Zoom Zoom Zoom, Part 2. Which son is the heir?

Our Client is a young woman who inherited a sizeable estate when her first husband died tragically in a plane crash. She has since remarried. She has two minor children from her first marriage. Her current husband has a son from a previous marriage. She and her current husband are considering having another child.

The Trusts says in the Distribution Provisions the Estate will be divided as follows:

The client’s husband and two sons will each receive a 1/3 share of her estate. If her husband dies before she does or for some other reason can’t claim his share, that share will be divided equally between the two boys. If one of the boys can’t claim his share, his entire share goes to his surviving brother.

The Trust goes on to direct that two subtrusts be created, one for each of the sons. These subtrusts will each receive a 1/3 share of the estate. The Trust says that when the conditions and requirements for the Subtrusts are satisfied, the beneficiaries will receive full and outright distribution of remaining assets.

And here’s the real contradiction in this clause,

“If any beneficiary set forth in part (a) above (meaning the two boys) shall predecease the termination of his or her subtrust . . .
Such subtrust shall be terminated forthwith and the principal and accumulated income distributed to the surviving heirs of the deceased beneficiary.”

Huh?

Here we have a case where the distribution provisions say that if one son dies, his share goes to his brother. Under the subtrust division, if one son dies, his share goes to his surviving heirs. His brother could be that surviving heir and there would be no conflict, but in a few years, he may have a son of his own. So who would inherits? Our client’s surviving son or her deceased son’s son?

Even worse, what if the current husband dies. Who gets his share? Will it be split between our client’s two sons as directed in the distribution provisions or will it go the husband’s legal heirs as directed in the Termination of Subtrust provision? That provision directs it to go to his heirs, which is likely to be his son from his first marriage.

Probably not what our client had in mind.

More on Monday . . .

Yesterday, a new client came in to our office. She was unsure of the Will and Trust that she got a few months ago from LegalZoom and wanted to ask some questions and possibly make a few changes. After reviewing the documents, I went to the internet to see what kind of feedback I could find from customers of these services. I couldn’t find much, but I did stumble onto a blog posting from a notary public about how impressive the LegalZoom will and trusts are and what a nifty binder they come in. Classy!!

I know as estate planning attorneys we’re going to be looked at suspiciously when we argue the benefit of our services over what you will get with a document preparation service like LegalZoom. And I know that these sites make it clear that they are only providing basic legal documents, not legal advice.

This site disclaimer says it all.

“LegalZoom is not a law firm, and the employees of LegalZoom are not acting as your attorney. LegalZoom does not practice law and does not give legal advice. This site doesn’t create in attorney-client relationship, and by using LegalZoom, no attorney-client relationship will be created . . .

Instead you are representing yourself . . . .

Legal zoom gives you a set of basic questions to answer and then checks them for completeness, spelling and grammar, as well as consistency of names, address and the like. So basically, you are hiring them to give you form that you probably could find at the library and for spell checking it. At four or five hundred dollars, that’s hardly a bargain. The rest is do-it-yourself law. Study up!I’ll post later on some of the problems we found. If you have stories or information relevant to the discussion on these document providers (good or bad), we’d like to hear about it.