Our law firm offers proactive, sensitive and caring legal representation in a range of legal matters related to Conservatorships, Probate, Estate Planning including Wills and Trusts, Trust Administration. Our goal is to relieve your anxiety and stress by providing the information and guidance you need in order to help plan for your future, the future of a loved one, or to assist you as conservator, or in the administration of a decedent's estate or Trust. We pride ourselves on our high level of integrity. The foundation of our client relationships is based upon our dedication to expert legal services, understanding of the law, and compassion and respect for our clients. Our individual care and attention affords the assurance that you are not alone and will not be regarded as "just another case."
We are experienced at setting up wills, trusts and handling complicated estate planning.
Estate planning can guarantee your family’s continued well-being in the event of your illness, incapacity or death. But it involves more than writing a will. The attorneys at Malhotra and Malhotra can help arrange trusts, as well as powers of attorney and healthcare directives and, if necessary, go to court to argue your side in a will dispute.
A Will or Last Testament
A will is a legal document in which you control who is to receive your assets upon your death. No matter who prepares your will, it must be executed in a manner prescribed by law. Failure to do this may invalidate the entire will. You can designate either individuals or institutions to be the beneficiaries. Your will is administered by someone (or institution) you choose, called an executor. After your death, the executor manages all your affairs, including the disposition of your possessions according to your wishes. In your will you may also name the guardian of your minor children, and make specific gifts to individuals or charities.
A Living Trust
A revocable Living trust, also known as a "living will" or "family" trust, is a written agreement between yourself, the trustor, and whomever is to manage the trust, the trustee. In a revocable trust, you give the trustee the right to manage your assets; set forth the provisions for the trustee to follow; and name the beneficiaries of your estate after your death. It may be amended at any time, even revoked, as long as you remain competent. Because a revocable trust allows you to set forth how your assets are to be managed, it avoids having to have a conservator appointed by the court. It also avoids the necessity of a probate action after your death.
A trust is a legal entity created to hold and manage certain assets (the res) for the benefit of a person or people (the beneficiaries). The trustee is the person or entity in charge of administering the trust. The trustee has three primary duties to the beneficiaries: the duty of loyalty, the duty of care, and the duty of obedience.
The first duty is the duty of loyalty. A trustee must put the beneficiaries’ needs and interests before the trustee's own interests. This also means that a trustee must put all of their reasonable efforts towards advancing the beneficiaries interests. This prohibits things like self-dealing, theft, embezzlement, misappropriation, and similar wrongs.
The second duty is the duty of care. The duty of care means that the trustee must act as a reasonably prudent person in a similar situation. In real world situations, this means the trustee must act reasonably. A trustee cannot make badly-informed decisions, or make decisions based on information that a reasonable person would reject. For example, a trustee that knowingly invested the trust's assets into bad investments and ended up losing the entire investment could be liable for breaching the duty of care.
The third duty for the trustee is a duty to remain true to the trust documents. This is sometimes called the duty of obedience. It means that the trustee is to follow the documents as they are written, not as he or she thinks they should be written. If the trustee believes that changes should be made, they may speak with the trustor (if the trustor still lives), or seek appropriate court authority.
Probate is a court proceeding utilized to supervise the transfer of your assets to your heirs and beneficiaries. It is also a process to determine who is entitled to receive distributions of your
property either under your will or according to the laws of intestate succession (if you die without a will). If you die with or without a will (and without a trust or other probate avoidance
device), and the fair market value of your probatable assets are worth more than $150,000 at the time of your death, it will be necessary for a probate proceeding to be initiated to transfer your
assets to your beneficiaries (if you have a will) or heirs (no will) as determined under the laws of intestate succession according to a statutory order of priority
(generally spouse, children, parents and so on).
The purpose of a probate is to legally transfer title and ownership of the assets of the decedent to the heirs under court supervision.
For example, if you died and owned a home in your name alone, your beneficiary would need legal documentation indicating ownership in the event they wanted to sell the property. No one could legally sign your name to a deed that would convey the property to the new owners. Bank accounts, stocks, bonds, etc., would also be unavailable to your heirs. Dividend checks or other monies owed to you may still arrive in the mail, but no one would be able to cash them.
