[WSBAPT] Life insurance company requires parent of minors to be appointed guardian

Tue May 19 14:50:41 PDT 2015

My concern with the custodian for a minor route is the duty of care an attorney has to the non-client heir under the Trask decision.  The attorney for a PR that advocates and facilitates for a certain distribution method to a minor heir, especially when there is no GAL, has a duty to ensure the heir is adequately protected from foreseeable harm.  What happens to you as the attorney, when the custodian has run off to Peru with bags of money and left the minor with nothing?  I think that was a certain King County Commissioner’s favorite practice tale – his view was that it is certainly foreseeable that a parent would steal from their own minor child.  Therefore, guardianship with a bond or a blocked account, even for a parent, was the default method to ensure adequate protection for the minor.

I think if the will authorizes distributions to a minor using various means, such as a UTMA account, then the duty of care to the minor heir is lessened because distribution to the UTMA account is implementing the testator’s already established distribution plan. 

However, if this is an intestate estate or you are trying to compel an insurer concerning the direct distribution to named beneficiary, who is a minor, then I would tread a little warily into waters that were anything less than a guardianship.

The process for appointment of a minor guardianship with the parent being appointed is not overly cumbersome, there is no GAL required, and reporting periods can be waived or extended.

Tara M. Roberts

Puget Sound Law PLLC

roberts at pugetsoundlaw.com

******************************
The information contained in this email may be privileged and confidential information intended only for the use of the individual or entity named above.  If the reader of this message is not the intended recipient, you are hereby notified that any dissemination, distribution, or copying of the email is strictly prohibited.  If you have received this email in error, please notify us immediately and delete the original message and any copies you may have.  Thank you.
******************************

From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Marcus Fry
Sent: Monday, May 18, 2015 12:57 PM
To: 'WSBA Probate & Trust Listserv'
Subject: Re: [WSBAPT] Life insurance company requires parent of minors to be appointed guardian

I have got the push back, but have sent them the UTMA statute and it worked just fine.  Why doesn’t the PR simply petition for an order directing insurance co. to distribute to custodian FBO child under UTMA and serve notice to insurance co. for hearing on the petition.  Let insurance company show up and argue that a gship is necessary.  One could even use TEDRA if they wanted.

Marcus J. Fry

Lyon, Weigand & Gustafson, P.S. 
Adoption Attorney*

P.O. Box 1689 
Yakima, Washington  98907 
Telephone:  (509) 248-7220 
Facsimile:  (509) 575-1883 

NOTICES:

 *Adoption Attorney reflects election as a Fellow of the American Academy of Adoption Attorneys, an invitation based organization of 300+ attorneys nationwide, under its criteria of experience, ethics and peer recommendation. Washington's Supreme Court has not yet developed or recognized a credentialing process for specialties, and certification/fellowship is not required to practice law in this state.

Confidentiality: This e-mail transmission may contain information which is protected by attorney-client, work product and/or other privileges.  If you are not the intended recipient, you are hereby notified that any disclosure, or taking of any action in reliance on the contents, is strictly prohibited.  If you have received this transmission in error, please contact us immediately and return the e-mail to us by choosing Reply (or the corresponding function on your e-mail system) and then deleting the e-mail.

From: wsbapt-bounces at lists.wsbarppt.com <mailto:wsbapt-bounces at lists.wsbarppt.com>  [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Eric Nelsen
Sent: Monday, May 18, 2015 11:48 AM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Life insurance company requires parent of minors to be appointed guardian

I've encountered Marketa's problem too, and always established a guardianship. Ch. 11.88 RCW has special provisions that eliminate a lot of the hassle if the sole basis for the guardianship is that the minor is a minor.

But I also think it's silly and I am annoyed at insurance companies that require this. Does anyone know what the legal basis is? Is it contractual--does the policy specify that payments to a minor will only be made to a court-appointed guardian? If that's not it and they're just being officiously risk averse, I wonder if a court order requiring payment to a UTMA custodian would suffice, followed by order of contempt if they fail to comply. I've just never had a client willing to tilt at that particular windmill.

