Wednesday, July 25, 2012

When Do I Need A Will?

If you are 18 or over, the answer is ALWAYS.

Many people assume they do not need one because they "do not have anything".

Some feel they do not have children, or just have one or two close relatives so "everything will just go to them anyway". Other people feel they have adequately named beneficiaries to all financial accounts, so assets would not pass through to an estate for probate.

A will provides direction for many aspects of your estate. Among other issues, it can: identify next of kin, give instructions for burial, state desired beneficiaries, detail specific bequests, state who has intentionally not been provided for in the will (often referred to as "cut out of will"), appoint your Personal Representative or Executor, or provide for tax planning if your assets are such that a taxable event would be created upon your death.

There are many circumstances which one might die under and have no tangible assets but would still require probate. These include negligent accidents and wrongful death among other instances of legal wrongdoing. Other circumstances require a Personal Representative (executor in some states) and the only way for a person to have legal authority to act as a Personal Representative is to open a formal administration and be appointed as such by a judge. Just because someone has a will that states a certain person is to be the Personal Representative does not give them the legal authority to act as Personal Representative. Only a judge can grant this authority.

Whether you are married, single or in a long-term relationship, whether do or do not have children, whether you have blood relatives or you have close friends as your "family", your wishes are important. If you do not have a will, and an estate needs to be opened for probate, your estate will be considered "intestate". This simply means that you died without a valid will. The State of Florida has statutes which list the order of beneficiaries should you die "intestate"; that information can be found here. The intestacy statutes list the beneficiary order based on your blood relatives. Your spouse and minor children would inherit first, if none then your adult children, if none then your parents, if none then your siblings or if they are deceased then your siblings children, and so on down (or up) your family tree.

Therefore, depending on your own personal relationship dynamics, you may not wish for certain family members to have control over your estate or to receive a share of your estate. In this instance, it is very important to record your wishes in a valid will.

Each state has different laws regarding the requirements of a valid will. Some office supply stores and online companies provide forms for wills, but these can create more problems than the savings one would get instead of engaging the services of an attorney. Each person's situation is unique and each state has its own rules which must be followed. An attorney in your state will be able to explain these requirements and draft a will suitable to your needs.

As long as you still retain "testamentary capacity", that is, the mental competency to create a will, you may change your will as many times as you like. In fact, it is a good rule of thumb to revisit your estate planning regularly to see if any changes have occurred in your life whether they are financial, geographical, or relationship-based changes. Major "life changes" such as marriages, births, and deaths are times that it is most important to revisit your estate plan.

A will is not something you create for yourself; it is a map you provide to your loved ones after you are gone.

Thursday, July 19, 2012

What is this thing P.A.C.A. you keep talking about?

What is this thing P.A.C.A. you keep talking about?

P.A.C.A. is the acronym for Perishable Agricultural Commodities Act. PACA is a federal act passed in 1930 to help prevent fraudulent in the course of selling perishable commodities, such as fruits and vegetables. This act enables the U.S.D.A. (United States Department of Agriculture) to enforce and regulate these laws to ensure perishable commodities are marketed in interstate and foreign commerce in a proper and lawful manner.

PACA requires all commission merchants, dealers, and brokers who engage in commerce of wholesale quantities of perishable fruits and vegetables, (frozen or not frozen) to obtain a PACA license from the USDA. The act details the conduct which PACA licensees must abide to ensure unfair, unreasonable, discriminatory, or deceptive practices do not occur in the weighing, counting, handling, shipping and sale of these commodities.

During a sale between licensees, a "statutory trust" is created; it is sometimes called a "floating trust". This trust is created by operation of law during the sale to benefit unpaid sellers. This is not a trust with written documents, such as one would draft for estate planning purposes. Rather, just by participating in the commerce of fruits and vegetables, the brokers and dealers are holding proceeds and inventories "in trust". These inventories and proceeds of sales make up the principal of the trust and are held "in trust" until all unpaid debts and claims associated with the sale are paid.

