Home-made estate plan claims another victim

Home-made estate planning claims yet another victim. In this case, a son who believes he is entitled to keep a GIC to which his mother had added him as a joint owner is not likely to receive the GIC he says his mother wanted him to have. Here is his question, followed by my answer.

"My mother put my name on her GIC approximately 1 year prior to her death, saying that the GIC, which is about 25% of her estate, would be for my own use. This was an extra thank you for the time and energy put forth by me (and my wife) over the last 12 years. I was my mother's care giver. Both my brother and I are Executors. He lives in the other side of the country and has for over 35 years. Due to him being an Executor and living so far away, he hired a lawyer to act on his behalf. This lawyer says I have no rights to the jointly held GIC and must turn it in.  I do know there is a law with regard to this scenario, but is it in pure stone? I understand there would be some times when this might be necessary, but when my mother jointed them with me, she had the knowledge that they would become mine should anything happen to her. Obviously neither of us knew about this law or other steps could have been taken to ensure the outcome of her actual wishes."

I can't even tell you how common this is. All over the country, parents are adding their children to their accounts, investments and real estate. And as those parents pass away, the children are being disappointed and pitted against each other to fight over the assets.

And to think that five minutes with an estate lawyer could have prevented the whole thing. If only people realized that taking steps that affect your children's legal rights without talking to a lawyer is simply a bad idea. The kick of it is that the parents generally don't even know they've left a mess behind for their kids to fight over.

The law in Canada says that when an asset is jointly owned between a parent and child (or other inter-generational arrangement such as grandparent and grandchild) and the money originally belonged to the older person, on the death of that older person the asset goes back to the estate.

If you are the parent in a situation like this and you want your child to receive the joint asset on your death, simply adding the child as a joint owner isn't going to be enough. You must also leave written instructions that the joint asset is actually intended to go to that child. The written instructions should be made around the same time you made the asset joint.

The son who wrote me this note might contact the banker who took the mother's instructions to put the asset in joint names. If the banker happened to ask the mother about her intentions, and happened to record them, that would go a long way to establishing what the mother intended for this GIC. Most banks don't keep paper files these days, but they all have customer management software that allows for  notes to be kept. You just might luck out.

If  you are a parent made the asset joint some time ago, you can still salvage the situation by  making a will that confirms that you want the joint asset to go to that child for his or her sole use. The son who wrote to me should double-check his mother's will to see if she says anything about the GIC in her will.

Once you pass away, it's too late for the child to do anything about it. It doesn't matter what the child says about the parent's intentions, even in cases like this one where there is a perfectly reasonable explanation for the child to receive extra funds.

I really feel badly for the thousands of people who have put themselves and their children in this situation. An estate planning lawyer could have given you some advice on how to record your intentions regarding the joint asset, and if it was already in joint names, could have advised you on how to set up your will to carry out your intentions.

10 reasons families fight about senior care

I've come across this excellent article by Jeff Anderson on a blog called www.aplaceformom.com. As I read the article, I found myself thinking that Mr. Anderson certainly has some real-life experience with the families of seniors. Not surprisingly, one of the ten things mentioned in the article as being a source of strife is the parents' wills.

Best of all, in this article the author points out possible solutions for each of the ten issues. Click here to read the article.

If you want some ideas about what a family meeting can achieve, and how to hold a family meeting without fighting, check out my book called Estate Planning Through Family Meetings (Without Breaking up the Family).

Watch for my article on Power of Attorney in Caregiver Solutions magazine

The latest issue (winter 2012) of Caregiver Solutions Magazine carries a feature-length article of mine called "Their power of attorney names you...now what?" In the article, I talk about how to use a power of attorney on behalf of another person efficiently and without getting into trouble. In addition to the main article, I give 10 tips for acting under the POA, and 10 tips for dealing with the paperwork. So far, an electronic version of the article isn't available, so if you'd like to read it, you should check out newsstands for the magazine pictured below, or contact the magazine at www.caregiversolutions.ca.

Protecting Canada's Seniors Act

Did you know that a new law called "Protecting Canada's Seniors Act" has now been enacted? To read a commentary about it by Audrey Miller of www.allaboutestates.ca, an expert on seniors' issues, click here.

This new law, also called Bill C-36, makes an amendment to our existing Criminal Code. It does NOT create a new crime of elder abuse. What is does do is add a bit more juice to a judge's power to punish someone who is guilty of elder abuse.

In our Criminal Code, there are a number of things that a judge can take into consideration when deciding what sentence a person should get for a crime. Some are aggravating factors that would cause the judge to give a harsher sentence. These would be things like the accused having a record of similar crimes.

