Dec 04, 2019
Iguana Trust? Ferret Trust? Parrot Trust? Are Pet Trusts a Thing & Do You Need One?
Dec 04, 2019
By Carrie Ann Colton, Esq.
We are no longer dog or cat owners: we are dog or cat parents! Long gone are the days of doghouses in the distant backyard. Our pets live inside with us, in extravagant surroundings, lavished with toys, ensembles for all seasons, and their own Christmas stockings hanging on the mantle. They have salon days, grocery shop with us, attend soccer games, and are now an integral part of our family.
Historically in California, the law treated pets no differently than any other personal property. The beloved Labradoodle was just like the china, Wagoneer, or Tahoe vacation home. At best, it might be gifted to someone, maybe along with money to be used toward care. Then came…the animal rights movement. Around the 1990s, states began to enact laws that made it easier for people to leave assets for the care of their pets, California included.
So, how does this work? In the past, though you could designate a person in your will to care for your pet, probating a will is often extremely time consuming, making a will an impractical vehicle to provide care for your pets as they need immediate attention upon your passing. Furthermore, even if you were fortunate enough to have a family member or friend who would informally agree to care for your pet, they would be under no legal obligation to do so. Can a pet be a beneficiary of a trust? Even now, pets are still considered to be property and therefore cannot be named as a beneficiary.
What’s a modern-day pet parent to do? Create a pet trust!
California Probate Code sections 15211 and 15212 allow for the creation of a pet trust for the duration of your pet’s lifetime. Setting up a pet trust involves several decisions:
- Identify a trustee. This is the person who will monitor and safeguard the trust’s finances and ensure your pet is cared for in the manner you designate in your trust. You want this to be a person who is devoted and agrees to meet these responsibilities for the remainder of your pet’s life. It is always wise to also designate a successor trustee in the event the original one becomes unable to meet the obligations.
- Determine how you will fund the trust. First, calculate the amount of resources you believe your pet will need (including, of course, the luxuries you may want for your pet) for the duration of its lifetime. These items may include food, toys, collars, crates, waste bags, beds, veterinary care, boarding funds for when your caregiver is unavailable, grooming, pet daycare, final arrangements, etc. Next, virtually any asset you own may be used to fund your pet trust. Depending upon the set-up of your pet trust, you may open a bank account in the trust name, or simply name the pet trust as a full or partial beneficiary of real estate sale proceeds, an annuity, a retirement fund, life insurance policy, etc.
- Identify a caregiver. Ideally, you want to select someone who will take care of your pet as you would have and provide the best home. Friends, relatives, dog park buddies are all great choices, but there are also organizations that are willing to assume these responsibilities. Again, it is wise to appoint a successor.
- Identify a remainder beneficiary. The pet trust will last for the remainder of your pet’s life. Assuming the trust doesn’t run out of money, leaving Fido to the mercy of the kindness of the caregiver you selected, you will need to designate what happens to funds remaining in the pet trust upon your pet’s passing. Many folks specify charities or family members and friends. You want to avoid naming the trustee or caregiver as this creates a conflict of interest and motive to spend the least amount possible for the care of your pet so they get the leftovers.
Final Fun Facts: Leona Helmsley, real estate mogul, bequeathed $12 million to Trouble, her Maltese puppy, $12 million more than she left her grandchildren. Though a court reduced the award to $2 million (and gave some to her grandchildren in case you were wondering), Trouble still lived an opulent lifestyle with expenses that included $100,000 annually for security, $60,000 for a caretaker salary, and meals of hand-fed crab cakes and steamed vegetables with chicken. Florida millionaire Gail Posner’s Chihuahua, Conchita, reportedly luxuriated with a full-time staff, diamond studded Cartier collars, and spa treatments. I’ve even seen a house left for a caretaker to live in to provide care for the pet and maintain the comfort of the original family home to “reduce the stress experienced by the pet at the owner’s passing.”
Remember, if you will a pet and some funds to a friend or family member, they may feel obligated to take care of your pet for the remainder of its life. If you create a pet trust, the trustee and caretaker are legally obligated to care for your furry, scaly, or feathery best friend.
Carrie Ann Colton is a long-time attorney in Novato who specializes in pet trusts, people trusts, and all things labor and employment law related. And yes, she does have a pet trust for Mr. Max the kitty, as well as a trust for her two children.