaker 2 (23:22):
Well, you can't wait till you need it exactly, that's
too late, yep. And things can go wrong that way.
A lot of things.
Speaker 1 (23:32):
We unfortunately have clients die before they complete their documents.
We have clients occasionally become incapacitated before you exactly. So
once you're incapacitated, everything's out the window.
Speaker 3 (23:43):
Right, Your ability to plan is severely limited.
Speaker 2 (23:48):
That's right.
Speaker 1 (23:50):
So we're coming up on the news here, so please
stay with us when we come back. But when we
come back, guardianships are not the only type of litigation
we do. We do some trust litigation and when we
come back, we'll get into the ways that that can
happen and the strategies that need to be in place
(24:10):
and who needs to do what in that situation.
Speaker 2 (24:13):
This is Life Happens Radio.
Speaker 1 (24:15):
I'm Aaron Connor from Pierre O'Connor and Strauss and when'll
be back right after this.
Speaker 2 (24:22):
Welcome back to Life Happens Radio.
Speaker 1 (24:24):
Aron Still Aaron Connor, still from Pierre O'Connor and Strauss.
My compadre is still Brent Stack All the morning, still
from piero Connins. So we are a state and trust litigators,
guardianship attorneys. So we had really kind of run through
some guardianship issues on the first half of the show,
(24:46):
which you can always listen to on iHeartRadio if you
missed and you really want to hear it, so please
please do.
Speaker 2 (24:52):
But a large part of our practice is trustworth right.
We do wills, we always do wills.
Speaker 1 (24:59):
But that's really not where our clients are deriving the
most benefit from us.
Speaker 2 (25:05):
We're planners. We are doing revocable trusts or irrevocable trusts,
And if you've listened to the show, you know that
there's a lot about an irrevocable trust.
Speaker 1 (25:15):
It's not as scary as it sounds, and it's a
good vehicle for most middle class people to preserve property,
make sure it doesn't go to pay a nursing home
and goes to where they want it to go, whether
it's children, other relatives, charities, whomever. So that's what we
try to do. We ultimately are trying to put a
(25:37):
plan in place to make sure you're covered, to make
sure your loved ones get or your beneficiaries get what
they're supposed to get, and the people who you do
not want to get things do not. And that may
be removing you may be removing a beneficiary, or you
may be making sure that a let's say, a child's
spouse doesn't end up with all the money or some
(25:59):
other predator. As we say, that's important to our clients
quote unquote bloodlining the money right, and in most situations
a trust can continue on for a very long period
of time. Now, New York has something, at least for now,
called the rule against perpetuities, right, which is a question
(26:22):
on the bar exam that ninety percent of the attorney's
never comes up, right, But in real practice it doesn't, right.
I mean, the thing is so essentially the rule of
perpetuities time is about one hundred and twenty years because.
Speaker 3 (26:40):
Lives and being plus twenty one.
Speaker 1 (26:42):
That's right, right, So, I mean the longest anyone's ever
lived is about one hundred and fifteen years exactly. So
if you roll the dice and you got that person, great, right,
but unlikely. So let's just say you had somebody live
into their nineties, you get twenty one years. You got
about you know, rough math math one hundred and twenty
(27:02):
years best case scenario in New York. In the state
like Delaware, you can have what's called the dynasty trust
that can essentially go on forever if you have enough money, right,
and you know, let's be honest, very few people have
enough money to create like a long lasting dynasty trust
like DuPont, like the DuPont family.
Speaker 2 (27:24):
It was very involved in Delaware.
Speaker 1 (27:26):
They owned a lot of property in Delaware, and they
had a lot to do with how the laws were
drafted in this favorable way. And the DuPont family would
be a family that still have generational wealth well downstream, yep,
but you can still create kind of your own I
(27:46):
don't know many dynasty trust if you want, well, we
try to make sure that money goes to your kids,
not their spouse. And then if something happens to your child,
that goes to your grandchildren, again not to the spouse. Right,
if you wanted to go to the spouse, hey, great,
we can make that work too. But that's that's like
two percent of people.
Speaker 3 (28:07):
Yeah, I think you're right. I didn't do uh. I
didn't do a lot of trust litigation before I came
to the firm, right, And I've been learning a lot
about trust since I've been at the firm, and I
think what a lot of people don't know. I think
you're right. Some people are afraid of irrevocable trust or
or trust in general. But I think you're right. I mean,
(28:28):
it's not just for the rich, it's not just for
the DuPonts. It's for everybody. It's it's by far the
best way to protect your assets and your wealth and
to pass it on, like you said, to who you
want to receive it, and to protect it from who
you don't want to receive it, including the government. If
we're you know, absolutely, I think that's uh, it's really important.
(28:52):
You know, I've been telling my family members since I've
started working here, you need to get in. You need
to do this right. You don't have to have a
million dollars, right, you know, any amount of wealth, and
you don't. It's not just money, it's not just cash. Well,
it's your home.
Speaker 1 (29:08):
It's the easiest thing to put in the trust is
property exactly right, And if you own property in two states,
you really want to trust because you don't want your
family probating in.
Speaker 2 (29:16):
Two places exactly absolute disaster.
Speaker 3 (29:19):
Yeah. Money wise, yeah, I mean too. I think we've
said it before on the show, but the best gift
that you can give your family when you pass is
the ability to avoid probate again and pay the lawyer less,
and pay and pay the lawyer less money. Right, stay
out of court if you can. One way to want
sure far away, to stay out of court, to stay
(29:40):
out of probate, which in a lot of counties in
New York State can take a really.
Speaker 2 (29:44):
Long time downstate complete night.
Speaker 3 (29:46):
Oh yeah, especially right, you can be in probate for
over a year, you know, just to have the will
approved and to then receive the ability to administer the estate,
which you know, all of these assets are are tied
up for a long time and you're paying out. But
(30:06):
if you put your property in trust and make sure
that you've got everything buttoned up the way it should be,
you can avoid probate. You can pass your assets to
your family members without going to court, and again, it's
it's probably the best thing that you can do.
Speaker 2 (30:24):
You know.
Speaker 1 (30:25):
One thing that people don't really think about is if
you are leaving assets to non family members, right like,
you don't want your family to get it, and that's
that's perfectly fine.
Speaker 2 (30:35):
Sure, the only person in New York State.
Speaker 1 (30:36):
That is absolutely entitled to a portion of your state
is a spouse, and they're only actually entitled to a
third right that's illegal. So I mean, you could leave
two thirds to someone else if you really wanted to.
I'm not advocating that specifically. I'm not advocating that in
case my wife is listening.
Speaker 2 (30:53):
But so.
Speaker 1 (30:58):
But if you're eaving things to friends and you don't
have children, let's say, it becomes really onerous to do
that in a probate probate.
Speaker 2 (31:09):
Proceeding easy for me to say, right.
Speaker 1 (31:12):
I met with someone this week that we're talking about
cousins yep as the just what we call distributees, people
who take in the absence of a will, And we're
talking about a number in the twenties of who we
have to serve, and we don't necessarily know where everybody is.
(31:34):
It's going to be a long ride, and it's not
going to be inexpensive. And even you know, in New
York you have the New York people, you have to
personally serve how to stay people. You can kind of
get around the personal service, but you still have to
do certified mail, and then you have to do proof
of delivery.
Speaker 2 (31:52):
And I mean twenty.
Speaker 1 (31:55):
Six Let's just say, if that were to number certified
mails is certainly going to be less than twenty six
personal service, but it's not. And then I'm sure that
some of these addresses will not be correct.
Speaker 3 (32:07):
I have a current case Aaron where forty eight individuals
are titled to service.
Speaker 2 (32:11):
Yeah, that's a nightmare because all you need is one
with a screw.
Speaker 3 (32:17):
Loose, right, or they're gonna start bouncing back, right.
Speaker 1 (32:21):
Or incapacitation there, right, I mean you get one that's
in a nursing home or under some kind of disability,
and you've just gone off the rails for a period of.
Speaker 3 (32:31):
Time guardian ad litem right.
Speaker 1 (32:34):
And you may not get your letters right away, right,
You have to ask for So when I say letters,
when you finally either a probate petition meaning there is
a will, or an ad administration petition meaning there isn't
a will, you get letters from the court, letters of
administration or letters testamentary, which are your authority to act
on behalf of the estate. And you can't really do
(32:55):
much without them. You can't martial assets, you can't open
a bank account. You're really not even supposed to be
like accessing property.
Speaker 3 (33:01):
I don't think you can do a thing without them.
Speaker 1 (33:03):
Well, the gray area is real property where people are
trying to preserve personal property. So generally the recommendation is
to lock it down or if there's something particularly valuable,
to make sure that it's not Because I think you've
seen once personal property is gone.
