Requests for Estate Plans Reflect Fears about Coronavirus

Estate planning lawyers have always known that estate planning is not about “if,” but about “when.” The current health pandemic has given many people a wake-up call and estate plans  reflect fears about Coronavirus. They realize there’s no time to procrastinate, reports the article “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes” from InsuranceNews.net. Legal professionals urge everyone and not just the elderly or the wealthy to put their end-of-life plans in writing. The last time estate planning attorneys saw this type of surge was in 2012 when wealthy people were worried that Congress was about to lower the threshold of the estate tax. Today, everyone is worried.

Top priorities are creating a living will stating your wishes if you become incapacitated, designating a surrogate or a proxy to make medical decisions on your behalf, granting power of attorney to someone who can make legal and financial decisions and preparing advance directives, such as “Do Not Resuscitate” orders.

An estate plan including a last will and testament (and often trusts) that detail what you want to happen to assets and who will be guardian to minor children upon your death, spares your family the fights, legal costs and hours in court that can result when there is no estate plan.

The coronavirus has created a new problem for families. In the past, a health care surrogate would be in the hospital with you, talking to healthcare providers and making decisions on your behalf. However, now there are no visitors allowed in hospitals and patients are completely isolated. Estate planning attorneys are recommending that specific language be added to any end of life documents that authorize a surrogate to give instructions by phone, email or during an online conference.  Any prior documents that may have prohibited intubation need to be revised, since intubation is part of treatment for COVID-19 and not necessarily just an end-of-life stage.

Attorneys are finding ways to ensure that documents are properly witnessed and signed. In some states, remote signings are being permitted, while other states, Florida in particular, still require two in-person witnesses, when a will or other estate planning documents are being signed. There are many stories of people who have put off having their wills prepared, figuring out succession plans that usually take years to plan and people coming to terms with what they want to happen to their assets.

Equally concerning are seniors in nursing homes who have not reviewed their wills in many years and are not able to make changes now. Older adults and relatives are struggling with awkward and urgent circumstances, when they are confined to nursing homes or senior communities with no visitors.

Reference: InsuranceNews.net (April 3, 2020) “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes”

 

Finalizing Estate Planning Documents while Social Distancing

After the initial shock of the pandemic, people are realizing not just that they need to update their wills, but the people who have been named in important roles. In a recent article from The New York Times, “What to Know About Making a Will in the Age of Coronavirus,” one person said, “I think I still have my jerk brother as the trustee. I need to change that.”

However, with social distancing now being the new norm, some necessary processes for finalizing estate plans are calling for extra creativity. While lawyers can draft any necessary documents from their home offices, the documents need to be signed by clients and, depending upon the document and the state, by witnesses and notaries. These parties usually need to be in the same room for the documents to be considered legally valid.

New York’s Governor Andrew M. Cuomo issued an executive order on March 7 that declared a disaster emergency in the state and temporarily gave notaries the authority to authenticate documents by videoconference. Other governors have also issued executive orders to allow video notarizations, including Connecticut, Iowa, New Hampshire and Washington. It’s safe to say that more states will probably permit this as time goes on.

However, besides needing notarizations, wills in New York State and other documents require two unrelated witnesses in the room when the document is signed. That also goes for the health care proxy, which gives a person the ability to name someone to make medical decisions on their behalf, if they become incapacitated.

One New York attorney used a video conference to watch two clients and their witnesses, located more than 100 miles away from his home office, sign new financial powers of attorney and health care proxies. He used his laptop to record a video of the proceedings, while clients used their phones. The client couple sat on the enclosed porch of a friend’s house in a distant county and signed the documents, while their friends stood six feet away. When the couple finished signing, they stepped away and their friends moved in to sign the documents, all in view of the attorney and all, of course, wearing vinyl gloves.

The documents were then scanned and sent to the attorney by email and he notarized them. They will also be mailed to him at his home, and then he will authenticate the documents.

In New Jersey, notaries need to be physically present at the signing of documents. One attorney took extra steps for two ER nurses, both single mothers and on the front lines of the coronavirus outbreak. He met them in the front yard of one of their houses, where a table had been set up and rocks were used to hold down the documents from blowing away in the wind. Everyone wore gloves and brought their own pens. One nurse served as witness for each other, and another friend was a witness for both. After each person signed, they stepped away, while another stepped up to the table.

Not every state is making changes to permit these documents to be witnessed and notarized, so there may be many outdoor signings taking place in the weeks and months to come. Speak with your estate planning attorney, who will know the laws that apply to your state.

