- By Jesson & Rains Associate Attorney, Danielle Nodar

The beginning of a new year lends itself to reflecting on the year that has passed and setting goals for the future. Come January, we are bombarded with information about New Year’s resolutions and implementing plans to help us transform our resolutions from lofty dreams to our reality.  From health goals relating to diet and fitness, financial goals such as saving for retirement or paying off longstanding debt, even decluttering our homes--there is no shortage of information about what we can do to improve our present and plan for our future.
 
However, one area of planning that many people seem to put off is creating an estate plan. Estate planning involves meeting with an attorney to discuss things like your assets and debts and how they could impact your estate plan; how you want your property distributed at your passing; who will administer the probate of your estate; who will handle your financial affairs and medical decisions if your become incapacitated and are no longer able to make those decisions on your own; and other important decisions that could make a lasting impact on your loved ones.
 
Even if you have an estate plan in place, you should meet with your estate planning attorney every three to five years to review any life changes or changes in the law.  Some reasons to update an estate plan are:
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• Births – When you have children, you should update your will and/or trust to 1) appoint a guardian for minor children in the event that you pass away before they reach the age of 18, and 2) provide a plan for your children to inherit your assets. Otherwise, under the law, children can inherit all assets once they reach the age of 18. It is also important to make sure you that are not inadvertently leaving out a new child or grandchild from your estate plan.
• Deaths – You may need to replace any deceased beneficiaries, executors, trustees, powers of attorney, and guardians. This not only applies to all your estate planning documents, but also includes documents where you name a beneficiary, such as retirement accounts or life insurance policies.  If a contingent beneficiary is not named for those products, the money will go into your estate, making it available to creditors.
• New disability or illness – If a beneficiary of your estate plan becomes disabled or ill, special planning can be implemented into your estate plan to ensure that these people are cared for and still retain benefits.  
• Marriage – If you are married, you may have to update your estate plan to include your new spouse. It is a common estate planning myth that when a spouse dies without a will, the other spouse will inherit everything.  Instead, a portion of the estate may go to the deceased’s children or the deceased’s parents instead of the spouse.  We also assist in retitling property in an effort to avoid probate.
• Divorce – If you become divorced, make sure your ex-spouse and his/her family is not inheriting or playing any other role in your estate plan. This also includes reviewing your beneficiary designations, such as retirement accounts or life insurance policies.
• Moving to a new state – If you have moved to a new state, does the new state have beneficial laws to incorporate?
• Buying real property in a second state – You may want to upgrade to a trust to avoid multiple probates in multiple states.
• Changes in assets or debts –For example, if your assets have dramatically increased, you may need to see if estate taxes are now an issue. If your debts have increased, you may need to come up with a different plan to shield your assets from creditors.

 
If you have had any major life changes or just want to ensure that your estate plan is in order, make it a goal for 2019 to plan for your future and the future of your loved ones with estate planning. We can help you to ensure that your property is distributed how and to whom you want it to be distributed and to ensure that you are leaving your family unburdened. 

​In honor of that day, we thought we would provide an overview of the healthcare-related documents we draft for our clients in addition to the standard wills and trusts that most people realize are part of jobs.  Additionally, though, estate planning attorneys draft documents that deal with the potential for incapacity during their clients’ lifetimes.  These documents cease to have any effect after the client has passed away, so they are not true estate planning documents if you consider that definition to include only documents that deal with property distribution.  Estate planning attorneys help their clients plan for possible incapacity with the following documents:
 
(1) Durable power of attorney.  In this document, you would name an agent to act in your place as to financial, business, and legal decisions, if you were incapacitated (unable to handle your affairs).   
 
(2) Health care power of attorney.  In this document, you would name an agent to make medical decisions for you in the event you cannot speak for yourself.  It is not necessarily an end-of-life document.  You could be going in for a routine surgery and under anesthesia, for example. 
 
(3) Living Will.  This is an end-of-life document.  You will state under what conditions and terms you do not want to be kept on life support.  If you do want life support (or if you want to leave it up to your healthcare agent), you do not complete this document. 
 
