The Effect of Wisconsin's Domestic Partnership Registry

In 2006, Wisconsin passed a constitutional amendment banning same-sex marriages. Because of that amendment, marriage licenses legally obtained in other states by gay couples are not recognized as legally valid in Wisconsin.

In an effort to provide same-sex couples with some of the legal protections available to married couples, Wisconsin implemented a domestic partner registry earlier this month. Same-sex couples may now register as “domestic partners” in the Register of Deed’s office of the county in which they reside, provided they are at least 18 years old, supply proof of a common residence, present certified copies of their birth certificates, their Social Security numbers, and the required filing fee. Registering as “domestic partners” affords same-sex couples with a legal status which gives some legal protection to their relationship.

Perhaps the two most critical effects of registering as “domestic partners” (aside from a public recognition of the relationship) is that registration: (1) allows for the extension of health care benefits to same-sex couples, and (2) greatly affects same-sex couples’ rights in probate and estate matters.

With respect to probate and estate matters, the new law allows one partner to inherit their partner’s property or other assets, even if neither partner has a will. Previously, if one partner died without a will, all assets would automatically go to that partner’s parent or siblings and the surviving partner would not be able to recover any of his or her partner’s assets. Other changes to probate/estate law are:

· A domestic partner also has priority over certain items of personal property, in that a probate court may transfer personal property to him/her set forth in a written selection, provided the property does not include items specifically bequeathed to another individual;
· The new law also creates a presumption that if a couple is listed in a document, instrument or bill of sale for property as domestic partners, that the couple owns the property as joint tenants, so that upon one partner’s death, the other partner is the sole owner;
· A partner also had the right to purchase his/her deceased partner’s interest in a home in which the two lived in prior to death;
· A partner may exempt up to $10,000 worth of property from creditor’s claims where the deceased partner’s assets are insufficient to pay claims;
· A partner may be entitled to support payments during the pendency of the probate process;
· A partner may be allowed to participate in an accelerated probate process where the estate does not exceed $50,000 in value; and
· If a Power of Attorney for Health Care is created and the agent is the domestic partner, termination of the domestic partnership terminates the power of attorney document just as it does for married couples who become divorced.

Additionally, the following protections are afforded for couples registering as domestic partners:

· A partner may be eligible for receipt of death benefits if the deceased partner was killed in a workplace accident;
· A partner may sue for a partner’s wrongful death;
· A partner may qualify for up to two (2) weeks off per year to care for a domestic partner with a serious medical condition (if the employee is covered by the state FMLA);
· A partner may invoke the privilege against testifying against a partner regarding private communications during the partnership, just as married couples may do;
· A partner may transfer real estate, mobile homes and motor vehicles to his/her partner without having to pay the real estate transfer fee, the manufactured home fee or the motor vehicle title transfer fee;
· A partner may share a room with his/her partner in a medical facility or nursing home;
· A partner may consent to his/her partner’s admission to a nursing home if there is no valid Power of Attorney for Health Care in effect;
· A partner may consent to organ donation on behalf of the other partner, and may also consent to an autopsy;
· When a domestic partner was the victim of a crime, the other partner is now deemed a “member of the family” who must be notified when the offender is released into the community, and the partner may also receive crime victim compensation;
· A partner may not be evicted from a rented dwelling when the other partner is an active duty member of the National Guard.
· A partner may be a dependent under an AIDS/HIV health insurance premium subsidy program; and
· A partner may receive insurance benefits from fraternal organizations and may be entitled to employee cash bond payments and/or wages when a partner employee dies.

