Estate Planning Archives - Page 9 of 21 - Lonich Patton Ehrlich Policastri

What Is Probate?

July 12, 2021/in Estate Planning, Probate /by Michael Lonich

When a loved one passes away, you’re consumed with grief. The last thing you want to think about is how assets are divided up. Unfortunately, dealing with assets and the estate is necessary in the aftermath of one’s passing. If you’ve recently lost someone you care about, you may find yourself wondering “What is probate?” Learn what it is and how you can navigate this legal process.

What Is Probate?

Probate is a legal process that occurs after someone passes away. In this process, a court determines how that person’s assets will be divided up. It also dictates how creditors will be paid. Having a valid will can make all the difference in how this process unfolds. You may have heard bad things about probate. This usually has to do with how time-consuming and lengthy the process is. The probate process is paid for out of the estate, so the longer a case goes on, the more depleted the estate will become.

Testate vs. Intestate Wills

Testate means there is a valid will in place, while intestate means there was no will, or the will was proven to be invalid. If the will is valid, the court will use this to name an executor and follow some of the last wishes laid out in the will, if not all of them. When a person dies intestate, the assets will be distributed via California probate law on intestate succession. There will be a court-appointed representative in charge of distributing assets. Dying intestate can elongate the probate process, so setting up a final will and testament can greatly help your loved ones in the future. Regardless of whether your loved one died intestate or testate, some of the steps for probate are the same.

1. Notification

The executor named in the will or appointed by the court is responsible for notifying all creditors and heirs of the probate proceedings. California probate law allows creditors up to one year to place a claim against the estate for repayment. After that window has expired, they may not file a claim in most cases. All heirs, including the ones not mentioned in the will need to be notified of the proceedings. Any heir that sees fit has the right to contest the will. Waiting for all heirs to come forwards and for creditors to come forward is one of the lengthier steps to probate.

2. Debts & Taxes

The executor is in charge of paying off debts and taxes using the assets and estate. The executor must file both personal and estate tax returns if the estate is over a certain income. This adds time to the probate process as it generally takes the IRS 3-4 months to process estate tax returns. Any claims of debt against the estate made in the one year period after notification will need to be paid off using the estate. When an executor is named, they are responsible for the estate and its financial management. If you are the executor of an estate and need help with probate proceedings, contact our San Jose lawyer, Michael Lonich. He is an expert in estate planning and probate.

3. Assets & Division

After debts and taxes have been taken care of, and if no heirs have decided to contest the will, asset division can begin. With the help of a judge, assets will be passed on how the will lays out or how the court dictates. If an heir does decide to contest the will, probate cannot begin until these proceedings are completed. The contesting of a will can take years to resolve, which is a drain on the estate and extends the probate proceedings indefinitely.
What is probate and what steps must an estate go through for assets to be distributed? If you are an executor or an heir in a probate case and have questions about the next steps, contact our legal offices at Lonich Patton Ehrlich Policastri. We offer free 30 minute consultations – both virtually and in person. You can set your consultation up here.

What’s The Difference Between Wills And Trusts?

March 10, 2021/in Estate Planning /by Michael Lonich

Nobody likes to think of leaving their loved ones behind, but it is an inevitable part of life that we will all face. Fortunately, wills and trusts allow people to ease the burden of their passing on their loved ones.

Wills and Trusts in Estate Planning

One of the most important steps that you can take in financial planning is to develop a plan for your estate in the event of your death or inability to manage your assets. While most people don’t like thinking about estate planning, it is an essential process to guarantee that your assets are given to their intended recipients.

When discussing your estate plan, it is important to decide if you want to create a will or a trust. Wills and trusts are both legal documents that dictate how a person’s assets must be distributed upon the person’s death.

If you are wondering what’s the difference between a ‘will and a trust?’ then you are not alone. While both wills and trusts have their advantages, it is important to understand their nuances so that you can choose the route best suited for your unique circumstances.

How a Will Can Help You

A will is a legal document in which a person specifies who they want to give their assets to — the beneficiaries — and how they want their assets to be divided among the beneficiaries upon the event of their death. A will automatically applies to all property that the creator owns, excluding joint-property and property owned via a trust or covered by a beneficiary designation or certain joint ownership that transfers at death.

