If you are reading this article, then you do not need to be reminded of how significant one’s pet can be. Accordingly, over the past few years, a number of articles have appeared in popular publications regarding estate planning for pets. Nonetheless, most professional estate planners dismiss this area as frivolous, primarily for practical reasons.
However, the longevity of many species of parrots is unique in the pet world. In the case of a parrot, the likelihood of the pet outliving its owner (and living for many years thereafter) is far greater than with dogs or cats. Thus, this author, who is both an estate-planning attorney and a parrot owner (or more accurately, I am owned by my parrot), has come to recognize the practical need for estate planning for parrots.
This article is intended to assist you, the reader, with the process of planning for the care of your parrot when you are no longer able to do so. Much of the focus is on estate planning, but you should also consider these alternatives in the context of your disability or incapacity.
In general, this planning process should address three fundamental questions: (1) who will care for your parrot; (2) what will be the source of funds for your parrots care; and (3) what mechanisms are necessary to carry out your wishes.
Who will care for your parrot?
In planning for the care of your parrot, the first and most important question is who will be trusted to adequately care for your parrot. The key attributes here are willingness, trust, and ability. Ideally, there is someone in your immediate family, or a close friend or neighbor, who not only loves your parrot, but also understands the depth of responsibility involved, but this may not necessarily be the case. The choice should be governed by common sense and concern for your parrot. For example, you should not feel “guilted” into leaving your parrot to a relative or close friend who “really loves” your parrot, but who has never owned a parrot or has a household that is likely to be inhospitable (e.g., two cats and a dog). On the other hand, you should not “guilt” someone into taking your parrot in circumstances where it would be hard for that person to say no.
If there is no individual that you trust to care for your parrot, you may consider leaving your parrot to a charitable organization that would be willing and able to care for your parrot. In selecting such an organization, you should, at very least, visit the organization’s facilities and familiarize yourself with its staff. If you are particularly diligent, you could also review information that is available to the public either from the organization itself – such as the organization’s application for tax exemption (IRS Form 1023), the organization’s exempt status determination letter, and any recent annual filings (IRS Forms 990) – or from the appropriate agency in the state where the organization was established – such as Articles of Incorporation or any annual reports.
In any event, your selection is not complete until you have discussed the issue with the person or organization of your choice. You should make sure that those parties understand the special needs of your parrot and your expectations regarding its standard of living. (For example, you may want to inform those parties of the name and address of your parrot’s vet or where its veterinary records are maintained.) Finally, you should also discuss what financial arrangements have been made to cover the costs of your parrot.
What resources will be available for the care of your parrot?
As a rule, the best party to take care of your parrot is the one who would be willing and able to do it for free. Similarly, you would never want the person taking care of your parrot to be motivated primarily by financial incentives.
That said, caring for parrots can be an expensive proposition. The longevity of parrots compounds this cost. Consider what you spend for food, cages, playpens, toys, and veterinary care, and the following table, which lists the lump sum amount that would be needed at the time of your death to meet the monthly needs of your parrot over its remaining life expectancy:
Next, consider whether you want to leave the party who will take care of your parrot without the funds necessary to maintain the parrot with the same quality of life that you currently provide.
Whatever decision you make in terms of finances, you should discuss that decision with your parrot’s caretaker and make sure that they are on the same page as you.
How do you put your plans for your parrot into effect?
A few preliminary points are in order for the benefit of the nonlawyers (or as I call them, “normal people”). First, as a general rule of law, your parrot will be considered your personal property, and as such, your parrot cannot own property or be a beneficiary of your estate or a trust. Second, if you have no will or trust, as personal property, your parrot would pass to your “heirs at law” (usually, your spouse and/or your children, although state laws vary). If you have a will without a specific provision, your parrot will pass to whoever is entitled to your personal property under the will. The bottom line is that if you do nothing, your parrot may not pass to the appropriate parties upon your death.
