Joint State's Amazing Record and Report

On August 1, 2013, the Pennsylvania Joint State Government Commission posted a Report, dated August, 2013 (PDF, 4.7 MB), entitled The Probate, Estates and Fiduciaries Code and Orphans' Court Matters: Legislation Recommended by the Advisory Committee on Decedents' Estates Laws, which encapsulates -- in 291 pages of history, descriptions, summaries, lists, and tables -- the amazing impact of that organization upon probate, estate, fiduciary, and related statutes, and upon Orphans' Court matters generally, since 1945 in this Commonwealth.

The Joint State Government Commission itself was established on July 1, 1937, to serve as "the primary and central non-partisan, bicameral research and policy development agency for the General Assembly of Pennsylvania."  

Its first appointed advisory committee -- the Advisory Committee on Decedents Estates Laws. (ACDEL) -- was established in 1945.  Since then, the "Advisory Committee has generated more than 40 reports that have served as the basis for legislation introduced during numerous legislative sessions of the General Assembly", which have improved Pennsylvania law in Title 20 of the Pennsylvania Consolidated Statutes (the Probate, Estates and Fiduciaries Code -- "PEF Code") and related statutes.  

The Report provides not only a history of ACDEL, but also a compiled reference of its work products, developed by various JSGC ad hoc study groups, legislative resolution task forces, and the standing ACDEL.  Such groups have analyzed, drafted, reviewed, revised, and recommended statutory law in the Commonwealth for the past sixty-eight years.

This report first recounts the purpose of 1945 Senate Resolution No. 46, which authorized the Joint State Government Commission to form a legislative task force and advisory committee to review decedents’ estates laws.

This is the Report's Summary of its contents:

The section titled The Task Force and Advisory Committee on Decedents’ Estates Laws also discusses the membership and leadership of the Task Force and Advisory Committee and outlines the process used to develop statutory recommendations.  Finally, that section summarizes the projects of the Advisory Committee from 1945 to 1972, the codification of the PEF Code (including the original chapter organization of the PEF Code), and proposed legislation since 1972.

The next section, Advisory Committee Reports, lists all 43 published reports of the Advisory Committee since its creation.  Numerous reports published after the 1972 codification contain proposed omnibus amendments to the PEF Code and, in some instances, to other titles of the Pennsylvania Consolidated Statutes.  Other reports focus on one particular topic, such as guardianships, powers of attorney, or trusts.

The list of Advisory Committee reports is followed by Proposed Legislation Organized by Advisory Committee Report.  This section details the contents of each report and provides the specific section and subsection that is the subject of the proposed amendment or repeal or that is newly proposed.  The reports are listed in reverse chronological order.

The next section, Proposed Legislation Organized by Statutory Section, comprehensively lists each specific section and subsection to which the Advisory Committee has made a recommendation.  It then summarizes the nature of the recommendation (proposed amendment, repeal or addition) and the report containing the recommendation.  Of note is that, in a number of instances, the Advisory Committee has revisited the same provision over the years, and several reports capture the multiple or recurring recommendations.

The section that then follows is Proposed Legislation Organized by Legislative Session.  Listed here are each bill introduced that is based on the recommendations of the Advisory Committee, along with the relevant provisions included in the bill and a summary of the disposition of the bill.  If the bill was enacted, the act number and enactment date is provided.  In two instances, a bill containing the Advisory Committee’s recommendations was vetoed by the Governor, despite having passed both chambers of the General Assembly unanimously.

The next section of this report provides a detailed table of contents for the PEF Code, as it was enacted in 1972.

Finally, this report contains a list of the Advisory Committee Chairs and Advisory Committee members, with dates of service and county of practice.

The Report itself is impressive in its sweep and detail.  But the story of passion and perseverance that it implies -- if you can read between the lines (because this is not pulp fiction) -- is even more impressive.

Consider that, since 1945, only 110 volunteer experts spread over 68 years -- many devoted until only death ceased their efforts -- donated their time, expertise, experiences, intellect, skills, and visions to suggest statutory frameworks that still evolve today.  Presently, the ACDEL has 34 members appointed by the Legislature, in roles either as lawyers or judges, serving pro bono.

Their work addressed the most difficult issues in human experience and the most fundamental laws affecting everyone -- disability, incapacity, death, reproductive technology, surrogate health care management, fiduciary administrations, and end-of-life decisions.

The most recent JSGC-ACDEL comprehensive report was issued in October, 2012, regarding reform of Pennsylvania guardianship law, contained in Chapter 55 of the PEF Code. See: Guardianship Law: Proposed Amendments to the Probate, Estates and Fiduciaries Code, which presently is embodied in Senate Bill 117 of the 2012-13 Session, as reviewed in a Legislative Analysis, dated February 12, 2013.

If that is not enough to impress you, check out the companion report also posted on August 1st -- Domestic Relations Law: Legislation Recommended by the Advisory Committee on Domestic Relations Law 1993-2010 (PDF, 218 pages).

The current supervising Legislative members of JSGC are listed.  All volunteer members of the ACDEL since 1945 were named.  The current supporting staff are listed, but past staff are not.  All were devoted to their craft.

JSGC-ACDEL produces studies and makes recommendations that are non-political, independent, expert, comprehensive, and reliable, in a cost-effective process. In this time of reduced funding and personnel, this organization is beyond special -- it is amazing.

The Joint State Government Commission is a one-of-a-kind blessing to this Commonwealth that, hopefully, will continue its work long into the future.

New "Granny Snatching" Law in PA

On July 5, 2012, Pennsylvania Governor Tom Corbett signed House Bill 1720 (Printer's No. 2589) -- commonly (and comically) referenced as the "Granny Snatching bill" -- into state law as Act 108 of 2012, to take effect in 60 days.

Act 108 amends Title 20 (Decedents, Estates and Fiduciaries) of PA Consolidated Statutes, to provide for uniform adult guardianship and protective proceedings jurisdiction.  The final form of that Bill is available on the web, in PDF format, and as a Word document.

Act 108 deals primarily with court-oriented jurisdictional, transfer, and enforcement issues relating to adult guardianships and adult protective proceedings.  For a lengthy explanation about the then-pending bill, with links, see: PA Elder, Estate & Fiduciary Law Blog post, "Granny Snatching" Prohibition Pending in PA (10/25/11).

Act 108 was based upon the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA), a national statutory model that received approval at the 2007 annual meeting of the National Conference of Commissioners for Uniform State Laws (NCCUSL).

Already in 2012, Connecticut and Maine adopted it, and seven other states, consider it.  Our nearby sister state, New Jersey, is one of them.  See:  New Jersey Considers Law to Prevent ‘Granny Snatching’, (05/21/12), by Beth Fitzgerald, posted on NJ Spotlight, which analyses how their proposed new law "would alleviate jurisdictional issues when families feud over guardianship".

Before 2012, a majority of more than thirty states adopted it (see map above, which now identifies Pennsylvania as an "enacted" state).

