SoCalQuestion
New Member
- Jurisdiction
- California
My question pertains to a specific distribution instruction included in my parents' revocable trust. I hope it isn' too long to be worth reading.
Background:
• My parents are about 85. They are frail and their brains have aged, but they don't have heart disease or any other disease.
• Their capacity for decision-making is questionable, and their memories are not good.
• I have a brother and a sister.
• A year ago, my parents resigned as co-trustees and appointed my sister and a bank trust officer as successor co-trustees. My sister was told she must step down because she lives in Canada, which their lawyer said would bugger things up. He didn't say how, after decades in his field of law, he did not know this originally but suddenly came to know it two weeks later.
• My brother is in the middle of a self-serving act that might be construed as elder abuse.
The specific distribution instruction [I inserted the Roman numerals I - III and refer to them later]:
Section 11.02 Specific Distribution to [my brother].
I. As soon as practicable after the death of the survivor of us, our Trustee shall distribute from the remaining trust property [address and APN] to [my brother].
II. The appraised value of this property, as determined on the date of death of the survivor of us, will be charged against [my brother's] distribution from the residuary as described herein. If [my brother] is deceased, then this distribution will lapse, and this property instead will be distributed under the other provisions of this trust.
III. Property passing under this Section passes free of any administrative expenses or death taxes. But property passing under this Section passes subject to all liens, security interests, and other encumbrances.
My brother has lived in the condo, rent-free since 2004, a benefit worth about $300,000 USD over 13 years. They granted him a one-third share (worth about $300K) around the time they last amended or changed the trust, in 2014. Neither of his two siblings has been given any share in any real estate nor free accommodation, so he's already advantaged by about $600,000 USD.
Issue #1: The property, a condominium in Canada worth about $900,000 USD, is not a trust asset. It is co-owned in three equal parts by my parents, as joint tenants, and my brother (without anything such as "joint tenant" written after his name).
Issue #2: Using what appears to be undue influence, my brother has secured my mother's promise that she will give him title to the condo now, years before either parent is likely to die.
His influence is undue because he acquired it by maligning and slandering me, to my parents, their estate-planning attorney and his staff, and the corporate trustee.
After the corporate trustee had shifted my parents' money to new accounts at his employing bank, without informing my parents, my mother happened to go to her branch of her usual bank to withdraw $200, only to be told the account was empty. My brother told her I had taken all their money. Unfortunately, she still believes that until I remind her that the trustee did it. She doesn't hold it against me, but she doesn't trust me. In the past I took her trust for granted, just as she took my trustworthiness for granted. She sees my brother as heroic for his epic sleuthing, even though she knows he discovered nothing.
My brother has power of attorney and has engaged an attorney in Canada to draw up the papers to transfer title to the Canadian condominium to himself. There are three things wrong with this:
1) If my parents run out of money, the option of liquidating a condo they don't need would be unavailable. They will run out of money, in three years, given the tragi-comic expense of $24,000 per month my brother directs the successor trustee, a 30-year-old bank trust officer, to pay a live-in senior home aide. (I am available to fill the role of live-in but that's a battle for another question.) They would have to borrow against their home, creating a debt for me and my siblings to pay, effectively for the benefit of my brother, or sell it, which would defeat my mother's intention of leaving the place "feet first," which she has vowed since the mid-1960s.
2) Item "I" will not be possible if my brother will already own the condo as sole owner. (Also, the condo isn't trust asset, although the wording suggests that my parents meant it to be, and it is subject to a provision that makes everything they own into trust property at some point).
3) There is no reason to give it to him now. It's not what my parents and their attorney deemed suitable 3 years ago, and nothing has changed except that my mother forgot entirely about the trust provision that balances out the spoils, and doesn't seem to think it matters. Even if she knew she and my father had spared him $600,000 in living costs that he might well have banked, while his sister shouldered their own living costs, and even living frugally, could not have built up a nest-egg like his in 13 years.
Two-part question:
A) Does the quoted material dictate that item II must take place after the death of the survivor of them (my parents), even if my brother had gained title to the condo years earlier? Or would his taking title now allow him to escape the $900,000+ charge against the distribution that was intended to render equal the three beneficiaries' shares of the estate?
(Sub-question: If, happily, it does not afford him that escape, but there is no residuary to charge against, does that leave his siblings SOL or could we exact $900,000 from him?)
