Former NFL quarterback Steve McNair was shot and killed in what police have deemed a murder-suicide on July 4, 2009, apparently at the hand of his mistress.

He left a wife, Mechelle, and four young children (two from a previous relationship), and no will or estate plan.

McNair’s estate is sizeable. He earned more than $90 million in his playing career, not including marketing and endorsement deals. At last inventory, his widow listed his estate assets at around $19.6 million.

Mechelle McNair hired a probate attorney and was granted the legal authority to administer his estate. However, in the probate petition, she listed only herself and her natural children as heirs saying she didn’t have proof that the other two were McNair’s natural children.

McNair was ordered by Mississippi courts to provide child support for the two children, which seems to indicate that Mechelle really had no reason to doubt their parentage. And while it doesn’t appear that Mechelle plans to challenge their claims to the estate, the two children – both of whom have attorneys representing their interests – have not yet filed as beneficiaries.

And most recently, another Mississippi woman has come forward claiming that McNair fathered her 17 year-old daughter.

And these are just the claims from McNair’s heirs and potential heirs. This says nothing of his outstanding debts, one of which may be unpaid rent for an apartment that may have housed a second mistress.

This sad story of his death is further agitated by the fact that this family’s grief and indiscretions must be played out in public.

Even if you are not a celebrity, or weren’t murdered by your mistress, there is no privacy when your assets go through the probate court – not from the media nor from the nosy neighbors next door. Everything is out there for the world to see, your debts, an itemization of each of your assets, and the names and addresses of your heirs.

A good estate plan can avoid this. Just do it.

James D. Perry

In my wills and living trust practice, it’s routine for a client to come in wanting to draft a will. From time to time, that client doesn’t speak any English. This may be a bit of a hurdle, but drafting the will is far from impossible.

Where the would-be testator speaks a different language, a translator will be called in, either by me or by the client, and together, we’ll hash out the details and make sure the will is drafted to specification in accordance with California laws.

The requirements to execute a will in California are the same for everyone, regardless of language, literacy, or physical disability. Your will is valid even if you can’t read the words on the paper. The same goes for your living trust document.

In the deciding case on this issue, the court ruled that a California resident who spoke Italian and very little English still had a valid will because the testator’s friend had translated as the lawyer read the document during execution proceedings, and because the testator indicated that he understood what was in the will.

The policy behind this is to encourage people to make arrangements for the orderly distribution of their property to their intended beneficiaries either by their last will, or through a revocable living trust.

Failure to have a valid will or living trust in place could result in your property going to legal heirs that you would just as soon disinherit.  Our lives and relationships are complex, and they deserve the extra effort that comes with drafting a will, or a living trust – even if it’s done in a non-native language.

Ultimately, my job is to make sure I draft the document to the client’s wishes, and to ensure that he or she is fully aware of and satisfied with the content whatever his or her native tongue.

The desire to protect our assets and provide for our loved ones is universal. Don’t let a language barrier stop your from carrying out your last wishes for your estate.

James D. Perry

 Where should you keep estate-planning documents prepared by your attorney?  Where should people expect to find your living trust, will, durable power of attorney and advance health care directive? You want to be sure that those documents stay safe and can be easily found when your family needs to find them.

For those of you in California, I suggest that you do not keep them in a safe deposit box at the bank.  They will be safe there, but not accessible when urgently needed.

Your safe deposit box won’t be easy for your friends or family to open it if you’re not there. This is true even if they are co-owners of the box. Having the key isn’t enough to get the bank to open it up for them — the bank wants you to prove that you have the legal authority to require them to open it up. So here’s the conundrum: the document granting your friends or family the right to act on your behalf as an executor or as the power of attorney/agent is inside the box, and until the box is opened, they can’t prove that they have the authority to get the bank to open it…etc.