Many of the costs and fees associated with probate proceedings are based on the fair market value of property you owned at your death regardless of any liabilities on the property such as mortgages and other debts. For example, let's assume the only asset in your estate was a home you own with a fair market value of $500,000, and that home has a $450,000 mortgage note on it when you die. The personal representative's commission, the attorney's compensation and the probate referee fees will all be based on the $500,000 amount. It is conceivable that much of the $50,000 equity in the home will be consumed by the fees and costs leaving little if anything for your beneficiaries.
Normally, whomever you nominated in your will as executor files a petition for probate asking the court that he or she be appointed. The original will is filed with the petition, and notice of the petition is sent to all the heirs and/or relatives to let them know that the petition has been filed and when and where the hearing will be held.
If you die without a will, the Probate Code provides a list of persons who have priority to petition the court to be appointed administrator.
Any "interested person" may begin the probate process. "Interested person" generally means any heir, relative, or creditor of the decedent. If more than one person initiates the probate asking to be appointed, the court will decide who to appoint as administrator based on the
statutory priority schedule. Whether the person named in your will is appointed executor or an administrator is appointed because you die without a will, we use the term Personal Representative to refer to the person appointed to handle the duties of the probate administration.
The petitioner must arrange for the Notice of the Petition for Probate to be published in a newspaper of general circulation where the decedent was domiciled at the time of death.
Any objections to the appointment or issues regarding the validity of the will may be brought at the time of the hearing. An interested party may contest the probate, or the validity of the will
at any time within 120 days after the will has been admitted to probate. If there are no
extraneous matters and the executor's appointment is accepted, the judge will sign the Order for Probate and Letters will be issued to the personal representative.
Unless you died with a will and the will waived bond, your personal representative will be required to arrange to post a bond and pay premiums to the surety until the probate is complete.
The personal representative must locate creditors, pays bills, file tax returns, and manage the estate assets. He or she must complete an Inventory & Appraisal form which adequately describes each asset and file the form with the court. State law requires a change of ownership form be sent to the assessor's office in each county the decedent owned real property within 150 days from death or when an Inventory and Appraisal is filed.
The court appoints a probate referee, who appraises these estate assets (other than cash) and determines the fair market value as of the date of death. Probate referees also receive a fee based on a percentage of the assets that have been appraised.
Your personal representative must send a notice of the probate to all reasonably ascertainable creditors. Creditors are required to submit their claims against the estate within a four-month period, provided they have been properly notified of the probate. The personal representative will approve or reject in full or part or each claim filed with the court.
After all the duties of the personal representative have been completed, he or she is required, in most cases, to prepare and submit an accounting and report of the executor's activities for
approval to the court.
The petition will request permission to pay attorney and representative compensation and to distribute the remaining estate to the heirs. If this petition is granted, the estate administration is completed by distributing the assets to the heirs, paying closing costs and compensation. If the estate administration cannot be completed within one year, a status report including an up to date accounting must be filed with the court explaining why the estate cannot be closed. A status report is required annually until the probate is completed.
When an adult cannot care for himself or herself and/or manage their own finances, a probate court can appoint another person to take protective responsibility. This creates a “court ordered Conservatorship” (also called a “Probate Conservatorship”) between the protected person (the “Conservatee”) and the responsible person (the “Conservator”). Conservatorships are a last resort, when proper estate planning did not take place and when a senior has not made plans to have someone make decisions for him or for her.
A Conservatorship is a formal, legal authorization for the Conservator (typically a spouse or domestic partner, a family member, close friend, or a hired professional) to make decisions for the benefit of the protected person (“Conservatee”). Because a Conservatorship restricts the Conservatee’s powers over their personal care and financial decisions, it is particularly useful when the protected person is mentally or physically unable to understand and accept help, or is vulnerable to predators who would take financial advantage of them.
A conservatorship can prevent a vulnerable person (protected person) from marrying, contracting with, or transferring money, property or any other assets to someone else without the approval of the Conservator and in some closely supervised situations, approval of the court.
When someone is no longer able to handle his or her own financial and/or personal affairs, the court can appoint an individual (the “Conservator”) to act on behalf of
incapacitated person (the “Conservatee”). The judicial procedure for this appointment is referred to as a Probate Conservatorship. The establishment of a Probate Conservatorship restricts the Conservatee’s powers over financial and/or personal care decisions.
