Are you a cat person or a dog person? The truth is many of us love animals. In fact, approximately 68 percent of American households own at least one pet. In some of those households, care for a pet is part of the estate plan. Consider, for example, millionaire head of Chanel, Karl Lagerfeld, who is believed to have left a significant portion of his $195 million fortune to his cat, Choupette. Talk about the cat’s meow!
Trust for the Care of an Animal
North Carolina recognizes trusts created to care for an animal. Conversely, because North Carolina considers pets property, a pet cannot directly inherit money left to it in a will. Therefore, anyone intending to provide financial support and care for their pets after they pass away should consider creating a pet trust.
As with all trusts, the settlor, or creator of the trust, can name an individual to serve as trustee in the trust document. If no trustee is named in the trust itself, the clerk of superior court will name an individual to serve as trustee. The trustee must oversee the administration of the trust and ensure that the principal and income are used pursuant to the settlor’s instructions and exclusively for the benefit of the designated animal or animals. In the event the beneficiary animal(s) dies before the trust property is completely expended, the trust document can provide instruction for the unexpended trust property. In the absence of such instruction, the unexpended trust property can pass back into the settlor’s estate, at which point it would be distributed in accordance with the terms of a will or in accordance with intestacy laws.
Uncommon as it may be, Karl Lagerfeld’s estate plan is certainly not unprecedented.
To speak with an experienced trusts and estates attorney about executing a will or creating a trust, or if you have questions about the administration of a trust or your duties as trustee, please give us a call at (704) 457-1010 to schedule a consultation. For more information regarding our firm, attorneys, and practice areas, please visit http://www.lindleylawoffice.com/.