Most estate planning lawyers are conscientious and do their jobs as expected. But some seem to forget that in the real world all family members don’t get along so well. A mistake we keep seeing at AgingParents.com, where we offer advice to families with elders is that lawyers put disconnected and even hostile adult children together on legal documents, setting them up for future warfare.
My own experience in law school was that we learned about estate planning, inheritance and basics in that arena but nothing about adult family dynamics. We learned about wills and trusts but not about aging and dementia. My current work involves helping the aging parents’ adult children navigate the journey when one or both parents lose decision making capacity. Often, I must review what the trust says about having an impaired elder resign or be removed as trustee. That’s the part that is most alarming. Some lawyers are unwittingly creating a nightmare for the elder’s appointed successors.
Here’s what I see in the trust or Durable Power of Attorney or even the healthcare directive (aka healthcare proxy). Lawyers go along with whatever a client thinks might be a good idea and completely fail to properly counsel them about what not to do. For example, if the elder has had more than one marriage, and step siblings are in the picture, the lawyer should be asking carefully about the relationships between and among the step siblings. Throwing them together on any legal document which will potentially give them total control over an aging parent’s finances or healthcare can be disastrous. When they don’t like each other, don’t communicate or don’t even really know each other, fights are likely to break out.
We have seen some step siblings able to all get along fine but they seem to be the exception. More likely, one sibling feels divided loyalty to the birth parent, not the step parent. The other sibling is in competition with that and gets adversarial with the one who is supposed to share authority on a legal paper.
Here is a real life example:
Dad, age 86, developed dementia and could not care for himself. His younger wife became abusive to him. She had to be removed from the home. Dad had two of his own children and Mom had one by her first marriage. The step-siblings didn’t know each other and had only met a few times over decades. The elders’ lawyer had given equal authority to the three siblings, putting all of them on the trust, as successors, and on the healthcare directive. This was a foreseeable mistake in planning. Both sides hired lawyers when the abuse occurred, wife taken out of the home, and the battle was on. Accusations flew, money flowed out of the family wealth to pay attorneys’ fees and a very complex legal tangle continued for a long time. A prudent lawyer should understand that people who don’t even know each other much should never be entrusted to share equal power on important legal documents.
These disasters waiting to happen are not limited to step siblings. Any family can have folks in it who do not see eye to eye. The true error on the lawyers’ part is failure to stop the client, usually not yet elderly, from engaging in a fantasy that these estranged siblings or others will somehow get along later. When they are needed as successor trustees or agents for healthcare decisions they have to agree to make those decisions. Yes, lawyers typically do what the client wants. But, there is a duty to protect the client’s best interests and setting up a scenario for fights is not in the clients’ best interests.
If you are a step-sibling, or if you are in a family with elders who may have done some unfortunate or fantasy-like planning, find out what their plans for their estate involve. Are you set up to become adversarial with anyone?
Here are the takeaways:
- Ask your aging parents, while they are competent to tell you about it, who would take over if they became disabled from managing their finances. If you find out it’s multiple people on documents and the appointed people don’t get along, see if you can persuade your aging parents to change the documents. Removing or changing names on such documents is not an expensive task.
- Plan for the real chance that one parent or another could lose the ability for decision-making about money in the future. That’s when these legal matters come into focus. What’s on their legal paperwork determines who is in charge, who has control. Looking at the realities of disability, dementia and other age-related matters ahead of time can really help avoid nasty surprises.
- If your aging parent is willing to allow it, look at the actual legal documents. Check the trust and the clauses that describe what is required when an elder becomes impaired. What do the other family members have to do at that point? Who will do those things? Is there a Durable Power of Attorney and who is appointed on it? Look at the healthcare directive and know who is appointed to make end of life decisions.
- If any cleanup of these appointments of successors makes good sense, discuss it and when possible get it done right away. Spending countless dollars on lawyers for intra-family battles years down the road can be avoided!