Heat Wave

As I lay in my bed, unable to sleep, western Washington undergoes an unprecedented heat wave. From Seattle to Tacoma, Bothell to Bellingham the mercury has soared, in many places well past 100 degrees. For those of you in traditionally warmer locales, you may be thinking what’s the big deal? But I can count on one hand the number of 100 degree days in the Puget Sound region in the past 40 years. What does this have to do with estate planning? Nothing really, except to say that this type of weather leads to heat stroke and dehydration, often in the elderly. So check in on your parents and older relatives. Make sure they are drinking enough fluids, have fans to keep air moving and if possible help them get somewhere with air conditioning. Many Senior Centers and libraries in the Puget Sound area are acting as “cooling stations” for people to get out of the heat.

The "Sandwich Generation"

A recent issue of Business Week contained a “Special Report” on retirement. Two of the many articles focused on the challenges faced by the Sandwich Generation. These are the folks who are simultaneously raising their own kids while caring for their aging parents.

Washington's Death With Dignity Act: It's Provisions and Problems

Last November Washington State passed a death with dignity law. The law, which went into effect on March 5, 2009, allows a competent adult and resident of Washington State to end his or her life. The person must be suffering from a terminal disease as determined by the attending physician and a consulting physician, and voluntarily express his or her wish to die.

Here’s the probable order of events:*

  1. The patient makes an initial oral request for the medication;
  2. The patient must then wait 15 days;
  3. Next, the patient makes a written request signed by patient and witnessed;
  4. The attending physician evaluates the patient to determine the diagnosis is terminal, and that the patient is competent and is making the request voluntarily;
  5. A consulting physician makes an identical evaluation, if they concur the request can proceed;
  6. The patient is referred for counseling by a licensed psychiatrist or psychologist if either physician deems appropriate;
  7. The attending physician must then give the patient the express opportunity to rescind the request;
  8. The patient must reiterate orally his/her request after he/she is given express opportunity to rescind; and
  9. The prescription is written, filled and the patient “takes” the prescribed medication.

*The timeline outlined above is anything but clear. The statute could be read to allow an oral request coupled with a simultaneous written request, then a 15-day waiting period, reiteration of the request orally and finally, writing the prescription. Under such a reading, the 48 hour wait period is subsumed into the 15 day period not added to it. This interpretation would give effect to both waiting periods, just not the way most people would probably think.

Washington’s statute is anything but perfect. While there are many safeguards, some problems do exist. One significant problem is the lack of control or guidance as to what happens after the medication is prescribed. There is no prescribed time or location to take the medication, no one has to witness the “self-administration”, and while one must have capacity all through the request process, there is no requirement of capacity at the moment of administering the medication. Moreover, while the language of Washington’s law seems to imply that only the patient can administer the medicine to himself/herself, another party could in fact give the medication due to the definition of “self-administration.”

It is only appropriate that we counsel clients on all ramifications of Washington’s Death with Dignity Law and allow them to decide how to proceed.
 

Know what you're buying with Long Term Care Insurance

Apparently, even rich and famous financial gurus can get sued. According to Forbes magazine, financial maven Suze Orman is being sued for civil fraud, conspiracy and breach of fiduciary duty for selling a long term care policy in the late 1990’s. Allegedly, promotional material used by Ms. Orman’s then financial advisory firm indicated “paid caregivers ‘cannot be a member of your immediate family living with you.’” This fact, among others I’m sure, induced the matriarch of one family to buy the Long Term Care Policy. Mom’s family did not reside with her, but lived nearby. After Mom received care from her family, she submitted reimbursement claims to the insurance company. The company denied the claims, however, citing policy language that barred payments to family members no matter where they lived. The moral of our story: be sure you know what you’re getting before you buy.

"Oh, my Will was Notarized . . ."

I hear this statement often from people who have written their own Will or pulled something off the Internet. Only problem is, notarization is not a requirement for a valid Will in Washington State. I’ll generally respond with . . . “Good, did you have two witnesses?” Some say yes, some say no. The reason I ask of course is in Washington you must have your signature witnessed by two competent persons to ensure your Will is valid and enforceable. Those witnesses should also be “disinterested,” which is generally someone who does not stand to benefit from your estate. So if you live in Washington State and want to make sure your Will isn’t as worthless as the paper it’s written on, reprint it and sign in front of two disinterested, adult witnesses. Or, better yet, contact a qualified attorney to assist you.

