NEWS AND COMMENTARY

Published on: May 14, 2015

Showing Proper Respect for Death Certificates

Gov. Jerry Brown signed into law the “Respect After Death Act.” This law requires persons completing a death certificate to report the deceased person’s correct “gender identity.” The law, sponsored by California Assembly Speaker Toni G. Atkins, is designed to clarify the responsibilities of coroners and funeral directors on this subject.

As of January 1, 2015, the new law will require the person preparing a death certificate in California to “record the decedent’s sex to reflect the decedent’s gender identity.” The person reporting the death is responsible for informing the person completing the certificate of the deceased individual’s gender identity, unless presented with another official document, such as a birth certificate or driver’s license, indicating a different gender identity. In such cases, the death certificate must reflect what is on the official document. If there is any disagreement between the official documentation or what the person reporting the death considers the deceased’s gender identity, a “majority of persons” having the legal right to dispose of the person’s remains shall decide the matter.

According to media reports, the Respect After Death Act was prompted by the 2012 death of Christopher Lee, a San Francisco filmmaker who was born female but identified as a male. His death certificate reported his gender as “female,” despite the fact his family provided official documentation noting his gender identity as male. The local coroner said existing law required identification of Lee as female unless he had gender reassignment surgery. Under the new law, that is not necessary.

Published on: January 30, 2015

California Appeals Court Expands Protections Against Elder Financial Abuse

by Scott C. Soady

On September 3, a California appeals court issued a landmark decision on the subject of financial abuse of the elderly. California maintains strict laws designed to protect persons aged 65 and above, who are more susceptible to fraud. In this case, the appeals court found the law could apply to potentially harmful financial transactions not yet completed.

Bounds v. Superior Court of Los Angeles County

This case involves an unusual legal remedy known as a writ of mandamus. In California, a mandamus proceeding is brought by a petitioner against a lower court, and the defendant or respondent is designated the “real party in interest.” If granted, the writ is a command issued by the appellate court to the superior court.

Published on: December 7, 2014

Delaware Sparks National Debate Over New Probate Laws for “Digital Assets”

by Scott C. Soady

“Digital assets” remain an unsettled area of estate planning law. While it is long-established that a person may leave physical assets, such as books or photo albums, to someone else via a will or trust, that is not necessarily the case for digital copies of the same items stored in an email or social media account. In fact, many popular online services, like Facebook and Apple’s iTunes, expressly restrict a person’s ability to transfer their account to another person.

At least one state has taken a step towards liberalizing the rules governing digital assets after death. On August 12, Delaware Gov. Jack Markell signed the nation’s first law governing “fiduciary access to digital assets and digital accounts.” The new law requires an estate executor or trustee to “have the same access as the account holder” to online accounts owned by the deceased. The fiduciary may then order the service provider to copy, deliver or even delete the account in question.

The Delaware law is based on the Uniform Fiduciary Access to Digital Rights Act, a proposal adopted by the Uniform Law Commission (ULC), a nonprofit organization of legal professionals who draft and lobby for model state legislation. Delaware is thus far the only state to consider or adopt this particular uniform act.

Published on: November 5, 2014

Can a Creditor Challenge a Trustee’s Mismanagement?

by Scott C. Soady

When you create a living trust, you transfer personal assets to a trustee, who then manages those assets on your behalf. In most cases, this won’t be a problem, since you can name yourself as trustee during your lifetime. But when someone else serves as trustee, he or she owes a duty, not only to you as the person creating the trust, but to any persons you name as beneficiaries of your trust. Under California law, a trustee may not misuse (or co-mingle) trust assets for his or her personal benefit to the detriment of any beneficiaries.

Recently, a California appeals court addressed a question that apparently had not been considered before: Does a trustee owe a creditor a duty to avoid self-dealing? The appeals court answered no, reversing a lower court’s decision to the contrary.

Vance v. Bizek

Published on: October 31, 2014

When Does a “Revocable” Living Trust Become Irrevocable?

by Scott C. Soady

A revocable living trust is a flexible estate planning device that allows you to transfer your property to a trustee–usually yourself–thereby reducing those assets subject to a court-supervised probate after your death. Your trust document names a successor trustee to assume responsibility for the trust assets after your death. And as the name implies, a revocable living trust may be modified or revoked at any point during your lifetime.

But what about after your lifetime? Does a successor trustee have the right to modify the terms of your trust? That was the question before a California appeals court recently, which had to decide whether the spouse of a deceased trust grantor could alter the distribution of assets he specified.