Safe deposit boxes are often inside a bank, which may be closed over the weekend. If a durable power of attorney or advance health care directive is needed over the weekend, no one will be able to get to it until Monday. In a medical emergency, the advance health care directive should be easily accessible.  If you insist on keeping your documents under lock and key either at a bank or at home, make copies of your durable power of attorney and advance health care directive, which can easily be located.

Most estate attorneys agree that the best place is in your home where the documents can easily be found when they are needed. Some suggest that you don’t lock them into a box for safekeeping inside your home, because that would be as difficult to penetrate as a safe deposit box.

My advice, simply leave them in a file cabinet or drawer, or inside a desk, on a shelf or binder somewhere else that is obvious to anyone looking for them.  

James D. Perry

As times have changed, so has the field of estate planning. When I started out in the field 22 years ago, people and their lives seemed to be less complicated.  As the years went by, it seems like the issues my clients shared with me became more complex.  Perhaps as I gained experience and felt more competent as a counselor, they were able to open up and tell me what was really on their minds.

Planning for the 21st Century Family

Today, clients who have been married for 40+ years and have two well-adjusted children and four well-adjusted grandchildren are in the minority.  Ozzie and Harriet don’t live here anymore, perhaps they moved to the midwest.

Instead, experienced estate planning attorneys are faced with planning for informed and sophisticated clients who come with “baggage” - singles (either by choice or through divorce), same sex couples, unwed couples, blended families, and dysfunctional families.

This change in family dynamics has led to a significant shift in how estate planners help their clients plan for incapacity and death. Today we have to listen and counsel more and offer insight and guidance on a case by case basis instead of just providing basic information and a generic solution. We are collaborators with our clients instead of sellers of estate plans.

This is why it’s so important for you to find an estate planning attorney who you feel comfortable enough with to tell everything - about your grandson who is addicted to drugs; your sister whom you haven’t seen in 20 years; your daughter-in-law who has turned your son and other children against you; your daughter and only child who has turned her back on you.

Without this information, your attorney won’t be able to work with you to develop an estate plan that will really work for you and your family. Your estate planning attorney needs to hear it all - the good, bad, and ugly - and then help you put together an estate plan especially tailored to your current situation. And as time goes by and your life changes, you’ll need to go back to your trusted estate planning attorney again and perhaps again and again to tweak, fine tune, and revise your plan.

If you view your estate plan as a static set of documents that you do once and then forget about, then you’ve been greatly misled. That’s why you are better off  committing to a long term relationship with a trusted advisor, someone who takes the time to understand you and your family dynamics now and also understands that those dynamics can and will continue to change.

The son who you have been estranged from for 20 years comes back into your life, and you have to ask your heart if you want to take him back after the hurt you have felt for all of those years 

As your life changes, your estate plan needs to change. Don’t procrastinate on making the changes.

James D. Perry

When people retire, or decide to move to be closer to family often times it involves a move to a different state.   So when you move to a different state, are your estate plan documents still valid in your new state of residence?

The answer is maybe.

Under of the U.S. Constitution, every state shall give full faith and credit to the laws of every other state. So as long as they are not contrary to California law, documents that were completed and valid in another state generally are valid in California and vice versa.

This is especially true with contracts. If you signed a contract in California that is governed by California law, the contract generally is effective in any state and still could be governed by California law.

Living Trusts generally are completely portable throughout the United States. You can choose which state law governs your trust.  In all of most of my trusts I insert a clause that says that this trust is governed by the laws of the state of California.

Contract law generally does got govern other estate planning documents such as wills or financial or health care powers of attorney. These documents more often will be governed by the laws of your state of residence or the laws of the state in which you are located when you are trying to enforce them.

Most states have specific statutes governing wills and durable powers of attorney for health care. Property Management powers of attorney are often governed by a state’s laws of agency, but if they have typical estate planning features, such as remaining effect upon your incapacity, they may be governed by probate law as well.

Most states have laws similar to California for these documents, but there are differences between states.