If you are contemplating becoming a Conservator to help a spouse, parent, family member or friend, you need to decide if you are going to make application for “Conservatorship of the Person,” “Conservatorship of the Estate,” or both. You must file a Conservatorship Petition for either or both. If you are a Conservator of the Person, you are responsible for seeing that the Conservatee has proper food, shelter and health care. If you are Conservator of the Estate, you are responsible for taking care of the finances of the Conservatee, including overseeing all of the Conservatee’s assets – including any real estate owned.
Petitioning for a Conservatorship
To become a Conservator, one must formally petition the court with a Conservatorship Petition and include detailed documentation, including confidential personal and health information about the proposed Conservatee, a “physician’s capacity declaration” of the Conservatee, confidential information about the proposed Conservator, and more.
Once your petition is filed with the Probate court, a court investigator is appointed to make a home visit and interview you and the proposed conservatee. The investigator reports his or her findings back to the court.
The court will set a hearing, where the judge determines whether or not the conservatorship is required and what types of special powers may be granted to the conservator. The Conservatee has the right to a jury trial if he or she desires one. Many seniors with early stage Dementia or Alzheimer’s will sometimes become lucid and insist that they do not want help.
If the tentative, or proposed Conservator can prove to the court that an emergency exists, he or she may obtain an expedited Temporary Conservatorship. With the power of a Temporary
Conservatorship, the Conservator can provide the Conservatee with
immediate personal or health care maintenance or support (for a “conservatorship of the person”), or would obtain the power to protect his or her property from loss or injury (for a “Conservatorship of the Estate”). The Temporary Conservator serves for a limited time, pending the determination of the main, slower-progressing, normal petition.
Limited Conservatorships are available for persons who have a developmental disability and who only need help with certain, specific aspects of their lives. If the Conservator is petitioning to be a Limited Conservator, he or she will petition for the right to perform certain, specific duties. If appointed, the Limited Conservator will have the power to take care of only those aspects of the Conservatee’s life and financial affairs which will be clearly specified in the court order. The Conservatee retains all other legal and civil rights beyond and outside of the court order.
Who can Petition to become a Conservator
According to the California Probate Code Section 1820 (a), a petition for the appointment of a Conservator may be filed by any of the following:
1.The proposed Conservatee.
2.The spouse or domestic partner of the proposed Conservatee.
3.A relative of the proposed Conservatee.
4.Any interested state or local entity or agency of this state or any interested public officer or employee of this state or of a local public entity of this state.
5.Any other interested person or friend of the proposed Conservatee.
Durable Power of Attorney
A power of attorney is a written instrument in which, a person, referred to as the principal, appoints another person, the agent or attorney-in-fact, to act in place of or on behalf of the principal. Powers of Attorney and Advance Health Care Directives are important components of a well drafted estate plan.
Typically, the durable power of attorney for financial management is used to provide for continuing management of assets in case of possible future incapacity. The general Durable Power of Attorney is immediately effective unless you indicate otherwise. You may want your Durable Power of Attorney to take effect only upon your incapacity and you would thus indicate this in the document. This is called a ‘springing’ Power of Attorney as the authority of your agent ‘springs’ into being on the happening of an event, namely, your incapacity.
A durable power of attorney must contain the words: “This power of attorney shall not be affected by subsequent incapacity of the principal” or “This power of attorney shall become effective upon
the incapacity of the principal”, of words showing a similar intent. If the power
of attorney does not contain these words, it is non-durable and is terminated if the principal becomes incapacitated.
The power of attorney for financial management may be very general and grant the agent broad authority, or the principal may limit the agent’s authority specifically in the instrument creating it.
Your Power of Attorney may allow your agent to make your mortgage payments, collect money due to you and deposit it in your bank account, pay your bills, and even keeping your business running. These
can be extremely powerful documents and great care
should be exercised in their use.
It is very important that the powers contained in your Power of Attorney are coordinated closely with the provisions of your trust and other documents making up your estate plan. If you become incapacitated and you do not have a comprehensive estate plan which includes a Trust and Power of Attorney, a court proceeding may need to be initiated to appoint one or more people to act on your behalf as a guardian or conservator.
Have questions or would like to make an appointment? Call us at 562 806-9400 or use our contact form.