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Upcoming Events

I will be speaking at Aegis of Bothell on July 28, 2009, from 6:30-7:30 p.m. about estate planning for seniors and the basics of Medicare, Medicaid and Long Term Care Insurance. The event is sponsored by the Bothell Neighborhood Resource Council which consists of a variety of local businesses focused on serving the needs of seniors and their families.

More Upcoming Events

The Senior Resource Committee of the Greater Bothell Chamber of Commerce is holding two information gathering sessions, one on July 14, 2009 at 6:30 p.m. at Washelli of Bothell (aka the “Bothell Funeral Home”) and the second on July 22, 2009 at 2:00 p.m. at the Chateau at Bothell Landing. These one hour long sessions are designed to obtain information from seniors and their families in the Bothell-Kenmore area on issues important to maintaining and improving the lives of senior citizens in the community of Bothell and surrounding areas. The Senior Resource Committee acts as an advocate for seniors to the Bothell Chamber, its members and local governments. For more information please contact the Greater Bothell Chamber of Commerce.

Where will his money go? We may never know

In the coming months we will no doubt, hear lots and lots about Michael Jackson’s estate. Is he the father of all his children? Will other Wills pop up as in almost every other celebrity probate? Who will control his estate? And on and on. But all the tawdry details aside, we can learn something about how to set up our own estates.

Michael Jackson’s Will did at least one thing very well. In it, he named a guardian, in this case his mother, to care for his minor children. Everyone with a minor child, regardless of the size of your estate, should have a Will and name an appropriate Guardian.

A recent Wall Street Journal article reported that Mr. Jackson left the bulk of his estate to a Family Trust. The trust purportedly provides for his children, his mother and various charities. Based on the language used in the WSJ article, it sounds as if Mr. Jackson set up a Revocable Living Trust where he was the creator of the trust and the trustee while he was alive. This type of trust is commonly used to avoid probate (although not in all cases), reduce costs and maintain privacy. The privacy aspect is why we may never know the full extent of the family trust and what it says. A Revocable Living Trust is not appropriate in all circumstances and does have a few drawbacks, but it's often a useful estate planning tool, especially if you own property in more than one state.
 

Buy-Sell Agreements: The Basics

Most closely held businesses with multiple owners should have a Buy-Sell Agreement, often called a Shareholder Agreement. Without such an agreement problems can arise. Upon an owner’s death his or her shares in the company will often pass to a surviving spouse. This may or may not be desirable from the surviving business owner’s point of view.

Another situation that can arise is that one shareholder will cease to be active in the business. If his/her shares are not reacquired at that time, you may have to buyout the departed shareholder’s shares years later; and for a greatly inflated price. Not that this is unfair, but most people feel that only the people who actually contribute to the business’ success should reap the benefits.

The Buy-Sell Agreement can address these and many other issues between business owners. The agreement should address some or all of the following:

  1. Describe what happens with an owner’s shares upon death, divorce, incapacity, retirement or other termination of a shareholder’s service to the Company;
  2. Lay out dispute resolution provisions;
  3. Describe a valuation mechanism for the Company’s shares;
  4. Require a commitment to the Company of the shareholders;
  5. Set out extraordinary actions requiring unanimous consent; and
  6. Set restrictions on the transfer of shares of the Company.

A thorough Buy-Sell Agreement can alleviate a lot of headaches down the road, especially if the Company is successful. I tend to recommend such an agreement to all of my closely held business clients with multiple owners.

Protect Your Parents - Spotting Signs of Elder Financial Abuse

It’s always been important to protect family money, but with the difficult economy, it’s now more important than ever. One way to help mom and dad maintain money for their retirement, is to avoid losing it to fraud or financial abuse. Learn to recognize signs of potential abuse. Some of the signs are:

  • Changes in banking habits
  • Changes in a Will or other documents
  • Unexplained transfers of assets
  • Forged signatures on checks or other documents
  • Excessive use of ATM or credit cards

Also, review or have an attorney review any document a parent is asked to sign. Recently, a client of mine was selling a piece of land, and the buyer presented a contract with language that could actually have my client paying the buyer instead of the buyer paying the seller!
 

 

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