Revocable Living Trusts are planned with the intention of keeping the family out of court. If this intent fails, courts have alarming powers to interfere with your plan. The recent case of Rene v. Sykes-Kennedy illustrates this point.

In Rene, a Florida court ruled that it was within the guardianship court’s authority to grant the court-appointed guardian of an incapacitated woman the power to modify the woman’s living trust. The modification? The court-appointed guardian modified the trust to appoint herself as trustee, despite the trust’s express language appointing the incapacitated woman’s granddaughter as trustee!

Now, if the granddaughter had been mishandling funds or self-dealing, this may have been a reasonable solution. However, the guardianship court made a clear finding that the granddaughter had committed no wrong-doing. Disregarding the intent expressed in the trust, the court decided to remove the granddaughter from her position as trustee and appointed the guardian instead—making its own determination “that it was in the [incapacitated woman’s] best interest.”

Rene illustrates the great discretionary power that a guardianship court wields. You can limit the court’s discretion when exercising its power to appoint a guardian by anticipating issues like incapacitation in your estate plan. A court, when exercising its power to appoint a guardian, must consider a person’s prior Designation of a Preneed Guardian. By including the Designation of a Preneed Guardian as part of your comprehensive estate plan, you can make it more difficult for the court to displace your intent. (We talked in-depth about Designation of a Preneed Guardian in our last blog post; click here to read if you missed it!)

A situation like unanticipated incapacitation is just one of the many dangers that can prevent an estate plan from working as you intended. If you would like to learn how you can avoid such potential problems through comprehensive planning, you are invited to attend one of our monthly “Truth About Estate Planning” workshops.

Image courtesy of Kittisak / freedigitalphotos.net

Leave a Reply

Your email address will not be published. Required fields are marked *