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TRUSTS FOR PETS
INTRODUCTION:
It was perhaps
fifteen years ago that our office had to advise a client that her beloved
dog, who she felt had saved her life in a fire, could not necessarily be
the recipient of a trust to care for her after her own death. Our client
had just been diagnosed with terminal cancer, knew she had less than a
year to live, and was outraged.
“My dog has
been closer and more caring to me than my own children and you are
telling me the law does not recognize my right to care for her until her
death?!”
We explained that
the courts had mixed verdicts on that issue, with some judges feeling that
it was inappropriate for the court to intervene to try to enforce trust
provisions protecting animals.
“Why not? If
I want my money to protect my closest friend, why should the court
discriminate against me…and my pet? Am I to die knowing that there is
no way to safeguard my dog’s care for the rest of her short
life?” She was almost in tears.
That was why we
were delighted when the California legislature passed specific provisions
providing for the legality and enforceability of trusts created to protect
animals. That law, and some common sense provisions that one should
consider, are the theme of this article.
THE LAW:
California Probate Code section 15212 was enacted in 1991 and authorizes trusts for
pets. Prior to 1991 in California courts had been reluctant to declare that these
types of trusts were valid. These Trusts are subject, generally, to the
same law and requirements of standard trusts. See our article on
Wills and Trusts.
The section reads:
A trust for the care of a designated domestic
or pet animal may be performed by the trustee for the life of the animal
whether or not there is a beneficiary who can seek enforcement or
termination of the trust and whether or not the terms of the trust
contemplate a longer duration.
It may be noted that
the complex reason for the precise wording relates to the Rules of
Perpetuity which is an antique but still applicable law that provides
that a trust provision is void if it cannot be performed within a
specified period of time based on human lives in being. This statute
allows the trust to exist regardless of that Rule and, further,
implicitly allows such a trust to be enforceable. No longer can the
courts question whether such a provision is legal.
THE PRACTICALITIES:
On its face, it
would appear that the task of creating appropriate provisions is not
difficult. A standard trust could be created, either in the will
(testamentary) or while living (intervivos) and that trust can provide
that a trust will be established for the care of the pet, and a specified
amount of money will be used by the
trustee for the care, feeding, and health care of the pet for the
remainder of its life. The article
linked above will provide the various details.
But, in reality,
there are unique issues to be confronted and the person wishing to
protect a pet must confront them or may waste time and money creating a
trust that is, practically speaking, of little help.
For example, in
most trusts we have a human beneficiary who, if the trustee acts
improperly, may go to court to complain and even sue the trustee for
breach of fiduciary duty.
Who speaks for the
pet? If the trustee or a successor trustee takes some of the money or
neglects his or her duties, who is there to complain to the court?
Many of our clients
simply assume that a friend or relative, if made the trustee, can be
expected to perform the duties and this is not a great danger. What they
forget is that the trustee, himself, can become ill or die in which case
the successor trustee or even the successor to the successor trustee may
be appointed and may care little for the pet or the duties.
One of our clients
left a living trust for a parrot, who, one may note, may live up to a
hundred years and clearly had at least thirty years of life left. When
her sister died three years after she did, the nephew was the successor
trustee but he was in the army, moved around quite a bit, and the bird
soon was neglected and left with an even younger nephew who was
irresponsible. Luckily, a more distant relative, visiting, saw the bird
and contacted the writer and we were able to work out a method to have
the bird cared for by a professional “bird sitter” but the
point made is that unless the Trustor creates some type of human
oversight of the trustee, the trust may be useless.
Another issue is
the remainder man: what happens to the money after the death of the pet
and, too often we see pets left in the care of the very remainder men who
achieve access to the money if the pet dies. That is a provision that
could be very dangerous for the life of the pet.
It is imperative to
think long and hard about the terms and the methods for creating such a
trust and there are safe alternatives available if time and trouble is
taken to create them.
Or, as one of our
clients commented a little sadly, “I am putting more trouble into
creating this trust than I had to for my own children. It’s because
my cat cannot protect itself, of course…but it does feel
odd…”
Odd, perhaps, but
necessary if you are to allow your beloved animal to enjoy the remaining
years of its life.
Another approach to
lifetime care for pets would be to give the pet to a friend, and also
give the friend a cash bequest. This would allow the trust to be closed
prior to the death of the pet, but also has a risk that the friend would not be legally
obligated to pay for the pet's care. Further, if the friend dies or is
disabled, there is no one appointed to take his or her place.
Our office thus
normally recommends a trust and the reader is advised to consider carefully
the terms of the trust keeping the factors above in mind.
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