Wills provide the benefits of being able to name a guardian for children if they are under 18 and being able to specify funeral arrangements. Additionally, they are relatively inexpensive to create, even with the help of an estate planning lawyer.

When a person creates a will they must designate an executor – a person who is responsible for executing the tasks of distributing the property according to the legally-mandated instructions in the will. It is important to include pertinent information in the will such as bank account numbers, life insurance policy numbers, and passwords to access the accounts and make the executor’s job easier.

Unlike a trust, a will must pass the probate process before the property is available for distribution. Probate is a court hearing in which a judge determines the validity of a will. While most wills pass in probate, it may be subject to a lengthy process if there are discrepancies in the will or if the judge has other reasons to doubt its validity. Since the probate process is a public hearing, it means that the individual’s private information will also be made available to the public.

A lengthy probate process amplifies the pain and stress of losing a loved one and a mistake in drafting the will can make it susceptible to a long hearing. In order to ensure a quick probate, it is highly recommended to hire a lawyer to ensure the will is lawfully dictated, especially for individuals with high-net-worth estates.

How a Trust Can Help You

A trust is a legal document that designates a “trustee” to manage the property included in a trust. A trustee can be a person, an institution, or a group of individuals who are responsible for actively managing the assets both during the person’s lifetime and/or after their death. A trust also includes beneficiaries, who are the people that will receive the assets.

Unlike a will, a trust does not automatically include all of the individual’s property and must be actively managed. Since a trust requires active management, it may be more expensive to create. Generally speaking, a trust is recommended for people who plan to make contributions to the trust throughout their lifetime, as doing this can have financial advantages such as future tax savings.

Another advantage of creating a trust is that it allows the trustee to manage the trust in the unfortunate event of a person becoming incapacitated and unable to manage their property.

Trusts also allow the property to bypass the probate process, thus making the distribution process more smooth and keeping the individual’s information private.

How LPEP Can Help You Plan Your Estate

LPEP specializes in high-asset estate planning in the Bay Area. Proudly serving San Jose and Silicon Valley, our team of reputable attorneys serve to protect your assets. We make it our goal to develop the best plan for your individual priorities, family circumstances, and finances.

If you are still uncertain of what your next steps in estate planning should be, or if you have any further questions, please do not hesitate to set up a free 30-minute consultation with our reputable lawyers.

Don’t Wait Until It’s Too Late – Plan Your Affairs Before Contracting Coronavirus

June 24, 2020/in Estate Planning /by Michael Lonich

Often, in our busy society, people don’t find time to put their affairs in order. They think “This can wait” or “I don’t have time today.” However, death is unpredictable. Especially in the current pandemic we are living in. Many people are finding themselves ill, with the symptoms coming on rapidly and without warning. In order to stop the spread of the disease, patients who are hospitalized with coronavirus are kept in isolation. This means that a family member or estate planning attorney can’t get through to put together a will or power of attorney. A power of attorney can appoint someone to make medical decisions for you in the case of your incapacitation (something that is very likely if you contract COVID-19). You need to get ahead of this before it becomes a problem. You want to make sure your affairs are in order in the unfortunate chance you catch coronavirus.

Things to Consider

When finalizing your affairs, there are a few things you should put together before meeting with an attorney. You can, of course, put these together with an estate planning attorney if you need help, but if you can put these together yourself, you can speed up the process.

List Out Your Assets – Make a list of all of your assets. This should include any real estate or properties you own, vehicles such as cars and boats, personal effects like jewelry and valuables, and life insurance policies or 401Ks or other bank accounts. This step may take some time, but make sure you are thorough.
List Beneficiaries – Make a list of everyone you wish to leave something to. You do not have to determine who will receive what at this point in the process. Just having a list of those who you wish to leave something to will help when planning your affairs with your estate planning attorney.
Take Care of Your Children – This is a step for you to dictate who will be the guardian of your children if you have them, and how you wish for them to be raised. While a judge does not have to follow these wishes, it is more likely if you have a firm plan set in place. Coronavirus doesn’t discriminate based on age. Many young parents are contracting the illness. Make sure you have the best interest of your kids in mind when creating a will or trust.
Dictate Your POAs and Directives – There are many different kinds of power of attorney. Deciding who will make financial decisions, medical decisions or the power to sign documents on your behalf can all be laid out in an estate plan.