The bill as originally proposed was based upon the model statute, and was revised only slightly for its final version adopted by the Legislature (House: 196-0 on October 26, 2011; and  Senate: 49-0 on June 26, 2012).  For example, the original bill used the uniform act's definition of "conservator" as one who manages property of an adult person, and "guardian" as one who makes personal decisions for another.  In Pennsylvania, instead, Chapter 55 (Incapacitated Persons) uses the term "guardian" for both aspects of surrogate management.

The few revisions added in the amended version of the Bill varied slightly from the model statutory form, but only clarified concepts.

This legislation, which will become effective on September 5, 2012, represents an accomplishment for those who drafted, introduced, advocated, and enacted it.  Its adoption will benefit those inside and outside of Pennsylvania, whose lives and living situations will be touched by guardianship disputes involving adults brought into courts.

Now Pennsylvania Orphans' Court judges will have clear jurisdictional rules, and the Commonwealth's Area Agencies on Aging, as well as private litigants, will have new tools, within the setting of an increasingly uniform state court jurisdictional system, that can expedite remedies for certain kinds of personal dislocations and financial elder abuse.

"Granny Snatching" Prohibition Pending in PA

Would you remember what "UAGPPJA" means, or what it could do in Pennsylvania, without an association to "granny snatching"?  Maybe that's why such a Scrabble of title letters is linked to a simple, silly phrase.  The serious and unremedied abuse situations involving transport of incapacitated elderly persons must be corrected by a dry, but effective, proposed model statute.

[Note:  See last Update below as to enactment of the proposal on July 5, 2012, effective sixty days thereafter.]

The term "granny snatching" was referenced in a November 12, 2007 article in The National Law Journal entitled, Dealing with 'Granny snatching' -- Model law aims to untangle adult guardianship, by Peter Page.  That article addressed the final version of the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA), which received approval at the 2007 annual meeting of the National Conference of Commissioners for Uniform State Laws (NCCUSL).   See also:  Uniform Laws Needed to Deal With Interstate 'Granny Snatching' (03/22/06), posted by the Senior Journal.

UAGPPJA deals primarily with jurisdictional, transfer and enforcement issues relating to adult guardianships and protective proceedings.

NCCUSL explains, on its website, Why States Should Adopt UAGPPJA:

• Provides procedures to resolve interstate jurisdiction controversies. 

• Facilitates transfers of guardianship cases among jurisdictions.

• Provides for recognition and enforcement of a guardianship or protective proceeding order.

• Facilitates communication and cooperation between Courts of different jurisdictions.

• Addresses emergency situations and other special cases.

Since 2007, the UAGPPJA has been adopted by more than half the states, with many considering it this year.  All states should adopt this law to prevent forum shopping and transport of persons with weakened mental condition.

Pennsylvania is considering it now.

On September 28, 2011, the Pennsylvania House of Representatives' Aging and Older Adult Services Committee, chaired by Rep. Tim Hennessey, held an informational session (videotaped by the Pennsylvania Cable Network) on House Bill No. 1720, which had been introduced into the House previously on June 22, 2011.

This is a second initiative this year that would upgrade and improve guardianship laws.  The first initiative remains before in the Legislature only in the form of two reports with recommendations, not in pending legislation.  See: PA EE&F Law Blog posting Proposed Amendments of PA POA, Guardianship & Health Care Directive Laws (06/14/11).

I understand that HB 1720 was widely and strongly supported by those at that session and within the House.  It is promoted by AARP-Pennsylvania (offices in Harrisburg & Philadelphia).  [Note:  It is also championed by the Pennsylvania Bar Association -- See Update below.]

Nationally, UAGPPJA is supported by the American Bar Association ("Guardianship Jurisdiction"), the Alzheimer's Association ("UAGPPJA Fact Sheet"), the National Guardianship Association, Inc. ("UAGPPJA Links"), the National Academy of Elder Law Attorneys ("Endorsement"), AARP ("Radio Report"), and the Conference of Chief Justices and Conference of State Court Administrators ("Endorsement").

As a practitioner, I too support it.  Unfortunately, present law in Pennsylvania will confound a court as to jurisdiction, can disconnect a local Area Agency on Aging as to protective services, and can create litigation in both home and foreign jurisdictions among family members at great cost and inconvenience.

The federal Elder Justice Act (effective March 2010) is not yet funded in the area of conflict of laws or interstate transport of elderly persons.  See:  The Elder Justice Act: What It Says, What It Means, And When Will It Be Implemented? (10/26/10), by Bill Benson and Bob Blancato.  Furthermore, the EJA does not codify state laws on the issue of state jurisdiction, so there is no framework of uniform state laws other than this proposal. 

NCCUSL's final model UAGPPJA must bear a few minor tweaks to conform it with existing Pennsylvania law in Chapter 55 ("Guardianship") of the PA Probate, Estates & Fiduciaries Code, for example, on matters such as emergency guardianship and also its use of the term "conservatorship" (not used in our law).  Also, it would need cross-referencing if it would become a new Chapter 59 of the PEF Code. 

WHYY's Newsworks posted an article on October 7, 2011, entitled Pa. plan aims to alleviate 'granny-snatching', which reflected both the need for, and growing momentum of, HB 1720:

Stories of elderly parents being fought over by their children or relatives who want to be the sole guardians are familiar to Rep. Tim Hennessey of Chester County.

"Somebody dies, and then someone else comes in and tries to assume control and the other siblings don't like it. And it could be county to county or it could be state to state," Hennessey said. "You know enough of these stories circulate that you think, oh, geez, somebody, here's a problem, we have to solve it."

When a group called the Uniform Law Commission approached him with legislation to clear up the murky legal issue, Hennessey agreed to sponsor it.
His proposal sets up rules to follow when multiple courts are involved in a dispute over who's responsible for an incapacitated adult. * * *

See also: New court rules proposal aims to prevent so-called "granny snatching"  (10/12/11), by Mary Wilson, posted by WITF. 

HB 1720 appears to be moving quickly in the House.  Today (October 25, 2011), it received second consideration and was referred to the Appropriations Committee.

This bill should be adopted by the House, and then by the Senate; and then it should be signed by the Governor into law.

And, while doing so, the Legislature should address that still-pending first initiative too, so that Pennsylvania's guardianship laws can be more effective and fair.

Update: 10/26/11:

On October 26, 2011, I received in the mail a copy of the Pennsylvania Bar Association's Bar News.

On the first page, under the heading PBA President and Elder Law Section Officers Take Part in State House Roundtable on Adult Guardianship Bill, and below a color photograph taken at the September 28, 2011, informational session, was this text:

PBA President Matthew J. Creme, Jr. and PBA Elder Law Section officers Sally Schoffstall and Jacqueline Shafer participate in a roundtable discussion Sept. 28 in Harrisburg with members of the state House Aging & Older Adult Services Committee about House Bill 1720.

The bill would amend Title 20 by adding the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act to provide a uniform mechanism for addressing multijurisdictional adult guardianship issues.  The PBA supports the bill.

