Brown & Associates - Attorneys & Counselors at Law, P.L.L.C.

FINAL THOUGHTS ON ESTATE PLANNING FOR PETS
(9/8/02)

This is the last installment in a three part series on planning for the needs of your pets after you are gone. Copies of the prior installments can be found on our web site, which is listed at the end of this article.

Be Aware of the Rule Against Perpetuities

While it is Greek to many, including some members of the legal profession, the Rule Against Perpetuities limits the duration of your trust to twenty one years after the end of certain measuring lives. The measuring life must be a human being and not an animal. This can become important if your trustee or caregiver lives in another state. Be sure any Trust you create meets the rules of your state and any other state in which it may be administered.

Who gets What's Left

Be sure to name a beneficiary to receive whatever's left after your pet dies. You expect your horse to live another thirty years, but any number of things can shorten that life expectancy. If there are trust assets remaining at the death of your pet, be sure to specify who gets what. As an aside, you probably shouldn't name the trustee or caregiver as the residuary beneficiary. Not that they would do anything to cause a premature death, but you don't want to give them a financial incentive to do so. Several of the trusts I've prepared name the local chapter of the Humane Society or a similar pet oriented organization to receive these funds.

Clearly Identify Your Pet

Be sure your pet can be easily identified. Otherwise, someone can replace your deceased or lost animal with a substitute and continue receiving benefits. This sounds far fetched, but I'm told a trust was established for "a black cat" to be cared for by the deceased owner's maid. When the cat continued to live far beyond its normal life expectancy, the authorities dug into the case and discovered the maid was on her third black cat, the original having died long before.

One way is to provide a detailed description of the animal including any variations in color, scars, etc. Another is to take detailed photographs from every possible angle. Some have even implanted microchips so the animal can be scanned to verify it's the right one. You can even obtain a sample of the animal's DNA for matching in subsequent tests.

Some of these sound pretty extreme, which presupposes a risk of switching. The best defense is to select the right caregiver and trustee in the first place.

Regular Interaction is a Must

Your caregiver and trustee need to be in regular contact with one another. The caregiver will want the trustee to see he is providing quality care and the trustee will want to be sure the funds are being used to fulfill your wishes. This is a win-win situation if you select people who are compatible. One client wanted to name his first ex-wife's brother as his trustee and his second ex-wife as caregiver. The brother-in-law blamed ex-wife #2 for the break up of his sister's marriage and didn't want anything to do with her. I finally convinced him to select someone else to everyone's relief.

The trustee should conduct regular random inspections so the caregiver can't supplement food or medicine when he knows the trustee is coming. The trustee needs to observe the pet and caregiver in their normal environment to get a good feel for how they interact with one another.

Burial Plan

At some point our beloved pets are going to die. If you want your pet cremated or buried in a pet cemetery, let the caregiver and trustee know and provide sufficient funds. One client has a pet cemetery on his property where all the family pets have been laid to rest. If he goes first, he wants this tradition to continue for the pets he leaves behind. The only way to be sure this happens is to spell it out.

Are than any Alternatives to Trusts?

While I've focused solely on the use of trusts so far, there is a simpler and less expensive alternative which you might want to consider. You can gift your pet to a friend or family member and then leave her money in your Will to care for your pet. This isn't a sure fire method since there's no one to enforce your wishes and make sure the beneficiary actually cares for your pet. On the other hand, if your estate is relatively small, this approach will minimize your expense.

If your caregiver has money of her own, you can leave her a specified amount in your Will to be paid only if she takes care of your pet during its remaining lifetime. Only after the pet dies does she receive this money. Or you can leave the money to the caregiver up front so she has the means to provide for your pet, but this is riskier. It may be necessary, though, if both you and your caregiver have limited resources. In this situation, you should specify the uses for the gifted funds and name a residual beneficiary to receive any funds remaining at your pet's death. This residual beneficiary has a financial interest in making sure the caregiver uses the funds properly. You can even require the caregiver to provide an accounting to the residual beneficiary quarterly or semiannually.

A Final Alternative

If you aren't comfortable with a Trust or a gift to a named beneficiary, you have another option. You can make a gift to a veterinarian, animal shelter, or other organization in exchange for care for the rest of your pet's life. You would leave both the pet and the funds to the veterinarian or organization in exchange for the promise of reasonable care and shelter so long as your pet should live. This doesn't appeal to some clients because they dislike the idea of their four-legged companion living out its golden years in an institutional setting. If all other options fail, however, at least you have someone who loves animals caring for your pet.

If you are a pet lover and want your pet to be properly cared for when you are no longer around or able to provide care yourself, consult with an estate planning professional who can dot the "i's" and cross the "t's" in your estate plan.

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