Wills & Trusts

Many people who are planning for the end of their life are unsure about whether or not to create wills or trusts. An experienced attorney can help explain the difference between the two and can help determine which is best for your situation. Commonly, people use them in tandem with some assets being passed through trusts and others in the will.

An attorney gestures at an estate plan as they help a client who has contracted coronavirus

Trusts are a popular way of avoiding probate. You can also dictate when the assets or funds in the trust can become available to the beneficiaries. There is even such a thing as a revocable living trust which allows you to revoke the trust while you’re alive. Wills do not have the exemption to probate but are often more practical for certain situations.

Take the first steps and start planning your affairs while you’re in good health. It’s better to be safe than sorry as we live through this deadly and unpredictable coronavirus. If you’re in the Bay Area, set up a free 30-minute virtual consultation with one of our estate planning attorneys. We’re experienced, and strive to make the difficult process of estate planning easier for our clients. You can set up your free virtual consultation here.

What Goes Into Setting Up A Last Will?

February 20, 2020/1 Comment/in Estate Planning /by Michael Lonich

The idea that you will not be around forever is never an easy truth to face, and knowing that you will leave behind loved ones makes it even more challenging.

In order to make the situation easier for your loved ones, it is essential that you take the appropriate actions to guarantee that you will leave them with their intended assets.

The most important thing that you can do to ensure that your property is handled appropriately is to create a last will. A will is a legal document that dictates who will receive your property, names guardians for your children, and even allows you to specify funeral arrangements.

Steps to Creating a Last Will

1. Do Your Research

The most important step in setting up your last will is to conduct research and do your due diligence to ensure that the appropriate legal measures are taken. These specific processes vary by state, thus it is highly recommended to conduct this process with the assistance of a qualified and reputable lawyer.

2. Aggregate Your Assets

When setting up your last will, it is imperative that you create an organized list that includes all your real estate, bank accounts, insurance policies, and retirement accounts. Make sure that all of the account numbers, answers to security questions, and any other necessary information is included.

3. Choose Your Executor

An executor of the will is the person legally responsible for ensuring that all specifications of your will are carried out, your assets are appropriately distributed, and that your financial assets are resolved.

It is highly recommended that this person receives part of your assets since they bear the responsibility of executing your will.

4. Choose Your Beneficiaries

Your beneficiaries are the people who will receive your assets upon your passing. It is important that you are specific with naming the people and stating the amounts that they will receive.

A person names their beneficiaries in their last will with the help of an attorney.

5. Name Guardians for Your Children

If you have children under the age of 18, it is recommended to make a list of at least three guardians (in order of preference) for your children if you pass away. This ensures that there are people of your choosing who will take care of your children if the first choice is unable to do so. If you have the means, it is wise to leave the guardians with financial assistance by naming them as beneficiaries as well.

6. Select a Witness to Sign Your Last Will

You must have a witness sign your will who is not a beneficiary. The number of witnesses involved and the formalities of signing vary by state. It is important that the specifications are carried through exactly as mandated or else your will may not hold up during probate

7. Keep Your Will In a Safe Location

Once your last will has been lawfully created, it is important to keep it in a safe, secure, and accessible location. It is also wise to inform a trusted person, perhaps your executor, of its locations.

Updating Your Last Will

You should always update your will after the event of a significant life event regarding:

A marriage or divorce
An acquisition of new property
The birth of a child
The death of a spouse
The sale or purchase of a business

The Bottom Line

If your estate is particularly large, you have joint custody of a property, you own a business, you own property abroad, or if you think someone may question the validity of your will then it is especially important to hire a lawyer for your last will.

Lonich Patton Ehrlich Policastri in San Jose is a reputable law firm whose lawyers make it their priority to protect your assets from an extensive probate process.

If you are living in San Jose and want to leave a legacy for your loved ones, our attorneys will help make your intentions a reality. Set up a free consultation with us.

Buy-Sell Agreement In Family Business

January 29, 2020/in Business Law, Estate Planning /by Michael Lonich

You may have heard of shareholder agreements but have you heard of the more specific Buy-Sell Agreement? This is a fundamental succession planning tool when it comes to owning and operating a business. It is especially helpful in the case of family businesses.

What Is A Buy-Sell Agreement?