In a prior Bar News issue (09/05/11), I found a report of the PBA's action authorizing such an appearance:

The PBA Board of Governors met July 28, at Rocky Gap Lodge & Golf Resort and took the following actions:  * * *

Unanimously approved the resolution of the PBA Elder Law Section that the PBA support the addition of a new §5503 to the existing Probate, Estates and Fiduciaries Code at 20 Pa. C.S. Chapter 55, also known as the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA).

The UAGPPJA provides a uniform mechanism for addressing multijurisdictional adult guardianship issues that have become time consuming and costs for courts and families.  Because the PBA had been asked to testify at a legislative hearing on this issue in September, the Board took action on behalf of the House of Delegates.

Update: 11/08/11:

Today's emailed update to PBA members noted recent approval by the House of HB 1720, as follows:

House Bill 1720, sponsored by Rep. Tim Hennessey (R-Chester), passed the House 196-0 on Oct. 26 and was referred to the Senate Aging and Youth Committee.

The bill amends Title 20 (Decedents, Estates and Fiduciaries) adding the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act, which provides for uniform adult guardianship and protective proceedings jurisdiction.

Update:  01/09/12:

HB 1720's legislative history indicates that it has not moved beyond the Pennsylvania Senate's Aging & Youth Committee.  That is unexplained, and unfortunate.  It should be a priority.

It remains a priority for the Pennsylvania Chapter of the Alzheimer's Association, which states on its "Advocate" web page, as follows:

The Alzheimer's Association strongly supports the adoption of UAGPPJA in Pennsylvania and across the country. Due to the impact of dementia on a person's ability to make decisions, individuals living with Alzheimer's disease may need the assistance of a legal guardian. The process of appointing a guardian is handled in state courts. Complications with appointing a legal guardian for an adult may arise when the guardian lives in a different state than the individual with Alzheimer's disease or a related dementia.

If we adopt UAGPPJA, we make it easier for families across the country to help their loved ones state to state without the hassle of re-filing for guardianship.
 * * *

Update: 07/02/12:

The Pennsylvania Bar Association reported today that the Legislature approved HB 1720, PN 2589 and sent it to the Governor for consideration of signature into law:

H.B. 1720, sponsored by Rep. Tim Hennessey (R-Chester), is on the Governor’s desk. The legislation amends Title 20 (Decedents, Estates and Fiduciaries) by adding the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA). UAGPPJA provides a mechanism for addressing multi-jurisdictional adult guardianship issues.

The Legislative History of HB 1720 indicates that it was adopted by the House on October 26, 2011 by a vote of 196-0, and then by the Senate on June 26, 2012, by a vote of 49-0.  It was presented to the Governor on June 28, 2012.

Update: 07/06/12:

House Bill 1720 (Printer's No. 2589) was signed by the Governor on July 5, 2012.  In sixty days, it will become law in Pennsylvania.  See: PA Elder, Estate & Fiduciary Law post, New "Granny Snatching" Law in PA (07/06/12).

As Charlie "Tremendous" Jones, late of Harrisburg, PA was known for saying, TREMENDOUS!!!

Proposed Amendments of PA POA, Guardianship & Health Care Directive Laws

On June 14, 2011, the Pennsylvania Joint State Government Commission posted the latest report (June, 2011) of the Advisory Committee on Decedents' Estates Laws regarding proposed amendments to the Probate, Estates, and Fiduciaries Code (PEF Code), which is available here.

This latest report (June 2011; PDF, 85 pages) alters and updates a prior report (June 2010; PDF, 87 pages) of the same organization regarding the PEF Code.

The two reports are the product of Subcommittee study and drafting, Advisory Committee review and revision, and JSGC approval, for submission to the Pennsylvania Legislature:

Over the years, the Advisory Committee has formed various subcommittees to assist in reviewing specific topics and developing statutory recommendations involving the Probate, Estates and Fiduciaries Code for consideration by the Advisory Committee.

The Subcommittee on Guardianships and Powers of Attorney was formed to review, among other things, 20 Pa.C.S. Chapters 54 (health care), 55 (incapacitated persons) and 56 (powers of attorney).

The subcommittee consists of John F. Meck, Esq., Chair; Robert Clofine, Esq.; William R. Cooper, Esq.; The Honorable Calvin S. Drayer, Jr.; Jay C. Glickman, Esq.; Neil E. Hendershot, Esq.; The Honorable Anne E. Lazarus; John J. Lombard, Jr., Esq.; James F. Mannion, Esq.; Michael J. Mullaugh, Esq.; R. Thomas Murphy, Esq.; The Honorable Paula Francisco Ott; The Honorable Stanley R. Ott; William Campbell Ries, Esq. and Robert B. Wolf, Esq.

After reaching consensus on its legislative recommendations, the Advisory Committee presents its recommendations to the Task Force on Decedents’ Estates Laws, which is a bicameral and bipartisan panel of legislators. The Task Force authorizes the Joint State Government Commission to publish a report containing the recommendations, which serve as a basis for legislation. * * * [Paragraphs rearranged]

What is in the June 2011 Report?  Its proposed legislation would reverse one Pennsylvania Supreme Court decision (Vine, December 21, 2010) regarding financial powers of attorney, and clarify the guardianship and healthcare decision-making statutes after another Pennsylvania Supreme Court decision (D.L.H., August 17, 2011) regarding medical decision-making.

In response to the Vine [v. Commonwealth, 9 A.3d 1150 (Pa. 2010)] and [In Re] D.L.H. [2 A.3d 505 (Pa. 2010)] rulings of the Pennsylvania Supreme Court, the Subcommittee on Guardianships and Powers of Attorney reviewed the topics of powers of attorney and health care decision-making and presented its recommendations at the 2011 annual meeting of the Advisory Committee.

The Advisory Committee reached consensus on the recommendations, and the Subcommittee subsequently finalized specific statutory amendments to the Probate, Estates and Fiduciaries Code, which are contained in this report.

The major statutory amendments that form the basis of this report concern the following:

(1) Third party liability and immunity regarding powers of attorney under 20 Pa.C.S.  Chapter 56, in light of the Vine ruling.
(2) An acknowledgment by the principal and affidavits of the two witnesses for powers of attorney.
(3) Health care decision-making by guardians under 20 Pa.C.S. Chapters 54 and 55, in light of the D.L.H. ruling.

Proposed legislative reversal of the Vine holding was explained in a Memo, dated April 4, 2011, from Senator Stewart J. Greenleaf to all Pennsylvania Senators:

[The Court's opinion appears to remove the immunity third parties have had for decades in relying on facially valid power of attorney.

Third parties will now be put in a position of having to investigate the circumstances surrounding the execution of a power of attorney.

