The Effects of 'Do-It-Yourself' Estate Planning

Sandy Calbreath, Trust Officer

In an attempt to save legal fees, a husband and wife created a Power of Attorney naming their bookkeeper as “guardian,” a role which can only be appointed by the Superior Court. After the wife’s death, the ailing husband compounded the error by utilizing a stationery store form to create a will. When he died a few weeks later, the bookkeeper, who had been named as Personal Representative, failed to probate the estate. After nearly a decade, the compliance office of the investment advisory firm called the local estate financial advisor and said the estate needed to be closed.

Not surprisingly, the will was so poorly drafted that the intention of the testator could not be clearly understood. An attorney was hired, legal documents were written and, with the consent of all the heirs it was determined that a trust was intended. The bookkeeper recently passed away and the financial advisor was named as successor trustee. However, the financial advisor resigned due to a conflict of interest and we were called in to replace him.

Trust records were delivered to us in two garbage bags and a liquor box full of miscellaneous papers. The trust assets included: securities, oil and gas leases, a farm, and other real estate. There were no trust accountings, no promissory notes were executed to support loans made out of the trust, no trust tax returns were filed, and there was no communication with the income beneficiaries.

The “do-it-yourself” attempt at estate planning resulted in a legacy of confusion. It created an expensive mess to clean up, assets were subject to exploitation, and it left three disgruntled heirs. The moral: as in plumbing or car repair, if you don’t know what you are doing, call a professional. You will save yourself (and your heirs) money and grief in the long run!

Print Date:  Spring 2012