Similar to how a will dictates how assets will be transferred in death, a buy-sell agreement is a legal document that dictates where an owner or partner’s share of a business will go in the case of certain life events (i.e. death, retirement, etc.)

Having an agreement like this in place protects the family business. It protects family assets so that everything stays in the family’s control and so that nothing can be transferred outside the family. These agreements can dictate the succession of ownership.

How It Protects Your Family Business

Often, for a myriad of reasons, one family member or partner will try to sell their share of the business. This can cause issues if they’re trying to sell their share outside of the family.Without an agreement in place, they can sell their share off legally despite their intentions. Setting up a buy-sell agreement means you can dictate how shares and assets are transferred or sold. You can create certain stipulations that prevent a family member from selling outside the family.

A married couple sets up precautions of a divorce in their buy-sell agreement

It can also help to have an agreement in place in case of a divorce. In California, any assets acquired during a marriage qualify as community property. This means that a spouse of the family owner can lay claim to their share of the family business. If you create a strict buy-sell document that requires the spouse to sell their share back to the company in the case of a divorce, you can prevent the share from transferring outside of the family.

The agreements are meant to be put in place in preparation of certain life events. If there is a divorce, or a retirement or a death, a plan is in place to prevent chaos. It is also great to have in place in the case of incapacitation which can include dementia or other things that prevent a person from acting in a mentally sound way or making informed choices.

Having a buy-sell agreement can assure the long term survival of a family business. Why would you not want to have that added layer of protection?

A Buy-Sell Agreement…

Ensures shares stay in the family
Creates a special space where shares can be bought and sold under dictated parameters
Identifies potential future events and conditions that trigger the agreement. These will determine what happens to that share
Determines the valuation of business shares
Specifies the source of funding for the purchase. Where does the money that will be paid in the transfer come from?

If you own a family business or a partner in one, you should consider the benefits of having a buy-sell agreement. That extra protection can ensure the longevity of your company. Live in the greater San Jose and Bay area? Set up your free consultation with Lonich Patton Ehrlich Policastri today.

How To Get Power Of Attorney In California

January 22, 2020/in Estate Planning /by Michael Lonich

There are many reasons residents of California seek out power of attorney(POA). If you have an older parent with dementia who struggles to act on their own, POA is a way to assure decisions that need to be made are made soundly. If you are being deployed, granting someone power of attorney can allow them to act for you in necessary areas while you are away. If you own a property and reside far away from it, you can grant POA so that someone who lives closer can manage your property for you. These are just a few instances in which the power of attorney becomes valuable. Most likely, you know why you need POA. The question is, how do you get it?

What Is Power Of Attorney?

POA is a legal document through which a person (aka agent) is appointed to make medical and financial decisions on a person’s (principal’s) behalf.

This seems simple in theory, but there are several types of POA, and that’s where things get a little confusing. When you add the different laws per state, things become very murky for those seeking legal help. Lonich Patton Ehrlich Policastri, a legal firm in San Jose, CA, can help clear things up for California residents by breaking down the types of POA.

What Are The Different Versions Of Power Of Attorney?

There are a few different types of POA. To get started, you need to determine which type is right for your situation.

Durable – This document allows you to choose someone to act for you financially and medically, and grants decision making power regardless of future incapacitation. The incapacitation addendum for this specific document means that even if the principal becomes incapacitated, the document will remain valid.

An alternate version of this is the Springing POA in which the document only becomes active when the person becomes incapacitated.

General – This is known as the financial power of attorney as it grants no power over medical decision making. This also differs from the durable POA because it has no incapacitation addendum. This means if the principal becomes incapacitated, the document will become void. This document is effective immediately.

A person with general power of attorney counts paper money

Limited – This document allows you to choose someone to act in your place for a specific or single duty. Once the duty is complete, the form becomes void. An example of this would be for a real estate transaction that is taking place. POA is only needed on a temporary basis for a very narrow and specific instance.

Medical – This is also known as a Health Care POA. This grants decision making power for all medical reasons. It also has an incapacitation addendum. It only grants power if the principal is unable to make decisions for themself.

What Happens Next?

So, you’ve determined which document you need. What’s next? There are a couple of legal requirements to complete a power of attorney.

The agent must be 18 years old at least and mentally sound. They should also be someone you trust and can rely on to act in your best interests.

Many people wonder if the document needs to be notarized or witnessed. Based on California law, it can be either.