The Importance of Estate Planning When Your Child Has a Disability (Creating a Supplemental, or Special Needs Trust)

Within twenty-four hours of our daughter Abby’s birth, my husband and I learned that there was an issue with her hearing. Her congenital hearing loss diagnosis (“Connexin 26 resulting in bilateral, sensorineural, mild/moderate loss”) by the specialists at Children’s Hospital would open us up to a dizzying, yet wonderful, world of expert physicians and audiologists, dedicated therapists and parents, incredible teachers and amazing children. After five years of hard work and tremendous help from terrific people, Abby entered a mainstream full-day kindergarten class just weeks ago, and has a future as promising as any other child. However, Abby may qualify for public benefits as an adult due to her hearing loss diagnosis, accordingly, we have to give special consideration when preparing for our, and for her, future. Implementing the right estate planning options for children with health conditions ranging from “mild,” as we view Abby’s diagnosis, to serious, can not only preserve a quality of life that parents work hard to achieve for their child, but it can ensure stability and dignity through adulthood, even if, and when, the child’s parents have passed on.

Generally, the needs of the child will dictate what type of plan is proper to implement. Estate planning options vary depending upon the age of the child at the time of planning and what is known about the child’s health care needs and job options. If a child has a health issue but will be able to manage his or her own work life and earn enough to support a family, the goal of an estate plan will be to supplement a working adult’s earning capacity by creating a trust which can, for example, make distributions that help the employed adult’s living situation. Estate planning for minor children becomes more complex when a child has a qualifying health condition which meets the definition of “disability,” whether the health condition is developmental, psychological, cognitive, or mental. If a child is not expected to be self-supporting due to the health condition and/or will qualify for public benefits, such as Medical Assistance and Supplemental Security Income, a special needs trust, or supplemental trust, as it is sometimes called, should be implemented in order to avoid disqualifying the disabled individual from benefits. That is because individuals who receive Social Security Supplemental Security Income (SSI) benefits, Medicaid and other state benefits are very limited in what they can have in assets and income while maintaining their benefits.

There are three basic categories of special needs trusts: (1) the third-party special needs trust, created by relatives and friends of a minor with a disability; (2) the self-funded special needs trust, which can be funded by an under 65-year-old disabled public benefit recipient or his or her representative; and (3) the pooled trust.

The first type of trust, the third-party special needs trust, is created by another person (not the child/beneficiary) for a disabled beneficiary of any age. Upon the death of the disabled person, any remaining money in a third-party special needs trust can be left directly to a designated contingent beneficiary (such as the sibling or offspring of the disabled beneficiary), without having to pay back the assets. The special needs trust generally provides that the money contained in the trust will be used to pay for the care of the child/adult which is not taken care of by the public benefits system (such as dental care and treatment or other health care not covered by private plans or public coverage, differentials in costs between housing and shelter for shared and private rooms, private rehabilitative training, private case management to assist the person with bookkeeping, periodic outings, etc.).

The second type of trust, the self-funded special needs trust, is for beneficiaries under the age of 65. It is often established by a court, parents, grandparents or guardians and funded with a disabled person’s settlement or unprotected inheritance. It can also be created by the disabled person himself or herself. Regardless of who establishes or funds the trust, the trust must contain a “payback provision” which agrees to pay back the money remaining in the trust at the disabled person’s death to the state agency which administers the medical assistance program. By agreeing to payback the benefits, the individual may continue to receive medical assistance benefits.

The final type of special needs trust is the pooled trust. In a pooled trust, the trustee is a non-profit organization which manages the funds of many individuals (typically other disabled persons) and invests these funds collectively, while maintaining separate accounts for each individual beneficiary. Upon the death of each beneficiary, the monies in that beneficiary’s account can either be used to repay the state agency which administers the medical assistance program or remain in the Trust to be used for the benefit of other persons with disabilities. Pooled trusts are generally used where the money available to fund a trust is modest in size such that a corporate trustee would not be available or practical.

Of the three, the basic planning approach for parents of a minor child who want to preserve public benefits for their child may be to:

· include a will with a testamentary special needs trust for the child;
· nominate a guardian and conservator for the child in the will;
· avoid naming the child as a beneficiary of an IRA or qualified benefit plan;
· provide substantial life insurance on both parents;
· prepare other estate planning documents with disabled child provisions;
· prepare care plan recommendations for future caregivers and for the trustee; and
· avoid living gifts to a UTMA account or Crummey Trust withdrawal powers for the child.

