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Legal Notes

Attorney Seunghee Cha; Bulkley, Richardson and Gelinas, LLP; Hadley, MA; 413-256-0002Attorney Seunghee Cha; Bulkley, Richardson and Gelinas, LLP; Hadley, MA; 413-256-0002What to Do When a Gun Owner Is Incapacitated or Dies

According to a recent Gallup poll, over 40% of the U.S. population lives in a household with at least one firearm. If you own a gun or live in a household with guns, you probably know the rules. Or you may not own guns or know much about them; however, if you are a fiduciary for a gun owner, such as an agent under a power of attorney or personal representative of a decedent’s estate, you need to know how to properly possess, transport, transfer, and dispose of firearms under federal and state laws.

According to a recent Gallup poll, over 40% of the U.S. population lives in a household with at  least one firearm.

Two primary federal laws that fiduciaries must comply with are the Gun Control Act of 1968 (CGA) and the National Firearms Act (NFA). Both laws are enforced by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Some of the rules are as follows:

  • It is unlawful to receive or possess certain unregistered firearms, which are contraband and cannot be registered later by the personal representative. Violations are felonies subject to fines and imprisonment.
  • It is unlawful to knowingly transfer firearms to prohibited persons (e.g., felons and drug addicts) and for such persons to receive firearms.
  • You must obtain a federal firearms license (“FFL”) for the sale and purchase of firearms; firearms that travel across state lines must be transferred using an FFL dealer.

State laws also govern gun ownership and dealings. Under Massachusetts law:

  • Firearms must be stored in a locked container or with a tamper-resistant locking device.
  • You must be licensed by the Commonwealth to own, transport, transfer, purchase, or sell firearms.
  • Residents who sell, transfer, inherit, or lose firearms must report the sale, transfer, inheritance, or loss of firearms to the Department of Criminal Justice Information Services Firearms Records Bureau. Any loss, theft, or recovery of a firearm must be reported to the state and local police departments.

To ensure proper handling of firearms, personal representatives should address the following responsibilities (generally applicable to any fiduciary):

✔ Ascertain if the decedent owned guns and whether any are unregistered. If you are unsure, call the ATF.
✔ Review the decedent’s estate plan regarding the disposition of firearms to identify who inherits them. Are the beneficiaries legally permissible transferees?
✔ Determine the type of firearms and transfer requirements.
✔ Secure and transport any firearm found in the decedent’s home. If you cannot safely do so, contact an FFL dealer.

In Part Two of this series, we will explore gun trusts as effective tools for management of firearms to help gun owners, fiduciaries, and beneficiaries navigate and comply with laws.

Picture of a house in the fall with a treeMany homeowners, as they get older, convey their real estate to family members and retain a life estate. When they create a life estate deed they no longer are the sole owners of the real estate and will then own what is known as a life estate interest, and the person or persons they conveyed the real estate to will own what is known as remainder interest. The owner or owners of the remainder interest only obtain full title ownership to the property on the date of death of the owner of the life estate interest.  When owners of life estate interests are still living, they are responsible for expenses such as real estate taxes, insurance, repairs, and maintenance and upkeep of the real estate. Sometimes the owners of the remainder interests will contribute their own funds, if the life estate tenant is no longer able to afford the upkeep and expenses, or is unable because of physical or cognitive decline.

The insurance company denied coverage for the loss of the real estate because the niece was not the named insured on the policy. 

Transfer on death deeds, which Massachusetts does not have, are similar to life estate deeds only that on the date of death full ownership transfers to the person or persons named to receive the property.  One of the main differences of a transfer on death deed is that the property owner retains full ownership until the date of death, unlike the split life estate interest/remainder interest ownership of a life estate deed. There was an interesting Minnesota Appeals Court case decided in February, Strope-Robinson v. State Farm Fire and Casualty Company,  Case No. 20-1147, regarding insurance coverage on a transfer on death deed.  The decedent in this case had homeowners insurance on the property in his name alone.  On the date of his death his niece, to whom he transferred the real estate, did not obtain insurance in her name.  A few days later his former wife burned down the house.  The insurance company denied coverage for the loss of the real estate because the niece was not the named insured on the policy.  The administrator of the estate sued the insurance company, but the court took the side of the insurance company.

