Tag Archives: durable power of attorney

What to Do When One Parent Lacks Capacity

happy father and daughterDear Liza, my parents do not have a living trust in place. I need to help them set one up. My father and mother are 91 and 83 respectively. My father has a form of dementia that prevents him from making decision about his property. My Mother is fully capable. Does my Mother have the right to make decisions about a living trust for both of them? Does my father have to sign anything?  I’m sorry that your father is no longer capable of making decisions about his property. Because your father lacks the capacity to understand the nature and consequences of his decisions, he can no longer do any estate planning on his own, even if he’s physically capable of signing his name.

Here’s my  short answer as what kind of estate planning options are available now: your mother can only create an estate plan that includes your father’s property if your father already has a Durable Power of Attorney in place that authorizes her, as his Agent, to create a living trust on his behalf. Not all Durable Powers of Attorney authorize that power, many authorize an Agent to transfer assets into a trust that’s already been created, but not to create a new one.

If your father didn’t sign a Durable Power of Attorney authorizing the creation of a trust, then your mother has two choices:

1) She can create a living trust that holds her 1/2 of the community property. She can leave your father’s property out of that trust. If he dies first, she can have his property transferred to her via a Spousal Property Petition (this is a very simple probate procedure that a surviving spouse can do), and put his property into her trust at that point. This isn’t a perfect solution, because if your mother dies first, your father has no estate plan in place.

     2) She can go to court and have herself named as your father’s conservator – this is a court procedure that, essentially, strips your father of the ability to make legal decisions and allows someone else, a conservator, to do so for his benefit under the supervision of the court. This is expensive, public, and potentially adversarial, but it’s the only way to create a Will or a trust, for someone who now lacks the legal capacity to make their own decisions.

Sorry that I can’t offer you better news, or more options. Good luck.

How Much Should A Living Trust Cost?

Dear Liza: What is a reasonable amount to pay for a lawyer to do a living trust? Here’s my rule of thumb: you should probably start by assuming that the whole process will take about 10 hours of an attorney’s time. This should include a face-to-face initial meeting to thoroughly discuss your goals, your family situation, and your finanicial assets.  The lawyer should then draft your documents, you should review them, and there should be some back-and-forth over the drafts. Some lawyers do this in a second meeting, some do it by phone or by email. Ultimately, though, you should finalize the language and get back together to sign the documents. Included in my estimate, by the way, is that the attorney will also be preparing a Will, a Durable Power of Attorney for finance, a Health Care Directive, and assist you in transferring your real property into the trust. If you are single, you can reduce the estimate to 8 hours. Since lawyer’s rates vary a lot around the country, just take my ten hours and translate that into the going rate where you live: in Northern California, where I practice, you can spend between $3000 and $5000, but in other parts of the country in could be much less.

Of course, that’s my estimate for something rather straight forward. If you need to do any planning for a child with special needs, or for parents, or have a second marriage, or have complicated assets, it can take longer.