In order to sign these documents, you must have capacity to know what you’re doing.  Waiting until someone is incapacitated to handle this means that you have waited too long.  These documents must be completed in advance of any medical issues.  If you would like more information, please give Jesson & Rains a call.
 

​Parents living longer than ever.[1]  The first generation of baby boomers have turned 70.   Cases of Alzheimer’s and dementia are on the rise.[2]  Health care costs are increasing.
 
We oftentimes get calls from adult children who want to hire us to “get power of attorney over their parent” to help them with bills and medical care.  Unfortunately, that is not the way a power of attorney works.  While the adult child can certainly schedule the appointment with us and even pay for the legal document, it is the parent’s document, and the parent is the client.  Attorneys are confined to the parent’s wishes.

If the elderly parent already lacks the capacity to enter into a contract or make legal decisions, or if the parent does not understand the effect of the power of attorney document, it is too late for the adult child to be named as their parent’s agent under a power of attorney.  If the elderly parent lacks capacity and needs help handling his or her affairs, the adult child may need to become legal guardian.

What the differences between Power of Attorney & Guardianship?
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With a power of attorney, the principal names an agent to act on the principal’s behalf in the event of incapacity.  It enables the agent to handle the principal’s business and financial affairs.  A health care power of attorney is a separate document that names an agent to act on behalf of the principal for medical decisions.  The agent’s powers are very broad unless expressly limited by the documents.  However, there is nothing preventing the principal himself from conducting business on his own.

With guardianship, a court makes a finding that the principal lacks capacity and removes that individual’s authority to make decisions.[3]  The court appoints a guardian to make those decisions from then on out. Once an institution, like a bank, learns of the guardianship, it would not be permitted to listen to the principal’s instructions – only the guardian’s.[4]  The court’s order is permanent until the principal regains capacity and a subsequent hearing is held to restore his or her rights.  Guardians have to file reports and/or yearly accountings with the court.

As you can see, guardianship is not to be taken lightly.  A court’s adjudication of incompetency essentially strips away a person’s rights, which is why we recommend getting power of attorney documents in place before capacity becomes an issue.  It is also more work on the guardian’s part due to the court proceedings and reporting requirements.  Readers should not only get their documents in place but talk to their parents or other elderly loved ones and encourage them to visit with an attorney before incapacity becomes an issue.
 
 


[1] http://abcnews.go.com/Health/story?id=118056.
 

[2] http://www.alz.org/facts/.
 

[3] There are three types of guardians: guardian of the estate (authority over property), guardian of the person, or general guardian (both estate and person).

[4] Unless the court orders a limited guardianship allowing the principal to retain certain legal rights and privileges to which the ward was entitled before the ward was adjudged incompetent.
 

​​It is important for newlyweds to have wills drafted for several reasons.  First, most of the property that you each own is going to be separately owned in the beginning.  Under the laws of North Carolina, if you pass away without a will, your surviving spouse is not always entitled to 100% of your property.  If you want to guarantee that your spouse is going to inherit everything, you’re going to need a will.  Also, for singularly-owned property, your spouse will not be able to handle your affairs in the event of your unavailability or incapacity without a durable power of attorney, and an estate planning attorney can assist you with that as well.
 
Once married couples start consolidating bank accounts or buying real estate together, this is less of a concern.  For jointly owned property, when one person passes, the other person automatically owns the property without there being any need for a will.
 
Secondly, some important clauses included in a will can ease the burden on your spouse in the event you do pass away.  For example, you can draft a will that waives the bond requirement.  That is a huge burden lifted – your spouse will not have to pass a credit check and pay a bond premium to administer your estate.  Your will can include provisions allowing your spouse to sell your property without court approval; again, your spouse will benefit from not having to pay an attorney to get a court order.
 
Third, if you are blending families, the only way to leave property to someone not related by blood or a step-child is to gift it to them in a will.
 
Another benefit to seeing an attorney to discuss your estate plan after you’ve recently been married is to ensure that your beneficiary designations are all up to date.  You’ll want to change your beneficiary on life insurance policies and retirement plans, for example, to your new spouse.
 