Parents of a child with a serious health condition often say that their knowledge about health care options, treatment, education and service programs can make a world of difference with respect to their child’s quality of life. Careful estate planning can do the same, and can extend quality of life to a time when the parents can no longer be there for the child.

Terminating a Durable Power of Attorney

Recently I was contacted by the family of an elderly man (“Phillip”) hospitalized with complications from pneumonia. The family resides several states away. They are concerned with whether a power of attorney Phillip created several years ago is valid. Pursuant to the power of attorney, Phillip had given his niece-in-law (his only relative living in the state) the ability to make decisions regarding his financial matters if he became incapacitated. Because of Phillip’s deteriorated health, Phillip’s physicians had confirmed his incapacity, and the power of attorney for health care and for financial matters had been invoked. Phillip’s family suspects that the appointed agent may be abusing her powers by inappropriately disposing of his assets.

The power of attorney form that Phillip had signed was a statutory power of attorney form. In Wisconsin, a principal (here, Phillip) may revoke the statutory power of attorney form by: (1) destroying the document; (2) by directing another person to destroy the document in the principal’s presence; or (3) by executing a written statement expressing his or her intent to revoke the power; and by signing and dating that statement. (See Wis. Stat. Sec. 243.10(7)(b)). Powers of attorney are also terminated by the principal’s death, or by dissolution or annulment of the principal’s marriage if the agent is the former spouse, pursuant to Wisconsin Statutes Sections 243.07(4)(a) and 854.15(3)(d).

According to Phillip’s family, Phillip had intended to talk with an attorney regarding his desire to change the agent he had previously designated in the form, but had never done so. Phillip also never destroyed the document, never had another person destroy it, and never put in writing his intent to revoke the power. Accordingly, the power of attorney remains effective.

Having said that, a power of attorney is to act only in the principal’s best interest. Phillip’s family is considering talking with the police and also court intervention, including a guardianship proceeding. (Under Wisconsin law, a previously executed power of attorney remains in effect despite the appointment of an alternative guardian unless, for good cause, the court revokes the power of attorney or limits the agent’s authority). The difficulty Phillip’s family faces is that they are not in any position to act on his behalf given their location and their own health issues. The family asked if I could serve as agent, however, the Supreme Court Rules are set up to discourage lawyers from serving as agents, unless the attorney is able to serve in a very limited capacity (such as funding a trust of which a bank or other party is a trustee).

I cannot express enough how important it is: (1) to select an agent whom you fully trust as power of attorney rather than choosing someone who may be “convenient,” and (2) to contact an attorney immediately to change a power of attorney when circumstances warrant a change.

What Parents of Minor Children Need to Know about Estate Planning -- An Estate Plan is Needed to Nominate a Caregiver ("Guardian") for Your Children

Whenever I tell someone that I am an estate planning lawyer, I often get the response -- “Okay. What is that, exactly?” Estate planning, “neatly” summarized, prepares your family for the tragic possibility of your death or incapacitation. The process of estate planning will:

· Organize your financial information (assets and liabilities);
· Designate a caregiver for your children;
· Establish how your children’s future will be funded (i.e., when your life insurance and other assets will be distributed to them – after they graduate from college, for example);
· Create a vehicle which indicates what assets will go to whom;
· Help you to ensure that more of your assets go to your beneficiaries, rather than to paying taxes;
· Ensure your assets are properly titled and that your contractual beneficiary designations are properly worded;
· Designate persons of your choice who will handle your finances and health care decisions if you are unable to;
· Walk you through difficult choices about what medical care you would choose in the event of terminal illness or a diagnosis such as “permanent vegetative state” and,
· If you wish, minimize the probate process for your loved ones after your death.