Instead of routinely relying on the validity of a power of attorney, they may have to seek the principal's ratification before acting. And, in turn, if the third party questions the power of attorney and does not comply with the instructions of the attorney-in-fact, the third party could find itself subject to liability for failing to comply with an agent's instructions. * * *

The need for remedial legislation after the Vine decision was highlighted by a Pennsylvania Bar Association Recommendation, dated April 11, 2011.  That Recommendation concluded:

These amendments are vital to restore commercial viability of Powers of Attorney following the decision in Vine v. Commonwealth, 9 A.3d 1150 (Pa. 2010), while still adopting appropriate new safeguards for potentially vulnerable principals. In expressing our support for prompt action by the Pennsylvania State Legislature, we have carefully considered the proposals by the Joint State Government Commission and we support the Commission’s approach to the necessary amendments of existing statutes.

As a means of strengthening the original execution of powers of attorney in Pennsylvania, the most recent proposal would require notarization of the maker's signature and affidavits by two witnesses, which requirements parallel those of a self-proving last will.  Other amendments would allow for use of facsimile copies of documents.

The other proposal in the June 2011 Report would clarify points made in the D.L.H. case, where the PA Supreme Court considered, "[W]hether plenary guardians can refuse life-preserving medical treatment on behalf of a person who lacks -- and has always lacked -- the capacity to make personal healthcare decisions, where the person is neither suffering from an end-stage medical condition nor permanently unconscious."

Careful study of that decision revealed areas of the Guardianship statute and the Health Care Decision Making statute that should address long-term and end-of-life medical decision making by a court-appointed guardian.  The result would be these amendments:

• § 5521. Subsection (d.1)(1) is added to provide that a guardian of the person for an incapacitated person shall have the same authority to make health care decisions on behalf of the incapacitated person as a health care representative, and a decision shall be effective without court approval, subject to (1) any limitations and conditions set forth in the order of appointment; (2) the same health care decision-making process as prescribed in the statutory provisions regarding the authority of a health care agent in making health care decisions; (3) the same limitations regarding pregnancy and regarding the duties of an attending physician and health care provider under Chapter 54; (4) the statutory provisions regarding powers and duties only granted by the court and regarding powers and duties not granted to a guardian; and (5) any other provision regarding health care representatives as set forth in Chapter 54, except the statutory provisions regarding who may act as a health care representative.

• Subsection (d.1)(2) is added to specify that, to the extent practicable, a guardian of the person must consult with close family members of the incapacitated person in making a health care decision, particularly one involving end-of-life decision-making.

• Subsection (d.1)(3) is added to require that a petition that is filed for the appointment of a guardian of the person on or after the effective date of the act must state whether it is proposed that the guardian of the person shall have the power to make health care decisions and, if so, whether the guardian shall have all the powers of a health care representative to make such decisions, and any limitation of those powers.

• Subsection (d.1)(4) is added to require that the notice of a petition or hearing must contain the information under the previous paragraph.

• Subsection (d.1)(5) is added to require that an order of appointment of a guardian of the person that is issued on or after the effective date of the act must specify whether the guardian of the person shall have the power to make health care decisions and, if so, whether the guardian shall have all the powers of a health care representative to make such decisions, and any limitation of those powers.

• Subsection (d.1)(6) is added to specify that a guardian of the person appointed before the effective date of the act shall have the same powers as a health care representative unless (1) a prior court order has limited the power of the guardian to make health care decisions or (2) a health care representative is available and assumes authority to act by agreement between the health care representative and the guardian, in which case the guardian thereafter has no health care decision-making powers.

I serve as a Guardianship/POA Subcommittee member and as an Advisory Committee member, and I worked on the reports and recommendations.

I strongly advocate for the Legislature's adoption of the recommendations contained in the June 2010 Report, as modified by the June 2011 Report.

Update:  10/27/11:

In searching bill information on the website of the Pennsylvania General Assembly, I do not find any legislation pending that derives from the two reports.

However, a guardianship-related bill, House Bill 1720, was introduced recently and finds support.  See: PA EE&F Law Blog posting "Granny Snatching" Prohibition Pending in PA (10/25/11).

PA 2010 POA Reform Report Issued by JSGC

On March 23, 2010, after an 18-month study, the Pennsylvania Joint State Government Commission issued its report, dated March, 2010:

POWERS OF ATTORNEY:
PROPOSED AMENDMENTS to the
PROBATE, ESTATES and FIDUCIARIES CODE

REPORT of the ADVISORY COMMITTEE on DECEDENTS’ ESTATES LAWS.

This report was issued today in response to the requirements of House Resolution 484, Printers No. 2753 (introduced 10/26/07), "[d]irecting the Joint State Government Commission to study the Uniform Power of Attorney Act and Pennsylvania's current power of attorney statute to determine whether any amendments should be made to Pennsylvania's current statute."

That Resolution tasked the Joint State Government Commission, acting through its Advisory Committee on Decedents' Estates Laws, as follows:

RESOLVED, That the House of Representatives direct the Joint State Government Commission to have its Advisory Committee on Decedents' Estates Laws study the Uniform Power of Attorney Act and Pennsylvania's current power of attorney statute to determine whether any amendments should be made to Pennsylvania's current statute; and be it further

RESOLVED, That the Joint State Government Commission report its recommendations to the House of Representatives within 18 months of the adoption of this resolution.

The 2010 POA Report, with attachments, is 214 pages long, and includes proposed legislation to amend Chapter 56 of the Pennsylvania Probate, Estates & Fiduciaries Code [unofficial version posted online], which statutorily authorizes and regulates powers of attorney in the Commonwealth.

The Report proffers legislation that, if adopted into law, would significantly change those actions authorized to be conducted by an agent under a power of attorney in Pennsylvania and also expand the ability of the Orphans' Court Divisions to apply remedies for unauthorized conduct by an agent acting under a power of attorney.

The introduction of H.R. 484 was discussed in detail on this Blog upon its introduction by Representative Jesse White. See: PA EE&F Law Blog posting House Reps Propose Further POA Study (11/05/07), which focused on an article by Dennis B. Roddy, entitled "Lawmaker: Tighten rules on power of attorney" published on November 2, 2007, in the Pittsburgh Post-Gazette.

Prior Post-Gazette articles highlighted a need for consideration, in Pennsylvania, of the latest model of a Uniform Power of Attorney Act (2006) (UPAA), approved by the National Conference of Commissioners on Uniform State Laws, on July 13, 2006. See: PA EE&F Law Blog postings: "Powers of Attorney" Investigated in Series (09/04/07); and Final "Courting Trouble" Article on POA Abuse (09/05/07).

The additional issues requested by HR 484 to be addressed were those mentioned in my prior posting entitled "Super Powers" Under Examination (06/05/07). In that posting, I had reflected on an article which appeared on June 4, 2007, in Forbes Magazine entitled "Taming the Superpower", by Ashlea Ebeling.