You can notarize a document for little cost. Some USPS locations now have notaries onsite. While it isn’t required, it is recommended to have real estate matters notarized for solid records.

Someone setting up power of attorney has a legal document notarized

Having a document witnessed can be a little more intricate. You must have 2 independent witnesses that are adults and mentally sound. The named agent of the POA cannot be a witness. For medical POAs, a healthcare provider or employee of the healthcare provider cannot be a witness either. Once you have your two witnesses, you must sign the document in the presence of the witnesses or you must go through a process known as acknowledgment. This can be as simple as signing the document and calling the witnesses over to say “I signed this. This is my signature.”

If you live in the greater Bay area, such as San Jose, and are in need of legal advice on POA, contact Lonich Patton Ehrlich Policastri. They offer free 30 minute consultations and can help you choose the right document for your situation. Set up your consultation here.

What Does A Trust Administrator Do?

January 15, 2020/2 Comments/in Estate Planning /by Michael Lonich

There are a lot of responsibilities when it comes to being a trust administrator. Most likely, if you’ve found yourself in this position, you didn’t know much – if anything – about trust administration beforehand. That can leave you with a lot of questions. The lawyers at Lonich Patton Ehrlich Policastri can shed light on your responsibilities and guide you through the administration process.

To start with, what does a trust administrator do?

Trust administrators have a huge responsibility and little room for mistakes. This can be overwhelming. It’s good to know what kinds of duties you will be responsible for going into the process.

A trust administrator goes over the division of assets and the estate laid out on the trust

Valuation Of Assets One of the administrator’s fiduciary duties is to assess the assets in the trust and value them. Valuation allows one to determine the total worth of the trust.

Deducting Liabilities Once the assets worth has been determined, it is the trust administrator job to deduct all liabilities from the total worth. Liabilities include all costs and expenses of the trust.

Record Keeping The administrator must keep track of the trust funds, taxes paid, and all correspondence. These records must be completely transparent as beneficiaries can view them at any point, but most commonly every six months or on an annual basis.

Filing Income Tax Returns The admin is required to file income tax returns yearly for the trust. This is because trust assets are not able to be distributed tax free. However, there can be deductions. Any taxes due are paid directly out of the trust. Go here for some tips on fiduciary tax returns.

Maintaining And Monitoring Assets It is the duty of the admin to maintain the value of the trust and the assets within it. You need to keep track of spending and costs to try and maintain the worth of the trust over time. This requires you to keep track of and audit any change within the trust. This ties back into record keeping.

Updating/Informing Beneficiaries Beneficiaries must be informed of the trust and updated on the status of the trust over time. The administrator must share trust expenses among other things with all beneficiaries after the initial notice that the trust exists and they are named a beneficiary.

Safeguarding Interests This means it is the admin’s job to protect the assets against unauthorized spending or use. What is needed to safeguard an asset varies case to case. An experienced attorney can help you determine what’s right for your situation and how to best protect assets. Contact Lonich Patton Ehrlich Policastri for a free 30 minute consultation on trust administration.

Along with their fiduciary duties, trust administrators are also expected to operate under certain principles.

A trust administrator shares openly how the trust is being managed with 2 of the beneficiaries.

Good Faith This means that the administrator must be honest, open and transparent in the way they manage the trust and in the ways they benefit from it. This is incredibly important as the beneficiaries have the right to sue the trust administrator if they fail to act in good faith.

Prudence/Fairness This requires that the administrator operates under these two principles. Fairness ensures the admin avoids playing favoritism amongst the beneficiaries. Prudence requires that the admin does not make risky investments with the trust which also has a hand in safeguarding the assets.

If you’ve been named a trust administrator, it’s normal to feel overwhelmed. There is so much information and it is a huge responsibility. Reaching out to an experienced estate planning lawyer can set you on the right path and prepare you for the duties ahead. Contact Lonich Patton Ehrlich Policastri for a free consultation.

What Is A Revocable Living Trust And Why Should You Have One?

January 8, 2020/in Estate Planning /by Michael Lonich

As the holidays approach, you might be thinking about family more. You want to take care of your loved ones, and while it’s a hard subject to discuss, you need to make sure everything is prepared when something happens to you. The holidays are a good time to put your affairs in order and make sure your estate is in place so that when that time comes, your family can get through the process as easily as possible. If you know anything about probate, you probably know how time-consuming and expensive it is. A revocable living trust creates the opportunity to avoid probate and is an amazing estate planning tool.