Speaker 2 (33:22):
It doesn't come back, you know. Oh yeah, here's the
diamond I took from mom. I'm wearing it now. That
never happens, It doesn't happen.
Speaker 3 (33:29):
Yeah. How many times do our clients come to us
with a list of things that went missing and we're
supposed to retrieve them?
Speaker 2 (33:37):
Happened?
Speaker 1 (33:38):
That can happen in the guardianship world too. The judge
always says, we're not going backwards.
Speaker 3 (33:43):
Oh yes, right, yep.
Speaker 2 (33:46):
Occasionally.
Speaker 1 (33:47):
I did have a case where we initiated a lawsuit
against another person and did recover because they'd essentially stolen
real property, and then when the house sold, we got
her money back.
Speaker 3 (33:59):
Yep.
Speaker 2 (34:00):
But that's unusual.
Speaker 1 (34:02):
And real property is easier to attach, And what we
mean by attached is you can put what's called the
least pendance on it, which makes it very difficult to sell,
and without coming to an agreement of who's going to
get what, you're not going to be able to sell property,
which you can restrain a bank account, but it is
not very easy to do and takes pretty high level
(34:25):
of proof. So if you're in a situation where you
have non family beneficiaries, you need to be careful and
think about what you're leaving behind.
Speaker 2 (34:38):
And I say this obviously all the time.
Speaker 1 (34:41):
It won't be your problem, but what problems are you
leaving behind? And I think that's important when people met
with some people this week, I did the planning for
their parent thirteen years ago, and it really was all
(35:01):
teed up.
Speaker 2 (35:02):
Yeah, it was easier for that. I mean not easy.
Speaker 1 (35:05):
They lost a parent, and which is a terrible situation,
but at least they didn't have to worry about how
this was going to be handled. And it's clean, it's
relatively easy, and it just gives people peace of mind.
Speaker 2 (35:19):
It gives them one less thing to deal with.
Speaker 3 (35:21):
Yeah, I mean, try not to leave behind a court case. Correct,
And here's my leg okay, yeah, and you can do that.
You cannot leave behind a court case. You know, it's
happened in my family some you know, things tied up
for years and my grandmother we didn't even know she
(35:42):
was doing it. She did the planning all on our own,
and it was it was just such a breath of
fresh air when my grandmother didn't leave the family a
court case. We found out that we found out that
all of her assets transferred out of probate. Yes, I think,
you know, I think a taxi turn needed to be filed,
(36:02):
but you know, yeah.
Speaker 2 (36:04):
Yeah, I mean you can roll the dice, don't. I
don't advise that.
Speaker 1 (36:09):
I mean, three out of my four grandparents did not
end up in a nursing home.
Speaker 2 (36:14):
But I don't think that that's typically the case. And
you want to be People think.
Speaker 1 (36:22):
That the transfer on death beneficiary is oh I did
my planning. Well, there's a lot of things that can
go wrong with a transfer on death beneficiary. If your
beneficiary dies before you, you have no beneficiary. If your
beneficiary is becoming capacitated for some reason, and that really
happens more often than you think. I have emails from
clients where they're unfortunately their children have some fored a
(36:43):
stroke or something like that, and we don't want to
leave them money directly. And if you leave again a
person money directly like that, their spouse is going to
get access sure, right, So that's.
Speaker 2 (36:55):
Not really a plan.
Speaker 1 (36:56):
If you have everything in a trust, let's just say
it an irrevocable trust, and you have a bank account
that you have control of, Yes, it's okay to have
a beneficiary. We want you to have a beneficiary in that,
but that's not the ultimate plan for all of your assets, right,
and you need to be mindful of that. I've told
this story many times. My grandmother's aunt, so, my great
(37:21):
grandmother's sister lived to be about ninety five or six,
and she was mean. And I thought she was just
mean because she was old. But my dad's cousin corrected
me on that and said she was just always mean
and that was just her personality. Never had any children,
so you think she'd be like just flying high, not
(37:42):
not a lot to be like you, annoying you in
your life. She had a lot of money when she
went into the tr Resian House in nineteen eighty one,
and when she died in nineteen ninety six, she didn't
really have any.
Speaker 3 (37:55):
Money, right.
Speaker 1 (37:56):
And the rules in nineteen eighty one were you could
have a trust that you had full control over until
you went into.
Speaker 2 (38:03):
The nursing home.
Speaker 3 (38:04):
Gotcha, the day you went in.
Speaker 1 (38:05):
You were triggered off. And oh those were real rules,
Like it's like mind blowing. Yeah, oh walked in sorry,
a new trustee and your money wasn't available.
Speaker 2 (38:14):
I mean, you could do that until nineteen ninety three
or ninety four.
Speaker 3 (38:18):
So I think that's another person. Yeah, I think that's
another good point, Aaron. I think a lot of people
have the miscont conception that when you place your assets
into trust that you don't have any access to them, right.
I think when when people come in, we tell them like, listen,
you can be the grant tour of your trust, meaning
you're the one who contributes the assets to the trust.
(38:39):
You can be also the trustee and the beneficiary. You
can be all three and you still have access to
your money, but it's protected from from other factors. I
think that's what people have a misconception about, too, is
that you don't lose your assets when you put them
in trust. All you're doing is protecting them, but you
still have access to them.
Speaker 1 (39:00):
Well, it depends on the type of trust, right, But
in a revocable trust you wear all three hats, and
an irrevocable trust you have a trustee that's someone other
than you because we need that separation. But you still
can do so many things. You can change your beneficiaries,
you can get money out the back door, you can
change your trustee at any time, so it's not really
as frightening.
Speaker 2 (39:20):
We're coming up on our last break.
Speaker 1 (39:22):
So when we come back, I want to talk about
some things that can happen in the trust world to
make sure that you're getting what you're supposed to be getting.
This is Life Happens Radio, Aaron Connor from Piro Connorance Strouse,
and we'll be back right after this. Welcome back to
Life Happens Radio. Aaron Connor, Piro Conorn Strausse joined by
Brent Stack, and we have been talking about trusts, on
(39:45):
guardianships and what can go wrong and what can go right.
Hopefully you get more right than wrong. But we often
are also encountering people who maybe mom or Dad say
up a trust or an a or an uncle or
who knows, right, could be anybody could be their neighbor
(40:08):
and they're a beneficiary, but not generally the trustee because
in the world of trustees there are many choices. It
could be an individual. Sometimes it's an accountant. Once in
a while it's a lawyer. I can tell you though
that nine times out of ten and a lawyer is
a bad choice as a trustee one for inattention. Two
(40:31):
they are not an investment professional. So if you hire
a lawyer as a trustee, and that's really what you're doing.
Because any trustee is entitled to a commission for serving
and being a fiduciary, meeting someone who has to act
in the best interests of another person, they're going to
have to hire an investment advisor, which you're also going
to pay for it. So there are trust companies out there.
(40:54):
There are investment houses that have separate trust divisions. There
are some investment houses that don't have trust divisions, but
the bigger ones typically do, and we see a lot
so generally in my experience, when people appoint a corporate trustee,
it's because they don't think that their children can manage
the money, or we'll spend it poorly, because a corporate trustee,
(41:20):
while applying the same standards, has a lot more to
lose than an individual trustee. Right.
Speaker 3 (41:24):
And they're also objective.
Speaker 1 (41:26):
Right, So if it says it can only come out
for X, Y and Z and us for a well
you're not going to get it.
Speaker 3 (41:32):
Oh yes, and I think you're right. A corporate trustee
is going to be hold the purse strings a lot
tighter than you know a family member or someone.
Speaker 1 (41:42):
Right, it's going to have and even when it has discretion,
it's going to be less likely to use it.
Speaker 2 (41:49):
Correct, You're going to be required to document a need.
Speaker 1 (41:53):
So if your kid is going to college and you
want money for college, well, if they're in their freshman
year of high school, you're not going.
Speaker 3 (42:02):
To get it, okay, right.
Speaker 1 (42:04):
Probably going to have to present a tuition bill that's
out saying you know what the cost actually is, and
then they will decide what to pay. They may pay
all of it, they may pay none of it, and
they may pay some of it.
Speaker 3 (42:19):
I think that's that's a good point too. With a
lot of trusts are for educational purposes, and I think
what we're running into a lot is what really is
the cost of education because colleges now they have a
tuition bill, but a lot of colleges also have mandatory fees.
And it's like, how can you separate tuition from mandatory fees? Well, books,
(42:40):
our books part of the no and they're that's separate.
So I think right now I have a couple of
cases where we're interpreting the language of the trust to
see exactly what the beneficiary is entitled to. And I
think that's that's what you're talking about.
