Pet Trusts: Providing for the Care of Our Pets After Disability or Death
Millions of households have pets.
They are such an integral part of the household our pets are essentially family members.
What happens to our pets if we become legally disabled or die?
It is incredibly common for someone to become hospitalized or die without any plan for how their pets and other animals will be cared for in their absence.
This is why it’s incredibly important to incorporate pet custody and care into any estate plan.
Luckily, Illinois has recognized the importance of allowing pet Owners the ability to plan for the care of their pets in the event of legal disability or death. Because most all animals need daily care and feeding, time is of the essence in these situations.
The need for immediate pet custody and care typically occurs when either:
(1) the Owner becomes legally disabled, or
(2) the Owner dies.
PET OWNER BECOMES LEGALLY DISABLED
It’s increadibly common for pet Owners to become unable to care for their pets due to a temporary or permanent legal disability. The onset of the disability could be gradual (dementia), or sudden. A sudden disability is quite a common occurrence. For example, the Owner is hospitalized due to a stroke or heart attack or auto accident.
I will not into detail on how to plan for this situation in this post (look for more in a later post). I will say two things.
First, under the Illinois Animal Control Act (510 ILCS 5/1), when an Owner suffers an unexpected health event, pets are often impounded at an animal control facility and must be reclaimed within a limited time.
The time to reclaim a pet (and the probability of the animal making their way back to their Owner before being adopted out or sent to an upstate farm) largely depends on whether the pet is microchipped. So, microchip your pets!
Second, have a plan in place. The State laws do not deal with this situation as well as one would hope. Estates planning tools such as a Power of Attorney for Property with an animal care and custody provision go a long way.
PET OWNER DIES
After someone passes, there are many options for attending to the care of pets. I won’t go into detail about the pros and cons of each. Instead, I’ll merely introduce each as a concept. Please note this list may not be exhaustive.
Under the Illinois Trust Code (760 ILCS 3/), Owners of “domestic or pet animals” can establish a trust for the care their animals.
However, the Illinois Pet Trust Code does not do a good job of defining what a “domestic or pet animal” includes.
The Illinois statutes defines “animal” to mean “every living creature, domestic or wild, but does not include man.” (510 ILCS 70/2.01).
So, what is a “domestic or pet” animal? Are these two different types of animals, or are “domestic” and “pet” alternative terms for the same thing?
A "companion animal" means “an animal that is commonly considered to be, or is considered by the Owner to be, a pet. "Companion animal" includes, but is not limited to, canines, felines, and equines.” (510 ILCS 70/2.01a).
What about farm animals? Beasts of burden? Rescued wild animals? Let’s not worry about that fine point for now. Let’s assume that a Pet Trust can be created for any living creature cared for by someone.
OPTIONS FOR PET CARE
1. Pet Addendum to Revocable Living Trust (Inter Vivos Pet Trust) – This is the best option if one has a Living Trust.
Under a Living Trust, a Grantor transfers legal title to Property (“Trust Corpus”) to a Trustee, and the Trustee manages the Property for the benefit of one or more Beneficiaries.
During one’s lifetime, the Grantor is the Beneficiary. Upon the Grantor’s passing, the named Beneficiaries convert to the persons named in the Trust Agreement (e.g., the Grantor’s children).
The reason this is usually the most preferred route is because during the Grantor’s lifetime the Trustee takes control and directs the custody and care of the pet. So, if the pet Owner (Grantor) becomes disabled, the Trustee merely steps in and fulfills that role.
Also, because this is a Trust, there are certain rules and protocols the Trustee must follow in order to ensure they comply with their fiduciary obligations. There are some controls in place.
2. Standalone Pet Trust – If one does not have a Living Trust, a standalone Pet Trust can be created to provide for the custody and care of pets by a caregiver. One item to note is that unlike a normal Living Trust, this Trust would need to be separately and adequately funded to take care of all expenditures one might encounter (e.g., food, insurance, vet bills, etc.).
3. Last Will & Testament Pet Provisions – A pet Owner can provide for the custody and care of their pet via their Will. Provisions are imbedded in the Will directing who will care for your pets after your passing and can provide financial means for pet care.
This one is OK, but not the best. First, this setup doesn’t account for what to do with the pet if the Owner becomes disabled. Second, these provisional typically only account for providing custody and financial means, without putting any fiduciary responsibility onto the new care provider. In other words, once the estate is settled, there’s no ongoing oversight.
Finally, this option does not account for custody or financial means to care for a pet prior to the Owner’s passing.
SUMMARY
No one wants to think about their own mortality. However, planning for the inevitable – sitting down with an attorney to discuss your concerns and goals can not only give you peace of mind, but it can also make these transitions easier on your PETS, family, and friends.