This case brings up an important issue of continuous insurance coverage in case of any type of loss with a life estate deed.  Check with your insurance agent or company for their policies and requirements for named insureds with life estate deeds, and continuing coverage when the life tenancy ends.  Perhaps the insurance company may require that the remainder owners be on the policy as additional insureds.  The remainder interest owners being on the policy as additional insureds would also ensure that if the life tenant owner failed to continue coverage, they would be notified and could take action to maintain coverage on the property.

Attorney Seunghee ChaAttorney Seunghee Cha; Bulkley, Richardson and Gelinas, LLP; Hadley, MA; 413-256-0002Most people own digital assets and conduct business online. In this digital era, it is necessary to plan for proper access, management, and transfer of digital assets in the event of incapacity and death. 

Given the legal uncertainties, it is important to be proactive about the administration of your digital assets.

Digital assets are electronic records in which you have a right or interest. They may be stored on a computer, smartphone, memory cards, or online in the cloud. The definition does not include any underlying asset unless the asset is an electronic record. Typical examples of assets that may take the form of “digital assets” are documents (word processing, PDFs), photos, videos, emails, music, information on Facebook, bank and investment accounts, IRS e-filings, crypto-currency, and domain names. 

Why should you have a plan?   

  • Help your family and fiduciaries: Providing information about your digital assets and authorizing access minimizes the burden and cost of handling your affairs.
  • Prevent financial losses: Digital assets may be lost if not discovered and properly marshaled.
  • Preserve family mementos: Your photos, letters, and blogs contain family memories and history.
  • Safeguard against identity theft: During incapacity and even after death, your personal information must be protected.  
  • Protect your privacy: You may possess data not intended to be preserved and may need to designate someone to destroy it.

Unfortunately, existing laws and industry practices pose challenges to planning. Service agreements usually prohibit access to your account by others. Some laws permit authorized persons access but deny their ability to manage and distribute digital assets.   

To address these challenges, many states passed the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) (2015). The statute defers to the owner’s intent, gives preferences to online tools for designating authorized users provided by custodians, grants access to fiduciaries affirmatively authorized by the owner, and upholds service agreements absent any online tool or affirmative record by the owner. RUFADAA was introduced in Massachusetts but has not passed into law. 

Given the legal uncertainties, it is important to be proactive about the administration of your digital assets. Here are some suggestions: 

  1. Create an inventory of digital assets and instructions.
  2. Designate authorized persons access if permitted by the hosting company.
  3. Grant fiduciaries in your estate plan (agent under a power of attorney, personal representative under the will, trustee) access and administration powers.
  4. Back up your digital assets. If you have crypto-currency, provide the private key to a trustworthy relative or fiduciary—otherwise it may be lost forever.
  5. Explore online storage services—beware that some may not comply with applicable laws and may not guarantee service.

Whether they have monetary or sentimental value, digital assets are an integral part of your life. Good planning will ensure their preservation for you and your beneficiaries.

Attorney Pamela OddyAttorney Pamela OddyLately, I find myself settling multiple estates in which the decedent wrote his/her own will. In each case, I do not know what the motivating factor was in not consulting a lawyer for this service. Was it a desire to save money on a lawyer's fee? Was it because they did not trust lawyers? Or was it because they felt that their last wishes were really simple and straightforward and, therefore, there was no need to consult a lawyer? Whatever the motivation to avoid hiring a lawyer to draft a will, the members of the family left behind are now paying a rather high price.

In one estate that I am settling, the decedent hand wrote his own will. In another estate, the decedent used a form that he retrieved from an online source. In the third case, the decedent copied a friend's will and adapted it to his own purposes and left out clauses that he either did not understand or thought to be irrelevant. All of these wills had one thing in common: They omitted very valuable clauses that are designed to make it easier and cheaper to settle an estate.

