Research shows that there are health and financial benefits to owning a pet.  The National Institute of Health reported that pet owners “reap unexpected health and financial benefits (from lower health care costs) in addition to enjoying the companionship of the family cat or dog.”  Pets can help a person stay healthy because owner may enjoy engaging in physical activity with the animal such as playing ball or going for walks.  Because of their unconditional love and their constant need for attention, pets may help to speed up recovery after major illness, deal with stress, improve mood and sense of well-being, lessen feelings of isolation and loneliness, or provide a sense of purpose.  The website of the National Center for Infectious Diseases reports that “pets can decrease your blood pressure, cholesterol and triglyceride levels, and feelings of loneliness.”

Most pet owners consider their pets as family members.  Because some pets may outlive their owner for an extended period of time, it is important to plan for this situation.  Dogs and cats can live up to 18 years, tarantulas up to 30 years, snakes up to 40 years, and Macaws up to 80 years 

Several wealthy individuals who recently died made significant provisions in their wills or trusts for the benefits of their pets.  The very wealthy Leona Helmsley bequeathed $12 million to her dog, Trouble, in a trust.  Mrs. Helmsley was a billionaire New York City hotel operator and real estate investor.  She had a reputation for tyrannical behavior that earned hear the nickname “Queen of Mean.”  After been convicted and sentenced for tax evasion and fraud, she spent her later years in isolation.   Her fortune was estimated to be over $5 billion.  The money allocated to Trouble’s care was just pocket change compared to the rest of Helmsley’s estate.  But the New York Times story reported that the assets in this trust were nearly ten times as large as all the assets of the existing animal-related nonprofits put together.  The Court accepted the concept of a pet trust but reduced the bequest to $2 million.  The dog’s caretaker submitted an affidavit to justify the $2 million principal, including expenses like a $60,000/year guardian’s fee and $8,000 in grooming fees, as well as the mundane expenses of food and veterinary care. 

In this estate planning, the attorney of Leona Helmsley should have been more careful regarding Trouble’s funeral instructions.  Mrs. Helmsley instructed that Trouble someday shall be interred with her at the Helmsley mausoleum at Sleepy Hollow Cemetery.  Unfortunately, the cemetery says that state law forbids animal remains to be buried in human graveyards.  Animal cemeteries do not forbid human remains to be buried in animal graveyards.  Shall the Helmsley mausoleum be transferred to an animal cemetery?

Mrs. Helmsley is not alone.  Carlotta Liebenstein, an Austrian countess, bequeathed her $80 million estate to her dog, Gunther.  Dorie Duke, the sole heir to Baron Buck Duke who built Duke University and started the American Tobacco Company, bequeathed $100,000 in trust for the benefit of her pet poodle, Minnie. 

However, the need for estate planning for the care of pets is not limited to wealthy individuals, and the increased need for estate planning for pet owners has been reflected by new legislation in the past decade, which recognizes pet trusts and provides provisions to make them enforceable. 

I. Legislative Overview

a. Historical background.

Pets are considered under common law to be tangible personal property, which has two key implications for estate planning.  First, in absence of specific provisions, pets will pass to beneficiaries of the decedent, along with the rest of the decedent’s tangible property.  Second, again in absence of specific provisions or statutes, the pet cannot be the direct beneficiary of any testamentary gift or trust.  In absence of any statutory provisions, pet owners could take certain actions, such as making a bequest of the pet to a caretaker, with a lump sum to cover the living expenses of the pet.  The average amount bequeathed varies from $10,000 to $25,000.  This provision usually works when the caretaker is trustworthy, the lump sum bequeathed is relatively small, and it is highly unlikely that the pet will outlive the caretaker.  However, this kind of testamentary provision has several issues.  It is not legally enforceable, and the caretaker can pocket the money and abandon the pet without fear of legal reprisals.  , With the necessary probate of a will, there may be a significant period of time between the death of the pet owner and availability of any monetary bequest and provisions for the care of the pet.  In addition, if the pet has a long life expectancy, there is no provision for a successor caretaker. 

b.     Trust Statutes Adopted by over 40 States

Because of the growing interest in having a legally enforceable trust for pets, 43 states have passed legislation recognized a form of pet trust in the past decade.  In 1990, the Uniform Probate Code provided model language which created enforceable honorary trusts for pets, subsequently adopted by ten states.[2]   The UPC model language is as follows:

§ 2-907. Honorary Trusts; Trusts for Pets.

(a) [Honorary Trust.] Subject to subsection (c), if (i) a trust is for a specific lawful noncharitable purpose or for lawful noncharitable purposes to be selected by the trustee and (ii) there is no definite or definitely ascertainable beneficiary designated, the trust may be performed by the trustee for [21] years but no longer, whether or not the terms of the trust contemplate a longer duration.

(b) [Trust for Pets.] Subject to this subsection and subsection (c), a trust for the care of a designated domestic or pet animal is valid. The trust terminates when no living animal is covered by the trust. A governing instrument must be liberally construed to bring the transfer within this subsection, to presume against the merely precatory or honorary nature of the disposition, and to carry out the general intent of the transferor. Extrinsic evidence is admissible in determining the transferor's intent.

(c) [Additional Provisions Applicable to Honorary Trusts and Trusts for Pets.] In addition to the provisions of subsection (a) or (b), a trust covered by either of those subsections is subject to the following provisions:

(1) Except as expressly provided otherwise in the trust instrument, no portion of the principal or income may be converted to the use of the trustee or to any use other than for the trust's purposes or for the benefit of a covered animal.