Speaker 2 (42:55):
Yeah, I mean so, and to date, myself.
Speaker 1 (42:58):
But before when I was a freshman in college, okay,
my books were five hundred dollars for one semester. I
can't imagine there's the same amount of money now. I'm
sure that they're more, right. And some of those were
softcover books, which I remember aggravated me at the time.
My astronomy textbook and I went to a place where
(43:20):
you could not see the stars at night because the
city lights were so bright, So it was really a
strange place to take astronomy.
Speaker 2 (43:27):
But I didn't really like my other science choices.
Speaker 1 (43:30):
So anyway, but books, books can be very expensive, so
if you don't have other means, that could be a problem.
You know, I think most of the time, someone who
establishes a trust to pay for educational purposes is trying
to avoid that person being burdened by loans exactly, because
(43:51):
as a law school graduate, I can tell you I'm
burdened by loans right, not as bad as some people,
but I mean, I've been out almost twenty years.
Speaker 3 (44:00):
And I still have a law school loan.
Speaker 2 (44:02):
So if you go to.
Speaker 1 (44:06):
Undergrad and then to graduate school, you could owe like
an enormous amount of money. So if that is in
fact the intent, and then you're denying let's say books
or maybe even housing.
Speaker 2 (44:22):
Right.
Speaker 1 (44:23):
Well, let's says somebody around here and let's say they
want to go to Siena, but they want to live
on campus, right right, the trustee may actually deny that portion.
I could and frankly, they could probably support that if
they wanted to.
Speaker 2 (44:36):
Right.
Speaker 1 (44:37):
Some of what that's going to depend on is how
much money is sent the trust. Then how would you
go about finding that out?
Speaker 3 (44:43):
Well, in that case, when when people, when beneficiaries come
to us and they say, you know, I'm entitled to
education from this trust, and the trustee is saying, yeah,
but I'm not going to pay for your books, what
you and I would do is we would file a
Supreme Court proceeding for an accounting of that trust. We
(45:05):
would have the trustee come in and provide us with
the way that they have administered that trust from the
inception of the trust to when they started paying it out.
What have they paid and for what? And what are
the expenses? What are the expenses and from.
Speaker 1 (45:22):
Tax filings, what have they taken in commission? What have
they paid out to themselves?
Speaker 2 (45:27):
Maybe? Right? Right? If it's a brother or sister or
some family.
Speaker 3 (45:30):
Member, and how are they doing as a fiduciary.
Speaker 2 (45:33):
And how are they right? Exactly? So have the investments
performed well? Right?
Speaker 1 (45:37):
If you had a trust that didn't make money in
twenty twenty four, we have a problem, right, right, it
didn't make money in twenty twenty five, well, and coming
back around exactly, Yeah, So you'd have a defense at
least there. But as a fiduciary, you are charged to
do the best with the money that you can.
Speaker 3 (45:58):
Yep.
Speaker 1 (45:58):
So I mean, honestly, probably now, if you had it
in an interest sparing account that was getting a rate
like four or five percent, like you see in some offers,
you probably would be okay, right, But most money is
invested in the market yep, to make sure it's actually
making real money.
Speaker 3 (46:15):
Yeah, And that's what I think our clients don't at
first comprehend the scope of an accounting, but it's really
you know, it's not just an accounting of the money.
It's an accounting of how you performed your fiduciary duty.
Have you expended the funds and the trust for the
purposes that the grant are intended? And how how in
(46:35):
general have you done as a fiduciary. I mean, if
you're I think we have a lot of trust Aaron
that you know, the trustee has a purpose to spend
moneys for a certain individual. But then what we have
is residuary beneficiaries. And who is the trustee really looking after.
Are they looking after the individual who is named in
(46:58):
the trust or receive the funds, or they looking after
the residuary beneficiary who gets all that's left old. They
may like better who they mighty better, right, and might
be and might be, you know, preserving some funds that
otherwise should be expended for the purposes of the trust.
Speaker 2 (47:14):
They might ultimately be that beneficiary.
Speaker 3 (47:16):
And they might be that beneficiary too.
Speaker 1 (47:18):
Yeah, it's a conflict of interest in a lot of ways.
Speaker 3 (47:22):
But that's how we get after That's how we get
at right, And.
Speaker 1 (47:25):
It's a way for us to decide whether we feel
like we need to move to remove a trust correct
because most times we don't have information that shows us.
It's a high burden of proof because you can't just
go in and say I don't like this person.
Speaker 3 (47:39):
That's not how it works exactly.
Speaker 2 (47:40):
They have to violated their fiduciary duty.
Speaker 3 (47:42):
We have to see how they're performing right, either.
Speaker 1 (47:44):
Self dealing if they had taken money, if they have
not followed the terms.
Speaker 2 (47:49):
Of the trust, you know, fraud.
Speaker 1 (47:53):
All sorts of things, but number one would be self
dealing or a form of self dealing. Whereas if they
may or the trustee, and the beneficiaries are their kids
and your kids and their kids seem to be doing better,
you know, getting more things.
Speaker 3 (48:08):
Absolutely, so those things happen.
Speaker 1 (48:10):
They don't just happen in movies, but they happen in
real life too.
Speaker 3 (48:15):
And I think that's another good point too, is if
you're coming to us or to whomever to establish the trust,
make sure that you identify, you know, pick the right trustee,
pick the right beneficiaries, try to avoid conflicts of interest
at all costs.
Speaker 1 (48:32):
Well, oftentimes I'm recommending something called the unit trust to people,
and that way, a set percentage comes out every year. Right,
maybe five can be more than that, but five is
a typical number, And that way it can be invested
for growth, right, and not worried about income. And there's
less discretion involved.
Speaker 2 (48:51):
Right.
Speaker 1 (48:51):
If you think there's going to be a problem, or
you think somebody isn't really great with money, you can
say here's your set amount. It can come out quarter annually,
it can come annually whatever, and eliminate that a lot
of the discretion. And by eliminating a lot of the discretion,
you can eliminate a lot of potential for a lawsuit.
Speaker 2 (49:10):
You can't eliminate an accounting.
Speaker 1 (49:11):
Right because we need to be able to determine whether
somebody's doing what they're supposed to be doing.
Speaker 2 (49:17):
But there would be less discretion and a trust like that.
Speaker 3 (49:20):
And it's also I think important to note that any
beneficiary can request or demand compell and accounting at any time,
and I think that's that's the number one layer of
protection for a beneficiary, is that you have the right
to compel on accounting, and that's how you're going to
find out how the money is being spent. If you're
(49:41):
kept in the dark, that's what.
Speaker 2 (49:43):
You do, right.
Speaker 1 (49:44):
And oftentimes there's concerns that the lawyer is taking too
much money too, so that's important and we can figure
that out.
Speaker 2 (49:51):
So we're coming to the close of the show. I
just want to.
Speaker 1 (49:55):
Say that this week we had our big Elder Law
forum at that does so if you attended or watched online,
thank you very much. That's our signature event, really one
of two big events during the year, and we had legislature,
legislators and people from the government to talk about what's
going on in long term care and managed long term care,
(50:18):
so very important stuff. If you didn't get a chance
to watch, please look online to see what is available.
And if you have an issue, please give us a
call or email us at the office. The office number
is five one eight four or send us an email
at info atpro law dot com.
Speaker 2 (50:36):
That's p I e R r law dot com.
Speaker 1 (50:40):
And we will be back next week. Thanks for listening, everybody,
have a great weekend.
Good morning everyone. Welcome to Life Happens Radio. Are you prepared?
This is our weekly radio program for individuals and their
families where we address the challenges we all face as
we age. We talk about aging as a lifestyle, the
issues that must be confronted, and the careful planning that's
required to avoid crises in the future.
Speaker 2 (00:20):
Life Happens will provide you.
Speaker 1 (00:21):
A tools to educate and prepare yourself for events like retirement,
protecting your income and assets, planning to pay for nursing,
home and home care, special needs, willson trusts, planning for
an untimely death, and resolving disputes in and out of court.
I'm Aaron Connor from Pure O'Connor and Strauss, joined this
week by Brent Stack.
Speaker 2 (00:40):
Good morning, Brent.
Speaker 3 (00:41):
Good morning, Aaron.
Speaker 2 (00:42):
If you don't know, Brent's been with us almost a
year now.
Speaker 3 (00:46):
Right, since July of twenty four.
Speaker 1 (00:48):
Yeah, so we're getting there. Brent does the litigation with me.
He probably more specializes in guardianships and trust litigation at
this point, but he's learning, learning.
Speaker 2 (01:04):
As we go.
Speaker 3 (01:05):
We do the messy stuff.
