5 Questions to ask YOUR parents about THEIR estate plan

I was a guest lecturer last night at the UC Davis Graduate School of Management. The class was on value investing. Lonnie Rush and Jacob Taylor are the teachers of the class. They asked me to talk to these 60 bright young minds about estate planning.

Showing how smart they are one student asked me a question I hadn’t been asked before. I was talking about the importance of integrating your parent’s estate plan into your own.  That is, whatever your parents have in their estate planning documents really becomes the child’s estate plan. If done right it can create huge opportunities and advantages for the children. If done wrong it’s a loss of opportunity.  The student asked me, “what should we ask are parents about their estate plan?”

As I said, these were sharp kids and though the question seems basic on the surface it really does get right to the crux. It thus leads to today’s blog, what are 5 crucial questions to ask your parent about their estate plan.

I should start by saying before you ask your parents anything you better know they are going to be comfortable with the questions. Some parents don’t want to talk about their personal business with anybody and they’ll think you are just “waiting for us to die.”

With that disclaimer here are 5 key questions to ask:

1) What estate planning documents do you have in place? Anybody with assets should have: a living trust, a pour over will, a durable power of attorney, an advanced health care directive, a certified extract of trust, and a general transfer. Some may also have other trusts such as life insurance trusts and qualified personal residence trusts.

2) Can I have a copy of your trust? The trust is probably the key document to get a copy of as it will give many clues to the overall estate plan.

3) Who are the financial decision makers in your estate plan? That is, who is the named trustee, executor and financial power of attorney?  As I told the students last night it is likely the estate plan was put into play 15 years ago when these students were young kids. They are now getting their MBA and thus well equipped to be in charge of their parent’s affairs.

4) At what age are the assets distributed to the kids? This question is buried at #4 but this is probably the key question. That is, this is where the biggest estate planning opportunity is for YOU within your parent’s estate planning documents. If your parents set it up right they can create a creditor protected trust which could provide you a large creditor protected asset for your future. Think protection upon divorce, car accidents, etc…. This is KEY!

5) Are all of your assets actually titled in the trust?  So often people set up a trust but do not properly fund the trust. Or they set up a trust, fund it, and then remove assets or get new assets. The key to a trust is a properly funded trust!

Of course there are more but if you can ask your parents these 5 questions you will be well on the way to improving YOUR estate plan!


Restate that trust rather than amend the trust

I often see estate plans where clients have done 3 or 4 amendments. That is, amendment to trust # 1 from 2002, amendment #2 from 2005, etc….  Now at first blush I could say they  didn’t have a good estate planning attorney, at the outset, who created flexibility into their trust. That is possible. However, beyond that they often create great confusion and definitely a very difficult time for the attorney who has to analyze the amendments in the future.  A restatement of trust simplifies all that.

A restatement of trust replaces all previous trust documents. Rather than have an original trust and a few separate trust amendment documents you would have ONE restatement. This is much simpler to interpret.  Also, the name of the trust does NOT change. That is, the original trust name and date remain the same!  This means NO assets have to be transferred.

If your attorney proposes trust amendment #2 or 3 ask why not just do a restatement of trust. In this author’s opinion it is easier and more cost effective in the long run.

Protecting Your Virtual Estate

I just read this interesting article on smartmoney.com about protecting your VIRTUAL assets after death. It really is something to think about. I see the practical side all the time when clients break into mom and dad’s accounts after death using passwords. They really shouldn’t do that of course! However, it goes well beyond that when you think about all that is tied to your virtual life.
Let’s think about just some stuff that is tied to your virtual world that has actual value:
– Banks
– Stock accounts
– Domain names you own
– Airline and hotel miles and points
However, beyond that most of our world is now linked on-line. If your family has your account information they can turn off the cable TV, make sure your mortgage is current and the list goes on and on.
Plus, should “you” tweet one last time after death!?  Your family can take care of that if they know your passwords!
How best to accomplish this?  Yes, you can give your estate planning your important passwords. However, there are better ways like using one of the encrypted websites that store passwords for you. I was looking at one the other day that did not charge; lastpass.com.  Of course there are many more but you just need one.  Thus you need one really good password for it and then everything else can be stored there.
In any event the point is that you should talk to your estate planning attorney about your virtual assets but even more important is making sure your most trusted family or friends know about your on-line world.

