using attorney in trust administration
DESCRIPTION
Presentation by Attorney Leslie Yarnes Sugai at the Professional Fiduciary Accociation of CA, May 2011TRANSCRIPT
Leslie Yarnes Sugai
How to use an Attorney
Effectively in a Trust
Administration Matter
16th Annual PFAC Annual Educational Conference
May 4-7, 2011Hyatt, Monterey
750 University AvenueSuite 140
Los Gatos, CA 95032(408) 354-0200
www.css-lawfirm.com
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• Expectation of the General Public• Expectation of the Court• Goal • Impact of Beginning Professionals versus
Experienced Professionals
Introduction
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• Attorney to review Trust, Case File and Background
• Attorney to petition for instructions for clarification of role
• Determine your role and duties as Trustee
Case Evaluation
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• Notice By Trustee – Attorney• Notice List• Heir search vs. Private Investigator• Bond
Trust AdministrationFirst Steps:
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• Expectation – PPF to handle• Attorney’s role is minimal• PPF should provide asset information to
attorney
Marshaling AssetsGeneral Issues
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• May be required to file Inventory & Appraisal• Utilize Probate Referee for Appraisal Process
Marshaling AssetsCourt Supervised
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• PPF to appraise assets as of date of appointment or date of death (if applicable)
• Establishes carrying value of assets• May not represent income tax basis of asset
Marshaling AssetsNon-Court Supervised
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• Legal document preparation• PPF to drive process, provide attorney with
information
Marshaling AssetsAttorney’s Role
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• Notification to County Assessor • Preparation of Property Tax Documents• Affidavit of Death or other Deed to clear title
Real Property IssuesAttorney’s Role
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• Physical Control of the Property• Change locks• Notify Tenants of change• Maintenance Issues• Landlord – Tenant issues – may need attorney
Real Property IssuesPPF’s Role
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• Attorney to review listing agreement, contract• NPA to be sent by attorney
Real Property IssuesSales of Property
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• PPF to obtain control of mail• Credit report for Decedent• PPF to pay expenses unless insolvent• Discuss Notice to Creditors with Attorney
Debts and Creditor Issues
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• Must have agreement regarding accounting• Court Format with all required Schedules• Original Statements
Accountings -Court Supervised
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• Must have agreement regarding accounting• Court Approval Desired?• Discuss format with attorney• Style Choices
Accountings –Non-Court Supervised
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• Consult with Attorney/CPA regarding Income taxes
• Sale Issues – CG, Property Tax, future ET• EIN• File Taxes – PPF responsibility
Tax Issues
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• In litigation matters, fees for all parties are expected to be higher
• Depends on PPF’s role – are you a party or the neutral?
Litigation
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• No Distribution without Attorney Approval• Duties to treat all beneficiaries equally
Distribution
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• Schedule of Distribution• Retention of Reserve• Timing for Distribution of Reserve
Distribution
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• Distribution – In-kind• Distribution following Sale of Assets• Tax issues
Distribution Options
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• Less work, less handholding and less explanation required for PPF clients
• Cases may be more complex, may require more complex legal reasoning
Attorneys’ Expectations from Professional Fiduciary Clients
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PPF
• Marshal Assets• RP Control• Pay Expenses • Accounting
Attorney
• Legal Issues & Documents
• Document Review
Both
• Tax Issues• Creditor Notice• Distribution • Sale of assets,
issues and Notice
Checklist
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• Meet with your attorney up-front • Set forth parameters of who will take care of
what task
Clear Guidelines