What Is A Revocable Living Trust?

So, what is a revocable living trust? A trust is an arrangement with a third party to hold assets that will eventually be passed to a beneficiary. A revocable living trust means that the stipulations of the trust can be changed while the trustor is living and capable, as their situation evolves.

Why Set Up A Living Trust?

A lawyer and client go over paperwork for setting up a revocable living trust

In estate planning, setting up a living trust is recommended for a common reason – to avoid probate. Probate is the lengthy court process in which the passing of assets are determined by a judge. It can take months to several years depending on the case.

Many people don’t even have wills, let alone trusts. Wills are important to putting your affairs in order, but they cannot avoid probate. For assets to pass through a will, you must die first – unlike a living trust – and all assets must go through probate whether you have a will or not. Living trusts are usually able to bypass the probate process altogether, saving your loved ones time and money.

If you live in San Jose or the greater Bay area, set up a free consultation with our estate planning attorneys to learn about living trusts.

How To Set Up A Revocable Trust?

There are a few steps that go into setting up a living trust. You must set up the trust while you are alive. You will need to work with an attorney to figure out the trust’s specifications such as who assets will pass to and how they must pass.

For example, you can create a joint living trust for yourself and your spouse. If one spouse dies, the assets will pass to the living spouse, and after their death, the assets will pass to whomever you name beneficiary next in line. You can stipulate that the assets or property only pass under certain conditions such as if your daughter graduates college. This allows you to control and protect your assets, even after your death.

An attorney hands over keys to a property that was listed in the revocable living trust to the beneficiary.

After you’ve worked with an estate planning attorney to put together a trust, you’ll have to fund the trust. This requires you to place property and assets in the name of the trust. Instead of the property being under the name “John Smith,” it will be titled “John Smith, Trustee of the John Smith Trust.” Forgetting to fund your trust can result in added expenses upon your death and a lengthy process to distribute assets in probate.

Living trusts aren’t right for every situation however, so you should consult with an experienced estate planning attorney before setting one up.

Live in San Jose or close by? Contact Lonich Patton Ehrlich Policastri to find out if a revocable living trust is right for you.

What To Know When Becoming An Executor Of An Estate

September 13, 2019/0 Comments/in Estate Planning /by Michael Lonich

When an individual is appointed to be the executor of an estate, they are entrusted with many duties and responsibilities. The executor is required to act for the estate using ordinary care and diligence. It is important, especially in estate planning, to know the difference between an executor of an estate and a power of attorney.

What Is The Difference Between An Executor Of An Estate vs Power Of Attorney?

It is important when it comes to estate planning to know the difference between an executor of an estate vs power of attorney. An executor is the individual who is responsible for managing all affairs of an estate of an individual who has died. A power of attorney is an individual selected and specified on a legal document that that individual has the authority to act for another individual in legal or financial matters.

The executor of an estate is different from the power of attorney when dealing with legal matters

What Is An Executor’s Responsibility With Estate Taxes?

The executor has a fiduciary duty to pay the estate’s taxes when there is enough money in the estate available to pay the taxes. Failing to pay an estate’s taxes even negligently is a breach of the executor’s fiduciary duty owed to the estate. If it is shown that the executor caused the estate to incur unnecessary taxes, then the executor may be charged for the part of the taxes that resulted from the executor’s action or negligence.

When an executor breaches a fiduciary duty, the executor may be personally liable for the consequences of that action. However, if the executor acted reasonably and in good faith, the court may excuse the breach.

What If There Is Real Estate Or Physical Property Involved With The Estate?

It is important to remember that an estate is not strictly limited to financial assets. There may be physical property involved with an estate as well. An executor of an estate must keep track of all property that is involved in an estate. The law may include real estate property, bank accounts, cash, and even stock or bond certificates as property of the Estate. Our firm, Lonich Patton Ehrlich Policastri can help with specifications for those who have estates or are executors of an estate in San Jose or Santa Clara County.

An executor of an estate looks to the will to distribute property assets

What Are My Next Steps As An Executor In San Jose?

