Recently, I have been talking a lot to my clients about whether it should be easy to declare someone incapacitated or hard. Where this comes into play is when you have a Revocable Trust and you are Trustee. If and when you become incapacitated (unable to handle the day-to-day paying of your bills, etc.) your Successor Trustee will take over. The question is, should it be easy for your Successor Trustee to take over?
My usual answer is yes, it should be easy. I know that everyone’s knee-jerk reaction is that they don’t want their spouse, or children, or other loved-ones declaring them incapacitated and taking over when they still want to run their own lives. My response to that is, in my family, nobody really wants to take over paying my bills and managing my affairs. In my family, if they could get me to pay their bills and manage their affairs, my loved ones would gladly give this up to me!
So one cause of alarm is really not there for most of us. But what is the down side to making it harder to declare someone incapacitated? What is wrong with requiring my doctor to make that determination? The answer is one that it isn’t wrong, but it could be a problem. Doctors are not experts on legal documents-they are medical experts. They understand “incompetency” but not necessarily “incapacity.” What is the difference?
Some of my older clients can converse with you about current events, the latest family news, tell you their favorite recipes, and a whole host of other things. But they are having trouble remembering to pay the water bill or remembering to pay the taxes on a piece of property. A doctor may have trouble saying that such a person is “incapacitated” if the doctor is using the incompetency standard.
Finally, it is the bank and other financial institutions that the Successor Trustee will have to convince that they can now take over under the provisions of the Trust. If the standard is the least bit complicated and the words of the paper declaring someone incapacitated is not perfect, the bank has wiggle room to refuse to deal with the Successor Trustee. In that case, it may be necessary to get a court order to force the bank to deal with the Successor Trustee. Legal fees and proceeding are exactly what my clients who set up Revocable Trusts are trying to avoid – wasted money and hassle!
In the case of a family where interpersonal trust is an issue, maybe a physician should be relied upon. But in most cases, I say make it easy on your loved ones to care for you!