The judge can also take mitigating factors into consideration. These are things that would cause a judge to give a lighter sentence, such as a thief returning what he stole.

The aggravating and mitigating circumstances that a judge can consider are set out in section 718.2 of the Criminal Code. The new law, Bill C-36, adds a new aggravating factor - that being “evidence that the offence had a significant impact on the victim, considering their age and other personal circumstances, including their health and financial situation”.

In other words, the judge may consider giving a harsher sentence to someone convicted of elder abuse.

Now we just have to figure out how to make sure that elder abusers actually end up in court. That will be no easy task, partly because so many perpetrators are family members and know exactly how to conceal their actions and persuade their elder family members not to expose them.

For those of you interested in elder abuse issues, I'm adding some new links to the "interesting links" section of this blog. Hope you find them useful.

Man, 91, dies after being left alone in Summerland care home

This is the kind of story that makes my stomach hurt, at the same time making me absolutely furious. It's the story of Alfredo Bonaldi, 91, who died recently after being left unattended in an assisted living facility in Summerland, BC for several days. Click here to read the article from the Vancouver Province. And for heaven's sake, don't leave your elderly relatives alone for very long.

You don't have to like what's in your parent's will

I wonder why people feel they have the right to decide what is "fair" in another person's will. Where does the sense of entitlement come from? The following note I received recently from a reader of this blog is typical of many I receive. It reveals an unhappiness with the terms of another person's will, and a willingness to jump in, question, judge and possibly force a change.

"My father (deceased) married the woman he had an affair with, and one of the executors (my brother) has claimed that all the grandchildren from both sides will inherit equally according to the will. Is this fair as the second wife has more children, who in turn have more children, and my father's blood grandchildren stand to get a very diluted inheritance, if any. Do they have any rights as beneficiaries and should I try to see the will for myself to review it?"

The father has every right to leave his money to anyone he decides and nobody has to like it. It's his money. His will. His choice. The father isn't obligated to leave any of his money to his "blood grandchildren" or even to his own children for that matter, so nobody should feel that they have the right to question his will on the basis that the blood grandchildren will receive less. If he wants to make an equal distribution among grandchildren, so be it.

The contents of the will appear to have come as a surprise to the reader, and I can guess why. If the father had told anyone that he was planning to benefit all grandchildren equally, he would have been under unwanted pressure to change the will. Pressuring someone to change a will to favour you or your children is elder financial abuse, no matter how you rationalize it.

This wouldn't appear to be a case of a son protecting a vulnerable older person against a recent friend who has coerced a senior into changing the will. I can certainly understand interference where it appears a senior is unwillingly being influenced by someone. In this case we are talking about a marriage and there is nothing to suggest it was a recent marriage. Also, the will is not particularly one-sided, as it sets out an equal share to everyone.

The reader's desire to see the will for himself (and presumably make a decision about the accuracy of the executor's statements regarding the grandchildren) is interesting, as the reader would appear not to be a lawyer or anyone else trained to interpret wills. If the father has passed away and the reader has not been given a copy of the will, I assume this is because the reader is not entitled to see the will. You don't get to see someone else's will just because you want to see it. The fact that the deceased is a parent doesn't entitle an adult child to see the will. If you're a residuary beneficiary, you'll get a copy. If not, you won't. Again, nobody has to like it, but that's the rule. 

I get the impression that the reader would like to read the will, make his own decision about who gets what, then attempt to force the executor to do things his way. This may also be why he was not named as an executor.

Where a parent has mental capacity to make a will, and takes all legal and moral obligations into consideration when making that will, the parent's wishes as expressed in the will should be respected.

Holographic wills and capacity

My friends over at www.allaboutestates.ca have posted something really interesting that some of you will recognize. An elderly parent who lacks mental capacity keeps making handwritten (or "holographic") wills. Holographic wills are legal in most parts of Canada, assuming that the parent has the mental ability to make a will. Is your parent doing this? And if so, how are you dealing with those wills? Click here to read an article that gives some advice on what to do.

The Sneaky Kid's Guide to Aging Parents

I really like this new article from www.boomertoboomeronline.ca. I always like articles that are clear, down to earth and give sensible advice to people who are desperately looking for some realistic help. In this article, the author gives several ideas for figuring out whether or not your aging parents are coping on their own. They are ideas that you can actually use. In fact, I used a few of them myself in the past.

And don't let the phrase "sneaky kid" worry you. The message endorsed by the article is "I love you, I owe you, please let me do some things for you so I don’t have to keep worrying that you’re okay." How can you argue with that? Click here to read the article.

Struggling with an abusive aging parent

I read a lot of material about aging parents and family dynamics. I've even written my share about them. But every now and then I come across an article that illuminates the subject for me in a way that I hadn't seen before, or gives me new food for thought. Dr. Marc Agronin's article in the New York Times called "Struggling With an Abusive Aging Parent" is one of those articles.