Paying the federal and state income taxes on the estate, including for the year the creator of the estate passed away, are only one of the many duties owed to the estate by the executor. If you have been appointed an executor or have concerns with an estate’s executor based out of San Jose, please contact our office for a consultation with our estate planning attorneys. The attorneys at Lonich Patton Ehrlich Policastri offer free 30-minute consultations.

Please remember that each individual situation is unique, and results discussed in this post are not a guarantee of future results. While this post may detail general legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.

Tom Petty’s Estate is Having a Breakdown

July 19, 2019/in Estate Planning /by Michael Lonich

Tragically, Tom Petty passed away in 2017. He left behind his wife, Dana Petty, and daughters, Adria Petty and AnnakimViolette, from a previous marriage.

Before he passed away, Tom Petty had prepared an estate plan. Upon his death, Dana was appointed as the sole trustee of Tom Petty’s entire estate. In the documents, there was a provision included that required Dana, and Tom’s two daughters, Adria, and Annakim, to participate equally in the management of the estates’ artistic assets.

Unfortunately, it turns out that Tom Petty’s estate plan was not as precisely written as the lyrics he was famous for.

The Beginning of a Long Lititgation

Adria Petty and Annakim Violette filed a lawsuit against Dana Petty for the court’s interpretation of the term “participate equally” in regards to the estates’ artistic assets. The daughters believe that the term “participate equally” would mean that Adria, Annakim, and Dana each get a vote with majority rule. Dana did not have the same interpretation of the same term.

Dana Petty responded to the lawsuit by claiming that as sole trustee, she alone has the authority to create the entity that will manage the estate’s assets and that “participate equally” applies only to management of that entity. As a result, this disagreement of definition sparked an extremely long and arduous litigation to decide what the document’s language meant.

Determining the Meaning of Language in Estate Plans

When an estate plan has terms with an unclear interpretation, it will lead to many issues including expensive litigation. The court process for interpreting an estate document can be complicated when the language used in an estate document can be interpreted in multiple ways.

Firstly, In California, to determine what the settlor intended, the court will have the express language of the document examined. If the language is determined to be clear and definite by the court, the analysis will end and the matter is settled. However, if the court believes the language to be ambiguous, the court will then consider the circumstances under which the estate was created.

Secondly, and finally, if the court determined the document’s language to be ambiguous, the court will attempt to place itself in the estate creator’s shoes. The court will exercise its independent judgment of the estate creator’s intention by examining evidence that is uncontested from outside the document. For example, the court may consider when the document was created, if there the documents were created by an attorney, and what kind of state of health the settlor was in. If that is the case, the process could potentially be excruciatingly long no matter how large or small an estate may be.

How Do I Get Legal Assistance for Estate Planning?

Involving the court in determining your wishes is costly, time consuming, and frustrating for your beneficiaries. If you are interested in planning your estate, please contact one of the experienced attorneys at Lonich Patton Ehrlich Policastri to assist in drafting your documents with the most clear and definite language possible.

Meanwhile, please remember that each individual situation is unique, and results discussed in this post are not a guarantee of future results. While this post may detail general legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.

What Is Probate?

Testate vs. Intestate Wills

1. Notification

2. Debts & Taxes

3. Assets & Division

Wills and Trusts in Estate Planning

How a Will Can Help You

How a Trust Can Help You

How LPEP Can Help You Plan Your Estate

Things to Consider

Wills & Trusts

Steps to Creating a Last Will

1. Do Your Research

2. Aggregate Your Assets

3. Choose Your Executor

4. Choose Your Beneficiaries

5. Name Guardians for Your Children

6. Select a Witness to Sign Your Last Will

7. Keep Your Will In a Safe Location

Updating Your Last Will

The Bottom Line

To start with, what does a trust administrator do?

What Is A Revocable Living Trust?

Why Set Up A Living Trust?

How To Set Up A Revocable Trust?

What Is The Difference Between An Executor Of An Estate vs Power Of Attorney?

What Is An Executor’s Responsibility With Estate Taxes?

What If There Is Real Estate Or Physical Property Involved With The Estate?

What Are My Next Steps As An Executor In San Jose?

The Beginning of a Long Lititgation

Determining the Meaning of Language in Estate Plans

How Do I Get Legal Assistance for Estate Planning?

Free 30-Minute Family Law or Estate Planning Consultation

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