ElderLaw News-The Estate Planning & Elder Law Firm, P.C. — MD, VA, DC
ElderLaw News

ElderLaw News is a weekly e-newsletter that brings you reports of legal developments and other trends of vital interest to seniors and their advocates. This newsletter is brought to you by The Estate Planning & Elder Law Firm, P.C., William S. Fralin, Esq., President., William S. Fralin, Esq., President.

Disability Planning Gone Wrong

Many families face hard questions as they decide how to manage the needs of their disabled child after death.

Often, during the parents' lives a disabled child's siblings can hold the mantle of responsibility, especially as the parents grow into their golden years. However, this harmonious family dynamic is likely to change after the death of the parents. While many caretaker siblings feel a sense of duty while their parents are alive, and express this sense of duty through the proper care and oversight of the disabled child, this sense of duty often ends when the parents are no longer in the picture. A generation ago, it was common to leave assets to the caretaker sibling in a family in order for that caretaker sibling to see that the needs of the disabled child are met. In fact, this technique was standard practice. However, with so many options available within the realm of modern estate planning it is not necessary, and somewhat risky, to give away assets directly under a moral obligation. One family in California recently experienced the downside of what can occur after the death of a parent.

The Kalfin family had two daughters: Diane was disabled and Jackie was a prominent businesswoman. At first it made perfect sense to believe that Jackie would be a trustworthy caretaker when their father died, but circumstances changed. Jackie, who received 4 million dollars outright, as opposed to in trust, decided that the money was entirely hers to do with as she wished – even though she had been told by her father to look after her disabled sister. Diane ended up suing Jackie, her own sister. The theory of her lawsuit, though, was unusual. Rather than arguing that Jackie had unduly influenced their father, she sued for breach of contract. Her theory was that Jackie had promised to take care of her, and it would take about $2 million over her lifetime to do that. She also claimed that Jackie had taken advantage of both their father (a vulnerable adult) and Diane (a dependent adult).

In Kalfin vs. Kalfin, Diane eventually won a settlement of 1.4 million dollars. However, the family inheritance was destroyed by the legal process and the actions of the allegedly trustworthy sister. The California Court of Appeals upheld the lower verdict, ruling Jackie's promise to take care of her sister was an enforceable contract.

There are many lessons from this story, but the foremost of these lessons is that disinheriting a child with disabilities and relying on another child to "take care of" them is not a reliable way to handle an estate. It might work, but there are real risks — and the cost and family disharmony resulting from litigation is almost certainly worse than what would be involved in simply setting up a trust for the child with a disability. Do you have a child with a disability? A complicated estate? Talk to the team at The Estate Planning & Elder Law Firm.


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The Estate Planning & Elder Law Firm, P.C.

The Estate Planning & Elder Law Firm, P.C. is an elder law firm. We represent older persons, disabled persons, their families, and their advocates. The practice of elder law includes estate planning, estate and trust administration, powers of attorney, advance medical directives, titling of assets and designations of beneficiaries, guardianships, conservatorships, and public entitlements such as Medicaid, Medicare, Social Security, and SSI, disability planning, income tax planning and preparation, care management, and fiduciary services. For more information about The Estate Planning & Elder Law Firm, P.C., please visit our website at http://www.chroniccareadvocacy.com.

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This newsletter is not intended as a substitute for legal counsel. While every precaution has been taken to make this newsletter accurate, we assume no responsibility for errors, omissions, or damages resulting from the use of the information in this newsletter. The Estate Planning & Elder Law Firm, P.C. thanks the law firm of Hook Law Center for their input to this newsletter.

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