What’s the best way to pay for legal services?

I am an attorney and I get paid for my work. Yes, I admit it.  You are a client and you know that you will have to pay to hire a lawyer. We both know that. However, what you might not know is that there are options for payment.

Yes there are some cases where my firm requires me to get a retainer up front before work is done. This is not the majority of cases though. In most cases there are options that are more flexible and that do not require you coming out of pocket with cash.

PAYMENT IN FULL PROBATE:  In full California probate cases typically we get paid at the end of the case after the Judge orders it so.  In some cases we get a retainer up front to cover out of pockets expenses, like the Court filing fee, but in some cases we can even front those. Thus, in most full probate cases you are paying little, or nothing, to get the case started. We don’t get paid until you get your inheritance and only when the Judge orders it!

FLAT FEE OPTIONS: In many cases, especially small estates, we offer flat fee payment options. As we do so much of this type of work we know exactly how much time it will take and exactly what costs we will incur. Thus we can usually offer a flat fee option that includes both fees and out of pocket costs and thus you just pay one amount.

DELAYED PAYMENT: Like most of us a lot of my clients have found the last few years to be challenging to their pocketbook. Their bank balances aren’t what they once were. I understand this.  We actually can create creative fee options, in some cases, where you don’t have to pay until the case is DONE and you have received payment. Each case is unique though so you will need to talk to John Palley, our lead probate attorney, to know what options are available to you.

PAYMENT OPTIONS: Like most companies we prefer cash or checks. We do not give cash discounts but we certainly do prefer cash and checks. In some cases we can also accept credit card. Again, talk to us to discuss.

THE BOTTOM LINE: Yes, this is a business and we are here to make a profit. However, we will do everything we can to work with you on payment. We want to be your attorney and we will get creative so we can do it!

Contact us so we can talk about some payment options that will work for you and your case.

One lone Beastie I be….

I find celebrity estates interesting because they often mess things up much worse than us mere mortals. However, it also is a good reminder that they are humans too!

I wrote recently about Adam Yauch of the Beastie Boys and his handwritten changes to his will.  Other celebrities have left similar, or worse, handwritten wills. If memory serves Jerry Garcia of the Grateful Dead and also a US Supreme Court justice both left handwritten wills. Mr. Yauch’s was just partially handwritten… one phrase… and that phrase will likely cause years of litigation.

In any event today I am writing about the part of his will written by his lawyer.  Clearly he and his wife did not see eye-to-eye on who should be guardian of their children.  If the second death, between he and his wife, happened in an even year his parents were first choice to be guardian of the kids. On the other hand if the death was in an odd year then her parents were first choice for guardian. Sure it’s possible there was some good luck type thing involved but I think it was just a straight compromise.

Really it’s a great compromise. Why fight about it!?  Just come up with a unique agreement!  I like to think I am a creative estate planning attorney but I have never thought of this one before. However, I am sure I will have the opportunity to use it before long with some young couple!

When you get your will in place make sure you have guardians named for your minor children.  Also it’s a good idea to have a living trust or testamentary trust to protect their assets. If you aren’t sure what to do please hire an experienced estate planning attorney.

DNA Testing in Probate Court

I had a case recently where a long lost child, or alleged child I should say, came out of the woodwork. The person, now an adult, claims to be the illegitimate child of a decedent in one of my probate cases.  It’s not my position to be believe or dis-believe her.  As I represent the Administrator of the estate my only job is to advise him of his role.  This is not the first time I have had this type of case come up. Is the child really the child of the decedent? How do you find out?  Could DNA testing be required? If so, how does that happen? Do they unearth the body?  Do they use other relatives?  In any event California Family Law section 7550, 7551, et seq provides the information.  Here are those sections in full.



7550. This chapter may be cited as the Uniform Act on Blood Tests
to Determine Paternity.


7551. In a civil action or proceeding in which paternity is a
relevant fact, the court may upon its own initiative or upon
suggestion made by or on behalf of any person who is involved, and
shall upon motion of any party to the action or proceeding made at a
time so as not to delay the proceedings unduly, order the mother,
child, and alleged father to submit to genetic tests. If a party
refuses to submit to the tests, the court may resolve the question of
paternity against that party or enforce its order if the rights of
others and the interests of justice so require. A party’s refusal to
submit to the tests is admissible in evidence in any proceeding to
determine paternity. For the purposes of this chapter, “genetic tests”
means any genetic test that is generally acknowledged as reliable by
accreditation bodies designated by the United States Secretary of
Health and Human Services.