Dr. Agronin talks about how as adults we may have to deal with the fact that our parents were abusive to us, or had other issues (such as addiction) that led them to behave in ways that we find hard to forgive. He talks about how our reactions to our parents manifest in our behaviour toward them when the parents become the ones who now need our care and help as they age, and how this makes us feel.

It's a compassionate but common-sense look at how families behave, and Dr. Agronin offers a couple of helpful tips as well. I urge you to read it if you're struggling right now with caring for a parent that you find hard to forgive. Click here to read the article.

10 ideas for reducing stress when looking after an aging parent

Acting on behalf of aging parents is well known to be stressful. From time to time, you will have to take steps on behalf of your parent that are in the best interest of the parent, but not what the parent wants to have happen. These are things like taking your parent to a doctor for a mental assessment, taking away the car keys or credit card, or hiring a caregiver.

The steps that are against your parent's wishes are the most stressful of all. And not just for you. Think about what it must feel like to be the parent in these situations. Your parent may be distressed, anxious or disoriented, as well as somewhat miffed at you for not doing what you're told.

Here are 10 ideas for keeping your parent's anxiety - as well as your own - to a minimum:

1.  Involve your parent in the decision-making process to the extent that he or she can handle. This level of involvement is different for everyone. While your parent might not be able to handle the documentation and financial transactions that are part of the sale of a home, he or she may still be perfectly capable of deciding which personal items in the home he or she wants to keep.

2.  Keep your parent and your siblings informed as to steps that you have taken on your parent's behalf. Proactively giving out information is going to prevent you from getting telephone calls and email messages constantly and having to repeat the same information to several people. For example, if you had said that you would contact an estate-planning lawyer on behalf of your parent, let your siblings know that you've set up an appointment.  As your parent is the focus of the situation, you should keep him or her up to date personally if at all possible.

3.  Find efficient ways to communicate with your family as a group. Set up a distribution list on your email that includes all immediate family members so that you can send one message to all of them with one click. Or set up a Facebook page or web page for your family so that you can post information that they can access when they have time. If you don't want to use your computer as your main means of communication, set up a telephone-tree arrangement in which you ask each person you call to call two or three others and pass your message along.

4.  While you are dealing with your parent, either privately or in the company of advisors or family members, be professional and calm. If you are an emotional wreck, your distress will rub off on your parent. This will only make things worse, as your parent could be frightened about matters if you cry or break down every time estate planning or medical appointments are mentioned. He or she will wonder what terribly upsetting information you're hiding. If your parent is confused on any details, your distress will cause him or her to give the most negative interpretation possible to the issue.

5.  If staying calm is impossible, you need to take a break. If there is nobody in your family who can help you with caring for your parents, even if it's only for a weekend, you might look into hiring a caregiver for a portion of each day, or for a certain day of each week. Also consider other living arrangements for your parent that offer more support.  If you find that you are always exhausted, that you are catching numerous colds each year, or that you are depressed, it could be that you are over-doing it and need some relief.

6.  If you are acting on behalf of your parent on financial matters, make sure that anyone who becomes involved, such as appraisers, realtors, accountants, bankers and lawyers, know that they should contact you directly and not your parent.  Give each person a copy of the document that gives you legal authority. This isn't so that you can hide things from your parent; this is so that your parent doesn't have strangers calling him or her to ask private financial information or to talk about unknown transactions. If your parent were capable of handling that situation, you wouldn't be involved in the first place.

7.  If your parent asks you questions, answer them. Help your parent undestand what you are doing and why you are doing it. When he or she wants to see documents, even if it's for the tenth time, show the documents. Write down information such as upcoming appointments on a calendar and display it prominently, such as on the front of the fridge where you parent will find it.

8.  Make sure that bank statements, court documents, receipts and correspondence are kept in an orderly, accessible place. Chaos isn't helpful.

9.  Listen to your parent if he or she wants to talk about his or her wishes. This could be wishes about living arrangements, or about distribution under your parent's will, or even about what your parent wants to do next week. You may not always be able to carry out those wishes, but you should still know what your parent would like to see happen. Having someone listen carefully and take your parent seriously can have a very soothing effect.  If you say something like "Why should I listen? You're only going to forget what you said and tell me again tomorrow", you are only going to upset your parent and increase everyone's stress level.

10.  Keep up with the requirements of your legal authority to act on behalf of your parent. For example, if you are going to be required to give a legal accounting of the finances one day, try to keep current with the ledgers and books. Trying to put together a couple of years' worth of financial records on a deadline is unpleasant and stressful. Look into getting book-keeping software that will keep things straight for you.

