A LACK OF COMMUNICATION LEADS TO FAMILY CONFLICT
A client of mine is coming to me for his estate plan because of how wrong it went with his dad's - a trust set up to divide assets across 8 children, real estate not properly funded (including a strip of land NEXT to the family beach home that wasn't included in the trust and is causing major issues for the sale), and now the same attorney that set up the trust is charging for the administration and only communicating with one trustee (of 3), causing conflict and division amongst the siblings - exactly what the dad had meant to avoid.
My client came to me because he knew that I would help him to communicate with his children now, during his life, which would help them understand his decisions, process emotions now (while he's here to help) and avoid conflict later.
A BLENDED FAMILY NIGHTMARE
My friend came to me to ask if I could help. Her father was remarried to her stepmother, and they had been married for years. While they were married, she and her stepmother, and even her stepmother’s children, got along well. They celebrated holidays together and had regular family gatherings. All that changed when her father died.
My client learned that in her dad’s will, he left all his assets to his wife, trusting her to take care of my friend, his only child. His wife had other plans. She ended up taking all his assets, giving my friend nothing, and decided not to speak to her anymore. My friend was understandably upset and asked if there was anything that could be done.
Her options were not desirable. She could go to court and challenge her father’s will, with only a small chance of success, and spend lots of money in lawyers and court fees, or she could do nothing. She opted to do nothing because she couldn’t afford to fight. It was such a sad situation and undoubtedly not what her father wanted.
A DIY TRUST THAT FAILED
All I can say is, “What a mess.” Jane had a sizable estate. But she had a sizable estate in part because she refused to spend money, so when it came to creating her estate plan, Jane found forms online and drafted her own trust.
Several years later, she created a separate list of items and gifts she wanted to leave to certain family members, thinking that they would receive the gifts by way of the trust. By the time Jane died, she was married to her second husband and the trust stated that he was to inherit all her assets outright. Since she didn’t know the law, she didn’t realize that the separate list she created was not actually a part of her trust, and so she effectively disinherited her children and grandchildren (which was not her intention). She also attempted to record deeds transferring her two homes to her trust, but both deeds were faulty.
Now the family is in court, and has been for over a year, fighting over the disposition of Jane’s estate, as well as what to do with the faulty deeds. They’ve spent lots of money and time fighting - and all that could have been avoided if Jane had just seen a lawyer instead of trying to do her plan herself. In fact, in Jane’s papers she stated that she specifically wanted to set up a trust so her family wouldn’t have to go through probate, yet that’s exactly what happened.
NO PLAN MEANS ONLY THE BANK BENEFITS
My client came to me after her father died. She lived in a different state, and when her father passed, she went home. She came back occasionally to clean out his house, and months later she saw a letter from her dad’s mortgage company. She was so sure that her father owned his home, but in fact, he was still making payments.
The bank had not been paid in months, so they issued a notice of foreclosure. The house was the only asset her father owned and even though it wasn’t paid off, he had a lot of equity in the home. My client couldn’t afford to pay her mortgage and his, so she attempted to negotiate with the bank. The bank told her there was nothing they could do until my client was appointed administrator of her father’s estate. We filed the paperwork as soon as we could.
Even though we live in a so-called “probate friendly” state, the process takes time and the bank was only willing to wait so long. After several months waiting for the judge to rule and nothing happening, the bank told my client that they’d exercise their right to foreclose, and soon after, they did. In the end, my client’s entire inheritance went straight to the mortgage company, and surely that’s not what her father wanted.
AN ESTRANGED CHILD GETS CONTROL
My client’s mother passed. She did not have an estate plan. The mom had been living with my client’s stepfather for over a decade and all mom had was the house. The stepfather was NOT on the deed. They had to get a probate attorney.
They are now a year into it. What makes it worse is that my client’s brother (who was estranged from the mom and had nothing to do with the family) fought to get appointed as executor and won. He has evicted the stepfather from the home, and continues to make the probate process difficult.
SHE WAS YOUNG AND DIDN’T THINK THE WORST COULD HAPPEN TO HER
Jennifer lived in Colorado, and was estranged from her mother and other family members in Iowa. She was young, single, and hadn’t made estate planning a priority because she didn’t have much.
One day she was in a massive car accident and suffered a brain injury rendering her unconscious. Jennifer’s friends were her chosen family and knew what she would have wanted for herself if she were to become incapacitated; CBD supplements, healthy food, holistic care, and her good friends making decisions for her.
Her mother, on the other hand, thought she knew better and wanted to take Jennifer out of Colorado and back to Iowa. She didn’t want Jennifer’s friends to have access to her, and definitely didn’t want Jennifer to have holistic care. Her mother filed a court action to take over Jennifer’s financial and health care decisions.
