pet trust basics

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The Colorado Lawyer | May 2008 | Vol. 37, No. 5 49

People have attempted to bequeath property to their com-panion animals for many years, often by setting up a pettrust. A pet trust may be either a provision in an already es-

tablished trust or its own separate trust.This article provides an overview of the basics of pet trusts, in-

cluding history and drafting considerations. Although the funda-

mental elements of a pet trust are essentially the same as for anytype of trust, the attorney must be aware of questions to ask andcircumstances to consider during the drafting process.Thoughtfulplanning and drafting will help provide for the future protection ofa clients pets, also commonly referred to as companion animals.

History of Pet TrustsPet trusts gained nationwide exposure in August 2007,when the

story of Leona Helmsley leaving a $12 million trust fund to herdog,Trouble, hit the papers.1 However, she was not the first toleave funds to care for an animal.

The following is a provision, taken in part,f rom a 1932 will:

I authorize and empower my Executor or the successor Trusteeof my estate to retain any part or portion of my estate as long ashe or she shall consider it to be for the benefit of my estate to doso and to provide for the care of my pet animals while they live.2

Historically, such bequests may have failed, despite a clear intentby the testator to provide for the companion animals. These be-quests failed for several reasons. Animals are classified as personalproperty and thus cannot be beneficiaries. The measuring livesused to validate bequests where the rule against perpetuities appliesmust be human lives.3 Finally,a trust must have a human designat-ed to enforce it.

In 1932, a New York court stated:

It is primary that a portion of a human life is to be consideredas a life in computing lives in beingwithin the terminology ofthe statute, wherefore, the argument which has been advancedthat the lives of cats and dogs are commonly known to be ofshorter duration than those of human beings,possesses no rele-

vancy to the determination.It is a matter of common knowledge

that such domestic animals frequently live to ages of ten or be-yond, and it would be absurd to assert that any measuring lifewhich might extend for a period of ten years beyond the deathof the testator, or even for an appreciable fraction thereof,wasan inconsequential limitation.4

Twenty years later, another New York court reached a similar re-sult,concluding:

the provision for the care of the testatrixs companion animalswas a condition subsequent,which could not operate to disturbthe vested interests of the beneficiary . . . [and] . . . since the con-dition is based on the lives of several animals, it clearly is voidunder the statute against unlawful suspension of the power ofalienation.5

Development of Colorados Pet Trust StatuteOver time, the law began to recognize that people may want to

ensure the care of companion animals who outlive them or in theevent of disability or extended absence.In 1996, New York becamethe seventh jurisdiction to pass a pet trust statute.6 Like the New

York statute,an Arizona statute validates trusts for the care of des-ignated domesticor pet animals; however, the trust terminates

when no living animal is covered by the trust.7 However,unlike theNew York statute, it does not provide an alternative terminationdate of twenty-one years.8As of 2007,thirty-nine states had someform of pet trust statute on the books.9

TRUST AND ESTATE LAW

The Basics of Pet Trusts forEstate Planning Attorneysby Gabriela N. Sandoval

Trust and Estate articles are sponsored by the CBATrust and Estate Section. Topics include trust and estate planning and administration, probate litigation,

guardianships and conservatorships, and tax planning.

Article Editors

David W. Kirch, of David W. Kirch, P.C.,

Aurora(303) 671-7726, dkirch@

qwest.net; Constance D. Smith, of

Rothgerber Johnson &Lyons LLP

(303) 623-9000, [email protected]

About theAuthor

Gabriela N. Sandoval is the sole member of the Rocky Mountain Legal Center for Child & Animal Wel-

fare. The practice focuses on issues affecting children and animals. The Center is located in Denver

and Gabriela can be reached by phone at (303) 954-4580 and by e-mail at gns@childandanimalaw.

com. Visit the Centers website at www.animalawyer.com. The Rocky Mountain Legal Center for Child

& Animal Welfare is not a public legal aid agency or charitable legal services organization.

