Archive for July, 2012
PLANNING FOR FLORIDA HOMESTEAD PROPERTY: IT CAN BE TRICKY
In our September 9, 2010 newsletter, we warned of a change in Florida’s homestead law effective October 1, 2010. We updated our clients, as well as our readers, and many of them heeded that warning and made changes to their estate plans. Clients of other attorneys may not have gotten the message.
Recently, we became involved in an estate dispute over homestead property. The deceased father and husband (to wife number 2) had a trust drafted by a competent local attorney several years ago. The trust explicitly stated that the homestead property was to be sold after his death and the proceeds split 3 ways, among the wife and his 2 children.
Unfortunately, neither the decedent nor his attorney thought to update the trust after the law changed. Because the homestead law trumps the provisions of the trust, the evil stepmother will be able to keep 50% of the proceeds when the home is sold (and could have prevented the sale entirely if she had wished to remain living in the home – for the rest of her life). This not only is contrary to the expressed wishes of the decedent, but it also means that his disabled daughter will miss out on $50,000 that she desperately needs.
There are several other tricky aspects to handling homestead property so that it remains protected from not only reditors’ claims, but also claims for expenses necessary to administer the estate of someone who has passed away. Proper planning means spending the time with an attorney counseling you on your options and updating your plan on a regular basis so that changes in the law don’t render it ineffective.
HOW DOES THE GUARDIAN ADVOCACY PROCESS WORK?
(Guardian Advocacy Series – Part Five)
Guardian advocacy is a special form of guardianship for individuals with developmental disabilities. Like other forms of guardianship, guardian advocacy involves the court appointing one or more individuals (“guardian advocates”) to help take care of the person with a developmental disability (the “ward”).
A person seeking to be appointed as the guardian advocate of someone with a developmental disability must open a case by filing appropriate documents, including a Petition for Appointment of Guardian Advocate, with the court. The Petition should assert that the proposed ward needs a guardian advocate and explain the ward’s abilities and the nature of his disability.
After the proposed guardian advocate opens the case, an attorney will be appointed to represent the person with a developmental disability in the proceedings. This attorney will meet with the proposed ward and evaluate the ward’s wishes and need for a guardian advocate.
Next, the case will go before the appropriate judge who will decide whether or not the proposed guardian advocate should be appointed and which rights should be taken from the ward and assigned to the guardian advocate. Unline traditional guardianships, this does not require the court to first declare the ward incapacitated, which involves a more expensive and invasive examination of the ward’s mental status and abilities.
A newly appointed guardian advocate will need to file initial reports to the court about the status of the ward’s person and property. She will generally have a duty to update the court every year about the ward’s physical and financial situation.
Although Florida law does not require guardian advocates to be represented by an attorney, we recommend that anyone trying to become a guardian advocate seek legal assistance at least in preparing the initial paperwork. At Cramer Law Center, we help guardian advocates from the very beginning until the initial reports are approved for a flat fee. We also assist guardian advocates with their ongoing reporting duties for a flat annual fee.
This blog is the fifth and final part of a series on Guardian Advocacy. If you have individual questions about guardian advocacy, please feel free to call and make an appointment.
ANOTHER ESTATE PLANNING HORROR STORY FROM THE REAL WORLD
Recently, I consulted with a young woman who has been married approximately one (1) year. Her husband is waiting on a liver transplant and has been for some time. Despite his precarious health situation, the couple did not do any estate planning after being married. She told me she felt like they had “plenty of time” to get around to estate planning.
However, while the husband was recovering from a fairly routine knee surgery, something went horribly wrong and he now suffers from brain damage. He no longer is capable of making decisions on his own. In fact, before his condition was fully understood, he emptied his bank account and ran up his credit cards to buy a boat (which wasn’t even worth close to what he paid for it) and the family is now broke, except for his social security and retirement income.
The wife came to me to talk about establishing a guardianship for her husband. When I explained that it would cost a minimum of $5,000 to $6,000 to establish a guardianship, she indicated that they could not afford to do this. All of their savings are gone. Had they only come to me for basic estate planning, the total cost would have been $1,250 for a complete will package for both of them, there then would have been no need for a guardianship. Instead, the only planning that the husband had done has placed an additional burden on his wife.
He had a several year old power of attorney in which he named an old Army buddy in south Florida as his agent. The Army buddy would prefer not be involved and to let the current wife handle everything. Unfortunately, he is forced to be her go-between because he is the only one with the legal power to manage her husband’s finances.
We always explain that the cost of estate planning involves not only the initial cost, but the costs of updating or “failing to update.” Here is a vivid example of both the financial and emotional cost of “failing to update.”