7551.5. All hospitals, local child support agencies, welfare
offices, and family courts shall facilitate genetic tests for
purposes of enforcement of this chapter. This may include having a
health care professional available for purposes of extracting samples
to be used for genetic testing.


7552. The genetic tests shall be performed by a laboratory approved
by any accreditation body that has been approved by the United
States Secretary of Health and Human Services. Any party or person at
whose suggestion the tests have been ordered may demand that other
experts, qualified as examiners of blood types, perform independent
tests under order of the court, the results of which may be offered
in evidence. The number and qualifications of these experts shall be
determined by the court.


7552.5. (a) A copy of the results of all genetic tests performed
under Section 7552 or 7558 shall be served upon all parties, by any
method of service authorized under Chapter 5 (commencing with Section
1010) of Title 14 of Part 2 of the Code of Civil Procedure except
personal service, no later than 20 days prior to any hearing in which
the genetic test results may be admitted into evidence. The genetic
test results shall be accompanied by a declaration under penalty of
perjury of the custodian of records or other qualified employee of
the laboratory that conducted the genetic tests, stating in substance
each of the following:
(1) The declarant is the duly authorized custodian of the records
or other qualified employee of the laboratory, and has authority to
certify the records.
(2) A statement which establishes in detail the chain of custody
of all genetic samples collected, including the date on which the
genetic sample was collected, the identity of each person from whom a
genetic sample was collected, the identity of the person who
performed or witnessed the collecting of the genetic samples and
packaged them for transmission to the laboratory, the date on which
the genetic samples were received by the laboratory, the identity of
the person who unpacked the samples and forwarded them to the person
who performed the laboratory analysis of the genetic sample, and the
identification and qualifications of all persons who performed the
laboratory analysis and published the results.
(3) A statement which establishes that the procedures used by the
laboratory to conduct the tests for which the test results are
attached are used in the laboratory’s ordinary course of business to
ensure accuracy and proper identification of genetic samples.
(4) The genetic test results were prepared at or near the time of
completion of the genetic tests by personnel of the business
qualified to perform genetic tests in the ordinary course of
(b) The genetic test results shall be admitted into evidence at
the hearing or trial to establish paternity, without the need for
foundation testimony of authenticity and accuracy, unless a written
objection to the genetic test results is filed with the court and
served on all other parties, by any party no later than five days
prior to the hearing or trial where paternity is at issue.
(c) If a written objection is filed with the court and served on
all parties within the time specified in subdivision (b), experts
appointed by the court shall be called by the court as witnesses to
testify to their findings and are subject to cross-examination by the
(d) If a genetic test reflects a paternity index of 100 or
greater, the copy of the results mailed under subdivision (a) shall
be accompanied with a voluntary declaration of paternity form,
information prepared according to Section 7572.


7553. The compensation of each expert witness appointed by the
court shall be fixed at a reasonable amount. It shall be paid as the
court shall order. The court may order that it be paid by the parties
in the proportions and at the times the court prescribes, or that
the proportion of any party be paid by the county, and that, after
payment by the parties or the county or both, all or part or none of
it be taxed as costs in the action or proceeding.


7554. (a) If the court finds that the conclusions of all the
experts, as disclosed by the evidence based upon the tests, are that
the alleged father is not the father of the child, the question of
paternity shall be resolved accordingly.
(b) If the experts disagree in their findings or conclusions, or
if the tests show the probability of the alleged father’s paternity,
the question, subject to Section 352 of the Evidence Code, shall be
submitted upon all the evidence, including evidence based upon the
7555. (a) There is a rebuttable presumption, affecting the burden
of proof, of paternity, if the court finds that the paternity index,
as calculated by the experts qualified as examiners of genetic
markers, is 100 or greater. This presumption may be rebutted by a
preponderance of the evidence.
(b) As used in this section:
(1) “Genetic markers” mean separate genes or complexes of genes
identified as a result of genetic tests.
(2) “Paternity index” means the commonly accepted indicator used
for denoting the existence of paternity. It expresses the relative
strength of the test results for and against paternity. The paternity
index, computed using results of various paternity tests following
accepted statistical principles, shall be in accordance with the
method of expression accepted at the International Conference on
Parentage Testing at Airlie House, Virginia, May 1982, sponsored by
the American Association of Blood Banks.


