Probate/Wills


GENERALLY


We here at White Law Chartered did a study, once upon a time,
of all American citizens born in the year 1800. After
thoroughly examining all relevant records, we were forced to
conclude that all of them were dead. 100% of them. No
exceptions. From that study, we concluded that everyone alive
today is probably going to die. Sooner or later. Possibly even
including the author of this web page. We then turned our
studies to the “when” of it, and discovered that a lot of the
time, people did not know when they were going to die….that
death took them by surprise. We can reasonably assume that we
will not be an exception to this rule. Therefore, it is
probably wise that we all spend a little time looking into
what will happen when we die.

Whatever we do, be it nothing, or execute a will, living
trust, deed upon death, or joint tenancy deed, etc, our heirs
are likely to find themselves in probate court. As will be
seen, that is not nearly as bad as many would have you
believe, at least where our heirs don’t put up a fight. In
fact, since people have been dying for a long time now,
probate procedures are pretty streamlined. Probate doesn’t
cost all that much, provided your will is clear and your heirs
don’t get into a fight. It’s cut and dried. And if they want
to fight, there is really nothing you can do about it. You
will be six feet under or in a memory care facility. Anyone
can sue anyone. The secret is to have your death/incompetence
papers air-tight. If your intention is clear (no-one can ask
you what you meant after you die), and your heirs are of
average or better intelligence, there will probably be no
fight. Most lawyers don’t like to lose. Fights, not probate,
are expensive. As an example, White Law Chartered probated an
$800,000 estate where total probate fees (costs and attorney
fees) were less than $3,000. The heirs in that case got along.
But White Law Chartered probated another estate of, roughly,
the same size, where, due to some unfortunate language in the
decedent’s living trust, the heirs decided to fight. In that
case, our pre-and post-probate fees exceeded $100,000. His
heirs would have received much more and the last few years of
the his life much happier, had his former counsel not talked
the decedent into a living trust. We eventually won the case,
but had to go to the Nevada Supreme Court to do so.


PROBATE


Probate is the process whereby your intentions are, as
expressed in your will if you have one, or presumed by the
Nevada legislature if you do not, implemented upon your death.
The process, in brief, goes something like this:

2.1

Lodging


Assuming someone can find it, the law requires that the
original Will (not a copy) be lodged within 30 days of your
death. A person in possession of the will who does not do this
is responsible for any resulting damage.

2.2

Initial Steps


Someone usually petitions to have the decedent’s Will
“admitted to probate.” This is accomplished by attaching the
Will to a probate petition which is filed in the District
Court in which the Decedent lived at his death. If there is no
Will, the Petition seeks letters of administration. In either
case, the process ends with someone running the show. We used
to call him the Executor, or her the Executrix, but with
modern political correctness, we now use “Personal
Representative.”

2.3

Administration


After the Personal Administrator is in place, he or she goes
about noticing creditors, collecting assets and paying bills.
Various reports, including an inventory of the decedent’s
assets and an accounting of the administration must be filed
with the court.

2.4

Distribution


After the estate has been administered and creditors paid, the Personal
Representative files for permission to distribute the assets
remaining to the heirs designated in the will, or designated
by the law of intestate succession, if no will. After the
assets have been distributed, the Personal Representative
files proof thereof, and is discharged.

2.5

Set-Aside


There are exceptions to every rule, it seems, and one is that
if the probatable estate does not exceed $100,000 in equity,
the estate can be set aside without administration under
certain circumstances.  The legislature is constantly tinkering with this.

2.6

Summary


The probate process is normally fast and inexpensive. Those
who say otherwise are generally trying to sell you something.
The basic process has been being refined for centuries and we
now have it down pat, more or less. The sunshine brought about
by the probate process has prevented many a fraud and even
more mistakes. However, if there is a fight among the heirs,
you may find yourself in litigation and litigation is
expensive, whether inside or outside of probate.


WILLS


Everyone should have a Will, whether they have a living trust
or not. And it should be updated every five years or so. A
Will is a document that speaks on your death and not before.
Unlike a living trust, which, like a corporation, can only
deal with property that it owns, a well drafted Will disposes
of all your property, real, personal, or mixed, separate or
community, tangible or intangible,  including property acquired after the will is made, and regardless of where it may
be located. It can dispose of your property outright, or it
can create a trust and dispose of it to the trustee of that
trust, under such conditions as you dictate (for example, your
Will can provide that your property, or some of it, is not to
be distributed to certain heirs until they reach a certain
age, or condition). Your Will can be revoked at any time, even
if you have agreed not to do so, provided you are competent at
the time you revoke it. However, if you do so (revoke it in
breach of your agreement not to do so), the heirs under the
wrongfully revoked Will may have a claim in the probate of the
new Will. Any competent person can make a Will.