Whatever the motivation to avoid hiring a lawyer to draft a will, the members of the family left behind are now paying a rather high price.

A common denominator of these "do it yourself'' wills appears to be the omission of a clause that gives the personal representative of the estate the authority to sell the real estate without obtaining permission from the probate court. The technical name for the clause is "Power of Sale." lf this clause is omitted from the will, it forces the personal representative to petition the court to obtain permission to sell the real estate. The petition takes time to be prepared because of all the supporting documents that it requires before submission to the court. During this pandemic, the court is extremely slow and it is not uncommon for this petition to take 4 to 6 weeks to be prepared, submitted, and approved. In the meantime, the buyer might walk away from the sale because it is taking too long or the buyer might lose his mortgage interest rate lock. In addition, creditors who are dependent upon the sale of the house for their payment such as plumbers, contractors, or electricians who may have had to put substantial work into the house to make it saleable are out of luck. The cost of the petition is $250 just to file with the court. On top of that fee, the lawyer also charges for preparation of the petition and also for the supporting documents that the petition requires. All of these problems can be avoided if a lawyer is the one to draft the will.

In another estate I am settling, it has taken over one month to obtain the court’s authority to sell the real estate. I am sure that the pandemic has slowed down the court's response. However, in the meantime, the buyer has lost his interest rate for his mortgage and the sale has had to be extended.

The bottom line is that if the person who drafted his own will thought he was being smart not to consult a lawyer, then he would most certainly be horrified to know that if a lawyer had drafted his will, it would have saved the estate at least $1000, if not more. This is a perfect example of being penny wise and pound foolish.

Cha color 1Attorney Seunghee ChaAre you concerned about the driving abilities of an older driver?

Although age is not a decisive predictor of poor driving skills, the aging process can cause impaired vision and hearing, and slower reflexes.

Health care providers and law enforcement officers may voluntarily report a driver to Medical  Affairs if they have good faith, reasonable belief based on personal observations, or physical  evidence that the driver has cognitive or functional limitations to operate a motor vehicle safely.

The Medical Affairs department of the RMV sets forth minimum physical qualifications for operators of motor vehicles regardless of age, with standards for vision and medical fitness. Individuals who have a medical condition that adversely affects driving must report their condition to the RMV when renewing their driver’s license. People who are age 75 and older must renew their driver’s license in person and pass the vision screening or provide a vision screening certificate. Otherwise, Massachusetts law does not mandate anyone to report a driver suspected of unsafe driving.

Health care providers and law enforcement officers may voluntarily report a driver to Medical Affairs if they have good faith, reasonable belief based on personal observations, or physical evidence that the driver has cognitive or functional limitations to operate a motor vehicle safely. Medical Affairs then makes the determination that the driver (i) is safe to drive, (ii) needs a competency road test within 30 days, or (iii) is not medically qualified to drive and must surrender the license within 10 days. In some cases, the RMV may impose a monitoring period or restrictions, such as no night driving. Additionally, family members and other interested third parties, such as neighbors, may request a medical evaluation by submitting a form to Medical Affairs providing the reporter’s name, address, and phone number; the driver’s name and a brief reason for concern; and at least one of the following about the driver: Social Security number, license number, date of birth, or address. Reports are not anonymous: the driver can obtain a copy by written request.

Health care providers and law enforcement officers are immune from civil liability for reporting, or not reporting, a potentially unsafe driver.

To promote safe driving, hospitals and rehabilitation facilities offer driving evaluations, and various organizations offer safety programs designed for older drivers. Use of adaptive equipment, such as mirror adaptors and pedal extenders, can also assist with driving more comfortably.

Giving up driving can mean loss of independence and isolation. If you have loved ones who are declining in functional capacity, you should ride with them and carefully note their driving abilities. Be prepared for the difficult conversation and share your observations and offer helpful alternatives. When appropriate, contact the RMV to request an evaluation.