Speaker 1 (01:06):
That's right, you know, if you and your sister or
you and your brother don't like each other.
Speaker 2 (01:14):
Now while mom and dad are alive, it doesn't usually
get better.
Speaker 1 (01:22):
Mom and dad are usually kind of the referee in
that situation or like an anchor in it. Like I
don't mean that in a bad way, dragging you down.
I mean that like it's a kind of like the
sun with you know, pulling you in right.
Speaker 3 (01:35):
Yeah, the shatters that we've seen in families when mom
and dad go.
Speaker 1 (01:40):
Right because people don't necessarily have to behave anymore right
like people should behave. And sometimes it's justified, and sometimes
it's you've got a tricycle when you were three and
I did not, and it.
Speaker 2 (01:54):
Just never gets better.
Speaker 1 (01:55):
It honestly is amazing to me how many people like
actively keep score over their lifetime.
Speaker 3 (02:01):
Yeah, I agree, and I think a lot of these
people don't see it coming right, and it makes me,
you know, it's sad. I want to go home and
hug my sisters.
Speaker 2 (02:13):
Well.
Speaker 1 (02:13):
Obviously, having a good family dynamic is much better, right,
And one of the issues is the more people you have,
the harder it is to get along, just because there's
that many more personalities. You know, there may be five
of you and four of you get along great, but
then there's one person or I mean a lot of
(02:34):
times there's a component of mental illness to someone, right, Yeah,
for sure. And in the older generation a lot of
undiagnosed mental illness, untreated, medicated if that's the appropriate course,
but even lack of any kind of therapeutic and just acknowledgement.
(02:55):
And what I've seen is when people age, it doesn't
get better, it gets worse. Sure, So if that's out there,
you know, some things are unavoidable. We try to put
a plan in place that avoids every kind of strife possible.
Speaker 3 (03:10):
I think you're right, planning, planning, planning.
Speaker 1 (03:12):
And but ultimately I used to work for a guy
who would say you could sue the pope for adultery. Right,
you don't really have to have like a claim that
needs to make a lot of sense to make people's
lives difficult. Now, hopefully there's no lawyer is going to
take a case that doesn't really have any merit, But
that doesn't stop people from acting what we say is
(03:33):
pro se, meaning without a lawyer, which is kind of
the ultimate nightmare in a courtroom. We have at least
one large case with a pro se litigant, and that
has already gone on. I think since twenty eighteen. I
can't say for sure, but it makes it more difficult.
(03:56):
It certainly makes it almost impossible to settle anything, absolutely
because you can make a very good offer and there's
nobody to really guide that person to say what will
happen when you don't Yeah, I.
Speaker 3 (04:09):
Think the pro sate litigant is extraordinarily skeptical and.
Speaker 2 (04:17):
They don't know what they don't know about procedure. Right.
Procedure is very.
Speaker 1 (04:23):
Important in a court, and that means how you initiate
a case in a lot of ways. Right, So whether
it's a complaint or a petition, and serving people, serving
the right people, serving them timely, having the contents of
a petition or a complaint that actually have.
Speaker 2 (04:42):
To be there, which in a lot of ways is.
Speaker 1 (04:47):
Not terribly difficult in the Internet era, but sometimes like
fraud for instance, has a higher pleading requirement, certain things
like that. But service is usually a big trip for
even serving the right people.
Speaker 3 (05:03):
Yeah, it is specialized. I mean we did learn something
in law school, correct. I mean there's a reason that
we that we exist in this field. There's a reason
that the courts, you know, appreciate our skill set our specialty.
Speaker 1 (05:21):
I mean, we're not even talking about like substantive stuff
right Exactly, you actually have a case, can you get
into the court right and before a.
Speaker 3 (05:29):
Judge exactly, because we're not talking merits here, we're talking.
Speaker 1 (05:33):
Right basics, right, Because I've seen lots of these just
get rejected out right because they don't meet the filing requirements.
The filing fee doesn't get paid, people don't get served,
and you only get so many cracks at this exactly.
Sometimes you only get one crack. So it's important to
(05:53):
have some some guidance and some knowledge and to have
a case ultimately right. But if you do end up
in a situation where it's sibling versus sibling, I hope
for your sake that everybody has their own counsel, because
it just makes things extraordinarily difficult.
Speaker 3 (06:12):
Yeah, there's a lot of pitfalls before you can get
to merits. I think. I think that's the point that
we're trying to make here, And.
Speaker 1 (06:19):
People tend to dismiss the counselor part of being a lawyer.
A lot of what we are doing is really counseling
people on what the best course of action is, and
they're free not to take our advice. I'm often surprised
how many people pay me and then don't do what
I tell them to do. Right, you're paying for my advice, and.
Speaker 2 (06:40):
You know you're you have agency, You're free to do
what you want to do.
Speaker 3 (06:44):
But I think you're you're exactly right. I mean, I've
found myself a lot in the last few weeks, just
those making those difficult phone calls, just saying, hey, this
is this is where we might get to, but this
is where we should go. And and well, winning a
court case is not necessarily the end of anything, right, absolutely,
(07:05):
because people have the right to appeal, and appeals can
go on not forever, but basically forever, and it's not
good for anyone. I spend a lot of my time
talking clients about the emotional damage or cost of continuing.
And if this is a case where someone has died,
(07:29):
you're likely not even grieving that because you are continuing
to plow through this.
Speaker 1 (07:34):
And sometimes that may be necessary. But when we can
get to a point where it's just about as good
as it's going.
Speaker 2 (07:39):
To get, we have to be realistic.
Speaker 1 (07:42):
And I'm sure everyone listening understands this, but Brett and
I do not work for free, and the longer that
we work, the less you are recovering, generally speaking from
the same pool of money.
Speaker 3 (07:55):
That's absolutely the case. Yes, some you know, some of
our unfortunate clients have have jumped immediately into litigation following
the death of a loved one, and I can guarantee
that they have not grieved because they've been in the
fight since since that day. And you know, I think
(08:16):
it's just the further it drags out. I think the
larger the emotional toll it plays on the entire family.
And you know, I think our clients say a lot
of times, you know, I can't wait to take so
and so to court. But that's that's really not what
you want.
Speaker 1 (08:35):
Is really, and we say it all the time. The
only people who went in court are the lawyers, right,
And we do get good results for our clients. We
do time, we do, but sometimes it's better to negotiate
that ahead of time.
Speaker 3 (08:50):
Sometimes you get that person in the you know, sometimes
you do get that person to court and the judge
will say, go out in the hallway and figure this out.
And that's not what people want to hear. They that
court is where you know, they can strike someone down
with a lightning bolt, and they think.
Speaker 1 (09:05):
It's going to be like a law and Order episode, right,
and in reverse, we're going to court first and they'll
go to jails.
Speaker 3 (09:11):
Right exactly. So it's we're here to help you resolve
your own disputes, but ultimately you're gonna need to participate
in resolving your own disputes with your with your loved
ones and with others.
Speaker 1 (09:26):
And I will say this, there are people who sometimes
contact us and they say, can.
Speaker 2 (09:30):
You write my sister a letter? We absolutely will not do.
Speaker 1 (09:33):
Okay, that is fruitless, nasty gram No, don't do it.
Speaker 2 (09:37):
Not interested, gets no results. Just so, we usually do.
Speaker 1 (09:42):
Want to be in a court context sooner rather than later,
because nothing gets resolved outside of that. But how we
get there, and kind of the tenor of how we
get there is important as well.
Speaker 3 (09:55):
It is helpful when you when you get that man
or woman in a robe in the room, absolutely because
everyone kind of they'll.
Speaker 1 (10:02):
Say, this is your problem, and this is your problem,
and I'm not making a decision, but you you both
have problems.
Speaker 3 (10:10):
It's helpful for you and I to get a judge involved.
Speaker 1 (10:14):
It's very rare that they say you are great, and
you are terrible.
Speaker 2 (10:18):
That very rarely happens.
Speaker 3 (10:21):
Exactly. We stay in the gray an awful lot.
Speaker 1 (10:26):
But so if you're looking for complete vindication, the courtroom
is generally not right.
Speaker 3 (10:31):
Yeah, yeah, right, yeah, exactly. I think you're right. No
one's going to get one hundred percent win. We see
that very rarely. I mean it's not it would take years.
Speaker 1 (10:40):
It would take years and thousands upon thousands of dollars
to do that. And it's really the judge is not
interested in that either. The judge is interested in solving
the problem in a fairly reasonable and quick way. So
we're coming up on our first break. When we come back,
we're going to continue you and talk about state litigation
(11:01):
and trust litigation. This is Life Happens Radio, and we'll
be back after this. Welcome back to Life Happens Radio.