The "General Observations" section of the 2010 POA Report stated the overall findings of the JSGC-ACDEL in contrasting PEF Code Chapter 56 to the UPAA:

• The Advisory Committee recognized that although the UPAA is better organized and more thorough and specific than Pennsylvania's current power of attorney statute, many of its best principles are already incorporated into 20 Pa.C.S. Chapter 56. The Advisory Committee acknowledged a general sense of satisfaction among practitioners regarding Pennsylvania's current power of attorney statute. Accordingly, it did not favor the wholesale adoption of the uniform act, instead opting to recommend discrete amendments to 20 Pa.C.S. Chapter 56 to address specific concerns or problems encountered by practitioners and others.

• The primary concern evidenced by the court system and commentators regarding durable powers of attorney is the potential for abuse by agents seeking to enrich themselves or benefit those close to them, such as through the altering of the principal's estate plan. Nevertheless, durable powers of attorney are very helpful tools for handling the principal's financial matters as well as for planning purposes; their inexpensive and private nature contrasts with the guardianship alternative. Therefore, the Advisory Committee reasoned that any statutory amendment to 20 Pa.C.S. Chapter 56 should preserve what is best about powers of attorney in Pennsylvania: their privacy, expediency and efficiency.

• The Advisory Committee also reviewed several provisions of 20 Pa.C.S. Chapter 54 regarding health care powers of attorney since 20 Pa.C.S. § 5602(a)(8), (9) and (23) and § 5603(h) and (u.1) currently permit a principal to incorporate by reference in a power of attorney the power to (1) authorize the principal's admission to a facility and enter into agreements for the principal's care, (2) authorize medical and surgical procedures and (3) make an anatomical gift of all or part of the principal's body. The Advisory Committee observed that several amendments to 20 Pa.C.S. Chapters 54 and 56 were appropriate regarding health care decision-making. [Emphasis added]

The 2010 POA Report then summarized the proposed changes to the existing Chapter 56 regarding powers of attorney in Pennsylvania [Emphasis added]:

§ 5601. Subsection (b) is amended to provide that two witnesses are required when any power of attorney is executed, thereby changing current law, which provides that two witnesses are only required when the power of attorney is executed by mark or by another individual. The amendment makes the execution of a power of attorney under Chapter 56 consistent with the execution of a health care power of attorney under Chapter 54. However, an agent appointed under a Chapter 56 power of attorney may not be a witness. Notarization, where the specific circumstances permit, is good practice but is not required. Subsection (b) is also amended to specify that a power of attorney “shall be dated and signed by the principal,” thereby replacing “signed and dated by the principal.

Subsections (d) and (e) are amended to provide statutory language regarding the preservation of the estate plan of the principal, including the effect of intestacy if the principal does not have a will.

Subsection (e.3) is new and provides that an agent and a recipient of a gift or other financial benefit, during the principal's life or at the principal's death, arising from the action of the agent is liable as equity and justice may require to the extent that the court determines that the action of the agent was inconsistent with (1) prudent estate planning or financial management for the principal or (2) the known or probable intent of the principal with respect to the disposition of the principal's property. An agent who in good faith exercises reasonable caution and prudence shall not be personally liable.

§ 5601.2. The title of § 5601.2 and subsection (a) are amended to specify that, similar to the gift provisions, a principal may empower an agent to make changes to the principal's estate plan only in specific circumstances. A power to make a gift or make changes to the principal's estate plan may not be inferred from a grant of another power or from a general grant of authority to do anything that the principal could do, except to the extent that a principal expressly grants the agent the power to provide for personal and family maintenance.

Subsection (b) is amended to clarify that limited gifts authorized in compliance with this subsection do not require court approval.

Subsection (c) is amended to change the title from “unlimited gifts” to “other gifts specifically authorized and not requiring court approval” and to clarify that other gifts specifically authorized in compliance with this subsection do not require court approval. The amendments permit a principal to authorize an agent to make a gift, which is not a limited gift under subsection (b), only by specifically identifying the donee and the gifted property or cash amounts. In addition, subsection (c)(1) specifies that the phrase “any donee” or other language showing a similar intent is not permitted.

Subsection (c.1) is new and provides that an agent may act without court approval if the agent's action is otherwise authorized by the power of attorney (e.g., to make a beneficiary designation or create a joint account) and maintains and is consistent with the preservation of the principal's estate plan, including the effect of intestacy if the principal has no will. An action may not be taken if the interest of any beneficiary under the principal's existing estate plan, including an intestacy if the principal has no will, is prejudiced thereby.

Subsection (c.2) is new and provides that an agent may make gifts or change the principal's estate plan (such as by creating or changing rights of survivorship or a beneficiary designation; by creating an inter vivos trust or amending, revoking or terminating an existing trust; or by waiving the principal's right to be a beneficiary of a joint and survivor annuity) only if the power of attorney expressly grants the agent the authority and the court approves the agent's action, in the manner set forth in new subsection (g), after finding that the action is consistent with (1) prudent estate planning or financial management and (2) the known or probable intent of the principal with respect to the disposition of the principal's property. If an agent complies with the grant of authority for gifts, the agent does not need to follow the procedures under Chapter 55 (incapacitated persons) so as to implement estate planning changes. Conversely, if the agent does not so comply, a guardianship proceeding would need to occur.

Subsection (d)(1), in defining the nature of a limited gift, is amended to add that the agent may make a gift to each donee to a tuition savings account or prepaid tuition plan.

Subsection (e), concerning equity and justice with respect to gifts, is repealed and replaced by § 5601(e.3) to make the concept of equity and justice applicable to all actions of an agent under Chapter 56.

Subsection (g) is new and provides for procedures concerning court proceedings for subsection (c.2).

§ 5602. Subsection (a) is amended to repeal paragraph (8) (“To authorize my admission to a medical, nursing, residential or similar facility and to enter into agreements for my care”), paragraph (9) (“To authorize medical and surgical procedures”) and paragraph (23) (“To make an anatomical gift of all or part of my body”). The substance of these paragraphs is being moved to Chapter 54.

Subsection (a) is amended to broaden paragraph (17) to include annuity transactions.

Subsection (a) is amended to add new paragraphs (24) (“To operate a business or entity”) and (25) (“To provide for personal and family maintenance”).

Subsection (c) is amended to change the reference from “executed copy of the power of attorney” to “originally executed power of attorney.”

Subsection (d) is new and specifies that, except for the purpose of filing at the courthouse, a photocopy or electronically transmitted copy of an originally executed power of attorney has the same effect as the original.

§ 5603. Subsection (a)(2)(ii), regarding gift splitting, is amended to (1) clarify that an agent can make a gift of the principal's assets up to twice the amount of the annual exclusion if the principal's spouse indicates a willingness to “split” gifts and (2) add a provision that limited gifts to a “family unit” (which is a child and a child's descendants) can be equalized even if this means exceeding the available annual exclusions and thus using a portion of the principal's cumulative lifetime gift exemption or paying gift tax if there is an insufficient amount of such exemption remaining.

Subsections (d) (power to claim an elective share) and (e) (power to disclaim any interest in property) are amended to eliminate as unnecessary the references to adjudication, since 20 Pa.C.S. § 102 defines an incapacitated person as “a person determined to be an incapacitated person under the provisions of Chapter 55 (relating to incapacitated person).” The determination under Chapter 55 necessarily involves an adjudication.