Wright v. Tufft

Published on: October 10, 2014

The Dangers of Using a Pre-Printed Power of Attorney

by Scott C. Soady

A power of attorney is a legal document whereby a person, known as the “principal,” grants to another person, known as the “attorney-in-fact,” the authority to act on his or her behalf in certain financial matters. The attorney-in-fact is an agent and therefore owes a fiduciary duty to the principal. California law requires an attorney-in-fact to keep his or her personal property separate from any owned by the principal and managed by the attorney-in-fact. This is to prevent self-dealing, where an attorney-in-fact may attempt to enrich him- or herself at the expense of the principal.

As it is a binding legal document, it is always best to retain a qualified California estate planning lawyer to prepare a power of attorney. Although pre-printed power of attorney forms are widely available, they may offer insufficient protection for principals, especially when such documents are subjected to the laws of another state. A recent decision by an appeals court in the State of Washington, called upon to interpret a pre-printed power of attorney signed in California, illustrates the problems that may arise.

Boyd v. Pandera

Published on: September 26, 2014

Collecting Payments After Your Death

by Scott C. Soady

Although you might think of an estate plan simply as a way to dispose of your existing assets, in fact your future estate might also be responsible for collecting additional income generated after your death. If you work in the entertainment industry, for example, your estate may still collect residual payments for years-even decades-after you’re gone. According to a recent report by the entertainment website Deadline Hollywood, the Screen Actors Guild (SAG-AFTRA) currently holds more than $40 million in unpaid residuals that belong to living and deceased members. In these cases, the union simply cannot locate the person or his or her estate to make the payments.

What Is a “Residual”?

A residual is any payment made to a performer in a television show or movie for the rebroadcast of that work. For actors, residuals are governed by a series of labor agreements between the studios and SAG-AFTRA. Since the 1970s, residuals have been unrestricted, meaning the performer must receive a payment for each rebroadcast without limit. This means residual payments may continue well after the performer’s death.

Published on: September 25, 2014

Establishing Paternity for Probate Purposes

by Scott C. Soady

When the law speaks of “heirs,” it refers to those individuals entitled to inherit a person’s estate in the absence of a valid last will and testament. For example, if you live in California and die without a will or a spouse, but you do have children, those children are your heirs and inherit your estate. “Children” includes your biological offspring, as well as any children you legally adopted during your lifetime.

But what about children whose paternity is unsettled? California law states, for purposes of inheriting an estate, paternity must be “established by clear and convincing evidence that the father has openly held out the child as his own.” A court may also enter an order during the father’s lifetime establishing paternity, whether or not he acknowledges a child as his own. If for some reason the father was unable to acknowledge paternity, it may be established after his death, also by the “clear and convincing evidence” standard.

Different States Have Different Rules

Published on: September 19, 2014

Making Your Intentions Clear in a Will

by Scott C. Soady

A successful estate plan makes the final distribution of a person’s property plain and clear. Ambiguity in a will or trust may lead to costly litigation over conflicting interpretations of a person’s intent. But even the best executed estate plan may still leave some unhappy heirs, as one recent California Court of Appeals decision illustrates.

The Case of the Lanfermans

The deceased in this case was Paul Lanferman, who died in 2011. Lanferman and his wife, Susan Lanferman, executed an estate plan nearly two decades earlier. The Lanfermans had a total of six children, all from prior marriages. The Lanfermans executed identical wills. As applicable here, Paul Lanferman’s will said upon his death that his one-half interest in any community property would go to his wife. The will attached no conditions to the gift, aside from an instruction to the executor, which stated that the couple’s home could not be sold during Susan Lanferman’s lifetime without her consent.

Published on: September 18, 2014

Naming Backup Beneficiaries In Your Will or Trust

by Scott C. Soady

In creating a will or trust, a person may make specific bequests of property to a chosen beneficiary. But what happens if that beneficiary does not survive the person making the bequest? A well-drafted will or trust must anticipate such contingencies. Either the document should name an alternate beneficiary, or it should be made clear that the gift lapses and passes as part of the person’s residuary (leftover) estate.

A recent California Court of Appeals decision illustrates the confusion that may arise when the intended beneficiary of a gift dies before the giver. This case is only provided as an example and should not be viewed as a comprehensive statement of California law on this issue.

Dilworth v. Tiernan