I am Aaron Connor from Peer O'Connor and Strauss. We
are in a state planning law firm. We do also
do medicaid work, in guardianship work, and a state and
trust litigation.
Speaker 2 (11:21):
I'm joined by Brent Stack. He is also a litigator
by trade. So we are.
Speaker 1 (11:27):
Talking about litigation shocking. We were talking about some of
the problems that can't be solved by litigation. In the
first segment, there are problems that can be solved by
litigation too.
Speaker 3 (11:38):
Yes, sometimes it is necessary.
Speaker 1 (11:40):
Unfortunately it's unpleasant and stressful, but there are sometimes that
it's just not going to get done otherwise. And these
can be in estates, they can be in trusts, they
can be in a guardianship. So a lot of times
this happens when mom or dad is alive, right, Usually
(12:02):
not both right. I have had a rare occasion where
we have alleged that both mom and dad are incapacitated,
but that's unusual. Usually it's the survivor, and it may
be that they're not taking care of themselves. This could be,
you know, house could be in disrepair. We've seen all
sorts of garbage and animals and infestation.
Speaker 3 (12:25):
And a lot of financial abuse. Also, we see a
lot of financial abuse where that's the more you know,
these these scams will it whether it be online scams
or phone scams. We've seen a lot of of our
alleged incapacitated people being taken financially being taken advantage of
(12:48):
financially right.
Speaker 1 (12:49):
And most of these cases are not clearly incapacitated person.
Speaker 2 (12:56):
Right, I mean.
Speaker 3 (12:57):
Good days, good days and bad days.
Speaker 1 (12:59):
When it's clear that someone is incapacitated, it's a very
easy is not the right word, but it's not as
difficult as it is when we have waning capacity, correct, Right,
because having been a court evaluator, right, and the person
that is a court evaluator, their role in a guardianship
(13:20):
is to interview people and review documents and see what
the facts are and see what capacity is like, and
to come to a set of recommendations. That is someone
appointed by the court who is a neutral and Brent,
you've been in that role.
Speaker 3 (13:36):
Yeah, kind of the eyes in the ears of the court, right,
take all take the entire story and present it to
the court with a set of recommendations.
Speaker 2 (13:45):
Because the truth is usually somewhere in between. Absolutely, you
get a petition that says X, Y, and z, you're
going to get an answer that says, probably that none
of that is true other than the person's name and
birth date, right, and maybe the kids are right. So,
but and then you usually when you get a good
court evaluator, they see this person more than one time. Yes,
(14:07):
because I've seen it many times. Someone with waning capacity
can turn it on for a short period of time.
Speaker 3 (14:15):
Yeah, capacity is a tough issue. You want to have
a conversation that lasts more than ten minutes because you
can you can see some of these people oriented to
time place who the president is. But then all of
a sudden, you know, things start to slip, And I
(14:39):
think that's tough for family members. They don't they don't
see that. I think, like you said, with waning capacity,
it's it's almost like when you you're driving your car
in your own breaks start to go. You know, you
just press a little bit harder on the pedal each time,
and you don't really comprehend that things have gotten out
of control.
Speaker 1 (15:01):
Right, and by the time you're Fred Flintstone stopping the
car with your feet, we've got a real.
Speaker 3 (15:05):
Problem, exactly, right, exactly, And unfortunately that's that's where we
come in. But you know, we can come in then
and help you sort through your your incapacity issues in
terms of getting a guardian appointed for your loved one.
And there are a lot of things that a guardian
(15:25):
can do to kind of right these wrongs. You take
over financial control, you can stop that financial abuse, you
can get more of protection against whoever the financial abuser is,
we can help with nursing home placement. The guardian can
can do nursing home placement, I think the only thing
that And it's important to note there are limitations on guardianship.
(15:46):
You can't place your loved one in a mental institution
or a drug and alcohol facility, and you can't you
can't write a new will.
Speaker 2 (15:56):
Yeah.
Speaker 1 (15:56):
I mean a lot of times people come to us
and they're trying to get guardian ship over a relative,
usually who has mental illness, and it is very difficult
unless that person is willing to give you guardianship. The
problem with even with that, though, is if they change
their mind, it can be a big problem. A little
(16:18):
known kind of provision of the guardianship world is that
if you want to terminate a guardianship, the burden is
on the person who wants to keep the guardianship, not
the person who's under a guardianship right, And in my opinion,
that's probably the pendulum swinging too much, too far to
the rights of the incapacitated person, because we're talking about
(16:41):
a person at that point who's already been determined in capacity.
There's no allegation they've gone through a factual hearing or
they've agreed, which is a little bit different than they're
technically a person in need.
Speaker 2 (16:53):
Of a guardian.
Speaker 1 (16:55):
But so maybe under those circumstances it makes a little
more sense. But predominantly we don't agree to person in
need of guardian. We're agreeing to.
Speaker 2 (17:05):
You know, a lot of the contest is over who
the guardian.
Speaker 3 (17:10):
Is a lot most of the time.
Speaker 1 (17:13):
There's occasional cases where capacity is an issue and the
person alleged to be incapacitated is fighting, but usually that
doesn't win.
Speaker 3 (17:26):
Out right, and it's it's a tough it's a tough
hearing when you know, when you're alleging that your loved
one is a person in need of a guardian, you
have to put on proof in front of them, correct,
you know they're at the hearing, you're alleging all of
their functional limitations, and it's very uncomfortable. So oftentimes we
(17:50):
find that, you know, a more favorable outcome is someone
agreeing to being a person needing a guardian right, not
an incapacitated person.
Speaker 1 (18:02):
And they tend to like that better as well, because
they're not deemed incapacity.
Speaker 3 (18:07):
Absolutely, and and I do think you know, when you
are determined to be an incapacitated person. I think that
the court has as some reporting requirements. I think that
you kind of you might be flagged as a person
who's incapacitated rather than a person who's consented to having
a guardian, right, and so there are there are future consequences.
(18:31):
And also, yes, these these proceedings are uncomfortable for families.
It's not a situation you want to have yourself involved in.
So that's why we often recommend that you get yourself
lined up with a health care proxy and a power
of attorney. The court at a bare minimum, the courts
(18:53):
will not appoint a guardian for you if you have
those things in place. So I think it's recommended that
all families, as people age, you do your planning, You
get your health care proxy, you get your power attorney,
you set up your trusts, you get your wills in order,
(19:14):
and then you can avoid avoid coming into court under
these unfortunate circumstances.
Speaker 2 (19:19):
Right.
Speaker 1 (19:21):
The best guardianships if you will are Mom or Dad
agrees to who the guardian should be, and it really
can be like a ten or fifteen minute hearing. Absolutely, yeah,
that's the best it gets and those happen. But to
be fair, we've probably spent close to ten thousand dollars
(19:42):
to get to that point. So you know, I'm not
going to say what a power of attorney and health
care proxy costs, but as well less than ten thousand,
absolutely right, So you don't want to be there if
you don't have to, it's better to you pick who
you want to be in charge. That's the other thing
(20:04):
that maybe people don't consider is that in a guardianship,
the person in charge isn't necessarily the person you would
have been appointed, right, right, maybe the person with a
better lawyer.
Speaker 2 (20:16):
Right.
Speaker 1 (20:17):
It may be that the person you would have appointed
has some issue right that you could have appointed.
Speaker 2 (20:27):
So I don't know.
Speaker 1 (20:28):
Let's say five years ago, it was a complete bar
if a person had a felony to be in a
guardian right, and I certainly understand the thinking, But relatively
recently in the legal world that was changed to it's
a factor, but it's not a complete bar. And it
(20:50):
may be some kind of felony that's I don't know,
not related to the types of things that would matter, right.
Speaker 3 (20:56):
I think it's yeah, I think you've got uh County
Department of Social Services is your guardian of last resort.
They're overwhelmed. Yeah, you don't with that with guardianships, they're
short on staff. It's not it's not ideal for your
(21:17):
loved one to have the Commissioner of Social Services become
their guardian, right.
Speaker 1 (21:21):
Which really means that an attorney in that department.
Speaker 3 (21:25):
Is probably there, right, and a social worker. Yeah, and
you're gonna your minimum visits per year, et cetera.
Speaker 2 (21:33):
There's just four, right, which isn't a lot.
Speaker 3 (21:35):
It's it's not a lot. You've got your there's a
it's it's called the Part thirty six list, which is.
Speaker 2 (21:43):
It's the turn number of choice.
Speaker 1 (21:44):
It's the thirty sixth choice that you would actually want
to be your Guardian's.
