Estate Planning Basics: March 2009 Archives

March 8, 2009

Parents Denied Use of Deceased Son's Frozen Sperm

In the first case of its kind to be decided, a New York appeals court has denied the right of parents of a deceased son to use his frozen sperm to create a grandchild. In 1997, the son deposited sperm at a tissue bank. He had been diagnosed with cancer and wanted to ensure his ability to create children if he survived the diagnosis. He signed an agreement with the lab asking them to destroy the sperm in the event of his death. He died six months later.

While going through his possessions, his parents discovered that there was a sperm deposit and asked the lab to continue to preserve it while they fought for the legal right to use the sperm to create a grandchild.

The New York courts have denied their claim to either ownership of the sperm or for permission to use the sperm. Their reasoning?  New York law requires certain screening tests be done before sperm can be donated for public use, and such tests are impossible to conduct at this point.
March 4, 2009

You CAN Take it With You! Debts and Death

As if things aren't hard enough right now, the New York Times reports this week that collection agencies are now working to collect debts owed by the dead. They're banking on the fact (no pun intended) that most people don't know that they AREN'T personally liable for these debts all. Jeez, how low can you get?

Specially trained agents are calling the heirs of the recently departed and politely asking them to pay up the outstanding balances on credit card debt, car loans, and the like. If an estate is filing an official probate proceeding, creditors have a process for filing claims against the decedent's property. But that's not who these collection agents are calling.

They're calling the relatives of people who have died who aren't in formal probate proceedings either because they had created living trusts during their lifetime or because the estate was too small for a probate proceeding.

Here's my advice: No matter how nice these people are (or well-trained), simply ask them why they think that you're legally responsible for the debt. In the vast majority of cases, you aren't obligated to pay them a nickel.  It's true that married people can be jointly liable for debts, and creditors can try and get repaid from the property you've inherited from the decedent depending on your state's laws -- but that's their problem, not yours.

In fact, most estate planning attorneys can successfully get credit card companies and the like to accept a fraction of the outstanding balance on those debts that the survivors are responsible for, because these companies know just how hard it really is to collect anything on the dead's debts.

For a comprehensive guide to the legal, personal and practical aspects of administering a living trust, see The Trustee's Legal Companion, by Liza Hanks and Carol Elias Zolla (Nolo).