If your household includes animal companions, be they dogs, cats, horses, rabbits or mice, you may want to include a pet trust in your estate plan. A pet trust is a legally enforceable document whose purpose is to insure that your pet receives the sort of care you would have provided had you not died or become disabled. In order to accomplish this, you name one or more persons to act as a trustee – the person who will use the money or property you put in the trust for your animal companion’s benefit. You also name a caregiver who will care for your animal companion; their expenses will be paid by the trustee out of the pet trust. The trustee will check periodically on your animal companion to make sure it is receiving the level of care specified in the trust instrument.
A pet trust is best created in your living trust or your will. When created this way, the trustee that you choose is required to honor all the terms of trust. These could include what type of food your animal companion likes, who your veterinarian is, and specific ways you would like your animal companion to be cared for after your passing. Your trust can be general, or very specific, whatever you prefer. It also gives third parties the right to initiate court proceedings to further the interests of the trust. Probate Code Section 15212 gives the court the authority to appoint a new trustee and further empowers it to “. . . make all other orders and determinations as it shall deem advisable to carry out the intent of the settlor . . . .”
In order to fund the trust, you should ask your drafting attorney to give a specific monetary gift or a percentage of your estate to the pet trust. These funds will be used to care for, feed, and provide for your animal companion. In order to decide how much money to fund your pet trust with, keep in mind the age of your animal companion(s), how many companions you have, what health issues they may have, and how richly you would like them to live.
You may designate residuary beneficiaries of the pet trust, who will receive the surplus, if there is any. You may leave the remainder to relatives, friends or to organizations like the Humane Society, the SPCA or local animal rescue groups. You should be very careful about leaving the surplus to the caregiver as that person may be tempted to put his or her financial interests ahead of the welfare of your animal companion. If you would like to leave it to your caregiver, it is highly recommend to have your attorney add conditional language to the trust so that they caregiver only receives the surplus if the animal dies of natural causes.
If your pet trust assets run out before the animal companions die, then you are dependent upon the good will and financial circumstances of your caregiver. It is for this reason that you should use great care in choosing this person and his or her successors. The trust instrument should contain a provision naming a person or organization you want your animal companion to go when all else fails. However, it is recommended to name two or three alternate successors so that your companion does not have a risk of being put in a shelter.
If you wish to provide for the care of a valued pet should you predecease your companion, you can do so with proper instructions to your trustee. Contact the estate planning attorneys at Schneiders & Associates, L.L.P. to discuss how to protect your pet’s future through a pet trust. The initial consultation is free.