Speaker 3 (21:49):
Called that, and that's not a great result. So the
courts have loosened the the prohibition on felon's sometimes your
family Sometimes your family felon is uh is a better
guardian than social services or a Part thirty six lists.
Speaker 1 (22:10):
So I mean, if the felony is embezzlement and mom
or dad has some money, they're not going to get appointed.
Speaker 3 (22:16):
Typically yeah, without a bound typically financial uh, any any
sort of theft fraud or physical abuse would probably be
a bar if it's a felony.
Speaker 2 (22:27):
Right, elder abuse.
Speaker 3 (22:29):
Elder abuse certainly would be seen as a problem by
the courts. But but yes, you you know, something like
arson if it's okay, all right with that, Yeah, that's okay.
But but but again that's why you said. And and
you know, I think we've in your power of attorney
(22:51):
you can state this is who, uh you know, I
point as my my power of attorney, my attorney in fact,
to be my agent. And I don't want a guardian.
But should I need a guardian, this is who I
want to become my guardian. That's something that you can
do to appoint to avoid the family felon becoming your guardian.
(23:11):
So again, I think it just it all comes down
to careful planning. Do it when you don't think you
need to do it. That's probably Actually when you need
to do it is when you don't think you need
to do it.
Speaker 2 (23:22):
Well, you can't wait till you need it exactly, that's
too late, yep. And things can go wrong that way.
A lot of things.
Speaker 1 (23:32):
We unfortunately have clients die before they complete their documents.
We have clients occasionally become incapacitated before you exactly. So
once you're incapacitated, everything's out the window.
Speaker 3 (23:43):
Right, Your ability to plan is severely limited.
Speaker 2 (23:48):
That's right.
Speaker 1 (23:50):
So we're coming up on the news here, so please
stay with us when we come back. But when we
come back, guardianships are not the only type of litigation
we do. We do some trust litigation and when we
come back, we'll get into the ways that that can
happen and the strategies that need to be in place
(24:10):
and who needs to do what in that situation.
Speaker 2 (24:13):
This is Life Happens Radio.
Speaker 1 (24:15):
I'm Aaron Connor from Pierre O'Connor and Strauss and when'll
be back right after this.
Speaker 2 (24:22):
Welcome back to Life Happens Radio.
Speaker 1 (24:24):
Aron Still Aaron Connor, still from Pierre O'Connor and Strauss.
My compadre is still Brent Stack All the morning, still
from piero Connins. So we are a state and trust litigators,
guardianship attorneys. So we had really kind of run through
some guardianship issues on the first half of the show,
(24:46):
which you can always listen to on iHeartRadio if you
missed and you really want to hear it, so please
please do.
Speaker 2 (24:52):
But a large part of our practice is trustworth right.
We do wills, we always do wills.
Speaker 1 (24:59):
But that's really not where our clients are deriving the
most benefit from us.
Speaker 2 (25:05):
We're planners. We are doing revocable trusts or irrevocable trusts,
And if you've listened to the show, you know that
there's a lot about an irrevocable trust.
Speaker 1 (25:15):
It's not as scary as it sounds, and it's a
good vehicle for most middle class people to preserve property,
make sure it doesn't go to pay a nursing home
and goes to where they want it to go, whether
it's children, other relatives, charities, whomever. So that's what we
try to do. We ultimately are trying to put a
(25:37):
plan in place to make sure you're covered, to make
sure your loved ones get or your beneficiaries get what
they're supposed to get, and the people who you do
not want to get things do not. And that may
be removing you may be removing a beneficiary, or you
may be making sure that a let's say, a child's
spouse doesn't end up with all the money or some
(25:59):
other predator. As we say, that's important to our clients
quote unquote bloodlining the money right, and in most situations
a trust can continue on for a very long period
of time. Now, New York has something, at least for now,
called the rule against perpetuities, right, which is a question
(26:22):
on the bar exam that ninety percent of the attorney's
never comes up, right, But in real practice it doesn't, right.
I mean, the thing is so essentially the rule of
perpetuities time is about one hundred and twenty years because.
Speaker 3 (26:40):
Lives and being plus twenty one.
Speaker 1 (26:42):
That's right, right, So, I mean the longest anyone's ever
lived is about one hundred and fifteen years exactly. So
if you roll the dice and you got that person, great, right,
but unlikely. So let's just say you had somebody live
into their nineties, you get twenty one years. You got
about you know, rough math math one hundred and twenty
(27:02):
years best case scenario in New York. In the state
like Delaware, you can have what's called the dynasty trust
that can essentially go on forever if you have enough money, right,
and you know, let's be honest, very few people have
enough money to create like a long lasting dynasty trust
like DuPont, like the DuPont family.
Speaker 2 (27:24):
It was very involved in Delaware.
Speaker 1 (27:26):
They owned a lot of property in Delaware, and they
had a lot to do with how the laws were
drafted in this favorable way. And the DuPont family would
be a family that still have generational wealth well downstream, yep,
but you can still create kind of your own I
(27:46):
don't know many dynasty trust if you want, well, we
try to make sure that money goes to your kids,
not their spouse. And then if something happens to your child,
that goes to your grandchildren, again not to the spouse. Right,
if you wanted to go to the spouse, hey, great,
we can make that work too. But that's that's like
two percent of people.
Speaker 3 (28:07):
Yeah, I think you're right. I didn't do uh. I
didn't do a lot of trust litigation before I came
to the firm, right, And I've been learning a lot
about trust since I've been at the firm, and I
think what a lot of people don't know. I think
you're right. Some people are afraid of irrevocable trust or
or trust in general. But I think you're right. I mean,
(28:28):
it's not just for the rich, it's not just for
the DuPonts. It's for everybody. It's it's by far the
best way to protect your assets and your wealth and
to pass it on, like you said, to who you
want to receive it, and to protect it from who
you don't want to receive it, including the government. If
we're you know, absolutely, I think that's uh, it's really important.
(28:52):
You know, I've been telling my family members since I've
started working here, you need to get in. You need
to do this right. You don't have to have a
million dollars, right, you know, any amount of wealth, and
you don't. It's not just money, it's not just cash. Well,
it's your home.
Speaker 1 (29:08):
It's the easiest thing to put in the trust is
property exactly right, And if you own property in two states,
you really want to trust because you don't want your
family probating in.
Speaker 2 (29:16):
Two places exactly absolute disaster.
Speaker 3 (29:19):
Yeah. Money wise, yeah, I mean too. I think we've
said it before on the show, but the best gift
that you can give your family when you pass is
the ability to avoid probate again and pay the lawyer less,
and pay and pay the lawyer less money. Right, stay
out of court if you can. One way to want
sure far away, to stay out of court, to stay
(29:40):
out of probate, which in a lot of counties in
New York State can take a really.
Speaker 2 (29:44):
Long time downstate complete night.
Speaker 3 (29:46):
Oh yeah, especially right, you can be in probate for
over a year, you know, just to have the will
approved and to then receive the ability to administer the estate,
which you know, all of these assets are are tied
up for a long time and you're paying out. But
(30:06):
if you put your property in trust and make sure
that you've got everything buttoned up the way it should be,
you can avoid probate. You can pass your assets to
your family members without going to court, and again, it's
it's probably the best thing that you can do.
Speaker 2 (30:24):
You know.
Speaker 1 (30:25):
One thing that people don't really think about is if
you are leaving assets to non family members, right like,
you don't want your family to get it, and that's
that's perfectly fine.
Speaker 2 (30:35):
Sure, the only person in New York State.
Speaker 1 (30:36):
That is absolutely entitled to a portion of your state
is a spouse, and they're only actually entitled to a
third right that's illegal. So I mean, you could leave
two thirds to someone else if you really wanted to.
I'm not advocating that specifically. I'm not advocating that in
case my wife is listening.
Speaker 2 (30:53):
But so.
Speaker 1 (30:58):
But if you're eaving things to friends and you don't
have children, let's say, it becomes really onerous to do
that in a probate probate.
Speaker 2 (31:09):
Proceeding easy for me to say, right.
Speaker 1 (31:12):
I met with someone this week that we're talking about
cousins yep as the just what we call distributees, people
who take in the absence of a will, And we're
talking about a number in the twenties of who we
have to serve, and we don't necessarily know where everybody is.
(31:34):
It's going to be a long ride, and it's not
going to be inexpensive. And even you know, in New
York you have the New York people, you have to
personally serve how to stay people. You can kind of
get around the personal service, but you still have to
do certified mail, and then you have to do proof
of delivery.
Speaker 2 (31:52):
And I mean twenty.
Speaker 1 (31:55):
Six Let's just say, if that were to number certified
mails is certainly going to be less than twenty six
personal service, but it's not. And then I'm sure that
some of these addresses will not be correct.
