By: Walter L Henderson
Practical Pointer from firsthand experience: Perhaps 28 years to revisit your estate planning documents is just too long (especially if you have reached your 94th birthday). Case Scenario: “Jane” who due to natural, physical and/or mental deterioration could not modify, change or amend any of her current estate planning documents because she lacked the requisite legal capacity to do so. Sometimes “putting off till tomorrow” is not the best idea especially when you might become “too old” or too decrepit to make any changes to your documents and legally you cannot remove that previously named family member or heir who has now become disgruntled, dissatisfied, and/or disgusting. “Jane” had old legal documents wherein she named her son “John” to serve under her Power of Attorney and to handle all of her financial and medical affairs. Since the signing of her documents “John” had run into some issues – he was convicted of few felonies, he was on probation and he was also a self-proclaimed “recovered” heroin addict. It never fails that when someone waits too long to change their documents and now does not have the legal capacity to make any changes – they always seem to have named that one family member that no one would ever trust with their medical and/or financial affairs.
It also never fails that when the people who actually do have your best interests at heart and know how bad “John” is – try to confront “John” and get him out of any fiduciary position “John” turns around and hires an attorney who will take his case on a “contingency basis” just because those attorneys know money is involved and they know you cannot “undo” your previous documents. Extortion by frivolous lawsuits (legal blackmail) works really well when there are assets available to pay the legal fees. “Jane” is blitzed and in a memory care unit now – “John” and his legal team are still in Court fighting over who should serve for mom – “John’s” siblings are trying to argue that they are fit to serve and that “John” is obviously unfit – and all the while “John’s” attorneys are being paid, “John” is still in control of mom’s money – and mom is slowing running out of money and will most likely be 100% broke by the time the litigation is settled.
We as professionals are not privy to the medical or psychological transitions of silent clients and, hence, it is important for clients to keep in touch and to contact us whenever problems are first perceived and for clients not to delegate such responsibility to a surrogate (out of town child, sibling, or friend) after a real deficiency in capacity has become obvious to all. To put this another way – if you wait too long to make necessary and anticipated changes to your documents – then you might be leaving everything to that disgruntled, dissatisfied, and/or disgusting family member or heir and they will proceed as they deem fit in handling all of your affairs. They will also have the power to override and defy any true fiduciary, loved one, friend or confidant who knows your situation and knows what you really wanted. Unfortunately for this true fiduciary, loved one, friend or confidant – they will have to sue “John” in order to have him removed from any legal position you originally named him to serve and “John” will be using your money to defend himself in any such lawsuit.