7556. This part applies to criminal actions subject to the
following limitations and provisions:
(a) An order for the tests shall be made only upon application of
a party or on the court’s initiative.
(b) The compensation of the experts shall be paid by the county
under order of court.
(c) The court may direct a verdict of acquittal upon the
conclusions of all the experts under Section 7554; otherwise, the
case shall be submitted for determination upon all the evidence.
7557. Nothing in this part prevents a party to an action or
proceeding from producing other expert evidence on the matter covered
by this part; but, where other expert witnesses are called by a
party to the action or proceeding, their fees shall be paid by the
party calling them and only ordinary witness fees shall be taxed as
costs in the action or proceeding.


7558. (a) This section applies only to cases where support
enforcement services are being provided by the local child support
agency pursuant to Section 17400.
(b) In any civil action or proceeding in which paternity is a
relevant fact, and in which the issue of paternity is contested, the
local child support agency may issue an administrative order
requiring the mother, child, and the alleged father to submit to
genetic testing if any of the following conditions exist:
(1) The person alleging paternity has signed a statement under
penalty of perjury that sets forth facts that establish a reasonable
possibility of the requisite sexual conduct between the mother and
the alleged father.
(2) The person denying paternity has signed a statement under
penalty of perjury that sets forth facts that establish a reasonable
possibility of the nonexistence of the requisite sexual contact
between the parties.
(3) The alleged father has filed an answer in the action or
proceeding in which paternity is a relevant fact and has requested
that genetic tests be performed.
(4) The mother and the alleged father agree in writing to submit
to genetic tests.
(c) Notwithstanding subdivision (b), the local child support
agency may not order an individual to submit to genetic tests if the
individual has been found to have good cause for failure to cooperate
in the determination of paternity pursuant to Section 11477 of the
Welfare and Institutions Code.
(d) The local child support agency shall pay the costs of any
genetic tests that are ordered under subdivision (b), subject to the
county obtaining a court order for reimbursement from the alleged
father if paternity is established under Section 7553.
(e) Nothing in this section prohibits any person who has been
ordered by the local child support agency to submit to genetic tests
pursuant to this section from filing a notice of motion with the
court in the action or proceeding in which paternity is a relevant
fact seeking relief from the local child support agency’s order to
submit to genetic tests. In that event, the court shall resolve the
issue of whether genetic tests should be ordered as provided in
Section 7551. If any person refuses to submit to the tests after
receipt of the administrative order pursuant to this section and
fails to seek relief from the court from the administrative order
either prior to the scheduled tests or within 10 days after the tests
are scheduled, the court may resolve the question of paternity
against that person or enforce the administrative order if the rights
of others or the interest of justice so require. Except as provided
in subdivision (c), a person’s refusal to submit to tests ordered by
the local child support agency is admissible in evidence in any
proceeding to determine paternity if a notice of motion is not filed
within the timeframes specified in this subdivision.
(f) If the original test result creates a rebuttable presumption
of paternity under Section 7555 and the result is contested, the
local child support agency shall order an additional test only upon
request and advance payment of the contestant.

Beastie Boy made a beastly change to his will before death

I came across an interesting article in Forbes the other day about Adam Yauch of the Beastie Boys and a change he made to his will before death.  Of course back in ’86 the Beastie Boys hit it BIG with the album Licensed to Ill which remains one of my top 5 favorite albums of all time; yes, I still call them albums.  He wrote that his name was MCA and that he had a license to kill and that it was time to get ill.  In any event, he was born and bred in Brooklyn of the USA and like a lime to a lemon he tried to write his own will… willl… willl.

His will (but not the trust the will pours over to) is a public record in the state of New York. It contained the following provision which is common for entertainers:

“Notwithstanding anything to the contrary, in no event may my image or name be used for advertising purposes.”

However, MCA, before signing the will, interlineated (added in) some extra words so that the will now reads as follows (his added handwritten provision is underlined):

“Notwithstanding anything to the contrary, in no event may my image or name or any music or any artistic property created by me be used for advertising purposes.”

