[WSBAPT] Guardian of Estate vs. UTMA and Trust Planning

[Stewart Feil]

Hi Eric,

 

I suppose that depends upon the type of plan involved. If there is a Living Trust in place that will control all distributions to the next generation, then I see no advantage to including the language for guardian of estate. 

 

If you are dealing with a Will that is not deliberately establishing any type of testamentary trust, then adding the nomination for guardian of the estate could have some benefit. This can solve the problem of who should be custodian for a UTMA transfer. The natural person to serve in that role is the person designated guardian of the estate. 

 

Again, I think that if there is a Living Trust as part of the plan that the successor trustee would control distribution of funds to the minor and the guardian of the estate would not really have a role to play. There comes a point when too many hats are distributed for various people to wear in fulfillment of a plan. This is an additional hat that isn’t necessary.

 

Interesting question, though. I look forward to other’s thoughts.

 

-- 

 

Warm regards,

 

Stewart Feil

Hanigan Law Office, PS

PO Box 39 - 68 Main Street

Cathlamet, WA 98612

(360) 795-3494

(360) 795-3001 (f)

 

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From: WSBA ProbateTrust List <wsbapt-bounces at lists.wsbarppt.com> on behalf of Eric Reutter <eric at appelgatereutter.com>
Reply-To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Date: Saturday, October 15, 2016 at 10:07 AM
To: <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Guardian of Estate vs. UTMA and Trust Planning

 

Hi Listmates,

Quick technical drafting question involving estate planning for minor children. My question is in regards to guardian nomination provisions in a WIll. I have seen slightly varying language in practitioner forms for the clauses that nominate a guardian for a minor child. Some clauses nominate only as guardian of the child's person, while others appoint the guardian as guardian of both the child's person and estate. 

 

Example: 

 

"I nominate John Doe as guardian of my child's person..."

 

 vs. 

 

"I nominate John Doe as guardian of my child's person and estate...

 

I understand the concepts of guardianship of a child's person vs. a child's estate, but my question is, is there any downside to having the nomination clause cover guardianship of both a child's person and estate? Or is there a reason to have the provision cover only nomination of the child's person?

If, for example, the estate plan was utilizing the UTMA (or trust planning) to pass assets to the children, would a concurrent nomination of an individual as guardian of a child's estate conflict with that UTMA or trust planning? If for example, if John Doe was UTMA custodian, and Jane Doe was guardian of the child's estate, would that create a conflict?

 

Or, would the guardian of the estate simply manage any future funds that might come into the child's estate, while the UTMA custodian would manage the funds passed through the WIll?

 

I am curious to hear some practitioner input/explanations on this issue. 

 

Best regards,

 

Eric Reutter, Partner 

J.D., LL.M. Taxation

14205 SE 36th Street, Suite 100

Bellevue, WA 98006

(425) 298-7110 | appelgatereutter.com 

 

  

 

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