Each invoice must contain the following statutory language in order to meet PACA trust law requirements:

"The perishable agricultural commodities listed on this invoice are sold subject to the statutory trust authorized by Section 5c of the Perishable Agricultural Commodities Act, 1930 (7 U.S.C. 499e(c)). The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities, and any receivables or proceeds from the sale of these commodities until full payment is received."

Invoices should also have readily identifiable basic information clearly and plainly printed on each invoice, such as names and addresses of the seller and the debtor, date of the sale, items sold, contract terms such as F.O.B., invoice price, payment due date and amount owed.

Thursday, April 12, 2012

Durable Power of Attorneys and Changes to the Law

A Durable Power of Attorney can cover a wide variety of financial issues. Depending on the content of the document, it gives authority to your appointee, called an attorney-in-fact or agent, to "step into your shoes" and make financial and other legal decisions for you if you cannot make your own decisions, or are otherwise unavailable.

An important detail to keep in mind is that not all Powers of Attorney will be valid should you be declared incompetent or incapacitated by a court. Your Power of Attorney must be "durable" and must state that the document is not affected by your subsequent incapacity and shall survive your incapacity. If this language is not in your document, your Power of Attorney will be invalid upon a court declaring you incapacitated. 

There are a great number of "forms" available regarding these three documents. It is important to remember these forms are usually basic and not necessarily tailored to the laws of your state or your situation. Seeking the advice of an attorney is always the best idea when executing any of these documents. One's personal situation is unique and an attorney can provide advice for your particular needs, which cannot be found on the back of a box.


On October 1, 2011, a new act controlling Florida Powers of Attorney took affect. 

All Powers of Attorney executed before October 1, 2011 are valid, however, there are certain powers that may longer be created under this Act and may be "ineffective". If you have a Power of Attorney executed before October 1, 2011, have an attorney review it to be sure what powers you wish for your attorney-in-fact to have are covered. 

The Act created a problem for certain pre-October 1, 2011 Powers of Attorney, such as those with "Springing" powers. Springing powers state the document is valid only starting on a some future certain date or when a certain event occurs. If those events have not occurred yet, then the Attorney-In-Fact can not use the document.  Powers of Attorney with springing powers are "ineffective" according to the new statutes and cannot be created after September 30, 2011. Springing powers have been used  to keep an attorney-in-fact from abusing the power. Some attorneys, instead of using a springing power, will hold onto all copies and originals until the power of attorney is needed. That way, the attorney can investigate the situation and make sure the need for it is present. One still may execute Limited Powers of Attorney for specific tasks, such as solely for the sale of a house.

The Act also created a list of Duties of the Attorney-In-Fact. These duties are mostly ones of common sense and duties of honesty, such as acting in good faith, keeping good records, be loyal and act with best interest to preserve estate plan. These duties of the attorney-in-fact can be found here.

Another change the Act brought is there can be no "general" or "blanket" power of attorney. If the attorney-in-fact is to have the authority to perform a specific act, that power has to be specified in the document. Many legal kits (such as one you would get at an office store) have general one-page forms. For example, in the past an Attorney-In-Fact could enter a safe-deposit box with such a "general" Power of Attorney. Now, a Power of Attorney must state that the Attorney-In-Fact has authorization to enter a current safe deposit box. 

A Durable Power of Attorney differs from a Healthcare Surrogate/Power of Attorney in that the Healthcare Surrogate is solely for health and medically related issues. Some Durable Powers of Attorney give authority to make health decisions but many do not. Health professionals prefer documents that are geared specifically to health and medical decisions.

New POAs (created October 1, 2011 or later) will have to meet certain requirements for certain powers to be valid. These include:
-Must state that all previously executed POAs are revoked,
-Investment & Banking powers should reference statute
-Gift provision and Trust provision must be initialed to be valid
-New list of items a POA does not have the authority or power to do 
-Must be witnessed and notarized

Other changes include the provision that photocopies are as good as the originals. This is important due to the fact that an attorney-in-fact with a photocopy will have the convenience of using the copy instead of hunting down the original in a situation of emergency. However, this convenience highlights the importance of one's choice of an attorney-in-fact as many folks provide their appointees with photocopies for "just in case" situations. A mischievous individual may use this in a fraudulent manner. 