It appears that Mr. Yauch may have inadvertently created a fight which could employ many lawyers to unwind. I always tell my clients not to write anything extra on their wills… and his lawyer likely told him the same. However, he also liked to put a pen to paper and write some def rhymes.

The problem gets into the difference between his public rights and his copyright rights. Mr. Yauch owned HIS publicity rights but his copyrights were owned by various entities including the Beastie Boys themselves (or a partnership by that name anyway).

Nobody knows exactly what he meant but my guess is the very publicly spiritual man probably didn’t want his likeness plastered on dozens of commercials and TV shows as so often happens (see Elvis or Michael Jackson). I have met with clients like this who just want their families to live a comfortable life on the millions he left and leave it at that. Keep things simple.  However, he potentially cut off his family’s ability to have a voice in the use of his copyrights… and since he only owned a portion of the rights those songs will keep on playing.

Like a 12 inch single with an extended re-mix this song might play a while. I will post more information when I hear it.



Getting creative in a Heggstad petition

We have talked before about the basics of a Heggstad petition. You have assets outside of a trust, after death, and want to get them into the trust without a full probate petition.  A Heggstad petition, pursuant to California probate code 850, is an incredible way to achieve this goal.

The key with a Heggstad is showing INTENT!  That is, showing that the decedent really did intend for the assets to be in the trust. This is often established by an asset being listed on an attached schedule of assets, a mention of the asset specifically within the trust, or a separate general transfer document.

However, what else can you look for?  Certainly mentioning the pour over will is a good idea as it shows intent. Another idea I was able to employ recently in a Heggstad petition was looking at the decedent’s written wishes given to the estate planning attorney. The attorney, unfortunately, failed to follow those written wishes. However, luckily the widow has hired me to clean up the mess left behind by the former attorney.

I am liking the chances of success as the decedent wrote his wishes in his own handwriting. It clearly shows written INTENT to get the assets into the trust.

If you want to discuss your post-mortem trust funding situation with a qualified Heggstad attorney call me!  -John

Competing Petitions in Probate

If a probate case has been filed and you want to contest it and/or you have additional information to provide the Court you will often file a COMPETING PETITION.  For example what if the first petition shows there to be no will but you know you have a valid and original will!? That’s a great opportunity to file a competing petition.  Here are a few nuances to keep in mind:

1) In most counties you use the same case number as the first petition.

2) You want to prepare your objection to the first petition first and foremost so that first petition does not get approved.

3) You want to prepare your own petition for probate and label it “COMPETING” just above the box that indicates the type of petition.

4) Your competing petition is a brand new petition so you need to publish, send out notice, and file all documents just like a brand new probate… and pay your own filing fee too!

5) Typically the first petition will be continued to the competing petition’s Court date… but, of course, you need to verify this happens.

6) In most counties, if not settled,the matter is sent to mediation to resolve. Since that takes some time it may be advantageous to get a special administrator appointed on an ex parte basis to handle the estate in the interim. This will often be a professional fiduciary.

7) If the matter is not resolved at mediation then a trial will be held to determine which petition should be granted. This is the true competing petition stage.

8) Then move forward with a regular probate….

Good luck.  -John

5 Steps to selling a house in probate

Selling real property in probate can seem totally over-whelming. What does one do!? Where do you start?  OMG!  People have these feelings and then do nothing.  Today let’s break it down to five simple steps:

1) Select a qualified California probate lawyer.  Yes, I am one with excellent qualifications and I work throughout California. However, you don’t have to pick me. You just need to pick some one who is experienced as a probate lawyer.  Do not select one that dabbles in probate though. Find an EXPERT!

2) File for probate and get Letters Testamentary (or Letters of Administration).  You can’t sell a house before you file so get your probate filed and get your LETTERS!

3)  Sign a probate listing agreement.  You can’t sell the house without a probate listing agreement so get it signed with a qualified Realtor.

4) Find a buyer. It can be difficult to find a qualified buyer who can borrow money to buy the house. So make sure you have an experienced Realtor who knows what to look for.

5) Send your notice of proposed action (or get court confirmation if required in your case). Do not allow escrow to close without taking one of these steps. Without it you will be on the hook if someone decides the house didn’t sell for enough.

There are, of course, many more steps but these are 5 crucial ones to keep in mind!

Ratings and Reviews

10.0John Bernard Palley
Wealth Counsel Member
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