Speaker 3 (32:07):
I have a current case Aaron where forty eight individuals
are titled to service.
Speaker 2 (32:11):
Yeah, that's a nightmare because all you need is one
with a screw.
Speaker 3 (32:17):
Loose, right, or they're gonna start bouncing back, right.
Speaker 1 (32:21):
Or incapacitation there, right, I mean you get one that's
in a nursing home or under some kind of disability,
and you've just gone off the rails for a period of.
Speaker 3 (32:31):
Time guardian ad litem right.
Speaker 1 (32:34):
And you may not get your letters right away, right,
You have to ask for So when I say letters,
when you finally either a probate petition meaning there is
a will, or an ad administration petition meaning there isn't
a will, you get letters from the court, letters of
administration or letters testamentary, which are your authority to act
on behalf of the estate. And you can't really do
(32:55):
much without them. You can't martial assets, you can't open
a bank account. You're really not even supposed to be
like accessing property.
Speaker 3 (33:01):
I don't think you can do a thing without them.
Speaker 1 (33:03):
Well, the gray area is real property where people are
trying to preserve personal property. So generally the recommendation is
to lock it down or if there's something particularly valuable,
to make sure that it's not Because I think you've
seen once personal property is gone.
Speaker 2 (33:22):
It doesn't come back, you know. Oh yeah, here's the
diamond I took from mom. I'm wearing it now. That
never happens, It doesn't happen.
Speaker 3 (33:29):
Yeah. How many times do our clients come to us
with a list of things that went missing and we're
supposed to retrieve them?
Speaker 2 (33:37):
Happened?
Speaker 1 (33:38):
That can happen in the guardianship world too. The judge
always says, we're not going backwards.
Speaker 3 (33:43):
Oh yes, right, yep.
Speaker 2 (33:46):
Occasionally.
Speaker 1 (33:47):
I did have a case where we initiated a lawsuit
against another person and did recover because they'd essentially stolen
real property, and then when the house sold, we got
her money back.
Speaker 3 (33:59):
Yep.
Speaker 2 (34:00):
But that's unusual.
Speaker 1 (34:02):
And real property is easier to attach, And what we
mean by attached is you can put what's called the
least pendance on it, which makes it very difficult to sell,
and without coming to an agreement of who's going to
get what, you're not going to be able to sell property,
which you can restrain a bank account, but it is
not very easy to do and takes pretty high level
(34:25):
of proof. So if you're in a situation where you
have non family beneficiaries, you need to be careful and
think about what you're leaving behind.
Speaker 2 (34:38):
And I say this obviously all the time.
Speaker 1 (34:41):
It won't be your problem, but what problems are you
leaving behind? And I think that's important when people met
with some people this week, I did the planning for
their parent thirteen years ago, and it really was all
(35:01):
teed up.
Speaker 2 (35:02):
Yeah, it was easier for that. I mean not easy.
Speaker 1 (35:05):
They lost a parent, and which is a terrible situation,
but at least they didn't have to worry about how
this was going to be handled. And it's clean, it's
relatively easy, and it just gives people peace of mind.
Speaker 2 (35:19):
It gives them one less thing to deal with.
Speaker 3 (35:21):
Yeah, I mean, try not to leave behind a court case. Correct,
And here's my leg okay, yeah, and you can do that.
You cannot leave behind a court case. You know, it's
happened in my family some you know, things tied up
for years and my grandmother we didn't even know she
(35:42):
was doing it. She did the planning all on our own,
and it was it was just such a breath of
fresh air when my grandmother didn't leave the family a
court case. We found out that we found out that
all of her assets transferred out of probate. Yes, I think,
you know, I think a taxi turn needed to be filed,
(36:02):
but you know, yeah.
Speaker 2 (36:04):
Yeah, I mean you can roll the dice, don't. I
don't advise that.
Speaker 1 (36:09):
I mean, three out of my four grandparents did not
end up in a nursing home.
Speaker 2 (36:14):
But I don't think that that's typically the case. And
you want to be People think.
Speaker 1 (36:22):
That the transfer on death beneficiary is oh I did
my planning. Well, there's a lot of things that can
go wrong with a transfer on death beneficiary. If your
beneficiary dies before you, you have no beneficiary. If your
beneficiary is becoming capacitated for some reason, and that really
happens more often than you think. I have emails from
clients where they're unfortunately their children have some fored a
(36:43):
stroke or something like that, and we don't want to
leave them money directly. And if you leave again a
person money directly like that, their spouse is going to
get access sure, right, So that's.
Speaker 2 (36:55):
Not really a plan.
Speaker 1 (36:56):
If you have everything in a trust, let's just say
it an irrevocable trust, and you have a bank account
that you have control of, Yes, it's okay to have
a beneficiary. We want you to have a beneficiary in that,
but that's not the ultimate plan for all of your assets, right,
and you need to be mindful of that. I've told
this story many times. My grandmother's aunt, so, my great
(37:21):
grandmother's sister lived to be about ninety five or six,
and she was mean. And I thought she was just
mean because she was old. But my dad's cousin corrected
me on that and said she was just always mean
and that was just her personality. Never had any children,
so you think she'd be like just flying high, not
(37:42):
not a lot to be like you, annoying you in
your life. She had a lot of money when she
went into the tr Resian House in nineteen eighty one,
and when she died in nineteen ninety six, she didn't
really have any.
Speaker 3 (37:55):
Money, right.
Speaker 1 (37:56):
And the rules in nineteen eighty one were you could
have a trust that you had full control over until
you went into.
Speaker 2 (38:03):
The nursing home.
Speaker 3 (38:04):
Gotcha, the day you went in.
Speaker 1 (38:05):
You were triggered off. And oh those were real rules,
Like it's like mind blowing. Yeah, oh walked in sorry,
a new trustee and your money wasn't available.
Speaker 2 (38:14):
I mean, you could do that until nineteen ninety three
or ninety four.
Speaker 3 (38:18):
So I think that's another person. Yeah, I think that's
another good point, Aaron. I think a lot of people
have the miscont conception that when you place your assets
into trust that you don't have any access to them, right.
I think when when people come in, we tell them like, listen,
you can be the grant tour of your trust, meaning
you're the one who contributes the assets to the trust.
(38:39):
You can be also the trustee and the beneficiary. You
can be all three and you still have access to
your money, but it's protected from from other factors. I
think that's what people have a misconception about, too, is
that you don't lose your assets when you put them
in trust. All you're doing is protecting them, but you
still have access to them.
Speaker 1 (39:00):
Well, it depends on the type of trust, right, But
in a revocable trust you wear all three hats, and
an irrevocable trust you have a trustee that's someone other
than you because we need that separation. But you still
can do so many things. You can change your beneficiaries,
you can get money out the back door, you can
change your trustee at any time, so it's not really
as frightening.
Speaker 2 (39:20):
We're coming up on our last break.
Speaker 1 (39:22):
So when we come back, I want to talk about
some things that can happen in the trust world to
make sure that you're getting what you're supposed to be getting.
This is Life Happens Radio, Aaron Connor from Piro Connorance Strouse,
and we'll be back right after this. Welcome back to
Life Happens Radio. Aaron Connor, Piro Conorn Strausse joined by
Brent Stack, and we have been talking about trusts, on
(39:45):
guardianships and what can go wrong and what can go right.
Hopefully you get more right than wrong. But we often
are also encountering people who maybe mom or Dad say
up a trust or an a or an uncle or
who knows, right, could be anybody could be their neighbor
(40:08):
and they're a beneficiary, but not generally the trustee because
in the world of trustees there are many choices. It
could be an individual. Sometimes it's an accountant. Once in
a while it's a lawyer. I can tell you though
that nine times out of ten and a lawyer is
a bad choice as a trustee one for inattention. Two
(40:31):
they are not an investment professional. So if you hire
a lawyer as a trustee, and that's really what you're doing.
Because any trustee is entitled to a commission for serving
and being a fiduciary, meeting someone who has to act
in the best interests of another person, they're going to
have to hire an investment advisor, which you're also going
to pay for it. So there are trust companies out there.
(40:54):
There are investment houses that have separate trust divisions. There
are some investment houses that don't have trust divisions, but
the bigger ones typically do, and we see a lot
so generally in my experience, when people appoint a corporate trustee,
it's because they don't think that their children can manage
the money, or we'll spend it poorly, because a corporate trustee,
(41:20):
while applying the same standards, has a lot more to
lose than an individual trustee. Right.
Speaker 3 (41:24):
And they're also objective.
Speaker 1 (41:26):
Right, So if it says it can only come out
for X, Y and Z and us for a well
you're not going to get it.
