Use of a Trust is a Double-Edged Sword Wills and Probate Legal Blogs

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The convenience of amending a Trust is a double-edged sword and sometimes you end up on the side grabbing at the blade end.

[LHG_Inline_Form Alignment=”right” Image_URL=”http://www.blocher-law.com/wp-content/uploads/2017/01/inline-form-placeholder.jpg” Title=”Your Title Here” Description=”Your Description Here”][/LHG_Inline_Form]Unlike a Will which requires two disinterested but acquainted witnesses who are willing to swear under oath that the person signing the document was in his right mind, acting alone without coercion or undue influence, and of his own free will, a Trust amendment does not require a witness and many Trust amendments that I have seen have only a Notary seal, indicating that the witness is only saying that the person who signed it is the person whose name is on the document.

About a decade ago, we ran into this when a man suffering from stomach cancer, who had his stomach removed and been on a feeding tube for nearly a year was suddenly air-ambulanced back from his retirement home in Florida back to Chicago so that he could execute an Amended Trust of 38 pages. The new instrument was barely different from the one he had signed but the effect changed the trust from the 20%-20%-20%-20%-20% distribution to each of his five children to 80%-5%-5%-5%-5%. Guess which son got the 80%- the one who had the new document prepared. It took a lot of fighting and the testimony of the decedent’s treating physician and oncologist about his inability to have understood what he was signing, to undo that mess. It remains not yet resolved to this day. Guess how much that is costing in fees and costs.

Another case occurred last year: a client (from the east coast) told me that her uncle living in Chicago had executed a Will that essentially left her everything. Simultaneously, he had executed a Trust with similar terms. When he died, she inquired of the Executor and was told that she was left nothing and, no, he would not give her any documents. What was turned over was the Will which stated that it was being done for the benefit of “[the niece’s name] and her children” but then poured everything into the estate into a Living Trust. That original Living Trust again left everything to the niece. Both were executed on the same day about 28 months before his death. It turns out that about eight months later, he told his lawyer to amend the Trust and leave her nothing-giving a substantial amount to the Executor and the remainder to Charities.

After a good bit of conferencing with the charities’ attorneys, the Illinois Attorney General for charitable gifts and others, we agreed to expedite things by each requesting the waiver of attorney-client privilege and deposing the drafting attorney who, off the record, said it was his opinion that the uncle, who was dying of cancer, became miffed when the niece failed to come to visit as soon as summoned (she was caring for her own mother who had become gravely ill) and that, in a fit of pique, he wrote her out. He never advised her of this. In fact, his attorney asked him to redo the Will so that his wishes were explicitly clear, but the uncle didn’t want to spend the additional money.

Trust amendments can come when someone, like in the first example, has lost capacity, or the second, where the Trust maker has had a sudden fit of anger or even a loss of capacity (when does poor judgment rise to that level?) that is not then detected. There are no witnesses attesting that the signor was not acting under compulsion, undue influence or other negative factors.

In a case very close to me, the father, with two lawyers in the family, amended his Trust seven times without consulting a lawyer, and the result was several conflicting sections that led to ill-feeling between his children and his second wife’s children.

The ease with which very large changes can be made is troublesome. The ease with which a trust can be amended is a tool which can work for good or ill.

If you need an attorney for a Will or a Trust, even if you are not sure which one is right for you, contact the Law Offices of Nelson David Blocher at www.blocher-law.com

David Blocher

The ease with which a Trust can be amended can be an instrument for good or ill.