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Planning Ahead for Trust and Estate Successors

Trust and Estate Successors

This week’s topic stems from a client question of what exactly is a successor trustee?  It reminded me that the concept of trust and estate successors can be about as foreign as everything else in the odd world of estate planning legal mumbo jumbo.

Thus, in my relentless pursuit of providing a quality Florida estate planning education I will endeavor to explain the concept of estate successors and the various roles involved. Along with the various roles, you also need to know that there is a way to appoint trust and estate successors that maximizes the effectiveness of the estate plan and minimizes potential conflicts.

Identifying the Successor Roles in Every Florida Estate Plan

A key component of any estate plan is the successful placement of “successors” who are to take charge of various duties in the event the primary person is unable to continue.

These various roles include the successor trustee in Florida, successor Florida power of attorney, successor healthcare surrogate in Florida, and the successor Florida personal representative of the last will (aka executor).  Depending upon the estate, a guardian (or successor guardian) may also be appointed.

A successor for any of the above roles is essentially the person who steps in for the original party.

For example, the successor to the trustee is defined as the successor trustee.

To put this in context, when someone establishes a revocable living trust in Florida (defined as the settlor), they generally appoint an initial trustee and this appointee is often themselves.  In the case of a joint trust, the initial trustee would be a dual role as co-trustees.   When a settlor can no longer manage the affairs of the trust, the successor is designated to step and an manage the trust assets on behalf of the settlor while living.  Upon the settlor’s death, the successor is designated to administer the trust by distributing income and assets pursuant to the terms of the trust.

In the same way that a successor trustee manages the affairs of the trust, a successor power of attorney would manage business affairs as designated in that document and so forth for the healthcare surrogate, personal representative and guardian.

Estate successors must be designated skillfully so as to maximize competency and harmony and minimize the likelihood of conflicts.

By the example above, it is hopefully clear that the person or persons whom are appointed as successors serve in a very important role.  In fact, it can make the difference between a harmonious estate and an estate riddled with conflict.  I have often unfortunately observed that a parent will appoint a favorite son or daughter to serve in various roles and essentially preside over the remaining siblings.   Although this approach may have made sense to the parent, such designations can naturally lead to strife.  In the world of estate planning, strife is bad because it can lead to sibling rivalry and even theft from the estate or other forms of drama.

Often times, it can be effective to appoint multiple siblings to serve as co-fiduciaries in various roles OR it may be advisable to mix up the appointments so that, for example, one sibling may serve as successor power of attorney and another as the healthcare surrogate.  It is often the case, that one sibling may be more suited than another for business decisions and another more suited for medical decisions, etc.

An important determining factor is the relationship between siblings and if applicable other appointees.  If relationships are currently strained, they may become more contentious in the event of a death.  If one appointee is really ideal, then the key question is whether they will be able to bring people together or on the other hand will they foster conflict.

All of these questions are very specific given the family relationships and goals of the estate plan and thus must be carefully considered in every case.

Steve Gibbs, Esq.

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