For most people, their revocable living trust is the centerpiece of their estate plan. They will also have a Will, but it is intended only as a back-up to the Trust. This back-up Will is often referred to as a “pour-over” Will because it is used to pour over to the Trust any assets that aren’t in the Trust when you die.
Without a pour-over Will, the assets not in the Trust will be distributed as if you had no estate plan at all. In a recent case, the decedent left a Trust but no pour- over Will. The assets of the Trust went to a life partner according to the decedent’s wishes. The assets not in the Trust had to go through probate and were ultimately distributed to relatives according to the laws of intestate succession, not at all what the decedent planned for. The Trust can be thought of as a Will replacement. Instead of the Will directing distribution of a decedent’s assets, all the gifts and division and distribution of assets are directed in the Trust.
The pour-over Will is only a back-up that leaves assets to the Trust in case any assets are left out. The pour-over Will does not have any of the “who gets what” provisions – those are all in the Trust. Since there should be no assets left outside the Trust, the Will is intended never to be used. There should be no reason to probate the Will.
That’s where the confusion starts. We still tend to think of the Will as the primary estate plan document. It gets more confusing trying to differentiate between the Executor and the Trustee. The Executor is the person named in the Will who would be appointed to administer the estate in a probate. But if probate is avoided, no Executor will ever be appointed.
The Trustee is the person named in the Trust whose job it is to administer the Trust for your benefit while you are living, (especially in case of incapacity), and to settle your affairs and distribute your assets according to your wishes after your death. We can think of the Trustee as the Executor, since the Trustee does the job we normally associate as the job of the Executor. But there is a distinction, the Executor is different from the Trustee.
We have seen do-it-yourself estate plan documents attempting to change the Trustee, but the documents refer only to the Executor and the Will, and are only effective to change the Executor. We know what was intended, but in a recent case, it required a petition to the Court to confirm the change of Trustee. The confusion resulted in an expensive Court proceeding.
Lisa C. Alexander, Esq.
JAKLE, ALEXANDER & PATTON, LLP
2001 Wilshire Blvd., Suite 420
Main Line: 310-395-6555