Florida Estate Planning Lawyer Blog

Creating a Florida Revocable Trust is a job that most Florida Estate Planning Lawyers are capable of but the process of avoiding Florida Probate does not end there. Once the Florida Revocable Trust has been created it must then be funded with the client’s assets. Without proper funding all of the assets that should have been in the trust will pass through Florida Probate costing heirs extra money in taxes and fees.

In order to fund your Florida Revocable Trust properly, you need to transfer ownership of your assets into the name of the trust. Personal property can be transferred using a document called a General Assignment or Assignment of Personal Effects. Real property is a little more complex because it requires executing a new deed transferring the property from your name as an individual to the name of the trust. Institutions with which you have bank and brokerage accounts usually require a showing that your trust exists and that it is your wish to have these accounts transferred. A Certificate of Trust is a document that provides proof of the existence of your trust and is usually given to the client in the living trust package he receives from his Florida Estate Planning Attorney.

Forgetting or neglecting to fund your trust is something you wouldn’t want to do after going to all the trouble to create a trust in the first place. Even if you initially funded the trust with assets there are many cases where people have acquired a significant amount of assets later and never transferred them to the trust. If you would like assistance in creating a revocable living trust or an assessment of your existing trust contact a Florida Revocable Trust Lawyer or Jacksonville Estate Planning Lawyer today!

Florida Revocable Trust are managed by a Trustee who is the person(s), or in some cases entity, that hold legal title to property for the benefit of an equitable title holder.

Often the grantor of the Florida Revocable Trustselects the trustee who is responsible for making sure the beneficiaries are taken care of according to the grantor’s wishes. A single beneficiary or group of beneficiaries can become dissatisfied with the performance of the trustee when unfortunate circumstances occur. This may lead to a difficult court proceeding where the removal of a trustee is sought.

Under the current Florida statute a beneficiary, co-trustee, or the grantor of the trust may request the court to remove a trustee. When a removal request is made, it is up to the court to decide if there are sufficient circumstances that justify the trustee’s removal.

The Florida Trust statute expressly states that the court may remove a trustee if:

1) The trustee commits a serious breach of trust,
2) There is a lack of cooperation among multiple trustees,
3) The trustee is unfit, unwilling, or persistently fails to administer the trust effectively, or
4) There has been a substantial change of circumstances or all beneficiaries agree to the removal, the removal of the trustee best serves the interests of all of the beneficiaries, is not inconsistent with a material purpose of the trust, and a suitable co-trustee or successor trustee is available.

If you are the beneficiary, co-trustee, or grantor of a Florida Revocable Trust and believe any of the circumstances mentioned here apply to your trustee, contact a Florida Revocable Trust attorney or Jacksonville Trust Attorney who can discuss whether it would be beneficial to seek the removal and appointment of a new trustee.

Florida Estate Planning involves many situations where is the potential do have disputes over money or assets. Many problems arise from poorly planned and drafted estate planning and these can lead to fights amongst family members, IRS audits, and lead to high litigation costs. Focusing on your specific needs can avoid these pitfalls and can benefit those individuals with all sizes of estates.

It is important to first understand and define your objectives and resources. In order to get a custom-tailored Florida Estate Plan, a Florida Estate Planning Lawyer must be able to explain exactly what you want in terms you can understand. In some cases there are advantages in giving up control over your assets. Part of the process often involves talking with children and other beneficiaries about the estate plan and educating them on how to use it to their benefit after you are gone. Your plan can often offer your children protection into their lives from divorce or claims by creditors if used properly. In addition, many future disputes can be avoided by helping your beneficiaries to understand your goals, objectives, and reasoning behind the decisions you are making. While documents are a large part of the Florida Estate Planning process, effective communications, a clear understanding and education of all those involved will help the plan be successful when you are not there to manage it.

If you would like professional assistance with your Florida Estate Planning contact an experienced Florida Estate Planning Lawyer to help you in these matters.

Trust Arbitration Clauses are common in Florida. In many states, they are not always enforced but Florida passed a law a few years ago that makes them enforceable in Trusts.

Florida Statute 731.041 Arbitration of disputes.

(1) A provision in a will or trust requiring the arbitration of disputes, other than disputes of the validity of all or a part of a will or trust, between or among the beneficiaries and a fiduciary under the will or trust, or any combination of such persons or entities, is enforceable.

(2) Unless otherwise specified in the will or trust, a will or trust provision requiring arbitration shall be presumed to require binding arbitration under Florida Statute 44.104.

We are often asked what is Arbitration?

Arbitration is process of dispute resolution in which a neutral third party (arbitrator) renders a decision after a hearing at which both parties have an opportunity to be heard. Where arbitration is voluntary, the disputing parties select the arbitrator who has the power to render a binding decision.

There are two types of arbitation 1) binding and 2) non-binding, what is the difference?

An arbitrator’s decision may be binding upon the parties or non-binding.

Binding arbitration is more common in trust documents, non-binding is usually a way to allow each side to test there position before having the full expense of a trial and is a hybrid of mediation and a trial.

If you are involved in a Florida Trust Dispute or Florida Trust Litigation, you should Contact a Florida Trust Litigation Lawyer who is familiar with arbitration disputes.

Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

Helmsey's estate made 53 charitable grants this week. Most of the money was given to hospitals and for medical research. Only 1 Million was given to 10 animal and dog charities equally. These donations came after a New York judge ruled that the trustees for the Helmsley Charitable trust has the sole authority to decide which charities would benefit from the trust.

