PET TRUSTS: THE NEXT NEW THING ON YOUR ESTATE PLANNING QUESTIONNAIRE

By: Richard R. Gans, Esq.

Fergeson, Skipper, Shaw, Keyser, Baron & Tirabassi, P.A.

Perhaps, when you were younger and less wise in the ways of the world, you read Rhubarb, by H. Allen Smith, wherein a cat named Rhubarb inherited and ran, after a fashion, a sad-sack baseball team. If you read the book, perhaps one day as you sat in your first year property class you suddenly realized that Mr. Allen had made it all up, that there was no way a pet could legally inherit a baseball team: trusts for pets aren’t valid. Perhaps innocence died for you at that moment.

A new day has dawned: beginning on January 1, 2003, trusts for pets are valid in Florida. New Section 737.116 of the Florida Statutes is the enabling legislation. Under the new statute, a trust may be created for a pet alive during the trust grantor’s lifetime, to last for the pet’s lifetime. A trust for more than one pet is permitted.

Who enforces a trust for beneficiaries who cannot speak? The statute provides that the trust may be enforced by a person designated by the grantor in the trust agreement. If there is no such person, anyone interested in the welfare of the pet may request the court to appoint a person to enforce the trust. The statute does not define what it takes to rise to the level of a person interested in the welfare of the pet. Ideally, the grantor should provide for a succession of “trust protectors” in the trust agreement. A trust protector has all the rights of a “normal” trust beneficiary in enforcing the trust on behalf of the pet.

The statute permits a court to determine that a pet trust has been funded in an amount exceeding that required for the trust’s purposes. What is reasonably required to care for the grantor’s pets varies from case to case: a trust for a tortoise is likely to last much longer, and require more funds to accomplish its intended purpose, than a trust for a cat or a dog. If the court determines that the trust has been over funded – presumably having been invited to consider the matter by the trust’s remainder beneficiaries – then the excess assets would pass to the persons designated in the trust agreement to take at the pet’s death. This puts a premium on selecting remainder beneficiaries who share the grantor’s vision as to the care of the grantor’s pets.

Drafting the purr-fect pet trust is not as simple as following the statute; the presence of non-human beneficiaries raises a host of issues not present in trusts created for people. For example, the draftsman will need to consider, and draft for, beginning- and end-life issues. Is a pet in gestation alive during the grantor’s lifetime? If this is what the grantor intends, the trust agreement should say so, and should contain authorization for the trustee to make the appropriate tests. End-life issues are more likely to present trouble in the real world. Remainder beneficiaries can be counted on to take a fairly expansive view of the humaneness of euthanizing an old or sick pet. To eliminate the possibility of trouble, the trust should designate a veterinarian familiar with the pet whose decisions on end-life issues are to be final.

The grantor should be as specific as possible as to the care he or she expects the trustee to provide for the grantor’s pets. The pet’s dietary, health care and exercise requirements should be clearly spelled out. If the beneficiary is a horse, is the trust to acquire a trailer to transport the horse? If the grantor showed FiFi during the grantor’s lifetime, is the trustee to arrange to enter FiFi in dog shows after the grantor’s death? If the grantor took Rover to Arizona three times a year to alleviate Rover’s chronic asthma, does Rover (and his caretaker?) get to continue making these trips after the Grantor’s death? There is no substitute for an in-depth discussion with the grantor about these types of issues. The trustee will thank you, even if the remainder beneficiaries may not.

The trustee does not have to be the person having actual custody of the pets; in fact, in many cases, the grantor will want to segregate the trustee’s money responsibilities from a caretaker’s animal care responsibilities. If someone other than the trustee has custody of the pets, the trustee should be given authorization to take one or more steps set forth in the document (i.e., implantation of a microchip) to enable the trustee to make positive identification of the pet. Everyone has seen at least one movie where Fluffy or Fido dies under the care of a panic-stricken teenager who then tries, always unsuccessfully, to pass off an imposter as the real pet. Most trustees would not see the humor in this sort of thing.

If the person having custody of the pet is not the trustee, the trust agreement should provide for a succession of individual caregivers. The initially appointed caregiver may die, move away, or just plain get tired of working for a dog. The grantor might also consider giving the trustee the power to hire and fire custodians if certain conditions set forth in the trust agreement have been met. The trust should give the trustee the power to make an independent determination as to whether the caregiver is adequately providing for the pet’s welfare. Here again, the trust might leave that decision to a veterinarian appointed in the trust agreement, exculpating the trustee from liability for the veterinarian’s decisions.

And so we return to Rhubarb the Cat. If there was mention in the story about the remainder beneficiaries of the trust, I must have missed it, and I don’t remember anything about trust protectors or microchips. Rhubarb’s story would, perhaps, lose some of its wholesome charm if it were confined to what is possible under new Section 737.116. Maybe it’s all moot, anyhow: if Rhubarb had lived in Sarasota, he would have been tempted to disclaim ownership of our local major league baseball team. Which raises another question: who has the power to disclaim for a pet?