Pet trusts, which are intended to provide funds to care for companion animals after the death or incapacity oftheir owners,are becoming increasingly popular in the United States.Thus, estate planning attorneys should be-come familiar with the history, purpose, functionality,and limitations of pet trusts, in an effort to effectivelycounsel clients interested in establishing such trusts.

Reproduced by permission. 2008 Colorado Bar Association,37 The Colorado Lawyer49 (May 2008). All rights reserved.


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50 The Colorado Lawyer | May 2008 | Vol. 37, No. 5

The Colorado pet trust statute10was enacted in 1995. Colo-rados pet trust statute is quite broad.It validates trusts for the careof companion animals, as well as their offspring in gestation atthe time the designated animal becomes a present beneficiary ofthe trust.11 It expressly permits introducing extrinsic evidence todetermine the intent of the transferor.12The statute also allows thetrust to remain in force until the death of the last animal covered bythe trust,which could be many years for a long-lived species.

The pet trust must name a caretaker who will take responsibilityfor the care of the animals, and a trustee who will manage thetrusts funds.13The trust instrument should contain language ex-plaining the limitations and responsibilities of the settlor, thetrustee,and the caretaker.

The trust instrument should specify when the trust will termi-nate.Termination can occur on a certain date or on the death ofthe last animal beneficiary.14

The trust should designate remainder human beneficiaries orcharitable organizations to receive the trust estate after the settlorsdeath and the deaths of all the animal beneficiaries. It also shouldprovide for distribution of the remainder of the trust fund after allanimal beneficiaries die.

The pet trust must be registered as required by the trust admin-istration statute.15 In Colorado, registration of a revocable intervivostrust (including a pet trust) is not required until the grantorcan no longer revoke the trust. Registration is not required if alltrust assets are distributable outright to the beneficiaries.16Thetrustee should sign an Information of Trust Registration,whichshould be sent,along with a copy of the Registration Statement,tothe primary and secondary caretakers.17

Types of Pet TrustsLike other trust instruments,pet trusts can be inter vivosor tes-

tamentary and, thus, part of a will. Both types of trusts offer ad-vantages and disadvantages,which are discussed below.

Inter VivosTrustsThe person creating an inter vivos trust is referred to as the sett-

lor and serves as or designates the initial trustee.The settlor namesa successor trustee and a caretaker. On the settlors incapacity,res-ignation, or extended absence, the successor trustee immediatelytakes control of the funds.Essentially, the successor trustee and thecaretaker are on standbyuntil needed. Moreover, the inter vivostrust can be effective during the settlors lifetime.This helps ensurethat the companion animals covered by the trust are cared for inthe event of incapacity or extended absence.

As with other trusts,the inter vivos trust can be made revocableby including language to that effect in the trust instrument.How-ever, if there is no set date for the successor trustee to begin act-ingif, for example, that occurs when the settlor becomes inca-pacitatedthere may be a question of when the client lacks capac-

ity.Litigation on this issue can be avoided by providing a clear defi-nition of incapacity in the trust instrument.The practitionershould discuss the clients wishes when drafting the definition.Forexample, the settlor may want incapacity to occur: (1) when heor she moves into a nursing home; (2) on notice to the trustee froma specified family member or a family doctor; or (3) after a med-ical emergency where the settlor is admitted to a hospital.


CRS 15-11-901 provides,in relevant part:

(2) Trust for pets. A trust for the care of designated domesticor pet animals and the animalsoffspring in gestation is valid.Forpurposes of this subsection (2), the determination of the ani-mals offspring in gestation is made at the time the designateddomestic or pet animals become present beneficiaries of thetrust. Unless the trust instrument provides for an earlier termi-nation, the trust terminates when no living animal is covered bythe trust.A governing instrument shall be liberally construed tobring the transfer within this subsection (2), to presume againstthe merely precatory or honorary nature of the disposition, andto carry out the general intent of the transferor. Extrinsic evi-dence is admissible in determining the transferors intent. Anytrust under this subsection (2) shall be an exception to any statu-tory or common law rule against perpetuities.