Subsection (h) (power to authorize admission to medical facility and power to authorize medical procedures) is repealed, in light of Chapter 54.

Subsection (k)(4) (power to engage in stock, bond and other securities transactions) is amended to specify that the agent may also join in any consolidation, dissolution or liquidation, thereby making the provision more parallel to 20 Pa.C.S. § 7780.6(a)(13), concerning the illustrative powers of a trustee under the Pennsylvania Uniform Trust Act.

Subsection (p) (power to engage in insurance transactions) is amended to include annuity transactions. Paragraph (3) is amended to give an agent the authority to change a beneficiary designation but only as permitted under § 5601.2(c.1) and (c.2), which concerns actions that change an estate plan and that may or may not require court approval.

Subsection (q) (power to engage in retirement plan transactions) is amended to give an agent the authority to change a beneficiary designation but only as permitted under § 5601.2(c.1) and (c.2), which concerns actions that change an estate plan and that may or may not require court approval.

Subsection (u.1) (power to make anatomical gift) is repealed, in light of Chapter 54.

Subsection (u.2) is new and defines the power to operate a business or entity.

Subsection (u.3) is new and defines the power to provide for personal and family maintenance.

§ 5604. Subsection (c)(1) is amended to delete the word “adjudicated” (with respect to an incapacitated principal) in the first sentence and to delete the second sentence, which provides that the guardian has the same power to revoke or amend the power of attorney that the principal would have if the principal were not incapacitated.

Subsection (c)(3) is new and requires the court to determine whether, and the extent to which, the incapacitated person's durable power of attorney remains in effect and include that determination in its guardianship order.

Subsection (d.1) is new and specifies that except as otherwise provided in the power of attorney, an agent is not required to disclose receipts, disbursements or transactions conducted on behalf of the principal unless ordered by a court or requested by the principal, the principal's guardian, another fiduciary acting for the principal, a governmental agency having authority to protect the welfare of the principal, or (upon the death of the principal) the personal representative or successor in interest of the principal's estate.

§ 5610. A third sentence is added clarifying that the court may assess the costs of the accounting proceeding as it deems appropriate, including the costs of preparing and filing the account.

§ 5612. This new section authorizes the court to order an investigation, appoint a guardian ad litem, make a referral to an appropriate agency or take any other appropriate action regarding allegations of financial abuse or mismanagement against a principal by his or her agent under a power of attorney. Any such order is made upon petition by an appropriate party and a reasonable showing of the financial abuse or mismanagement. However, the court may consider information not only from the formal petition but from other sources (such as from a report by a social service agency or from other communications).

§ 5613. This new section provides that venue of any matter pertaining to the exercise of a power by an agent acting under a power of attorney is in the county where the principal is domiciled, a resident or residing in a long-term care facility. A court may decline to exercise jurisdiction if it determines that a court of another county or state is a more appropriate forum, in which case the court shall either dismiss the proceeding or stay the proceeding upon the condition that a proceeding be promptly commenced in another county or state. The court may impose other conditions as well. This new section provides the court with maximum flexibility regarding the relevant and important factors to be used in determining whether to exercise jurisdiction.

§ 5614. This new section supplements Chapter 56 with the common law and principles of equity.

The 2010 POA Report also contains the following proposed amendments to 20 Pa.C.S. Chapter 54 (health care):

§ 5422. The definition of “health care decision” is amended to include decisions regarding (1) an individual's admission to a facility or entering into agreements for the individual's care and (2) after the individual's death, making anatomical gifts, disposing of the remains or consenting to autopsies.

§ 5456. Subsection (a) is amended to specify that the health care agent's power includes the power to authorize admission to a facility or enter into agreements for the principal's care.

§ 5460. Subsection (a) is amended to repeal the last sentence, which provides that the guardian has the same power to revoke or amend the appointment of a health care agent that the principal would have if the principal were not incapacitated, but the guardian may not revoke or amend other instructions in an advance health directive absent judicial authorization. Subsection (a) is also amended to add statutory language providing that in its guardianship order and determination of a person's incapacity, the court shall determine the extent to which the health care agent's authority to act remains in effect.

I was privileged to be a member of the drafting committee (the "Subcommittee on Guardianships and Powers of Attorney"), chaired by John J. Lombard, Jr., Esq., Chair, which included: William R. Cooper, Esq.; Jay C. Glickman, Esq.; Neil E. Hendershot, Esq.; The Honorable Anne E. Lazarus; James F. Mannion, Esq.; John F. Meck, Esq.; Michael J. Mullaugh, Esq.; The Honorable Paula Francisco Ott; William Campbell Ries, Esq. and Robert B. Wolf, Esq. In addition, The Honorable Calvin S. Drayer, Jr. and The Honorable Stanley R. Ott were invited to participate in the subcommittee's review and discussion process.

Update: 03/26/10:

On Friday, March 26, 2010, the Pittsburgh Post-Gazette published an article by Dennis B. Roddy entitled Reforms aimed at power-of-attorney abuses: State commission proposes changes to curb cheating, which noted issuance of the 2010 POA Report and a legislator's intention to introduce legislation based upon its recommendations:

A Pennsylvania government study commission has proposed legal reforms to curtail power-of-attorney abuses that have cheated the elderly, the disabled and their heirs.

The 222-page report includes draft legislation and is the result of an 18-month study ordered by the state House after a 2007 series of articles in the Post-Gazette. The articles revealed gaps in the law that had allowed attorneys and family members to divert savings and pension benefits to their advantage.

"The majority of powers of attorney work very well, but when they don't work they cause tremendous problems," said Superior Court Judge Anne Lazarus, a member of the advisory committee on estate law that proposed the reforms to the Joint State Government Commission.

The study was ordered after the House passed a resolution by State Rep. Jesse White, D-Washington County, who said he was incensed by reports of POA abuses detailed in the newspaper during 2007.

"I will almost certainly be introducing some sort of legislation for comprehensive power of attorney reform," Mr. White said. Initially, Mr. White and several others had suggested the commission explore adopting a nationwide standard called the Uniform Power of Attorney Act.

The committee did a side-by-side comparison of Pennsylvania law with the proposed uniform act.

"We found that our structure was sound and that we addressed most issues already," said Neil Hendershot, a Harrisburg estate lawyer and expert on POA.

Instead, the committee opted for alterations of the current Pennsylvania law. * * *

POA Abuse Report and a PA POA Trial

On December 4, 2008, the AARP Public Policy Institute and the American Bar Association's Commission on Law & Aging, issued a research report entitled "Power of Attorney Abuse: What States Can Do About It" (Nov., 2008), which "explores the problem of power of attorney abuse and how state legislatures can protect vulnerable adults against it."

More specifically, the Report "explains how the new [model] Uniform Power of Attorney Act helps prevent, detect and redress abuse, and provides resources to promote enactment of this model law."