Powers of Attorney executed under another state's laws may be used in Florida if they were properly executed in that other state, however, they will be subject to Florida’s Power of Attorney Act and other statutes. The attorney-in-fact may only perform acts that Florida law allows and by the terms of the Power of Attorney.


An attorney-in-fact may not perform acts that require specific and personal knowledge of the person. These acts include: voting, signing affidavits swearing to personal knowledge, creating or revoking a will, taking the place of the person (such as taking the person's place as Trustee or Guardian) or fulfilling contracts of personal service.


Only a few of the changes have been mentioned here. It is important to seek the advice of an attorney when considering execution of a Durable Power of Attorney because each person's situation is different. The attorney may see issues in your personal situation that you do not see and cannot prepare for from a box.

Finally, it is always important to discuss your decisions first, before signing your documents, with the person you are appointing. Do not assume because the person is older than you, or if they have been through a similar situation before, that they would be ready, willing and able to be your appointee. Such discussions can be useful not only in your own planning but in your peace of mind that your appointee will be ready should such an unfortunate time occur. 

Tuesday, March 6, 2012

Health Surrogates and Living Wills: Plan For Your Wishes

Regardless of your situation in life – whether you are single, married, live with a partner, friends or family members – having documents that appoint a specific person or persons to make medical decisions on your behalf can be one of the kindest acts you can do for your loved ones.

Imagine your loved one is in the hospital and unable to communicate. The medical professionals need permission or a decision to be made in order to move forward with your loved one's care. Imagine there are relatives of your loved one standing in the room with you, arguing with you, and they want the professionals to perform the exact opposite of what you know your loved one would want. Now imagine the professionals tell you the law says you have no authority to make a decision because your loved one never obtained the proper documentation to give you that authority.

There are two different types of authority one needs to give others to make medical decisions. One is a Healthcare Surrogate (or Health proxy), and the other is a Living Will.

Healthcare Surrogate
In Florida, the person you appoint to make your health and medical decisions for you is called a Healthcare Surrogate. You may also see it referred to as a Healthcare Proxy or Medical Proxy. If you cannot speak or are incapacitated, this document allows your appointee to make decisions for you regarding your care, treatment, medication, surgical procedures, and other medically related issues. Your health proxy does not have to be a relative, but the proxy does need to be at least 18 years old.

Living Will
A Living Will is an advanced directive which gives your appointee instructions and authority to carry out a certain plan if a tragic situation should arise. Should you be in a condition where you have no brain activity and no chance of recovering, and you are being kept alive via artificial resuscitation and machines, your Living Will tells your appointee to turn the machines off. However, you may also make an advanced directive telling your appointee to do whatever necessary to keep you alive.

Florida Statutes section 765.101 defines three different medical conditions which are referenced in the Florida Statute's suggested form for a Living Will.

The End-stage Condition means an irreversible condition that is caused by injury, disease, or illness which has resulted in progressively severe and permanent deterioration, and which, to a reasonable degree of medical probability, treatment of the condition would be ineffective.

The Persistent vegetative state means a permanent and irreversible condition of unconsciousness in which there is: the absence of voluntary action or cognitive behavior of any kind and an inability to communicate or interact purposefully with the environment.

The Terminal condition means a condition caused by injury, disease, or illness from which there is no reasonable medical probability of recovery and which, without treatment, can be expected to cause death.

There are certain circumstances, such as with Mrs.Terry Schiavo, when ventilators and machines are turned off but the person continues to breathe on their own. In Mrs. Schiavo's situation, she was kept alive for years with a feeding tube. A painful and public battle ensued between her husband and her parents to decide whether the tube should be removed and allow Terri to, essentially, starve to death. A judge ordered the removal, and she lived for many days before she died. Had she executed an advanced directive much of this could have been avoided, however, at the time it likely would not have mentioned withdrawal of food and water. This tragic situation lead to a change in Florida law which mandates Living Wills must state whether you wish for food and water to be withdrawn or whether you wish to receive food and water if you are in such a condition.

