For many people, planning for their pets’ care is critically important. Having recently acquired an African grey parrot, I realize planning is especially important for longer-lived animals. The concept of a Pet Trust is relatively new and press coverage tends
For many people, planning for their pets’ care is critically important. Having recently acquired an African grey parrot, I realize planning is especially important for longer-lived animals. The concept of a Pet Trust is relatively new and press coverage tends to focus on the trusts established by the rich and famous: Leona Helmsley’s $12 million trust for her dog Trouble, Donald Trump and Oprah Winfrey. However, many average Americans are interested in providing for their beloved pets, so this column will describe the options available to pet owners and my next column will discuss the mechanics of funding the trust and suggestions for terms to include in the trust.
The Humane Society of the United States estimates that 4 to 5 million pets are euthanized annually. While the largest numbers of animals killed each year are sick, lost, feral or abandoned animals, more than a million were destroyed as a direct result of the failure on the part of the owners to provide for their pets in the event of death or disability. It is a sobering fact that 500,000 companion animals were euthanized this year because their owners died, were moved into nursing homes or assisted-living facilities or were simply no longer able to care for them and had made no provision for them.
Why a trust is better than a will
In her will, Katherine left $10,000 to her sister, Mary, for the care of her dog, Rex. Mary cried at her sister Katherine’s funeral, then took Rex to the pound and used the $10,000 for a shopping spree. No one, including the court, could do anything about it.
Because pets are considered property, they cannot legally inherit. Katherine is not permitted to leave money directly in her will to her pet. The provision asking Mary to care for the pet with the monies left is a request and the court has no power to enforce her wishes. Additionally, a will takes effect on the death of the owner. A will doesn’t provide for the pet’s care if the owner is alive but is incapacitated and can’t care for it.
Fortunately, Hawai‘i law provides pet owners with two options: traditional pet trusts and statutory pet trusts. The traditional pet trust allows the pet owner a great deal of control over the pet’s care. Generally, the trust agreement instructs the trustee to provide for the pet by paying the beneficiary (caregiver) for the pet’s expenses according to pet owner’s directions.
The trust agreement specifies who will mange the property (the trustee), who will be the pet’s caregiver, what kind of expenses will be paid, what type of care the pet will receive, what happens if the caregiver can no longer care for the animal and the disposition of the pet after it dies.
The statutory pet trust is a basic plan and does not require the pet owner to make as many decisions regarding the terms of the trust. The state law “fills in the gaps,” and thus a simple provision in a will, such as “I leave $1,000 in trust for the care of my dog, Tessie,” may be effective.
A pet trust may be made in two ways: either while you are still alive (an “inter vivos” or “living” trust) or when you die by including the trust provisions in your will (a “testamentary” trust). Both options have their advantages and disadvantages.
An inter vivos trust takes effect immediately and thus will be functioning when you die or become disabled. This avoids delay between your death and the property being available for the pet’s care. However, an inter vivos trust often has additional start-up costs and administration fees.
A testamentary trust is the less expensive option because the trust does not take effect until you die and your will is declared valid by a court (“probating the will”). However, there may not be funds available to care for the pet during the gap between when you die and when your will is probated. In addition, a testamentary trust does not protect your pet if you become disabled and unable to care for your pet.
• Karen Baldwin received her doctor of jurisprudence from the University of Denver College of Law in 1970. Her practice is limited to wills, trusts and probate and asset protection. You may contact her at 826-7888 or email kbaldwinattny@hotmail.com with questions or comments. This column is for general information only. Your individual circumstances may change the advice given. Consult an estate planning attorney to discuss your specific needs.