(2) Upon termination, the trustee shall transfer the unexpended trust property in the following order:

(i) as directed in the trust instrument;

(ii) if the trust was created in a nonresiduary clause in the transferor's will or in a codicil to the transferor's will, under the residuary clause in the transferor's will; and

(iii) if no taker is produced by the application of subparagraph (i) or (ii), to the transferor's heirs under Section 2-711.

(3) For the purposes of Section 2-707, the residuary clause is treated as creating a future interest under the terms of a trust.

(4) The intended use of the principal or income can be enforced by an individual designated for that purpose in the trust instrument or, if none, by an individual appointed by a court upon application to it by an individual.

(5) Except as ordered by the court or required by the trust instrument, no filing, report, registration, periodic accounting, separate maintenance of funds, appointment, or fee is required by reason of the existence of the fiduciary relationship of the trustee.

(6) A court may reduce the amount of the property transferred, if it determines that that amount substantially exceeds the amount required for the intended use. The amount of the reduction, if any, passes as unexpended trust property under subsection (c)(2).

(7) If no trustee is designated or no designated trustee is willing or able to serve, a court shall name a trustee. A court may order the transfer of the property to another trustee, if required to assure that the intended use is carried out and if no successor trustee is designated in the trust instrument or if no designated successor trustee agrees to serve or is able to serve. A court may also make such other orders and determinations as shall be advisable to carry out the intent of the transferor and the purpose of this section.]

In 2000, the Uniform Trust Code provided detailed provisions for creating enforceable trusts for the benefit of pets, which was adopted by 20 additional states.[3]  The most recent adoptees of this model language are the states of Connecticut, Maryland, and Vermont.  The UTC model language is as follows:

            (a) A trust may be created to provide for the care of an animal alive during the settlor’s lifetime. The trust terminates upon the death of the animal or, if the trust was created to provide for the care of more than one animal alive during the settlor’s lifetime, upon the death of the last surviving animal.

            (b) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court. A person having an interest in the welfare of the animal may request the court to appoint a person to enforce the trust or to remove a person appointed.

            (c) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use must be distributed to the settlor, if then living, otherwise to the settlor’s successors in interest.[4]

Finally, several states have adopted various other statutes which create enforceable pet trusts, with some similar provisions as to the model language.[5]    

The Humane Society recommends that the owner provide signage regarding the pets on entrances to the owner’s dwelling.  The Human Society of the United States offers self-stick door/window signs for emergency workers and emergency contacts stickers for the inside of the dwelling.  These signs inform that pets are in the dwelling and provide contact information.

b.     Powers of Attorney

The Durable Power of Attorney should address the issue of custody of the pets and provide an expenditure provision for the care of the pets.  This immediate estate planning is particularly important for individuals who live alone, who are advanced in age, who suffer from chronic illnesses, who have multiple pets and want them to stay together, whose family members do not want to take care of the pets, or whose pets have a very long life expectancy.  Of course, the pet owner should ensure the named pet caregivers are willing to care for the pet.

 Sample of Durable Power of Attorney Language

My agent shall take possession and custody of Treeline, my Dachshund dog, and Ladycoach, my cat, and any other pets I may have.  If my agent cannot take possession and custody of my pets, my agent shall provide their possession and custody of my neighbor friend, Petlover.  If Petlover is not available or willing to take possession and custody of my pet, then my agent shall seek appropriate care and shelter for my pets.  My agent shall expend and utilize such amounts of my funds or other property as may be necessary or advisable to provide for the health, care, and welfare of my pets, including but not limited to food, veterinary care and/or insurance, toys and other recreational activities, and temporary boarding and/or pet-sitting fees.  For the purposes of this instrument, any action taken by my agent for the benefit of my pets shall be considered taken for my benefit.  In addition, unless medically or physically impracticable, my agent shall ensure that I have as much contact with my pets as I did before becoming incapacitated. 

c.      Living Wills

Pet owners may want to provide instructions similar to a “Living Will.”  Pets can have many painful diseases including arthritis and cancer.  Information on how the owner feels about euthanasia will help the pet caregiver and veterinarian make decisions on how far they should keep a pet alive or when the pet should be relieved from pain.  Also, instruction on how the pet’s remains should be disposed of should be included (e.g., cremation of the pet and burial of the remains in a particular place.)  The cost of a pet burial ranges from $250 to $1,000, and pet cremations are less expensive.  Several internet sites offer to create a memorial for the pet.  See http://www.in-memory-of-pets.com/

 Sample language (1):

My agent should follow my wishes known to him or her or that I have written.  If my agent cannot determine the choice I would want for my pets then my agent’s decision shall be based on what my agent believes to be in my pet’s best interest.

 Sample language (2):

I direct that my pet caregiver provide any needed, reasonable veterinary care that my pet(s) may need at the time to restore the pet(s) to generally good health and to alleviate suffering, if possible.  Any pet not in generally good health or who is no suffering – and whose care is beyond the capabilities of veterinary medicine, reasonably employed, to restore to generally good health or to alleviate suffering- shall be euthanized.  [or: If there is no hope of medical improvement and my pet is in constant or almost constant pain; I hereby authorize my agent to end my pet’s life.  However, my agent’s decision should be based on the written opinion of a veterinarian who has examined the pet.]

 Sample for a Do-Not Resuscitate Instruction

I hereby request that in the event my pet’s heart and/or breathing should stop, no person shall attempt to resuscitate my pet.