If you moved from another state and have estate-planning documents that were prepared in your old state, there may be portions of your documents that are unenforceable in your new state. Whenever you move to a new state, at a minimum you should have your old estate planning documents reviewed to make sure they comply with the laws of your new state. Better yet and often times more economical, you could have new estate planning documents prepared by an attorney in your new state.

James D. Perry

The judge overseeing the probate of the hotelier Leona Helmsley’s will has ruled that, contrary to her wishes, the billions of dollars that will flow into the charitable trust she created do not have to be spent solely for the care and welfare of dogs.

Experts in trusts and estates had warned that Mrs. Helmsley’s order that her fortune be spent promoting canine well-being may not have been legally binding. The two-page “mission statement” that contained her instructions also gave the trustees discretion in spending the money, and it was never incorporated into her will or the trust documents.

A spokesman for the trustees, said they planned to begin making grants from the trust next month in such areas as health care, medical research, human services, education and various other areas.

Over the years, bequests made for the purposes of furthering animal welfare generally have a hard time surviving the probate process.

However, in California pets are no longer treated like any other piece of property. California probate law provides that a trust for the care of a designated domestic or pet animal may be performed by the trustee for the life of the animal.

With the adoption of this code, setting up a trust to care for pets became a recognized estate planning technique. This law enables pets to become the beneficiaries of your will or trust.

Pet trusts are typically of two types: a testamentary trust which is designed to provide care after your death, and living trusts which provides care when you still living but no longer able to care for your animal. Living trusts can be useful if you are incapacitated or living in an assisted-living facility.
 
You actually have a number of options in planning for your pet. The first is to contact a pet retirement home and fully fund your pet’s care while you are still living.

Another plan would be to skip the trust altogether and donate your estate to a local animal care sanctuary with the stipulation that your pet receive care for the remainder of its life.

I have drafted plans that limit the size of the bequest to something on the order of a few thousand dollars per year for each year of the pet’s remaining lifespan. 

If you have multiple pets, one way to address the challenge of keeping them together and cared for in the manner of your choosing is to include real estate as part of the trust. The designated caretaker lives rent-free as long as he or she cares for the animals.

Remember, pet care is expensive. A pet trust will give your relatives or other caretaker the means to provide for your animals in a manner consistent with your wishes. To fund such desires, some people have designated their pets as the beneficiaries of substantial life insurance policies.

James D. Perry

Wow, the banks have been getting hit hard again in the stock market. It’s hard to believe that you can buy a share of Citigroup and a share of Bank of America for a less than 10 bucks.  I don’t know about you, but it doesn’t give me a lot of comfort with our banking system. Putting what’s left under the mattress is starting to look like a reasonable alternative.

In the short term, the financial bailout plan signed into law in October benefits persons who have trusts, because bank accounts owned by Living Trusts can get more FDIC insurance than accounts owned by individuals. Living Trust accounts get the maximum FDIC insurance for every qualified beneficiary.

Until December 31, 2009, when the financial bail-out package expires, the FDIC now insures “qualifying beneficiaries” for $250,000 each. A qualifying beneficiary is a spouse, child, grandchild, parent, or sibling of the account owner. The account must be owned creators or grantors of the living trust.

Here is how it works:

A single parent in Orange County sets up a living trust naming her two children as the beneficiaries after he or she dies, the bank account owned by the trust is insured up to $500,000: 2 beneficiaries at $250,000 each.

If you and your spouse and I set up a living trust and all three of your children are the beneficiaries after you both die, the trust account is ensured for up to $1,500,000.  $250,000 for each (child) beneficiary and for each owner. (3 beneficiaries x $250,000 x 2 owners = 1,500,000).

These FDIC limits are per bank not per bank account at the same bank.  If a California living trust owner has more than one account at the same bank, these limits apply to all their accounts there.

Be sure and confirm this with your banker in writing and avoid relying on any other informal sources. You can get some help with this handy calculator on the FDIC website.