(3) Additional provisions applicable to trusts for pets. In ad-dition to the provisions of subsection (2) of this section, a [pet]trust is subject to the following provisions:

(a) Except as expressly provided otherwise in the trust instru-ment,no portion of the principal or income may be converted tothe use of the trustee, other than reasonable trustee fees and ex-penses of administration, or to any use other than for the trustspurposes or for the benefit of a covered animal or animals.

(b) Upon termination,the trustee shall transfer the unexpend-ed trust property in the following order:

(I) As directed in the trust instrument;

(II) If the trust was created in a nonresiduary clause in thetransferors will or in a codicil to the transferors will,under theresiduary clause in the transferors will; and

(III) If no taker is produced by the application of subpara-graph (I) or (II) of this paragraph (b), to the transferors heirs un-der part 5 of this article. . . .

(d) The intended use of the principal or income can be en-forced by an individual designated for that purpose in the trustinstrument,by the person having custody of an animal for whichcare is provided by the trust instrument, by a remainder benefici-ary,or, if none,by an individual appointed by a court upon appli-cation to it by an individual.

(e) All trusts created under this section shall be registered andall trustees shall be subject to the laws of this state applying totrusts and trustees. . . .

(g) If no trustee is designated or no designated trustee is will-ing or able to serve,a court shall name a trustee.A court may or-der the transfer of the property to another trustee, if required toassure that the intended use is carried out and if no successortrustee is designated in the trust instrument or if no designatedsuccessor trustee agrees to serve or is able to serve. A court mayalso make such other orders and determinations as shall be ad-

visable to carry out the intent of the transferor and the purposeof this section.

Colorados Pet Trust Statute


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The practitioner should obtain the necessary releases18 if thedefinition of incapacity requires obtaining information from ahealth-care provider. Also, the trust instrument should state whatconstitutes notice, including whether a photocopy, faxed, or e-mailed document will suffice.

An advantage of an inter vivostrust is that it becomes effectiveimmediately, thus avoiding the probate process, which can take

weeks or even months, depending on the circumstances. During

probate, although the deceaseds financial affairs may be handledby family, there may be no plan for caring for the animals.Anotherbenefit of the inter vivostrust is that at the death of the client, thetrustee has immediate access to the funds, because the trust is notcreated or funded through probate. Also, an inter vivostrust canprovide protection for the companion animals of an individual whobecomes disabled or otherwise unable to care for them.

Thus, an inter vivostrust may be a better option than a testa-mentary trust.However, setting up an inter vivos trust often is moreexpensive,because there may be start-up or administration fees.

Testamentary TrustsUnlike an inter vivos trust, a testamentary trust is funded only

on the testators death.The testamentary trust is beneficial to thetestator,because it does not require the transfer of any assets duringhis or her lifetime. Also,there are no administration fees;however,the trust provisions must be included in a will.


The following is based on a similar example drafted byCarolyn A.Payne and included in Pace,ed.,Fundamentalsof Colorado Trust Practice: Counseling Clients, DraftingTrusts, and Building a Successful Practice 4.9.2 (BradfordPublishing Co.,2004).

Client is a single woman living alone with two dogsand four cats; she also has a horse boarded approximatelyten miles from her home. She plans on visiting out-of-state relatives and wants to ensure that her animal com-panions are cared for and protected while she is away. Herneighbor,who is on a fixed income,will care for the dogsand cats. Because clients neighbor has creditors who areconstantly trying to collect from him for his outstandingbills, client designates her nephew as trustee.The trust in-strument could designate as the horses custodian anothertrusted local neighbor who boards his horse at the sameboarding facility where client keeps her horse.Client candirect that the neighbor taking care of the dogs and catscheck in on the horse once a week and report any con-cerns to the nephew. Alternatively, the horse could becared for by a horse-boarding facility under contract withnephew.

