In this clip, Host Zack Spencer and Wills and Estates Lawyer Elyssa Lockhart and Estate Litigation Lawyer Leah Donaldson discuss why it is important to have a lawyer involved when planning a will, and how improper planning can lead to litigation disputes among loved ones.
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All right. Let’s get into the next stage of this. Why do you need to have a lawyer involved with setting up your will and your estate? We hear ads on TV and get a kit and do it yourself, and it can just be simple. Explain, and then Leah can get into the pitfalls of what happens when you don’t do it correctly.
It a nutshell, short before long, you don’t know what you don’t know. When we’re structuring something, we might as laypeople think, the most important thing here is to avoid probate because it delays things.
You have to explain what probate is.
Probate is the process after a person dies where the individual who will ultimately take the assets of that deceased person into their name in trust to distribute to the beneficiaries is proven before the court. We take a list of the assets and the will if there is one to the court registry, and we determine that this person is an appropriate person, that there’s no objection from other family members, that this is the person actually named in the will who was trusted by the deceased. We say, these are the assets that this person will have control over. Anything not included in that probate application will not flow through that person’s hands. Those are the assets that this person will either liquidate or transfer in specie as they are to the beneficiaries, and they’ll have to do an accounting to those beneficiaries. It’s a very careful process where beneficiaries know at the end of the day that they weren’t missing anything. There’s no assets that were wasted or lost or absconded with. That’s the probate process, is where we identify this person as a proper trustee, and only then can assets such as land or other registered assets transfer from the name of the deceased to the name of somebody else, either a beneficiary or a buyer.
So, you need that middle person to get it done.
You need that executor, or in the case of an intestate, where someone dies without a will, you need an administrator.
Okay. We’re talking about not having it done and set up properly with a lawyer. What can happen? Where can it go sideways? What do you typically see?
It can go sideways in many ways. I think if I chose a simple example, it would be choice of executor. Often, we’ll have people come in where a person has chosen three executors that all have to act together, and maybe it’s three children and they have not gotten along their entire lives. They now have a will that says they have to do everything by agreement among one another.
Is that a problem? Should you choose one executor? Or having more than one? What do you think?
It’s not necessarily a problem, but it’s something that needs to be discussed with an estate planner about why have you chosen these people? And definitely multiple people carries with it different challenges. If you can name one person, then obviously, that’s preferable, but a person may have a very good reason to name two children, for instance. If they get along and there’s no issues, maybe it isn’t a problem. The point is, it’s like Elyssa was saying, you don’t know what you don’t know. So, having an estate planner walk you through exactly what an executor will be doing after your death might prompt you to think about whether this is the best decision.
That’s maybe not the right person for that job.
Can you name a number one and a number two, if the person denies the—
Absolutely. When Leah’s talking about what does an executor do? For me it’s, what is the skill set that’s going to be required? We’ve always in our family named the oldest child as executor, is what I hear a lot. If my oldest child is the most emotional, the most tied to me or the least sophisticated, the least comfortable dealing with accountants, the court registry, realtors, bankers, then that oldest child by virtue of being the oldest, that’s not actually the skill set, the tool bag, that we want them to be carrying. We want to look to the person who either is maybe my sibling if they’re younger than me, if they’re in good health. Or a family friend or one of the younger children. If they get along, like Leah is saying, that is one of the key selection criteria for me, but if they get along and they’re sophisticated and they’re comfortable and they won’t find this to be too much of a burden.
In your experience, is it better to have somebody that’s not a child? To go outside of the nuclear family? To go to an aunt or an uncle or somebody? Is it cleaner that way?
We see so many different circumstances. Each family is quite different, but sometimes there is problems by naming one child over the other. You can also name a private executor. That person is paid, of course, a rate. Or a family friend. Like Elyssa is saying, someone that’s sophisticated. Someone’s that able to deal with these kinds of matters easier than an overly emotional child or choosing one child over the others may cause problems.
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