Speaker 3 (41:32):
Oh yes, and I think you're right. A corporate trustee
is going to be hold the purse strings a lot
tighter than you know a family member or someone.
Speaker 1 (41:42):
Right, it's going to have and even when it has discretion,
it's going to be less likely to use it.
Speaker 2 (41:49):
Correct, You're going to be required to document a need.
Speaker 1 (41:53):
So if your kid is going to college and you
want money for college, well, if they're in their freshman
year of high school, you're not going.
Speaker 3 (42:02):
To get it, okay, right.
Speaker 1 (42:04):
Probably going to have to present a tuition bill that's
out saying you know what the cost actually is, and
then they will decide what to pay. They may pay
all of it, they may pay none of it, and
they may pay some of it.
Speaker 3 (42:19):
I think that's that's a good point too. With a
lot of trusts are for educational purposes, and I think
what we're running into a lot is what really is
the cost of education because colleges now they have a
tuition bill, but a lot of colleges also have mandatory fees.
And it's like, how can you separate tuition from mandatory fees? Well, books,
(42:40):
our books part of the no and they're that's separate.
So I think right now I have a couple of
cases where we're interpreting the language of the trust to
see exactly what the beneficiary is entitled to. And I
think that's that's what you're talking about.
Speaker 2 (42:55):
Yeah, I mean so, and to date, myself.
Speaker 1 (42:58):
But before when I was a freshman in college, okay,
my books were five hundred dollars for one semester. I
can't imagine there's the same amount of money now. I'm
sure that they're more, right. And some of those were
softcover books, which I remember aggravated me at the time.
My astronomy textbook and I went to a place where
(43:20):
you could not see the stars at night because the
city lights were so bright, So it was really a
strange place to take astronomy.
Speaker 2 (43:27):
But I didn't really like my other science choices.
Speaker 1 (43:30):
So anyway, but books, books can be very expensive, so
if you don't have other means, that could be a problem.
You know, I think most of the time, someone who
establishes a trust to pay for educational purposes is trying
to avoid that person being burdened by loans exactly, because
(43:51):
as a law school graduate, I can tell you I'm
burdened by loans right, not as bad as some people,
but I mean, I've been out almost twenty years.
Speaker 3 (44:00):
And I still have a law school loan.
Speaker 2 (44:02):
So if you go to.
Speaker 1 (44:06):
Undergrad and then to graduate school, you could owe like
an enormous amount of money. So if that is in
fact the intent, and then you're denying let's say books
or maybe even housing.
Speaker 2 (44:22):
Right.
Speaker 1 (44:23):
Well, let's says somebody around here and let's say they
want to go to Siena, but they want to live
on campus, right right, the trustee may actually deny that portion.
I could and frankly, they could probably support that if
they wanted to.
Speaker 2 (44:36):
Right.
Speaker 1 (44:37):
Some of what that's going to depend on is how
much money is sent the trust. Then how would you
go about finding that out?
Speaker 3 (44:43):
Well, in that case, when when people, when beneficiaries come
to us and they say, you know, I'm entitled to
education from this trust, and the trustee is saying, yeah,
but I'm not going to pay for your books, what
you and I would do is we would file a
Supreme Court proceeding for an accounting of that trust. We
(45:05):
would have the trustee come in and provide us with
the way that they have administered that trust from the
inception of the trust to when they started paying it out.
What have they paid and for what? And what are
the expenses? What are the expenses and from.
Speaker 1 (45:22):
Tax filings, what have they taken in commission? What have
they paid out to themselves?
Speaker 2 (45:27):
Maybe? Right? Right? If it's a brother or sister or
some family.
Speaker 3 (45:30):
Member, and how are they doing as a fiduciary.
Speaker 2 (45:33):
And how are they right? Exactly? So have the investments
performed well? Right?
Speaker 1 (45:37):
If you had a trust that didn't make money in
twenty twenty four, we have a problem, right, right, it
didn't make money in twenty twenty five, well, and coming
back around exactly, Yeah, So you'd have a defense at
least there. But as a fiduciary, you are charged to
do the best with the money that you can.
Speaker 3 (45:58):
Yep.
Speaker 1 (45:58):
So I mean, honestly, probably now, if you had it
in an interest sparing account that was getting a rate
like four or five percent, like you see in some offers,
you probably would be okay, right, But most money is
invested in the market yep, to make sure it's actually
making real money.
Speaker 3 (46:15):
Yeah, And that's what I think our clients don't at
first comprehend the scope of an accounting, but it's really
you know, it's not just an accounting of the money.
It's an accounting of how you performed your fiduciary duty.
Have you expended the funds and the trust for the
purposes that the grant are intended? And how how in
(46:35):
general have you done as a fiduciary. I mean, if
you're I think we have a lot of trust Aaron
that you know, the trustee has a purpose to spend
moneys for a certain individual. But then what we have
is residuary beneficiaries. And who is the trustee really looking after.
Are they looking after the individual who is named in
(46:58):
the trust or receive the funds, or they looking after
the residuary beneficiary who gets all that's left old. They
may like better who they mighty better, right, and might
be and might be, you know, preserving some funds that
otherwise should be expended for the purposes of the trust.
Speaker 2 (47:14):
They might ultimately be that beneficiary.
Speaker 3 (47:16):
And they might be that beneficiary too.
Speaker 1 (47:18):
Yeah, it's a conflict of interest in a lot of ways.
Speaker 3 (47:22):
But that's how we get after That's how we get
at right, And.
Speaker 1 (47:25):
It's a way for us to decide whether we feel
like we need to move to remove a trust correct
because most times we don't have information that shows us.
It's a high burden of proof because you can't just
go in and say I don't like this person.
Speaker 3 (47:39):
That's not how it works exactly.
Speaker 2 (47:40):
They have to violated their fiduciary duty.
Speaker 3 (47:42):
We have to see how they're performing right, either.
Speaker 1 (47:44):
Self dealing if they had taken money, if they have
not followed the terms.
Speaker 2 (47:49):
Of the trust, you know, fraud.
Speaker 1 (47:53):
All sorts of things, but number one would be self
dealing or a form of self dealing. Whereas if they
may or the trustee, and the beneficiaries are their kids
and your kids and their kids seem to be doing better,
you know, getting more things.
Speaker 3 (48:08):
Absolutely, so those things happen.
Speaker 1 (48:10):
They don't just happen in movies, but they happen in
real life too.
Speaker 3 (48:15):
And I think that's another good point too, is if
you're coming to us or to whomever to establish the trust,
make sure that you identify, you know, pick the right trustee,
pick the right beneficiaries, try to avoid conflicts of interest
at all costs.
Speaker 1 (48:32):
Well, oftentimes I'm recommending something called the unit trust to people,
and that way, a set percentage comes out every year. Right,
maybe five can be more than that, but five is
a typical number, And that way it can be invested
for growth, right, and not worried about income. And there's
less discretion involved.
Speaker 2 (48:51):
Right.
Speaker 1 (48:51):
If you think there's going to be a problem, or
you think somebody isn't really great with money, you can
say here's your set amount. It can come out quarter annually,
it can come annually whatever, and eliminate that a lot
of the discretion. And by eliminating a lot of the discretion,
you can eliminate a lot of potential for a lawsuit.
Speaker 2 (49:10):
You can't eliminate an accounting.
Speaker 1 (49:11):
Right because we need to be able to determine whether
somebody's doing what they're supposed to be doing.
Speaker 2 (49:17):
But there would be less discretion and a trust like that.
Speaker 3 (49:20):
And it's also I think important to note that any
beneficiary can request or demand compell and accounting at any time,
and I think that's that's the number one layer of
protection for a beneficiary, is that you have the right
to compel on accounting, and that's how you're going to
find out how the money is being spent. If you're
(49:41):
kept in the dark, that's what.
Speaker 2 (49:43):
You do, right.
Speaker 1 (49:44):
And oftentimes there's concerns that the lawyer is taking too
much money too, so that's important and we can figure
that out.
Speaker 2 (49:51):
So we're coming to the close of the show. I
just want to.
Speaker 1 (49:55):
Say that this week we had our big Elder Law
forum at that does so if you attended or watched online,
thank you very much. That's our signature event, really one
of two big events during the year, and we had legislature,
legislators and people from the government to talk about what's
going on in long term care and managed long term care,
(50:18):
so very important stuff. If you didn't get a chance
to watch, please look online to see what is available.
And if you have an issue, please give us a
call or email us at the office. The office number
is five one eight four or send us an email
at info atpro law dot com.
Speaker 2 (50:36):
That's p I e R r law dot com.
Speaker 1 (50:40):
And we will be back next week. Thanks for listening, everybody,
have a great weekend.
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