That said, the remainder of this article is a somewhat detailed discussion of the various means of providing for your parrot upon your death, starting with the most simple/least certain and ending with the most expensive/most protective:
- Outright or conditional bequest. In your will, you could bequeath your parrot and any necessary caretaking funds to your intended caretaker. Unfortunately, this is the least protective alternative because there is no legal impediment to preventing your caretaker from abandoning the parrot and/or spending the money well before the end of the parrot’s life. Even if you have the highest level of confidence in your chosen caretaker, this method has the additional disadvantage of leaving no legal enforceable direction for who is to care for the parrot in the event that your first choice of caretaker is unable or unwilling to do so. To be sure, you could place a condition on the gift – i.e., that the beneficiary is entitled to custody of the parrot and the funds only on the condition that the party takes care of your parrot. You could also set forth what would happen if the party ceases to care for the parrot. Even so, there remains practical problems as to who would step up to the plate to enforce this provision and how such a provision would be enforced years after your death. Furthermore, courts in some states will refuse to uphold such conditions. That said, an outright or conditional bequest is the simplest, least costly alternative and may be entirely adequate if you have a high degree of trust in the individual caretaker you have chosen and you trust that individual to make appropriate provisions in the event that he or she is unable to care for your parrot. This method may also be appropriate if you leave your parrot and any caretaking funds to a recognized charitable organization that is operated for the purpose of caring for parrots, since the organization will already be bound to do so by law.
- Trusts. At this point, a little legalese about trusts is in order. First, a traditional “legal” trust is a relationship whereby a “settlor” (or “trustor”) transfers property to a “trustee”, who holds legal title for the benefit of a “beneficiary” under a trust agreement. A settlor may create a trust by executing an agreement and transferring assets during his or her lifetime or by including trust provisions in a will whereby the settlor’s assets will pass to the trust only upon death. Either the settlor (if he or she is alive) or the beneficiary may enforce the trust agreement against a trustee. In most states, a trust is not valid unless it must, by its terms, terminate within a certain period of time, which is usually based on some human lifetime (called the “perpetuities period”). These rules create two legal impediments to establishing a trust with a pet as beneficiary – i.e., (1) there would be no human beneficiary to enforce the trust during the pet’s lifetime; and (2) making the duration of the trust contingent on the pet’s life expectancy would violate the rule that the term of the trust must be based on some human life.Nonetheless, there are two means by which you may impose provisions for the care of your parrot after your death:
- Pet trust or honorary trust. Over the last decade, some states have adopted laws designed to alleviate these legal impediments to creating a trust for a pet. In a so-called “pet trust,” you would name your caretaker as trustee and your parrot as the beneficiary and designate the amount of funds passing to the trustee to meet the parrot’s needs for its lifetime. Some states have held that pet trusts are “honorary trusts” – i.e., the caretaker-trustee may choose to honor the terms of the trust, as opposed to allowing the parrot and caretaking funds to pass to your other beneficiaries. However, this offers little assurances that your trustee will actually do so. Rather, if the caretaker-trustee decides not to honor the terms of the trust, the parrot and the caretaking funds would simply pass to your other beneficiaries. Some states, like Arizona, have gone a step farther and adopted a statute which provides that a pet trust is a valid trust that any person may enforce against the caretaker-trustee, eliminating the requirement that the term of the trust be measured by some human life. However, even under these special statutes, a practical problem remains as to who will actually enforce the trust against the caretaker-trustee. Even if there were another eye looking out for your parrot, that party would probably have to go into court to remove the parrot and the caretaking funds from the trustee.
- Legal trust. The most secure method of insuring that your parrot is adequately cared for is establishing a legal trust that simply avoids the impediments to creating a trust for an animal (see discussion above). In preparing the trust, you should consider the following provisions:
- Trust property. The “property” transferred to the trust would be your parrot and the necessary caretaking funds. As discussed above, the amount of funds transferred should be sufficient to ensure that the parrot will be adequately cared for during its liftetime. On the other hand, the amount should not be so large as to bring out the worst in people (e.g., disinherited beneficiaries who would find it worth their while to tie the trust up in court challenges).
