As one ages, I suspect that it is inevitable that one thinks to one's legacy. or in this case, one's estate. I was thinking of this the other day as I enjoyed my weekly coffee with a former colleague. She shared her story which I find illuminating and so I would like to share it here.
Jo, not her real name, was one of three siblings who grew up on a decent house, on a large lot in what became over time an exclusive and highly desirable suburb in what became a very affluent city. She left for college, married and moved to a different state and did not return to her hometown other than for reunions, Thanksgivings and so on.
As time's arrow flew, her parents needed more support and ultimately care. Her younger brother, the youngest in the family, had stayed in the nest until his 20s, and then in the same city. Her middle brother had also left the city and was living in another state.
Jo's father died but, as she was travelling, when the news reached her she could not return in time for the funeral. Then her mother fell ill and she went back to see her for the last time. Literally, because her mother died a couple of days later.
Jo stayed for the funeral, her middle sibling also came back, and the three of them had a post-interment meal. During this, she later realised that her siblings were almost rubbing her hands with glee as they spoke of "the estate" but at the time, she did not.
A few months later, she received a letter from the probate attorney. Apparently, being the only sibling in the same city as her parents, her brother had had himself appointed Power of Attorney. When she commented on this to the middle sibling, this action was defended as being logical or reasonable.
The letter also revealed that baby brother had "borrowed" $200.000 for a disastrous real estate investment which he had not paid back. Worse, he had entered into a partnership with a developer to subdivide the lot, demolish the family home, and build two town homes. This had collapsed, the title of the new lots had gone to new purchases and their payments had covered the construction debts.
So a house and land worth then $1.2 million or so, today around $6 million, produced an estate of zero. Jo's parents had grifted and grafted and saved for 40 years to leave their children and grandchildren something valuable, all for ought. She never found out if all that money really had legitimately been spent, or why the "borrowed" sum had not been re-paid.
Jo complained to both siblings and both responded, "You weren't here" and all was logical or reasonable. She pointed out that she had never been informed or consulted. Same refrain. She also said that the property would have been better kept for the next generation, and rented out. Same.
So Jo spoke to her own attorney. Guess what. All horribly illegal. Her remedy? Sue her brother who was a financial failure and had nothing to forfeit. He said he was confident Jo would win, but (a) legal fees would be hers to bare (b) her brother had no assets (c) proving the middle sibling was involved would be at best complicated and (d) suing her brother was suing her brother.
The lesson? Do not give a beneficiary power of your assets. A neutral party has no vested interest. An attorney for example has a fiduciary duty. I have heard somewhere that when a will appears, so do family disputes; a disinterested arbiter can help smooth things, and even prevent iniquities such as what happened to Jo.
*Please leave your comments and queries below.*
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