My parent can't manage alone anymore. What are my options?

Your parent is getting older, and it has become obvious that he or she simply can't manage alone without significant help from you or your siblings. Do you know what your options are? Many people assume that they will have to apply to the court to become a guardian and/or trustee for their parents, but will they?

Before deciding to make that application to the court, it's worthwhile to consider whether there are any alternatives available. Each elderly person's situation and needs are unique, and it may be the case that those needs can be met by measures that are less expensive and less intrusive than having a guardian or trustee appointed.

For example, a senior living alone might have no trouble understanding his or her banking and looking after investment transactions but might have physical limitations. It might be possible to avoid the expense and trouble of having a guardian appointed for this person if someone could accompany him or her to the bank on a regular basis. Being appointed as a trustee who controls this person's money should be a last resort.

Alternatives should be explored for two reasons. The first reason is that guardianship and trusteeship can be invasive to an individual. How would you like it if someone took over control of your whole life? The second reason is that court applications can be expensive and may deplete a modest estate unneccessarily.

In many jurisdictions in Canada, the law expressly says that no guardian or trustee can be appointed if there are effective alternatives available. In Saskatchewan, for example, if you are applying to be a guardian or trustee of an older adult, you will be required to first show the court that other, less intrusive, methods have been tried or at least seriously considered. In the Northwest Territories, the court won't make a trusteeship order unless you can satisfy the court that there is no alternative available that is less restrictive of the older adult's decision-making rights.

Not all jurisdictions have this kind of requirement stated right in the law itself, but the concept of using the courts only as a last resort is well established.

Some of the alternatives you might consider are listed  below. Some address guardianship issues and some address trusteeship issues, and perhaps your solution will be a combination of them:

1.  Informal trusteeship - if your elderly relative is receiving benefits from the federal government (OAS, CPP, GIS, spouse's allowance, survivor's allowance), Veteran's Affairs or the provincial government, it may be possible for a family member to apply directly to the government to become an informal trustee for those benefits alone.

2.  In-home support - if the issues facing your relatives are largely due to physical limitations and not loss of mental capacity, you might consider assisting your relative to continue to live in his or her own home, if that is their wish. This is often possible if you arrange suitable in-home helpers to assist with nursing needs, housekeeping, nutrition, or transportation.

3.  Move in with relatives or into a supported living facility - sometimes the move to an environment where the older relative has access to the amount of help needed when it's needed can avoid the need for formal legal arrangements.

4.  Health care directive - this document may be signed by the older relative to appoint someone of their choice to make medical, health and personal decisions for them when they are unable to do so alone.

5.  Representation agreements - in British Columbia, Saskatchewan and the Yukon, an older person can make a written agreement with a trusted friend or relative who is willing to assist the older person with decision-making. This is only for personal decisions and not for financial decisions. Alberta and the Yukon also have supported decision-making arrangements as well.  Unlike health care directives which allow someone to act for an older relative, representation and supported decision-making agreements allow someone to act with the older relative.

6.  Enduring Power of Attorney - this document may be signed by the older relative to appoint someone of their choice to take over management of financial matters. The document can either take effect immediately, if that's what the older person wants, or it can come into effect at a later date when the older person begins to lose mental capacity.

7.  Bank power of attorney - unlike the Enduring Power of Attorney mentioned above, which would cover all of a person's assets, a bank power of attorney is signed only for a specific bank account or investment. It's a perfect solution when the older person really only needs help with banking or bill-paying.

I've talked about many of these alternatives in greater detail in previous blog posts, and I'll continue to develop others. It's essential that when we set out to help our older parents and relatives, we take the time to understand what they need, and offer only as much help as it takes to fill those needs.

Elderly Senior's Extravagant Gifts Spark Litigation

It happens time and time again. An elderly person gives money or expensive gifts to someone who is helping them. In a famous case, Huguette Clark gave $37 million worth of gifts to her nurse, doctors and other caregivers.  Whenever an objection is raised to extravagant gift-giving, the recipient of the gift will say that the gift was given voluntarily. But were they? Or was the elderly person manipulated? How on earth can anybody tell?

An American court has decided to get to the bottom of the gifting by Ms. Clark, who died at age 109. The representative of her estate has demanded the return of the gifts, declaring that they were only given because Ms. Clark was manipulated by those around her. Click here to read more about this from lawyer Kyle Krull.

I'll be really interested to see what the court comes up with in terms of distinguishing between gifts that really are voluntarily given, and gifts that are only made when a senior is subtly (or not so subtly) influenced by self-interested people. As anyone with an aging parent can attest, determining whether a senior has been financially abused can truly be a tough question.