Reference: The New York Times (March 26, 2020) “What to Know About Making a Will in the Age of Coronavirus”

Ex-Girlfriend Could Own Your Family Home

The friend and the girlfriend agreed when they split that she would quitclaim her interest in the house to the friend, in exchange for the amount she contributed to the home. She signed a document conveying her ownership in the home to the friend, released her interest in the property and agreed not to claim any future right to the property, as described in the article “Cautionary tale involving claims on deceased owner’s home illustrates importance of estate planning” from The Washington Post.

When the friend died, it was learned that he had never changed his will and the ex-girlfriend now wants the house. This is a textbook example of why it is so important to review and update estate plans regularly in general and especially when a major life change occurs, like a breakup for divorce.

An estate plan typically includes a will, a living will, powers of attorney for financial matters, powers of attorney for healthcare and if appropriate, trusts. All of these documents need to be kept up to date to avoid this kind of nightmare situation.  The will is used to direct what happens to a person’s assets at the time the document was finalized. The will is the “last word” in what that person wanted to happen. Creating a legally binding will takes some time and requires a number of steps. It starts with an estate planning attorney creating the will, discussing the person’s wishes, getting details on what the person owns and then going through a series of legal procedures.

The will must be signed before a notary and witnesses, with the number of witnesses varying by state. In some cases, each page of the will must be initialed, and the last page of the will gets a notary’s stamp and the signature of the witnesses. The purpose is to make sure the document truly reflects the person’s wishes and to ensure that the person who signs it is of sound mind—that is, they have legal capacity to determine their wishes and sign the document.

The seriousness of the will is why it prevails over almost everything (except for beneficiary designations). When couples divorce and neglect to change their wills, depending on state law, the will may supersede their divorce agreement, and an ex-spouse could end up with everything.

In this case, the ex-girlfriend signed a document giving up her claim to the home, but the court cannot tell from that document whether the friend truly wished her not to get the house. There’s no way to know if he intentionally did not change his will, or if he just forgot. The will is the final word, and it is likely the ex-girlfriend has a legal right to the home. Contact an estate planning attorney to create an estate planning package so that things are in order.

There are some wrinkles: if the friend put his children on the title as joint tenants with rights of survivorship, the court will have to consider this in making a decision. It’s not usually recommended to do this but if this step were taken, it would give the court another factor to consider.

Reference: The Washington Post (Nov. 23, 2020) “Cautionary tale involving claims on deceased owner’s home illustrates importance of estate planning”

 

There’s A Reason Why There are Laws about Wills and Estates

There are laws about Wills and Estates and if this sounds like a question from a lawyer’s bar exam, that would be about right. It sounds like the first will should be in control, since his intentions were made clear in the first will, even if it was not executed correctly. This was explained by nwi.com in the article “Estate Planning: Will formalities are important.” However, there are many different factors that go into determining which of these three wills should be the one that the court accepts. This is a good illustration of why a will should be prepared with the help of an estate planning attorney.

First, is the third will valid? If there were no witnesses, it seems very clear that it is not. Except for very unusual circumstances, a will is only valid if it is in writing, signed by the person who is its “creator,” which is the “testator,” and witnessed by not one but two witnesses.

The next question is, how about that second will? Is it valid? Was the second will revoked, when the third was created, even though it was not properly executed?

There are two basic ways to revoke a will: physical destruction or written instrument. If the will was not destroyed, then the revocation of the second is considered to have occurred by the creation of the third will. Most wills contain a recital revoking all previous wills and codicils, which serves as a written revocation.

However, there’s a problem. Because the third will is most likely void, then it could not have revoked the second will. Will revocations also need to be witnessed, and since the third will was not witnessed, the recital contained in the third will revoking the prior wills is also void.

It, therefore, seems that the second will is valid in this situation. We say it seems, because there may be other factors that might also make the second will invalid: we don’t have all the facts.

The lesson from this article is that when it comes to wills, trusts and estate plans, the formalities really do matter. Procedures and formalities are considered more important than intent.

Another story that illustrates that point comes from an attorney who was involved in an estate matter where the person who made the will tried to take out several beneficiaries, by taking a razor blade to the document and physically removing their names from the will. The estate battle began after he died. The intention was clear—to remove the beneficiaries from the will. However, because the proper formalities were not followed, the beneficiaries were not properly removed from the will and they received their bequests after all.

If you have a will and estate plan and you wish to make changes to it, sit down with an estate planning attorney to discuss the changes you want to make, and have the documents properly revised, following all the required steps. Don’t try to do this yourself: your wishes may not be followed otherwise.

Reference: nwi.com (March 10, 2019) “Estate Planning: Will formalities are important”