The Full Report (PDF, 88 pages) was co-authored by Lori A. Stiegel, JD, & Ellen M. Klem, of the ABA's Commission on Law & Aging. A summary is available online either in HTML format or PDF format.

This [AARP Public Policy Institute] research report explores the problem of power of attorney abuse and how state legislatures can protect vulnerable adults.

Powers of attorney are legal documents used by individuals to empower someone else to act on their behalf. As the population ages, the power of attorney will be used increasingly to appoint trusted family members or others to handle financial decision-making.

But it also can be a ‘license to steal,’ because it grants broad powers with little oversight.

The report shows that a large majority of states lack protections against abuse. The Uniform Power of Attorney Act, a model law, lays the groundwork for keeping seniors safe from abuse, while allowing them to plan for the future. (88 pages)

As noted in an article entitled "Elder Abuse Resource", published in the October, 2008 issue (Vol. 30. No. 1) of Bifocal (the ABA Commission's newsletter), two "fact sheets" were provided for use in the Report regarding Durable Power of Attorney Abuse, both now posted online:

• Durable Power of Attorney Abuse -- A National Center on Elder Abuse Fact Sheet for Consumers (PDF, 4 pages) [Also posted by the National Center on Elder Abuse, here.]

• Durable Power of Attorney Abuse: It’s a Crime Too -- A National Center on Elder Abuse Fact Sheet for Criminal Justice Professionals (PDF, 3 pages) [Also posted by the NCEA, here.]

The ABA Commission also posted a chart of Power of Attorney Laws: Citations, by State (PDF, 2 pages), which was expanded as to specific provisions in the Report.

The Report was noted in an article posted by AARP entitled "License to Steal: When Power of Attorney Is Used to Abuse" (12/05/08) by Carole Fleck posted online by AARP Bulletin Today.

The article highlighted perceived increasing financial elder abuse through use of a durable power of attorney, which is intended by laws to assist and protect the maker, not turn the maker into a victim of misappropriation or theft.

The power of attorney can be “a license to steal because it grants broad powers with little oversight,” says Naomi Karp, a strategic policy adviser at AARP. * * *

“We have definitely seen an increase in the number of referred cases of exploitation, particularly those that deal with power of attorney documents,” says Art Mason, director of the elder abuse prevention program at Lifespan, a nonprofit in Rochester, N.Y., and president of the National Adult Protective Services Association. “The vast majority of cases involve someone in the family.”

The saga typically begins when an older adult, usually a woman whose husband handled the finances, becomes widowed and starts to fall behind on her bills. Often, an individual’s diminished mental capacity plays a role in the need for help from family or friends.

This creates the opportunity for someone in the family or a trusted friend to take advantage of a vulnerable person, “with no criminal consequences,” Mason says.

“For 10 years now, it’s been a battle to get legislation passed that would give law enforcement more opportunities to go after people criminally who abuse their power of attorney.”

Issuance of the Report was also noted in a nationally published article, entitled "Senior citizens can lose life savings via power of attorney" (12/04/08), by Sandra Block, posted by USA Today. That article noted some bullet point reminders as to "[h]ow to protect yourself when assigning power of attorney":

• Trust. Don't give anyone even a child or spouse power of attorney unless you thoroughly trust that person with your finances, says Naomi Karp, strategic policy adviser for the AARP Public Policy Institute.

• Verify. Consider requiring the person who has power of attorney to periodically report to a third party, such as your lawyer or another family member.

• Communicate. Make sure other family members know who has your power of attorney. That way, Karp says, they can be on the lookout for misconduct.

For an illustrative case of alleged financial abuse under a durable power of attorney, read a Press Release, issued November 29, 2007, by the PA Attorney General's Office, entitled "Attorney General Corbett announces criminal charges against a Schuylkill County couple accused of stealing more than $84,000 from an elderly man."

The trial on those announced criminal charges is now underway in Pottsville, PA in a Schuylkill County Common Pleas criminal jury trial, according to "Caregivers on Trial for Stealing Thousands" (12/09/08) by Norm Jones, posted by WNEP (TV-16) (Northeastern PA):

A trial began Monday for a Pottsville couple accused of stealing tens of thousands of dollars from an elderly man they were supposed to take care of.

The state attorney general's office is handling the case because the district attorney asked for the state's help in investigating the theft and conspiracy case.

Monday attorneys for both sides made opening statements in the trial against Robert and Catherine Whitney. They are charged with stealing $85,000 from Louis Long of Mahanoy City.

The Whitneys' attorney is trying to prove they didn't steal from Long, but had permission to use his money to pay for his care.

The attorney general's office told jurors the Whitneys milked more than $85,000 from Long's bank accounts but defense attorneys painted a much different picture, about a family who took in an elderly man and when he was stricken with Alzheimer's, cared for him 24 hours a day, seven days a week. * * *

For a further account, see "Were pair thieves or caregivers of elderly man?" (12/09/08), posted by The Morning Call (Allentown, PA):

A Schuylkill County couple befriended a man at the outset of his Alzheimer's disease, took him into their home and drained $167,000 from his accounts before his bank teller friends alerted authorities, who removed him from the home a month before his death, a state prosecutor told a jury Monday.

But the lawyer for Catherine Whitney, 58, and her husband, Robert, 57, said they did nothing more than take in and provide end-of-life care for a friend who made them promise they wouldn't let him die in a nursing home ''alone, isolated in loneliness, cared for by no one, loved by no one.'' * * *

In the setting of this criminal trial where the principal is deceased, consider this: Pennsylvania law already contains many protections intended to prevent financial elder abuse -- far more than many state laws reviewed in the Report.

Yet financial abuse of the elderly continues statewide. See: PA EE&F Law Blog postings "POA Abuse Cases Pressed by PA AG" (12/03/07) and other postings under the topic "Powers of Attorney."

Soon, though, the current Pennsylvania law (Chapter 54 of Title 20 of PA Consolidated Statutes) will be revisited by a study group of the Decedents Estates' Laws Advisory Committee, of the Joint State Government Commission, to reconsider whether those existing protections are sufficient.

Update: 12/12/08:

"Robert M. and Catherine M. Whitney, charged with stealing almost $85,000 from an elderly Mahanoy City man they were caring for, were convicted Thursday in Schuylkill County Court of stealing $10,000 to pay taxes," according to an article, "Jury: $10K stolen from elderly man" (12/12/08) by Peter E. Bortner posted by The Republican & Herald (Pottsville, PA).

As the Pottsville couple's daughters wept, a jury of seven women and five men deliberated more than seven hours before finding Catherine, 58, and Robert, 57, each guilty of three counts of theft, but not guilty of five other charges, four of theft and one of conspiracy.

President Judge William E. Baldwin, who presided over the Pottsville couple's four-day trial, ordered preparation of a presentence investigation but did not set a sentencing date. He allowed them to remain free on $75,000 unsecured bail pending sentencing.

Two of the thefts are felonies with a maximum prison term of seven years, while the third is a misdemeanor with a maximum possible sentence of five years, Senior Deputy Attorney General Anthony W. Forray said.

