Knowledge…Shared…Multiplies
Jennifer Alexander-John (fictitious name) recently consulted me with a problem that seems widespread in Grenada. Jennifer is 52 years old. She has her own family comprised of her husband and two young adults. Her parents, Mr. and Mrs. Alexander had six children. Jennifer is the third of the six children but the first girl. Jennifer is the only child of Mr. and Mrs. Alexander who remained in Grenada. All the other children, grown adults ranging in ages from 61 to 45, live out of Grenada. Jennifer gets on very well with most of her siblings. However, Jennifer does not get along with Jonathan who lives in the US.
Jennifer’s mother died eight years ago. Her father is now 88 years old. During the last two years Mr. Alexander, who is quite wealthy, owning lands, shares in businesses and substantial bank accounts, developed Alzheimer and he has now totally lost his mental capacity.
Before Mr. Alexander developed Alzheimer he was very independent. He lived by himself, drove his own car and took care of all his business, paying his bills out of a chequing account.
Jennifer, as the only member of the family in Grenada, is now responsible for caring for her father. She loves her father dearly and goes the distance to care for him. However, Jennifer feels burdened by the effect the responsibility of sole caregiver for her father is having on her own family. She is particularly stressed out by the fact that she has no access to her father’s resources and has to use her money to care for him.
Jennifer consulted a lawyer who advised her that she can make an application to the court to obtain a guardianship order. However, her brother, Jonathan, is opposed to such action and has vowed to file an opposition in court if Jennifer seeks a guardianship order.
Estate planning
The difficulty that Jennifer and the Alexander family currently face, with Mr. Alexander having lots of assets but such assets being inaccessible to use to care for him, highlights one of the consequences of lack of estate planning.
By estate we mean the sum total of assets owned by a person. In the case of Mr. Alexander his estate is made up of the value of his lands, shares, bank accounts, etc less any debts he may have.
The law provides several tools with which a person can determined how their estate can be used for their benefit in old age and how it is to be distributed after their death. The use of these tools is referred to as estate planning. Estate planning is
The sum total of decisions taken and methods/tools employed by a person with a view to preserving their estate so that it is available for their use while alive and for distribution after passing in accordance with their wishes….
In the case of Mr. Alexander there are two estate planning tools which could have been used to ensure that provisions for his care were in place. These are a lifetime trust or a living will.
Lifetime trust
A trust is a legal arrangement whereby a person referred to as the trustee holds property for the benefit of another person or persons known as the beneficiary or beneficiaries.
The person who sets up the trust is known as the settlor or grantor. The settlor has wide powers to decide what property would be held under trust and what powers the trustee has with regard to the property.
An important feature of a lifetime trust is that the settlor can also be a beneficiary of the trust.
It was therefore possible for Mr. Alexander to have established a lifetime trust with provisions for his trustee to use the assets of his estate to care for him if he became incapacitated.
Living will
The other tool that could have been used by Mr. Alexander is a living will. One way of doing this is to grant a power of attorney to a trusted person. A power of attorney is a legal document by which one person (“the grantor”) gives another person the power to carry out actions and make decisions on their behalf. The person given the power is referred to as the attorney-in-fact. The actions and decisions made by the attorney-in-fact, within the scope of the power granted, has effect as if made by the grantor.
Thus while he was fit and well and mentally capable, Mr. Alexander could have granted a power of attorney to Jennifer or some other person to use his resources and to take decision for his medical care.
The use of either estate planning tool would have avoided all the drama and headaches that the family now face with the possibility of prolonged and destructive litigation over the issue of caring for a father that all the children profess to love.
-Joseph Ewart Layne
This article is for general information purposes only. Its contents do not constitute legal advice. Before you act on any matter in this article, seek advice from an attorney-at-law.
Joseph Ewart Layne is the Principal of JEL Professional Solutions Inc. He is a graduate of Hugh Wooding Law School; he holds a LLB (Honours) and a LLM (Corporate & Commercial Law) from London University and a LLM (Legislative Drafting) from UWI, St. Augustine. He also holds a BSc. (First Class Honours) in Applied Accounting from Oxford Brookes University and is an ACCA Affiliate.