Jonathan G. Blattmachr, a partner at Milbank, Tweed, Hadley & McCoy LLP, has published "Reducing Estate and Trust Litigation Through Disclosure, In Terrorem Clauses, Mediation and Arbitration" in the Cardozo Journal of Conflict Resolution, 9 Cardozo J. Conflict Resol. 237 (2008).

He suggests six methods to reduce litigation.

1. Advise Inheritors of Inheritance Plans. Especially when children of the decedent are treated unequally, will contests and litigation arise from disappointed feelings of entitlement. Telling the children ahead of time what their shares will be may avoid a later dispute. Blattmachr even suggests that one could enter into a contract (for consideration) with such a person that he or she will not object to the validity of the document. (Of course, as Blattmachr says, "advising a child that he or she will not receive an equal share may have adverse effects even if it prevents litigation after death." You think?)

2. Use a Revocable Trust in Lieu of a Will. Since a revocable trust can be funded and operate during lifetime, it is difficult to contest on the grounds that the individual was unaware of its terms. When the Settlor of the trust dies, there is no need to begin a court proceeding to "prove" the validity of the trust, such as there is for a will.

3. Use an Irrevocable Trust in Lieu of a Will or Revocable Trust. An irrevocable trust is even less likely, in Blattmachr's view, to be challenged than a revocable trust. Irrevocable trusts can be drafted in such a way so that transfers of property to them are not completed gifts. Alternatively, making a transfer that is a completed gift, paying gift tax, and filing a gift tax return disclosing details may be additional evidence that the transfer was truly intended. Again, Blattmachr believes that a lifetime trust that is significantly funded is less likely to be challenged.

4. Use an In Terrorism Clause. If the testator lives in a state that will enforce it, an in terrorism clause (or disinheritance clause) could be used. Or the testator could direct that his will be probated in a state that does enforce such clauses. A lot of trust and estate litigation is not about the validity of the document, it is about its interpretation or about actions taken by the fiduciary. In order to reduce this type of litigation, an in terrorism clause can cause a forfeiture of a beneficiary's interest if such a challenge is made.

5. Use Mediation or Arbitration Provisions. Arbitration or mediation cannot be used with respect to the challenge of a document's validity unless the parties agree to it. Using an in terrorism clause to cause forfeiture if the parties will not participate can be used. This could stop claims that are filed only to harass other beneficiaries or to delay distributions to others. Another approach would be having the parties enter into a contract agreeing to arbitration before the transfer.

6. Use a Condition Precedent to a Bequest as an Alternative Method of Causing Participation in Mediation or Arbitration. Since a person cannot be forced to participate in arbitration or mediation unless the law provides for enforcement, consideration must be given to how to get parties to use these methods. One can use the carrot instead of the stick. Parties can be given a benefit if they consent to use arbitration or mediation instead of resorting to court.

While a Terrorism clause may not be enforceable in Florida it is possible to give the Trustee the ability to flee the jurisdiction and use the laws of a jurisdiction where it can be enforced.

When creating estate plans or trust documents it is important to consider the potential for litigation and whether it should be addressed prior to the death or after the death of the people creating it. While much can be done prior to death to resolve potential disputes and keep communications open, often issues only arise after the death of the trustees.

To discuss your estate plan with a Florida Estate Planning Lawyer and discuss what can be done to reduce the likelihood of estate and trust litigation Contact an estate planning attorney familiar with litigation issues.

In re Estate of Carpenter, 253 So. 2d 697 (Fla. 1971), the Florida Supreme Court stated to raise the presumption of undue influence, a plaintiff must show a confidential relationship between the donor and the donee and active procurement of the gift. Because courts have found that a confidential relationship exists in most relationships, the real issue comes down to active procurement of the gift. Recently Patrick Lannon wrote a summary of case law on the topic for the Florida Bar journal. Carpenter gives a list of seven factors of active procurement of a will, the:

1) presence of the beneficiary at the execution of the will;
2) presence of the beneficiary on those occasions when the testator expressed a desire to make a will;
3) recommendation by the beneficiary of an attorney to draw the will;
4) knowledge of the contents of the will by the beneficiary prior to execution;
5) giving of instructions on preparation of the will by the beneficiary to the attorney drawing the will;
6) securing of witnesses to the will by the beneficiary; and
7) safekeeping of the will by the beneficiary subsequent to execution.

In contrast with inter vivos transfers courts use a balancing test when evaluating the six recurring factors:

1) the donee’s level of involvement in the donor’s affairs;
2) the donee’s level of involvement in the actual gift in question;
3) the relationship of the donee to the donor as compared to the natural objects of the donor’s bounty;
4) the secrecy or openness of the transaction;
5) the effect of the transfer on the donor’s pre-existing estate plan; and
6) the physical health and mental acuity of the donor at the time of the gift.

Generally it is much harder to undue a gift that takes place with a Florida Will than during the decedents life. These factors should be considered with making or planning to make transfers. With an understanding of how these issues are raised, it is possible to structure transfers so to avoid many of the factors of Undue Influence.

If you would like help in structuring transfers of property to help avoid the appearance of an improper transfer of property, Contact a Florida Will Attorney or a Florida Estate Planning Lawyer to review your case.

If you believe you have been harmed by the improper transfer of property, Contact a Florida Probate Litigation Attorney or a Florida Trust Litigation Lawyer to review your case.

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.