It cost Jennifer more than $10,000 - all of the money she had in the bank - because that’s how it works. Even though Jennifer’s friends fought to ensure Jennifer was cared for the way she would have wanted, her mother ultimately won the court battle and moved Jennifer to Iowa where she has been caring for Jennifer in her own way ever since.
A HALF-FINISHED WILL GIVES $1M TO THOSE STRUGGLING WITH ADDICTION
My client's mother had her Will drawn up, but she never got around to signing it. The Will would have given half of her estate to my client, and half to my client's sister, who is currently in rehab for drug addiction. The mother didn’t want her children’s inheritance to go to them outright, but rather, held in a trust so someone else would be able to protect the assets from being squandered.
The mother passed away without ever signing her Will. Unfortunately, the state law has a plan for what happens to the assets when a Will is never signed, and it’s not at all what mom wanted. In fact, it’s the opposite of what she wanted. As a result, my client's nephew, who is also addicted to drugs and has threatened the lives of his family, is entitled to get about $1 million outright to do with whatever he wants. My client’s sister in rehab will also get about $1 million free of trust, free to do with it whatever she wants.
A FIGHT OVER A GUN COLLECTION COSTS MORE THAN THE VALUE OF THE GUNS
A father told his son and daughter that the son would get his gun collection when he died and his daughter would get his china and silver. Unfortunately, the father never wrote his wishes down. When he completed his Will, he never specified what he wanted done with his guns, china, or silver. Instead, he did what most people do; drafted a Will leaving everything to his son and daughter equally.
Since the law dictates that, unless certain items are specified in writing within a Will, “everything” means everything. As a result of the way the Will was written, the daughter gets half of the gun collection. The son said, “Over my dead body.” The siblings are now in court fighting over the gun collection. Attorneys’ fees will likely reach six figures, while the gun collection was only worth approximately $25,000.
“POOR MAN’S ESTATE PLANNING” RESULTS IN AVOIDABLE TAX BURDER
A man didn’t think he had much, so he didn’t believe an estate plan was necessary. Instead, he purchased a life insurance policy, naming his long-term girlfriend as the beneficiary, and added her to the deed to his house. What he didn’t realize was that by adding his girlfriend to the deed rather than leaving it to her in a Will, he was leaving her with an unnecessary tax bill.
He died thinking he had taken care of her, but in reality, even though they had been together for many years, his family received the rest of his assets and his personal belongings under the law. She was devastated, not only because she didn’t receive anything from his estate, but also because she must now pay tax on her home when she sells it. If he had just made a Will and left the house to her in his Will she would not have incurred this tax.
SAME-SEX COUPLE FORCED APART AFTER ONE SUFFERS A BRAIN INJURY
A same-sex couple had been living together for nine years when one of the partners suffered a brain injury in a freak accident, rendering him unconscious for many weeks. Neither of the men had an estate plan, and when he was taken to the hospital, he needed someone to make medical decisions on his behalf.
The closest relative was his sister, with whom he didn’t get along. She immediately came and took control of his health care and his finances. One of the first acts she did was to ban his partner from seeing him in the hospital. Then, while he was unconscious and even after he woke up, she took over his business, not knowing at all what she was doing, lost all his money, and enriched herself with his funds.
His partner ended up suing the sister to regain control of the man’s health decisions and finances and he won, but only after most of the money was gone. Luckily, the man regained consciousness and was able to make decisions for himself again, but the damage done to his business and his family (two siblings took her side, two his) was irreparable.
KICKED OUT OF HER HOME OF 20 YEARS
A woman I know lived with her boyfriend for 20 years in his house. She paid half the mortgage for all of those 20 years. He said he would leave her the house in his Will and promised to get his Will done. But since he had no children he wasn’t too worried about being able to stay in the house once he passed. Unfortunately, he never took the time and died without a Will.
Under the law, and unbeknownst to her, the house went to his 80 year old sister, as she’s his only living relative. His surviving girlfriend doesn’t have the money to bring a court action for the half of the mortgage that she paid for 20 years, and she can’t afford to buy out the sister. All that could have been prevented with a simple Will. Now she’s out on the street at 55 years old and lost all the money she paid for the home.
ELDER MAN WASTED $3,000 ON A FAILED TRUST
An older man spent $3,000 on a trust plan with an attorney, all with the intent of keeping his family out of court and conflict. However, his attorney never followed up to ensure the trust was properly funded or updated over time, and so it wasn’t.
When he died, his daughter and her husband were stuck dealing with her father’s ex-wife and the probate court, even though he spent money on an attorney and an estate plan just to avoid that result. His daughter was in school at the time and was certain the attorney had committed malpractice. But she soon found out that it was common practice, even though the $3,000 her father spent was a total waste.
To this day, if you search “Lewis L. Crosley” in the Florida Dept of Unclaimed Property, you’ll still find his unclaimed assets there, just part of the loss the family experienced when Lew died.