- Beneficiaries. Your chosen caretaker would be the beneficiary of the trust, at least during the parrot’s lifetime. As such, the caretaker-beneficiary would be entitled to possession of your parrot and reimbursement for expenses incurred in the parrot’s care (as discussed below). The caretaker-beneficiary could be removed or replaced by the trustee if proper care is not being provided (as discussed below).You should also make provisions for who is to receive the remaining caretaking funds in the event that the parrot dies. Naming the caretaker as the beneficiary of the remaining funds could create an incentive not to provide the best care for the parrot. In this regard, if you have only one person in mind as the primary caretaker for your parrot, you may consider naming a charitable organization that cares for parrots as the successor or remainder beneficiary, just in case things do not work out the way you planned.
- Trustee. The trustee would be someone you trust to manage the caretaking funds and keep a second eye on your parrot. In general, the trustee should be someone other than the caretaker-beneficiary and should be granted the power to remove and replace the caretaker-beneficiary with another party if the parrot is not adequately being cared for. In granting such a power, you may also want to impose a specific duty on the trustee to check in on the parrot (e.g., once every six months). These provisions would provide the extra protection that an outright or conditional bequest or a pet trust lacks.
- Duration. The trust would terminate upon the earlier of the death of your parrot or the expiration of the perpetuities period that applies under the laws of your state (see the discussion above). As a practical matter, if properly drafted, your parrot would well outlive the expiration of the applicable perpetuities period. Nonetheless, if you opt for establishing a legal trust for your parrot, you should consult an attorney in your state to determine how this clause in your will or trust should be drafted.
- Reimbursement or compensation. First, you should consider how much the caretaker-beneficiary will receive. At a minimum, the caretaker-beneficiary should be entitled to reimbursements for reasonable expenditures for the parrot’s care, and to avoid potential conflicts between the trustee and the caretaker-beneficiary, you should specify some general or specific guidelines for determining what is an appropriate expenditure for the parrot. You could also compensate the caretaker-beneficiary with additional amounts (e.g., a fixed amount per year) if you feel that this would not foster unintended motives.Your trustee is generally entitled to reasonable compensation for his or her services unless the terms of the trust indicate otherwise. As such, you may want to provide that, although the trustee is entitled to reimbursement of expenses, he or she is to serve without compensation or with compensation in an amount expressly stated.In any event, the issue of reimbursement and compensation should be discussed with your intended caretaker and trustee beforehand. You should also consider these issues in determining the amount of funds that will be transferred to the trust.
- Other terms. You should also consider provisions for disposition of your parrot’s remains upon its death (e.g., a time or place for burial/cremation or a memorial). To protect the trust assets from third party creditors, you should include a “spendthrift provision” and, perhaps, a provision authorizing the trustee to acquire liability insurance. (See your local attorney for details.)
You may include trust provisions in your will or establish a revocable trust agreement during your lifetime. Creating and transferring your property to a properly drafted trust during your lifetime, or adding certain provisions to an existing revocable “living trust” that you already have, has two advantages over simply putting these provisions in your will. First, carrying out the provisions in your will generally requires court intervention, although the degree of court intervention may vary depending on the size of your estate and the laws in your particular state. Second, in your trust, you may also include provisions for your trustee to care for your parrot in the event that you become incapacitated or disabled.
Of course, there are downsides to using the trust alternative. As an attorney who has experienced the financial and nonfinancial costs associated with messy probates precipitated by poorly-drafted estate planning documents by do-it-yourselfers and incompetent lawyers, I recommend that you obtain the assistance of an attorney who is knowledgeable in the area of estate planning in drafting the terms of the trust. Of course, attorneys cost money. In addition, after your death, your trustee will have to establish a separate bank account for the caretaking funds and, perhaps, even file separate income tax returns for the trust.
That said, if you already have a will or revocable “living trust” (also known as a “will substitute”), the additional costs of adding trust provisions to your existing documents may be less than you think. And if you do not already have a will or revocable living trust, then there may be other reasons (beyond planning for your parrot) to consult an estate-planning attorney.
In any event, if you elect to use any of the alternatives discussed, I suggest you provide your local attorney with this web page and the following other web sites, which include detailed legal information and suggested language for wills and trusts:
Written by Steven D. Baker, Attorney, Plattner, Schneidman & Schneider, P.C.,
1707 E. Highland, Suite 190, Phoenix, Arizona 85016; (602) 274-7955;