3.1

FORM WILL


A Will is your document. It can, within reason, contain most
anything you might want it to contain: instructions to your
children on how to live, instructions to your Personal
Representative to read to them your favorite poem, etc. It can
be short. It can be long. Here are a couple of rough examples
of Wills for illustrative purposes only:


LIVING TRUSTS


A Living Trust is a document that speaks now, before you die.
It creates legal relationships now, before you die. It can be
revoked during your lifetime, so long as you are competent to
do so. Be careful here as you are usually NOT the one who has
the final say on whether or not you are competent. A living
trust  normally becomes irrevocable on your death. While everyone should
have a will, the same can’t be said of living trusts. A living
trust is a separate legal entity, similar in ways to a
corporation. It speaks now, unlike a will, which speaks only
on death. This is not rocket science. The idea is that, like a
corporation, which does not die when a stockholder dies, a
trust does not die when its settlor(s) die. So, if it’s set up
properly, and funded properly, and nobody fights, a living trust can usually
avoid probate and sometimes guardianship. That’s a big “if.” And we say
“usually” here because Nevada law allows beneficiaries and
trustees of a living trust to seek to have the trust
administered by the probate court under certain circumstances
following death of a settlor no matter how well funded the
trust might be. And guardians of the person are often
necessary no matter how well drafted the living trust.
Further, a living trust doesn’t save taxes; and it doesn’t
protect assets from creditors. And, since you are basically
doing your own probate before you die, it can be a lot of work, particularly if you are still an active player, buying, selling and the like.  So,
most Nevadans don’t need (or want) a living trust. Revocable
living trusts are best used in cases of blended families or
where the grim reaper is known to be closing in. They (and powers of attorney) are also now being used defensively, to protect the Settlor and his or her assets from private professional guardianships.

Both the downside and the upside of living trusts, of course,
is that they are designed to avoid the protections of the
probate and guardianship courts. With perhaps a few
exceptions, that (avoiding probate and guardianship) is their
only purpose. Many a widow has suffered at the hands of her
advisers, following her husband’s death, for the trust process
normally occurs without the sunshine afforded by a formal
probate proceeding. Many a settlor has found out, when he
tries to cash a check, that he has been ousted from his
trusteeship by the alternate trustee designated many years ago when the
living trust was first declared. And many a beneficiary has expended
funds unnecessarily in order to force a trustee to account, something that happens automatically in probate.

A while back some clients brought in a Living Trust prepared
by one of the local living trust mills. It weighed over four
pounds. Though they had signed it several years ago, they had
no real idea what it said or how it effected their lives or
their estate. Sort of proved, at least to me, that living
trusts are more often an attorney’s best friend than the client’s.

But there are always exceptions. A few years back a doctor came in
and told us that he had cancer and was given 6 months to live.
Not all of his property was in Nevada. In fact, he had some
personal property titled in a foreign country. We set up a
living trust. The doctor and his wife were co-settlors,
co-trustees and co-beneficiaries. Funding the trust took us
almost the full 6 months, but, before the doctor died, all
their property had been conveyed to his trust. When the 6
months rolled around and the doctor died, the trust was not
really affected. Rather than two trustees, it now had only one
(his wife). After a respectful wait of a couple of months, the
wife, as trustee, conveyed all the property to herself, free
of trust. There was no probate.


Durable Powers of Attorney for Health Care


More important, perhaps, than any of the foregoing is the
Durable Power of Attorney for Health Care, sometimes called
the “Death Power.” This is a statutory form, easily available,
and basically does two things: First it tells your treating
physicians that if you are in a state where you cannot make
decisions on your own, this or that is what you want them to
do. For example: Either resuscitate me or Do Not Resuscitate
under conditions which you specify. Other details are found in
the form. The other thing most standard Death Powers do is
appoint a trusted person to advise your doctors if they have
questions. For example, under what conditions are you to be
force-fed. If Terri Schiavo had executed a Death Power, her
family would have avoided much misery and more expense. There
are other, similar, forms which perform similar functions. See
link below.