Probate is a court-supervised process for distributing the individually owned assets of a deceased person.  The probate process carries a lot of responsibilities and the court process is often daunting, even for lawyers who are not experienced with probate matters.  The Law Offices of Ernest J. Kim can help guide your loved ones through the process as sensitively and completely as possible.  We can provide specific services, or handle the entire probate process so your family doesn’t ever need to step into a courtroom.

In Probate court, estate assets are distributed to beneficiaries in accordance to the instructions written in the person’s will.  If there is no will, the assets are distributed according to the California Probate Code.

Estate administration can be complex and estate administrators should seek advice from competent and experienced counsel to guide them through the process.  They must make important decisions – sometimes quickly – and they need help to make them wisely.

Our firm has guided other attorneys through the probate process, and we are ready to assist you & your family.

Our planning does not end with the creation of your estate plan.

All too often, we see the following scenarios amongst our clients who have businesses:

SCENARIO #1. A family owned business is run by a parent or parents.  The business has good cash flow and cash value, but the owners/parents have made no plans for what happens at the business in an emergency situation.  One or both parents become ill, or die.  With no leadership, the business cannot continue to operate beyond one or two months.  The family desperately looks for a buyer, tries to get out of the lease and other contractual obligations, and/or is forced to close its doors.  Best case scenario – a buyer is found, and the family can “sell” the business, but all they get for a lifetime of their parents’ work is pennies on the dollar.

SCENARIO #2.  A family owned business is run by parent/s and one of their children.  The business has good cash flow and cash value, but the owners/parents have made no plans for what happens at the business in an emergency situation.  One or both parents become ill, or die.  Luckily, their child is able to continue to operate the business, and does so – quite successfully.  The other children – who are not involved in the business – want their share of their parents’ estate, and rightfully so, since their parents’ estate plan said to split the assets “equally.”  The children can’t agree on a fair division;  some want to sell the business and split the proceeds, while others want to keep it in the family.  Years of litigation between the siblings ensues.

SCENARIO #3.  A family owned business is run by a parent or parents.  The business has good cash flow and cash value, but the owners/parents have made no plans for what happens at the business in an emergency situation.  One or both parents become ill, or die.  A key employee sees the writing on the wall – with no leadership, the business cannot continue to operate beyond one or two months.  While the family desperately looks for a buyer, tries to get out of the lease and other contractual obligations, and/or is forced to close its doors, the employee opens an office across the street and takes the clients with them.  The business “survives” – but the family gets no benefit from the lifetime of labor their parents put in.

These are just some of the actual scenarios we have seen repeating over and over and over…. And every single one was completely avoidable:

Scenario 4.   A family owned business is run by a parent or parents.  The business has good cash flow and cash value, but the owners/parents have made a plan for what happens at the business in an emergency situation.  One or both parents become ill, or die.  The business continues to operate or is sold immediately exactly as the owners planned.  The family retains the business, or sells it for its full and actual value.

All of us have a choice.  No one would choose scenario 1, 2, or 3 for their family business, but if you DON’T MAKE A PLAN THAT CHOOSES SCENARIO 4, what are the chances that your family business will ultimately benefit your family?  Let us help you plan your exit strategy.

If you are like most of us, you look forward to the day you can retire, perhaps turn your business over to a son or daughter, or sell it.  You didn’t work 12 hour days in order to see your business fail or go to strangers.  But no matter what you are planning, or even if you are not planning to EVER stop working, you must absolutely MAKE A PLAN TODAY, for the day you cannot run your business due to unforeseen illness or death.

Most business owners do not take the time to plan for how they will leave their business. They are busy running the company, or they don’t know where to start. But if you own a business at your death, it will be included in your estate and could be subject to all of the scenarios above PLUS substantial  taxes. Your family could be forced to sell the business or its assets at ‘fire sale’ prices. Then you will have worked hard all these years so strangers and Uncle Sam – not your family – will reap the benefits.

Planning for how you will exit from your business should be an integral part of your estate and retirement planning. Proper planning now can provide you with retirement income, reduced income and estate taxes, and even let you benefit a charity if you so choose, regardless of whether you transfer your business to family members at discounted values, to employees, or to an outside buyer. In today’s market, the economy and trends are affecting the timing and value of business transfers.

Planning now to exit your company will result in you and your family receiving the best possible results, both now and after your retirement, disability or death. You can receive retirement income; you can transfer your business to your family, your employees or an outside buyer; you can make a difference for a charity or your community; and you can do all of this with reduced income, gift and estate taxes.

A power of attorney is a legal document that many people have heard about, but may not fully understand its use. A power of attorney is a legal document that is used to give someone else the authority to take actions on your behalf, such as signing your checks to pay your bills or selling a particular piece of real estate or even making healthcare decisions. Powers of attorney are a great way to make sure that your affairs will be properly taken care of no matter the circumstances.

ADVANCE HEALTHCARE DIRECTIVE:

A healthcare power of attorney allows your trusted friend or family member to make medical treatment decisions for you if you are unable to communicate your wishes to doctors. Without one, you must have a guardian or ‘conservator’ of your person appointed by the court before decisions can be made on your behalf.

