With Minnesota’s recent enactment of legislation permitting pet trusts, pet trusts are now recognized by law in all 50 states and the District of Columbia. The idea isn’t new in Arizona, however. In Arizona we have two separate statutes that deal with pet trusts, one of which is part of the probate code and has been in effect since 1995, the other of which is part of the trust code that was enacted in 2009.
A pet trust isn’t the only way to plan for the care of your pets if they outlive you, but it is a useful option. The concept is that pets are personal property, not people (no matter what some pet owners may think), so they can’t receive gifts in your estate plan like people can. Of course there’s also the problem that a pet can’t open a bank account, so even if you could make a gift directly to your pet, there has to be a person to hold the money for the pet. That’s where the idea of a pet trust comes in.
THERE ARE OPTIONS FOR PLANNING FOR YOUR PETS
Before I get into more detail on how pet trusts work, I think I should tell you about other, perhaps simpler, pet planning options, and what resources are available.
Nathan B. Hannah, attorney
The simplest pet planning option, in my opinion, is to leave your pets to a trusted family member or friend along with a gift in recognition of the sacrifice that the recipient will make to care for the animals. Note the way I worded that: I don’t think of the gift as being direct compensation for the cost of caring for the pets, but as a gift in gratitude for the money and time that your family member or friend will devote to the pets’ care. You can, if you prefer, think of the gift as being compensation for the cost of care, but the estimate will necessarily be inexact and won’t compensate for the time that will be devoted to the pets’ care.
This method depends, of course, on there being a trusted family member or friend who is willing and able to take over the care of your pets. Many people don’t have that option. One alternative is the programs some animal welfare organizations have developed that involve a gift to the organization coupled with the organization undertaking to place the pet for adoption.
There’s also the option available through some animal welfare organizations for the pets to be placed in foster homes and offered for adoption through the organization.
One local animal welfare organization that I have heard good things about, and that I know is experienced in handling pets left orphaned, is The Animal League of Green Valley. They are an independent, donation-funded, all-volunteer organization with a shelter and thrift store in Green Valley. They’ve been around for over 30 years.
Next I’ll go into some of the mechanics of pet trusts and how they differ from the other methods I have discussed.
THE NUTS AND BOLTS OF A PET TRUST
As I discussed above, there are other ways to provide for the care of your pets if they outlive you, but a pet trust is probably the most comprehensive planning method for that situation.
How do you set up a trust for your pet? The Arizona statutes don’t give a lot of detail, but they do provide enough guidance that a lawyer experienced in estate planning should be able to put together a pet trust that will work both legally and practically.
I should point out that the Arizona statutes on this subject, contained in the Arizona probate code and the Arizona trust code, are based on uniform code provisions. This means that many other states have similar laws. As with any estate planning situation, of course, the planning must be done in compliance with the specific provisions of law in your state.
The statute in the Arizona probate code starts with this statement: “A trust for the care of a designated domestic or pet animal is valid.” It was necessary to say that because without it, a pet trust would not be valid. Without that statement, you couldn’t make an animal the beneficiary of a trust.
The probate code provision doesn’t expressly say how you can establish a pet trust, but a pet trust can apparently be established either in a will or in a separate document that meets the requirements for establishing a trust.
The trust must be for the care of one or more animals that are alive during the lifetime of the person establishing the trust. The trust terminates when the last animal provided for in the trust dies.
The trust should identify who is to be the trustee, although the court can appoint a trustee if one isn’t named. The statutes are explicit that the trust assets must be used only for the purposes of the trust.
The court may reduce the amount of property a person puts in a pet trust if the court determines that the amount substantially exceeds the amount required for the intended use. Any trust assets left at the termination of the trust, or any excess if the court reduces the amount of the trust, will be distributed according to the provisions of the trust instrument. If the trust instrument doesn’t say what happens to assets left at termination, the assets go to the residuary beneficiaries of the person’s will, or in the absence of residuary beneficiaries, to the person’s heirs.
One last thing I should mention is that I have deliberately avoided the issue of animals having legal status, that is, having their own legal rights that can be enforced on their behalf. The fact is that, despite some chatter about it recently, and even some attempts by people to assert legal rights on behalf of animals, animals have no legal rights of their own, period. They are chattel. More to the point of this discussion, pets are the personal property of the people who own them. There’s really no uncertainty about that.
An attorney who is well versed in estate planning techniques can help you develop a plan for your pets that will best fit your circumstances.
Nahan B. Hannah is a Shareholder in the Tucson office, and practices in the areas of estate planning and administration, real estate, and commercial transactions. He is also a noted blogger, and you can find more of his articles on his private blog,
Contact Attorney Hannah: nhannah@dmyl.com or 520/ 322-5000
This communication is designed to bring legal developments of interest to the attention of our clients and others. It should not be relied upon as a substitute for specific legal advice in a particular matter. For further information on any of the subjects discussed, or for legal advice in connection with any particular matter, please contact us.