Finally, a discussion with an attorney about probate and the benefit to owning joint property cannot be understated if you’re bringing a lot of debt into the relationship.  While your spouse is not responsible for your student loan debt, for example, your estate will be – there may need to be some planning involved to pass along property to your spouse instead of your creditors.  You may also be able to plan your estate so that probate could be avoided entirely!
 
If you’re newly married and want to ensure your spouse is protected in the future, the attorneys at Jesson & Rains can help you.  

A few weeks ago, viewers across North Carolina were shocked when they saw a story on the news about a mother, Rae Stone, and her son, Forrest.  Forrest had just turned 18 when he was involved in a snowboarding accident that left him in a coma.  The Virginia hospital treating Forrest would not allow his mother to make medical decisions on his behalf or access his medical information due to HIPAA.  According to the news story, the doctors at the hospital were the ones who were deemed to be the decision makers.
 
Clients in North Carolina want to know: Would this happen in North Carolina?
 
The answer is maybe. In North Carolina, the following people, in this order, are authorized to consent to medical treatment on behalf of an incapacitated patient:
 
(1) A health care agent appointed pursuant to a valid health care power of attorney[1] (unless the court has appointed a guardian and suspended the health care agent’s power);
 
(2) A court-appointed guardian;
 
(3) An attorney-in-fact, with powers to make health care decisions for the patient;[2]
 
(4) The patient's spouse;
 
(5) A majority of the patient's reasonably available parents and children who are at least 18 years of age;
 
(6) A majority of the patient's reasonably available siblings who are at least 18 years of age; or
 
(7) An individual who has an established relationship with the patient, who is acting in good faith on behalf of the patient, and who can reliably convey the patient's wishes.
 
(8) The patient's attending physician.[3]
 
Therefore, if a power of attorney or guardianship does not exist, in the event your unmarried child is incapacitated, you should be able to consent to their medical treatment in North Carolina.  If you are married, you should be able to consent to your spouse’s treatment if they become incapacitated.
 
Given the North Carolina statute, is there any reason why I should fill out a health care directive or appoint my loved one as my power of attorney?  Yes.

1. If you and your spouse are informally or legally separated, the spouse may still be able to make medical decisions on your behalf prior to your divorce. There is no case law on this issue. If you file a health care directive, the hospital must comply with your wishes.  Or you can appoint someone else power of attorney. 
2. The statute calls for a MAJORITY of reasonably available parents or children.  What if these parties disagree?  What if your parents and your children disagree with your treatment?  What if there is an even split, so there is not a majority?  There is no case law on this issue, either.  A health care directive or power of attorney appoints one person as the decision maker.
3. What if you know, in advance, that the person tasked with making the decision on your behalf pursuant to the statute (your husband, for example) disagrees with your final wishes?  For example, your husband would keep you alive on a ventilator, even if you had no chance at survival and you did not want to be kept alive?  If you draft a health care directive, you can direct the hospital to make decisions based on YOUR wishes, not those of your loved one.
4. Under HIPAA, a federal law that applies to medical facilities and patients in North Carolina, a physician may release medical information to family members in an emergency. The hospital is not required to.  If the hospital does not release the information, there is no way the family member can make decisions on the patient’s behalf, as allowed under North Carolina law.  However, a doctor is required to release information to a “personal representative,” which includes people named in a health care directive, health care power of attorney, or durable power of attorney that includes the power to make healthcare decisions.
5. Simplicity.  If you or a loved one are in the hospital, do you really want to risk it?  Do you want to spend your time arguing with the hospital or hiring an attorney to help you?  Probably not.  Having these documents drafted costs very little and does not take much time.  It can save a lot of headache and heartache in the future.

[1] Power of attorney for the sole purpose of making medical decisions on your behalf, or a health care agent named in your advanced health care directive (which outlines your wishes in the event you become incapacitated)..

[2] Power of attorney over  health care decisions (as you appoint).

[3] N.C.G. S. § 90-21.13.