Sincerely,

Eric

Eric C. Nelsen

SAYRE LAW OFFICES, PLLC

1320 University St

Seattle WA  98101-2837

phone 206-625-0092

fax 206-625-9040

From: wsbapt-bounces at lists.wsbarppt.com <mailto:wsbapt-bounces at lists.wsbarppt.com>  [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of John J. Sullivan
Sent: Sunday, May 17, 2015 4:05 PM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Life insurance company requires parent of minors to be appointed guardian

I've always had to establish a guardianship. 

There is one alternative, however. You can leave it in the policy until the minor reaches 18. It earns statutory interest. My recollection is the interest rate is quite high, especially compared to today's returns. 

I maybe wait until the kid is 17 1/2 to establish the guardianship, assuming the money isn't needed. 

John Sullivan

Sent from my iPhone

On May 17, 2015, at 3:24 PM, Lisa Schuchman <lisa at lisaschuchman.com <mailto:lisa at lisaschuchman.com> > wrote:

I tried this argument once with a life insurance company and a guardianship is required, but no GAL.  

Lisa E. Schuchman

206-325-2801

www.lisaschuchman.com <http://www.lisaschuchman.com> 

Education is what you get when you read the fine print.  Experience is what you get when you don’t. -Pete Seeger

NOTE: I do not use encrypted email.  Messages sent to or from my office via email are not secure and may not be protected by attorney-client privilege. This email address is not monitored at all times.  If your matter is urgent, please phone my office during regular business hours.  

Any tax advice included in this document and its attachments was not intended or written to be used, and it cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code.

P  Please consider the trees before printing this document

From: wsbapt-bounces at lists.wsbarppt.com <mailto:wsbapt-bounces at lists.wsbarppt.com>  [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Marketa Vorel
Sent: Sunday, May 17, 2015 12:31 PM
To: WSBA Probate & Trust Listserv
Subject: [WSBAPT] Life insurance comapany requires parent of minors to be appointed guardian

Dear Listmates, 

I have very little experience with guardianship of minors and the case law seems a bit thin on this issue.  Is a surviving parent of minor children required to undergo guardianship proceedings in order to manage the minors' assets?   

The client is mother of two minor beneficiaries on a life insurance policy established by her deceased spouse (the insured).  The life insurance company demands "guardianship papers for the finances of minor beneficiaries" before pay out.  

Client and deceased were a legally married (same-sex), client adopted both children at birth and has been their legal parent since then. 

The insured also appointed client as the children’s guardian in her will and established a testamentary trust under which any funds due to the minors shall be received and administered.  The insured’s will has been admitted to probate and its provisions are irrevocable and in full force and effect.  

UTMA/RCW 11.114.050, seems to give authority for client to receive and manage the proceeds of the insurance policy without further court proceedings.  Specifically, the statute provides that transfers will be “authorized by a will if the testator has nominated a guardian under RCW 11.114.030 to receive custodial property” and that a “custodian nominated under that section shall be a person to whom a transfer of property of that kind may be made under RCW 11.114.090.” 

AIG refuses to budge and insists on a court appointed guardian.  It seems like the issue of a parent being the de-facto and automatic guardian would be a settled one, without requiring the surviving parent to go to court to demonstrate guardianship of her own children.  What am I missing? 

Thank you in advance for any wisdom,

M.

-- 

Law Office of Marketa Vorel

1520 K Avenue

Anacortes, WA  98221

206.799.0541

marketa.vorel at gmail.com <mailto:marketa.vorel at gmail.com> 

_______________________________________________
WSBAPT mailing list
WSBAPT at lists.wsbarppt.com <mailto:WSBAPT at lists.wsbarppt.com> 
http://mailman.fsr.com/mailman/listinfo/wsbapt

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20150519/63a6b1ba/attachment.html>