Everyone is unique in their beliefs, and the subject usually can make for a lively debate between people with opposing opinions. For a reference, you may wish to read the following articles for religious perspective. See this statement from the Papal Academy's JointDeclaration of the World Federation of Catholic Medical Associations and thePontifical Academy for Life on the vegetative state (17 to 20 March 2004) ; this page requires a browser translator. For a Jewish perspective on the subject of living wills, withdrawing nutrition and life support and the Jewish Faith, you may wish to read the article PalliativeCare/Spirituality by Rabbi Elliott Dorff, Ph.D. of the American Jewish University.

The subject of ending, or not ending, life support and nutrition is delicate. One should think carefully and gather as much information from professionals -including one's physician, attorney and spiritual advisor (if applicable) - when making a decision regarding this advanced directive.

Many times, people would rather their family not be in a position of authority at all. For people in that situation it is most critical that they have these documents in place because the law only recognizes kin as having an authority to make decisions. In other situations such as the Schiavo case, the individuals with authority are the ones arguing and preventing a decision to be made. With the proper documentation appointing a person or persons to make these decisions for you, the medical professionals caring for you will know exactly who to turn to for these decisions and your family will clearly know your wishes so delays and unnecessary arguments during a tragic time can be avoided.

Finally, when making a decision as to who you wish to appoint it is always best to discuss your decision to give them this authority first. You do not want that person to be blindsided with the information in the midst of a difficult situation. Talk with your person (and alternate appointee) and make sure they understand not only the gravity of what you are asking them to do, but also exactly what sort of care and decisions you would wish for them to make. Some people find these subjects uncomfortable to talk about, but the more open you are about your wishes, the more information they will have to draw from during a potentially difficult time.

Thursday, March 1, 2012

If You Are 18 or Older, Make Sure You Have These Documents

If you are 18, or older, in addition to a Will you should have a General Durable Power of Attorney, Healthcare Surrogate and a Living Will.

These three (3) documents give your authorization to your appointee so they may make medical and financial decisions for you if you are, for whatever reason, mentally incapacitated or otherwise unable to make those decisions for yourself. You may not be mentally incompetent, but perhaps you have been rendered unable to communicate through an accident or medical coma.

Hospitals and physicians do not necessarily act immediately upon decisions your spouse, parents or other close relatives make for you. Often relatives argue, such as the parent or spouse of a patient arguing with the adult child of a patient. Other times patients have life/domestic partners which the hospital may not recognize as having the legal authority to make these medical decisions. To protect themselves, the medical personnel will require legal authority.

Likewise, with financial decisions, unless the other person is a co-owner or authorized signator on your accounts at a bank, the bank will not discuss your accounts with your loved ones without proper authority. In other situations, one might have an accident due to a third party's malicious act or negligence, and the injured person's loved ones need to get payment from the third party for medical expenses. The loved ones will need authority to do that if the injured person cannot speak for themselves; as an adult, the parent or loved one needs to show proof of the express authority to act on the injured person's behalf.

Without these documents, in some situations your loved ones may be forced to go to court and open a guardianship for you so they can be appointed as your guardian and gain the authority to make these decisions. This can be costly and extremely time consuming. Once a guardianship is opened and a guardian appointed, your guardian must ask the court permission to withdraw any funds or make other important decisions. The guardian is responsible to the court for yearly reports regarding the financial accounts and your physical well-being. The financial accountings will be audited by a court appointed accountant. In some situations, guardianships are useful to protect the "ward" (the minor person or person unable to act for themselves), but in many situations are not needed if the proper people have authority to act. These three documents can help your loved ones avoid this hassle during a difficult and painful time.

Young people think they will live forever, and of course, that is not true. Once one becomes an adult, their parents no longer have the authority to make certain decisions for their children. It is best to "plan for the worst and hope for the best".

These documents only have authority while you are alive. Once you die, your authority dies with you, becoming void at the time of your death.