B) Does the second sentence of item III provide an opportunity for me to take some action that would create a lien, security interest or other encumbrance that could be designed to cause Item II to take place later? Such as?
Background:
• My parents are about 85. They are frail and their brains have aged, but they don't have heart disease or any other disease.
• Their capacity for decision-making is questionable, and their memories are not good.
• I have a brother and a sister.
• A year ago, my parents resigned as co-trustees and appointed my sister and a bank trust officer as successor co-trustees. My sister was told she must step down because she lives in Canada, which their lawyer said would bugger things up. He didn't say how, after decades in his field of law, he did not know this originally but suddenly came to know it two weeks later.
• My brother is in the middle of a self-serving act that might be construed as elder abuse.
The specific distribution instruction [I inserted the Roman numerals I - III and refer to them later]:
Section 11.02 Specific Distribution to [my brother].
I. As soon as practicable after the death of the survivor of us, our Trustee shall distribute from the remaining trust property [address and APN] to [my brother].
II. The appraised value of this property, as determined on the date of death of the survivor of us, will be charged against [my brother's] distribution from the residuary as described herein. If [my brother] is deceased, then this distribution will lapse, and this property instead will be distributed under the other provisions of this trust.
III. Property passing under this Section passes free of any administrative expenses or death taxes. But property passing under this Section passes subject to all liens, security interests, and other encumbrances.
My brother has lived in the condo, rent-free since 2004, a benefit worth about $300,000 USD over 13 years. They granted him a one-third share (worth about $300K) around the time they last amended or changed the trust, in 2014. Neither of his two siblings has been given any share in any real estate nor free accommodation, so he's already advantaged by about $600,000 USD.
Issue #1: The property, a condominium in Canada worth about $900,000 USD, is not a trust asset. It is co-owned in three equal parts by my parents, as joint tenants, and my brother (without anything such as "joint tenant" written after his name).
Issue #2: Using what appears to be undue influence, my brother has secured my mother's promise that she will give him title to the condo now, years before either parent is likely to die.
His influence is undue because he acquired it by maligning and slandering me, to my parents, their estate-planning attorney and his staff, and the corporate trustee.
After the corporate trustee had shifted my parents' money to new accounts at his employing bank, without informing my parents, my mother happened to go to her branch of her usual bank to withdraw $200, only to be told the account was empty. My brother told her I had taken all their money. Unfortunately, she still believes that until I remind her that the trustee did it. She doesn't hold it against me, but she doesn't trust me. In the past I took her trust for granted, just as she took my trustworthiness for granted. She sees my brother as heroic for his epic sleuthing, even though she knows he discovered nothing.
My brother has power of attorney and has engaged an attorney in Canada to draw up the papers to transfer title to the Canadian condominium to himself. There are three things wrong with this:
1) If my parents run out of money, the option of liquidating a condo they don't need would be unavailable. They will run out of money, in three years, given the tragi-comic expense of $24,000 per month my brother directs the successor trustee, a 30-year-old bank trust officer, to pay a live-in senior home aide. (I am available to fill the role of live-in but that's a battle for another question.) They would have to borrow against their home, creating a debt for me and my siblings to pay, effectively for the benefit of my brother, or sell it, which would defeat my mother's intention of leaving the place "feet first," which she has vowed since the mid-1960s.
2) Item "I" will not be possible if my brother will already own the condo as sole owner. (Also, the condo isn't trust asset, although the wording suggests that my parents meant it to be, and it is subject to a provision that makes everything they own into trust property at some point).
3) There is no reason to give it to him now. It's not what my parents and their attorney deemed suitable 3 years ago, and nothing has changed except that my mother forgot entirely about the trust provision that balances out the spoils, and doesn't seem to think it matters. Even if she knew she and my father had spared him $600,000 in living costs that he might well have banked, while his sister shouldered their own living costs, and even living frugally, could not have built up a nest-egg like his in 13 years.
Two-part question:
A) Does the quoted material dictate that item II must take place after the death of the survivor of them (my parents), even if my brother had gained title to the condo years earlier? Or would his taking title now allow him to escape the $900,000+ charge against the distribution that was intended to render equal the three beneficiaries' shares of the estate?
(Sub-question: If, happily, it does not afford him that escape, but there is no residuary to charge against, does that leave his siblings SOL or could we exact $900,000 from him?)
B) Does the second sentence of item III provide an opportunity for me to take some action that would create a lien, security interest or other encumbrance that could be designed to cause Item II to take place later? Such as?