We have counseled thousands of families in crisis.  When a health crisis arises, you can choose who will make decisions and what the decisions will be.  If you do not make this important document, imagine the hardship on your loved ones of having to go to court, waiting for a judge to appoint the person to make these decisions for you.  Even if the “right” person is appointed by the judge, the trauma of going to court when a parent or loved one is in the hospital increases the emotional toll on your family. We have seen firsthand the toll taken when children have to go to court while their parent lies ill in the hospital.

A healthcare power of attorney not only saves precious decision making time, but it also makes sure that the individual you trust the most has the power to make these most important decisions for you if you are unable to make the decisions on your own.

DURABLE POWER OF ATTORNEY – PROPERTY MANAGEMENT:

Who will make decisions for you if you are unable to make them for yourself?  Who will have the power to sign documents on your behalf, or make sure your bills get paid?  Without a durable power of attorney, someone who is mentally incapacitated must be taken to guardianship or conservatorship court to have a decision maker named for them by a judge. A carefully written durable power of attorney will allow you to name someone you trust to make decisions for you if you become disabled to the point of no longer being able to make those decisions yourself.

We advise clients on the use of trusts and sophisticated business entities that provide asset protection benefits in addition to estate and gift tax benefits.  Using these methods, someone suing you won't be able to touch certain protected property regardless of the size of the court judgment they may obtain.

However, the only time most of these methods can be put into place is before any trouble arises. You must act while there is no lawsuit on the horizon in order to receive the full benefits of the many and varied asset protection methods available.  

Asset protection is not just for the "ultra rich."  The likelihood of "Average Joe" being sued goes up everyday, and the US is called "sue happy" in leading journals and periodicals.  Note these statistics as of 2011:

• A new lawsuit every 2 seconds  

• One lawsuit for every 12 adults

We assist business owners, professionals, and families like yours have the peace of mind knowing that even in the worst case scenario, a lawsuit can be a minor setback instead of a catastrophic financial disaster.

MORE...

QPRT - ASSET PROTECTION TRUST FOR YOUR HOME

*Note that the address information on the above document (linked) is out of date.

Our overarching goal is to make sure that all of our clients - and their estates and trusts - stay out of litigation.  But there are times when litigation may be the only option, such as:

• Breach of Trustee Duty

• Fraudulent Heirship Claims

• Unhappy Family Members

• Defending an Accounting

• Obtaining an Accounting from a Reluctant Trustee

• Auditing an Accounting

• Fixing a Botched Trust or Estate Plan

• Unsatisfied Beneficiaries

• Blended Family Situations

• Questions About Mental Capacity

• Forged Documents

• Damages Caused by a Careless Trustee or Fiduciary

• Missing Assets

• Etc.

Trust and estate litigation is a highly specialized area of the law, requiring extensive knowledge of probate court procedures and trust law. If you are facing estate/trust litigation or believe you have grounds to sue on a trust or estate matter, you need an attorney who will advise you not only as to your rights, but also about your responsibilities and possible liabilities so you can make an informed decision about your case. 

Our combined decades of experience will be at your disposal, and you'll get answers grounded in law and common sense. We will provide you with an analysis of your case, and a recommendation for an efficient, cost effective solution. We have guided many of our clients to avoid costly litigation, while still achieving their goals. But in cases where litigation cannot be avoided, we provide full litigation services. 

Trustee Duties:

A trust is a legal document that can contain your instructions for what you want to happen to your assets when you die. 

A trust is controlled by its "Trustee" - usually, a person chosen by the trust's settlor ("grantor"). Among other things, a Trustee is required by law to act in accordance with their duties, including a duty to administer the trust solely in the interest of the beneficiaries. If a trust has two or more beneficiaries, the Trustee must deal fairly and act impartially with each of them. A Trustee must not use or deal with trust property for their own benefit or for purposes unconnected with the trust, and trust assets must be kept separately, with trust assets and income accounted for at regular intervals. 

The trustee is responsible for seeing that the assets of the trust are distributed properly and in a timely manner. Added to their duties, is a list of tasks that they are expected to actively perform, generally including the following:

• Review of the trust document

• Contacting all trust beneficiaries and heirs

• Contacting financial institutions and gathering all trust assets

• Estate Tax Analysis

• Collection of death benefits

• Creation of sub-trusts

• Dissolution of trust

There are many other duties of a Trustee, but most Trustees are laypersons, not professional Trustees who deal with legal or financial matters on a daily basis. Sometimes knowingly, and sometimes through lack of proper professional guidance, Trustees often breach their duties and cause damages to the beneficiaries they are supposed to protect.

If a Trustee is not handling their responsibilities properly, they need to be guided to do so, or removed from the office of trustee to prevent further damaging the beneficiaries' interests.  

At the Law Offices of Ernest Kim, we've helped countless Trustees properly manage their trust responsibilities to a successful final termination of the Trust. 

We have also helped beneficiaries get answers and make sure trust assets are properly managed, protected, and accounted for.  We've assisted countless beneficiaries who had been in the dark about their rights for years, to finally receive the assets and information intended for them.