Probate and Switch
Lou Ann Anderson
September 1, 2008
Bait-and-switch tactics have long been part of America’s commercial landscape. While routinely associated with retail categories ranging from electronics to cars, other industries including travel, real estate and even financial institutions (subprime lenders) have earned well-documented reputations for engaging in these actions. One having escaped the bait-and-switch tag yet increasingly deserving of the designation is the legal industry – especially with regard to probate or estate issues.
Probate instruments such as wills, trusts, guardianships and powers of attorney are being used to redistribute property in a manner contrary to the intended wishes of hard-working Americans. These are folks who mistakenly take the “bait” put forth regarding estate planning documents. Lawyers are the first to extol the need to avoid “the high cost of probate” or “government intrusion” as well as to protect one’s estate from “greedy heirs and lawyers.” During this process, however, the real “switch” potential is rarely discussed. That is, members of this same industry (maybe your lawyer) turning the tables and using your estate documents to deny assets to rightful beneficiaries/heirs and instead perpetrating an Involuntary Redistribution of Assets (IRA). Disgruntled family members excluded from the plan or else wanting more than their specified share easily connect with attorneys willing to assist. It’s an unflattering reflection on the legal industry but with this backdrop, IRA actions are quietly happening everyday.
Having said this, estate planning that includes applicable legal instruments (will, trust, guardianship, powers of attorney – medical and otherwise, etc.) continues to be a critical component of any financially responsible person’s life. People must, however, become aware of estate management’s dark side. The dangers posed by unscrupulous attorneys, a pay-to-play legal system and would-be looters with an inflated sense of entitlement are increasingly visible. IRA actions are affecting Americans from a variety of socioeconomic backgrounds. With the large transfer of wealth coming in the next 20 or so years, these cases will likely skyrocket. People think proper estate planning will protect them – wrong! People think they don’t have enough assets to be a target – wrong!! There is no inoculation from the threat of IRA. Forewarned, however, is forearmed.
Estate bait-and-switch actions are downplayed as finding information about the theory of probate abuse and dispute resolution is easy. The practical realities of being drawn into an IRA situation are not so candidly addressed by legal and other professionals and therefore left to the blogosphere and web sites such as EstateofDenial.com.
The September 2008 edition of O, The Oprah Magazine, provides a great example as financial guru Suze Orman fields the question “is my brother stealing our inheritance?” The writer says her brother is in charge of their mother’s banking and that the mother has dementia. The sister says she believes her brother is living off their mother’s money and asks how she can stop him from “stealing” what should be their inheritance upon their mother’s death. Suze called on an estate planning attorney who provides a thorough procedural rundown of potential action steps based upon the limited knowledge available. It is reasonable and very civilized. Unfortunately, the “bait” aspect of this sanitized response likely left the questioner with a sense of having a manageable situation. Many IRA targets have far different experiences.
As a longtime Suze fan, it was more expected for her to have replied, “Girlfriend – you just might have a big problem.” If Suze and Oprah want to empower their audiences through providing a broad base of knowledge, an opportunity existed here yet was missed. From the EstateofDenial.com perspective, we would first point out that depending upon the brother’s legal status, it is likely that he can use the mother’s money to fight off any legal action while the sister’s efforts will have to be self-funded. People who dishonestly take money from the dead or disabled/incapacitated aren’t currently adhering to any ethical code and this will doubtfully change with a legal proceeding.
Attorney misconduct is rarely punished so our country is full of attorneys who will bend or break rules. These “bottom feeders” are the vanguard flag carriers emblematic of why the general public has such disdain for the legal profession. Be prepared for the brother to ally with one of these and for consequences to the sister to be unpleasant and expensive. The court system is pay-to-play so come prepared with an open checkbook and a willingness to put your life on hold as these things additionally consume years of a person’s life and damage if not destroy family relationships. Don’t get too caught up in the truth and justice aspects of your case. With enough time and money, you may eventually get there, but months, even years, will first be spent on legal posturing and procedures that will forever change your view of the judicial system. The brother’s attorney will want to wear down the sister (financially and emotionally). As billable hours mount, what does he/she care? By now, most readers will have read enough, but even so, we could go on and on. People don’t understand the endless ugliness that emanates from IRA cases.
Reasonable folks don’t take advantage of sick, old people. Nice people don’t steal from the dead. Why then would anyone expect fighting an estate or probate action like this to be reasoned, expeditious and civilized? The “painting with a broad brush” response usually comes about now so let us acknowledge that not every lawyer and judge is corrupt – but too many are or appear to be motivated by self-interest instead of justice or even fairness.
Property rights have long been an important part of American life. Those rights are being violated due to greedy individuals partnering with unscrupulous legal professionals in using the legal instruments sold as estate safeguards (the bait) to now redistribute property (the switch) in a manner contrary to the estate owner’s wishes.
At EstateofDenial.com, we are not lawyers or other associates of the legal community. While this causes some to discount our opinions and perspectives, our credibility comes from personal experience and knowledge that the average person in no way understands the growing threat facing their lifelong accumulation of assets. Public policies regarding our probate systems must be reviewed. The culture surrounding probate and other applicable venues must also be changed. Attorneys and judges must face real accountability and consequences for misconduct. Estate disputes should be moved from civil to the criminal venues in which they belong and where appropriate punishment can be applied. Legal professionals, their associates as well as government officials (often with a background in the legal profession) know the realities, but the lucrative status quo provides no incentive for change. Government will take the side of the people only when the people demand it and re-election may seem in peril.
EstateofDenial.com will continue to “shine light on the dark side of estate management” in hopes of educating more people regarding the dangers ahead. Our exposure of greedy wannabe beneficiaries/heirs allied with legal charlatans masquerading as estate planning professionals only to perpetrate “probate and switch” actions will continue. It’s not sanitized, civilized, reasonable or rational, but it’s a story that needs to be told.
Lou Ann Anderson is an advocate working to create awareness (www.EstateofDenial.com) regarding the Texas probate system and its surrounding culture. She may be contacted at firstname.lastname@example.org.