Astor Matter Reminds Us that Trustworthiness is Essential When Nominating Substitute Decision Makers

Lately, the matter of Brooke Astor’s estate has been covered in the media. Like many people she had an estate plan in place which included a Durable Power of Attorney and Health Care Proxy, which nominated subsituted decision makers in the event she would lose the capacity to make important financial and/or medical decisions at some point during her elder years. She did not want to burden her family with obtaining a Guardianship and/or Conservatorship through the courts. She did end up suffering from Alzheimer’s disease and her son took over her financial powers. He just didn’t do a very good job…

The following is an exerpt from this week’s AZCentral.

Anyone who has signed a financial document has to be squirming a bit over Brooke Astor’s estate case.

Her son, Anthony Marshall, recently was convicted of stealing millions of dollars from Astor while she suffered from Alzheimer’s disease before her death. Although the case largely centered on a contested will purportedly signed by Astor, other estate-planning issues also came into play.

One was a financial power of attorney signed by Astor that gave Marshall authority to direct her affairs if she became incapacitated - and the means to steal from her.

The episode provides a wake-up call for people who use financial powers of attorney. These legal documents can be highly effective in ensuring that someone else will be around to handle financial matters for you if you’re alive but unable to do so - as in the case of mental incapacity.

A power of attorney can be as short as a page or much longer, depending on the detail desired. They’re often included with a trust, will, health power of attorney (addressing medical issues) and other estate-planning documents.

For all the benefits of using a power of attorney to avoid a potential court-supervised conservator situation, there are pitfalls, too.

In particular, you need to trust the person whom you designate to act on your behalf. And you should make sure he or she is responsible, diligent and reasonably astute.

“They really are documents that people should pay attention to,” said Denise McClain, a financial principal and attorney at wealth-management firm Lowry Hill in Scottsdale. “You’re potentially passing along a lot of power.”

Guardianship Alternative for Minor Children Living With Non-Parent

Occasionally a minor child will end up living with someone else besides his or her parents. This could be temporary, semi-permanent, or permanent. Perhaps the parent is in the military and was called to active duty so the child goes to live with a grandparent. Maybe the parents have a health or substance abuse issues and an aunt/uncle take charge of the child. Or perhaps a child chooses to live with a relative so that they may attend a specific school.

In situations such as those it used to be that in order for the caregiver to have the authority they needed to deal with health care providers, medications, and the school systems, a Guardianship was needed. This process was costly, time consuming, and actually replaced the parent’s rights to make decisions for their children during the time that the guardianship remained in effect. A trip to the Probate Court was needed to initiate and terminate the process.

Currently there is a new law which allows a parent to give a caregiver (the person the child is living with) concurrent authority to make educational and health care decisions for the minor child. The Act Relative To Caregiver Education and Health Care Authorization allows a parent to authorize a person with whom their child is residing to “exercise concurrently the rights and responsibilities, except as prohibited by the parent, that the parent possesses relative to the education and health care of the minor children.”

The parents can specify any actions that the caregiver is not allowed to take, and the parents continue to retain their authority to take any and all actions related to their children’s health care and education. The form only needs to be signed by one parent so it can be used to grant limited powers to “step-parents” who are primarily available during school hours and/or who take the children to their medical appointments. This is a wonderful news for blended families with minor children. The parent’s decision supersedes the caregiver’s decision if there are any disputes. The caregiver signs an acknowledgment that they will not knowingly make any decision that conflicts with the decision of the child’s parent or other legal guardian.

The document remains in effect until the date specified by the parent, not to exceed 2 years and the powers can be changed or amended at any time by the parent. The document should be provided to the child’s school and health care providers.

This new law will go a long way to help those families who need some assistance in caring for their children, without needing a costly and inconvenient visit to the probate court.

Major Life Events Provide an Opportunity for your Estate Plan Review

Last night I spoke at the Lutheran Health Care Center in Worcester. One attendee asked, “How often should I review my current estate plan?” It is very important to review your family’s financial and estate plan at least every 3-5 years. The general rule is that the older you are, the more frequent your reviews should be.

Another way to determine when you should schedule a review is when you or your family is/will be experiencing a major life event. Some examples of major life events include:

• Marriage (yourself or your child)
• Divorce (yourself or your child)
• Birth of a child or grandchild
• Death of a spouse or child
• Change jobs with significant increase or decrease in income
• Retirement
• Purchase new/additional real estate
• You move to another state or country
• Start, close, or sell a business
• Major Illness or disability of self, spouse, or child
• Life Insurance/annuities
• Wanting to make major gifts to friends, family, and/or charity
• Major change in tax law

So, how are you supposed to keep track of “major changes in tax law?” Don’t worry. That’s where I come in. Every time there is a major change in a tax or estate planning law thay may effect your estate plan, I’ll send a letter out to you informing you of the change and suggest an estate plan review. Additionally, you’ll receive a similar letter if I haven’t sat down with you in the last five years.

As more major life events, how can I keep track of when ALL my clients have a baby, get divorced, change jobs, retire, etc. I’d love to, however, simply put, I can’t. That’s where you come in. Always remember to keep your estate planning and elder law attorney informed when major life events occur. That way I can determine if a review is necessary for your particular situation.

Why I Also Make Housecalls

While some clients book traditional consultations at my office, I always make myself available for home visits with my clients. While the idea of a housecall has gone the way of black & white televisions, I find that meeting clients in their home, on their “turf,” helps make what is usually an emotional process, a bit more comfortable. In their home, clients tend to be more relaxed and at ease. The conversation goes a different way and I can sense the pride they have in sharing their home with someone. Coffee and tea flow more easily and taste better from your favorite mug than a styrofoam cup.

As an elder law attorney, our conversation eventually moves to the business at hand and it’s much much easier for a client to get an idea of what they’ll be leaving behind if the items are right there. Important paperwork is never forgotten as it’s right where the client always keeps it. Clients tend to be more thoughtful and less distracted when in a familiar environment. With so much legal language to deal with, it’s better for a client to be relaxed and more attentive.

Ultimately, a home visit allows me to get to know my client and understand their needs better. It gives me the chance to be attentive to them without outside distraction. With seniors, I can also see their current state of living, if they have all the things they need and maybe attend to some previously unaddressed issues. What many might see as a bother - a housecall - I consider an honor and a blessing.