Trust Hypothetical


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52 The Colorado Lawyer | May 2008 | Vol. 37, No. 5

Trust Drafting TipsThe practitioner should begin by discussing with the client his

or her companion animals and what type of care they typically re-ceive.It may be helpful to document details about each animal, in-cluding name; species; breed; age; behavioral characteristics or is-sues; medical information, including veterinary records andproviders; dietary requirements and preferences; whether the ani-

mal has a microchip or distinguishing markings; and pet sitter con-tact information.Next,the practitioner should help the client determine who will

be responsible for caring for the animal and who will manage thetrust fund, and make disbursements to that caretaker.It is impor-tant for the client to have realistic expectations,especially when de-termining who will care for an animal.An alternative caretaker andtrustee should be selected, in the event the original caretaker ortrustee or both are unwilling or unable to serve.

The client must determine how to fund the trust. It is impor-tant to avoid overfunding the trust. An overfunded trust is morelikely to be challenged and may be found invalid or the trust corpusmight be reduced by a court. For example, in some other states, acourt may reduce the amount of the property transferred to thetrust if it determines that amount substantially exceeds the amountrequired for the intended use.The amount of the reduction, if any,passes as unexpended trust property.19

Colorados statute does not include similar language; however,that does not prevent challenges to the trust. As such, in an effortto avoid overfunding, it is important to consider the estimated

remaining lifespan of the animal; the animals current standard ofliving; annual expenses associated with the animal; and estimatedfuture medical, emergency, boarding, and pet-sitting costs.A vet-erinarian and accountant may provide assistance with these calcu-lations.

If the client plans on compensating the trustee, that compensa-tion should be reasonable and expressly provided in the terms ofthe pet trust.20The trust instrument should define reasonable

compensation, which may be calculated as a percentage of the trustcorpus or a specific dollar amount commensurate with the value ofthe trustees services. Along the same line, another good idea is toinclude a no-contest clause so that family members are discour-aged from challenging the trust.

The Clients WishesIt is important to determine the clients wishes when drafting

the trust instrument.The trust document and language therein willbe enforceable,although there is not yet published case law on theenforcement of pet trusts in Colorado.

When discussing the clients wishes, consideration should begiven to the care and maintenance of the animal companions.In-structions for the caretaker should be specifically and clearly setforth in the trust instrument.The client may wish to include in-structions regarding the logistics of getting the animal to the care-takers home in the event of disability or death.This can be difficultif there are several animals or if the animals are large and no plan

was made in advance.The trust also could address veterinary care,



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feeding, medication, exercise, and housing for the animal,as wellas final disposition of the animal.Also,the trust instrument shouldaddress how and how often the trustee should verify that the ani-mal is being cared for according to the instructions.

ConclusionThis overview of pet trust basics was intended to provide infor-

mation on topics to discuss with a client before drafting a pet trust,as well drafting and enforcing a pet trust.Understanding the histo-ry of pet trusts and their purpose may help the practitioner identi-fy clients who might benefit from setting up pet trusts.

Notes

1. See Helmsleys Dog Gets $12 Million in Will, The WashingtonPost (Aug. 29, 2007), available at www.washingtonpost.com/wp-dyn/content/article/2007/08/29/AR2007082900491.html.

2.In re Howells Estate, 260 N.Y.S.598 (1932).3. Restatement (Second) of Property, Donative Transfers 1.3, Re-

porters Note 6 (2007).4. HowellsEstate,supra note 2.5.In the Matter of the Accounting of Elliot R. Fiske, as Executor of Anna

M. Filkins,Deceased, 203 Misc.454,455,120 N.Y.S.2d 124 (1952).6.N.Y.Est.Powers & Trusts Law 7-61.7. Waisman et al.,Animal Law:Cases and Materials(3d ed.,Carolina

Academic Press,2006).8.Id.9. SeeState Pet Trust Statutes(April 11,2007), available at www.pro

fesserbeyer.com/Articles/Animal_Statutes.htm.

10.CRS 15-11-901(2).11.Id.12.Id.13. CRS 15-11-901(3)(d) and (g).14.CRS 15-11-901(2).15.CRS 15-11-901(3)(e),15-16-101,and 15-16-102.16.Id.17. CRS 15-11-901(3)(e) and 15-16-102.18.Pub.L.104-191.

19.N.Y.Est.Powers & Trusts Law 7-6.1.20.CRS 15-11-901(3).


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