Folks, you can’t be too careful. Lots of good attorneys and financial advisors out there. Pick one of them. Stay away from the too-good-to-be-true guys and gals.
Happy Birthday to It
May 1, 2016 by Leave a Comment
It doesn’t look a day over . . . : The estate tax turns 100.
Estate Planning? I Don’t Have Time . . .
April 30, 2016 by Leave a Comment
Why doves cry. Half of Prince’s estate to go to government.
About that Power of Attorney
April 28, 2016 by Leave a Comment
A power of attorney gives someone else–the agent–the power to act in place of the person granting the power–the principal. A durable power of attorney is a power that continues even after the principal becomes incapacitated, hence the adjective “durable.”
If you or your attorney is drafting a power of attorney in Utah or any other Uniform Power of Attorney Act state, be careful and be very specific; make sure certain grants of power are “expressly” authorized in the document that allows the agent to act in the principal’s behalf.
To wit, Utah Code §75-5-503, signed into law in 2003, says:
A power of attorney may not be construed to grant authority to an attorney-in-fact or agent to perform any of the following, unless expressly authorized in the power of attorney:
(1) create, modify, or revoke an inter vivos revocable trust created by the principal;
(2) fund, with the principal’s property, a trust not created by the principal or by a person authorized to create a trust on behalf of the principal;
(3) make or revoke a gift of the principal’s property, in trust or otherwise; or
(4) designate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death. (emphasis supplied)
General, broad language probably won’t do. The grant in these four cases must be express because these four cases present too great an opportunity for abuse. I’ve hedged just a little here because the one Utah Supreme Court case on this point seems to leave the door open, if only slightly, to less express language, language typical of a broad grant of power.
In fact, in analyzing the language of the durable power of attorney at issue in the Burrows case, the Utah Supreme Court talked favorably about both the broad and the express grants of power:
¶ 17 The durable power of attorney expressly granted Ray authority to gift Ida’s personal property. The two-page instrument gives Ray broad authority over Ida’s assets and personal property. It authorizes Ray “ in any and every way and manner [to] deal in and with goods, wares, and merchandise, [choses] in action, and other property in possession or in action, and to make, do, and transact all and every kind of business of what nature or kind soever.”
¶ 18 More specifically, the power of attorney expressly authorizes Ray “ to gift property whether real or personal.” . . . 131 P.3rd 9 (Utah 2008)
If I were arguing this proposition before another court, I would argue like a mother bear that even the broad language does the job according to Burrows. If I were drafting the power, I would make sure the power of attorney expressly authorized each of the four powers outlined in §75-5-503, that is, if my client wanted to give those powers to his agent.
Cyber Intestacy? Yeah, There’s That.
April 27, 2016 by Leave a Comment
What happens to your Facebook, Twitter, and Instagram persona when you die? You might want to consider that question.
Gonna Be a Prince of a Mess
April 26, 2016 by Leave a Comment
Well, I guess since Prince didn’t have one, you don’t need one either . . .
Prince’s sister has said the superstar musician had no known will and that she has filed paperwork asking a Minneapolis court appoint a special administrator to oversee his estate.
Something tells me this will neither go smoothly nor end well.
The Federal Circuit Courts of Appeals and 2nd Amendment Gun Rights
April 25, 2016 by Leave a Comment
David Koppel’s got it if you want it: a complete review of federal circuit court jurisprudence on the 2nd Amendment post Heller and McDonald. Here’s the abstract:
“The Supreme Court decisions in District of Columbia v. Heller and McDonald v. Chicago left lower courts with the responsibility to flesh out many aspects of Second Amendment legal doctrine. This Article explains how the federal Circuit Courts of Appeal have done so. The Article provides a comprehensive synthesis and analysis of the Circuit decisions, covering everything from ammunition to zoning.
“Most Circuits use the Two-Step Test propounded by U.S. v. Marzzarella (3d. Cir.). Step One is to determine whether a challenged law implicates Second Amendment rights. If the answer to Step One is “yes”, Step Two is to apply some form of heightened scrutiny. In both steps, the burden of proof is on the government.
“Step Two can involve intermediate scrutiny, “not quite strict scrutiny,” strict scrutiny, or categorical invalidation, depending on various factors. All forms of heightened scrutiny involve consideration of alternatives which might be less burdensome to the right; the stringency of that consideration increases when higher forms of scrutiny are employed.
“Not every Circuit case perfectly fits with the emerging doctrinal norms. The Second Circuit, for example, has been a consistent outlier in manipulating standards of review in order to treat the Second Amendment as an inferior, second-class right – contrary to the mandate of McDonald v. Chicago. Even so, analysis of the nearly 150 Circuit Court Second Amendment cases since Heller reveals a mostly consistent methodology.”
You can read a bit more (without having to read the entire 118 page article) at The Voloch Conspiracy.
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(You Gotta) Plan to Be a Rothschild
April 24, 2016 by Leave a Comment
From Bloomberg:
“For more than a half-century, Mr. Bartley’s Burger Cottage has been a Harvard Square institution. Six days a week, college students line up around the block for creations that include the People’s Republic of Cambridge, a hamburger topped with coleslaw and Russian dressing, and the Chris Christie, which is fortified with marinara sauce and mozzarella. General Manager Bill Bartley was born in 1960, the same year his father, Joe, started the Cambridge, Mass., restaurant. Although all four of his siblings have worked there at some point in their lives, Bill is the only one still there. ‘I was groomed to take over, like a veal calf,’ he jokes. ‘They kept me in that confined area in the kitchen so I didn’t get too big.’
“Mr. Bartley’s is somewhat of a rarity: Only about a third of family-owned businesses survive into the second generation, 12 percent make it into the third, and a mere 3 percent to the fourth, according to the Family Business Institute. ‘Succession planning has become a hot item with every organization we work with,’ says Castle Wealth Advisors’ Gary Pittsford, an Indianapolis-based financial planner. ‘There are more than 27 million closely held businesses, and baby boomers are now in that 65 to 70 age bracket. There’s upwards of 5 million boomer owners trying to figure out what to do.’”
I’ve read similar statistics year in and year out, and yet family business succession planning–including succession on family farms and ranches–remains an issue. I’m guessing those who haven’t done it, but should, have two reasons or excuses: 1. I’m too busy right now, and 2. it costs too much.
In response to the first, I’d remind them, none of us have time; we’re all very busy. And that will never change, so you’re going to have to change your priorities.
In response to the second reason, I’ll repeat what I’ve said before, because it obviously needs saying again: if you think succession planning costs too much, you ought to see what it costs when you don’t do it. Remember this little fact from the quote above:
“Only about a third of family-owned businesses survive into the second generation, 12 percent make it into the third, and a mere 3 percent to the fourth . . .”
I don’t have the facts at hand, but I’ll bet those businesses that make it to the 2nd, 3rd, and 4th generations are successively much better off than the same business in the generation before.
Quote for the Day
April 23, 2016 by Leave a Comment
“An often-neglected requirement of federal crop insurance is that the insured producer maintain complete records of crop production, harvesting, disposition, and inputs. Farm clients should be advised that they are to keep records of production and marketing for each crop by insurance unit. These records are an extremely valuable asset to the modern row crop operation, as records of production may be needed to validate farming practices or the production history of an individual farm or farm operation. The failure to provide these records when requested can lead to claim denial or revision of insurance guarantees, impacting the level of protection a policy provides the policyholder.”
Grant Ballard, “Farm Clients & Federally Reinsured Crop Insurance: What Clients Need to Know,” WealthCounsel Quarterly, July 2015