By far the most important planning decision that an estate plan will allow parents of minor children to make is the designation of a caregiver, or “guardian,” who will raise your children if the unimaginable should happen to both parents when one or more of the children are under the age of 18.

When one spouse passes away “intestate,” or without an estate plan/will, the other parent assumes the role of sole caregiver of the couple’s children. But, when a couple dies “intestate,” or without an estate plan/will, a court must step in to appoint a guardian on behalf of the children. The guardian will take on the “substitute” parent role and will handle everything from the day-to-day care for the children to critical decisions regarding medical care, education, religion and other life-defining choices. While a court often will appoint a close relative of the children, the court has the discretion, meaning the right, to select anyone who steps forward and requests to be appointed. Although a court will consider numerous factors in making the decision, including the children’s wishes, if they are old enough to make those wishes known, it is the particular judge that the case is assigned to who makes the final decision. Not only does the appointment process result in legal fees which may reduce your children’s inheritance, but more importantly, the process may result in the appointment of a person whom you would never choose to raise your children. Sometimes, families find themselves in lengthy, drawn out court battles over who will raise the children, causing serious rifts in relationships and resentment during an already tumultuous time for the children.

Most often when providing advice on this topic, I hear parents say: “We really can’t think of anyone who would raise or love our children as we would.” Perhaps the best thing to do is to accept that there is no one who could love your children as you do, or who would make choices for your children as you would, i.e., that there is no clone replacement for you. Instead, I encourage parents to look to their families and close friends for a person(s) near their age whom they believe would be the best runner-up -- who would provide a stable, nurturing environment for their children, and then for the second best runner-up, in the event that the first choice for any reason cannot serve. Consider who has a good relationship with your child/children already. Examine how many children the person/couple already has, and their lifestyle. Does the person/couple live life/raise children with the same morals/religious values? Does the person/couple have children such that raising your children in addition would cause hardship on everyone? If the person/couple does not have children, does the person/couple want children? Is the person/couple in a healthy relationship? Does the person/couple value education as you do? Is the person/couple in good health, mental and physical? What is the person’s/couple’s approach to financial matters? If your assets fall short in rearing your children, would the appointed guardian be able to financially support the child/children? Does the person/couple have a good network of support? Does the person/couple have the time and energy to devote to your children? Is the desired guardian(s) located relatively close to where the children are being raised?

Many times couples will wish to nominate their own parents, but consideration must be given to the age of the grandparents and to their health status, and to whether or not raising a teenager at ages 60 or 70 is the best option for either. Also, you will often choose the same guardian for all of your children, but in some instances, such as stepsiblings or children who are far apart in age, different guardians may be appropriate. Further, clients often also wish to elect a sister and brother-in-law, or vice versa. The recommended procedure is to name just the sister, or just the brother-in-law, in order to avoid a dispute regarding which should have custody in the event your sister and brother-in-law divorce, but this can also complicate the decision making process for the guardian. I suggest that once you feel you’ve chosen a couple who you believe would lovingly raise your children, that you explain that you are “exploring the possibilities,” and ask them how they would feel about being the guardian of your children, what their feelings are about divorce or termination of their relationship, and how they would like to handle the medical and decisional aspects of guardianship (whether one would prefer to be the decision maker or both would like to be named as guardians). If you have selected a guardian(s) and an alternate, and one or both are persons outside of your family, I suggest that you talk with your family to avoid a surprise, which could result in a challenge to the guardianship proceeding and a lengthy court battle. In every circumstance, your estate plan should nominate someone other than the guardian as the trustee, or keeper, of your children’s inheritance. The separate appointment is not intended to be a statement on the guardian’s trustworthiness or honesty, but as a means by which to avoid any impropriety to outsiders.

While your chosen guardian(s) will likely know you well, I often suggest that couples draft a letter about their hopes and expectations for their children and that they keep this letter with their estate plans/wills, which will serve as a guide for the guardian(s), and as a keepsake for your children if they lost you.