"Absolutely," Forray said when asked if prosecutors will seek to send the Whitneys to prison.

The Whitneys, who did not visibly react to the verdict, said nothing as they left the courtroom, but their lawyer, Frederick J. Fanelli, Pottsville, said they would consider filing an appeal, which would not occur until after sentencing.

"We're disappointed in the counts that resulted in conviction," he said. "It's a curious verdict." * * *

Notice Requirements by PA Trustees

On October 29, 2008, Vincent F. Lackner, Jr., Esq., posted on the Pennsylvania Bar Association's "Probate & Trust Law Division Listserv" a helpful guide regarding trustee notice requirements under the present form of the Pennsylvania Uniform Trust Act.

Vince is an excellent attorney, and also the founder & President of The Lackner Group, Inc., of Pittsburgh, PA, which produces professional-level software supporting estate and trust administration in Pennsylvania and many other states. See: PA EE&F Law Blog posting "Fiduciary Administration Software" (12/14/07).

With his permission, I repost his message to lawyers, as edited & reformatted by me.

Clarification of Notices
Required under the PA Uniform Trust Act
by Vincent F. Lackner, Jr., Esq.

I have recently received some clarification relating to Section 7780.3 of the Pennsylvania Uniform Trust Act, 20 Pa.C.S. §7701 et seq. ("Duty to Inform and Report").

This act was effective November 6, 2006, but some notice provisions were effective two years thereafter. That date now approaches.

Since the enactment of the PA UTA, an omnibus amendment, in the form of Senate Bill 1203 ("SB 1203"), would correct and amend Section 7780.3 (and other sections) in several important respects. Section 7780.3(l)(2) in particular (see below) would be retroactive to November 6, 2006, if and when passed.

Section 7780.3 requires that trustees provide a specific notice, as spelled out in 7780.3(i), to certain people within a certain period of time, depending on:

• whether the trust is revocable or irrevocable,

• whether the settlor of the trust has died or been adjudicated incapacitated, and

• when the settlor died or was adjudicated incapacitated (before 11/06/2006 or on/after 11/06/2006).

There was a two-year grace period under the original PA UTA, however, for trusts where the settlor died (or was adjudicated incapacitated) before November 6, 2006. In these cases, the deadline to give notice will be November 6, 2008 (just two days after next week's election!).

The dilemma is that SB 1203 would affect compliance with this deadline of November 6, 2008, but will clearly not be effective until after November 6, 2008.

During the past few days I have been in contact with lawyers involved in either drafting the Pennsylvania Uniform Trust Act or lecturing on this topic for the Pennsylvania Bar Institute during the past two years.

The subject is inherently complex, and there are some ambiguities that are largely unavoidable. Based on my recent conversations, however, I've tried to draw some "bright lines" that may help others who are trying to comply with the November 6, 2008 deadline (and beyond).

Interestingly, Section 7780.3(i) does not give a name to the required "notice". The consensus seems to be that "Notice of Trust Administration" would work as well as anything else. It would provide symmetry with the PA Supreme Court Orphans' Court Rule 5.6(a) requirement for a "Notice of Estate Administration". Also, it is generic enough to encompass recipients of all classes (not just "current beneficiaries").

The potential recipients of this notice include the following. All relationships are to the settlor's estate (#1), the settlor (#2, 3, 5), or the trust (#4):

• #1 Personal Representative

• #2 Spouse (or Spouse's Guardian*)

• #3 Children (if at least 18 years of age) or Children's Guardian*, if any

• #4 Current Beneficiary: "A person 18 years of age or older to or for whom income or principal of a trust must be distributed currently or a person 25 years of age or older to or for whom income or principal of a trust may, in the trustee's discretion, be distributed currently" (emphasis added).

• #5 Guardian*

* Guardian is defined in Section 7703 as "[a] person other than a guardian ad litem who is appointed by the court to make decisions regarding the property of an individual."

Note: If a child is not yet 18 and has no court-appointed guardian, then no notice is required in connection with that child.

So, here is my attempt at some "bright lines" in areas that are not explicit under the UTA:

• A. Inter Vivos Revocable Trust: Even after the decedent has died, the rules for "Revocable Trusts" continue to apply.

• B. Inter Vivos Irrevocable Trust: Any inter vivos trust that is not "Revocable" as defined under the PA UTA.

• C. Testamentary Trust: Does not exist until funded. Thus, for purposes of notice, it is treated as equivalent to an "Irrevocable Trust".

Dependent upon the types of trusts, these are the notices required for each:

Inter Vivos Revocable Trust	Event	Recipients	Deadline
Settlor Adjudicated Incapacitated	Before 11/06/06	#5	11/6/2008
	On/after 11/06/06	#5	W/i 30 days after trustee learns of adjudication
Settlor Died	Before 11/06/06 **	#4	11/6/2008
	On/after 11/06/06	#1, 2, 3, 4	W/i 30 days after trustee learns of death
Inter Vivos Irrevocable Trust
Settlor Adjudicated Incapacitated	Before 11/06/06	#4	11/6/2008
	On/after 11/06/06	#4	W/i 30 days after trustee learns of adjudication
Settlor Died	Before 11/06/06	#4	11/6/2008
	On/after 11/06/06	#4	W/i 30 days after trustee learns of death
Testamentary Trust
Settlor Died	Before 11/06/06	#4	11/6/2008
	On/after 11/06/06	#4	W/i 30 days after the trust is first funded

** Existing Section 7780.3(l)(2) has a cross-reference in it to 7780.3(c) (inter vivos Revocable Trusts). This cross-reference was apparently an error. It is safe to proceed as if that error has already been corrected (via the still-pending SB 1203). Section 6(a)(2) of SB 1203 explicitly states that this change shall be "retroactive back to November 6, 2006."

When, under proposed SB 1203, the reference to 7780.3(c) would be removed from 7780.3(l)(2), then the time period for Revocable Trusts for pre-11/06/2006 decedents would be covered by a combination of the following:

• 7780.3(f) (catch-all provision) (notice only to current beneficiaries)

• 7780.3(l)(3) (specifies that the notice under 7780.3(f) need not be completed until 11/06/2008).

Two further notes:

• Beneficiary Ages. Trustees need to monitor the ages of beneficiaries, so that required notices can be sent to beneficiaries once they become "current" (i.e., turn 18 or 25).

• Change of Trustee. Under Section 7780.3(g) (as proposed to be revised under SB 1203), when there is a change in trusteeship, the trustee must provide written notice of this change to: (a) the current beneficiaries (if the Settlor has died or been adjudicated incapacitated) or (b) the Settlor (otherwise). This notice must include the trustee's name, address, and telephone number.

Vince's article adds to the guidance provided in a recent online course (No. OL-1088) offered by the Pennsylvania Bar Institute entitled "Uniform Trust Act Notices: Only Five Months To Go!" See also: Posting by Patti Spencer, Esq., "PA UTA - Required Trust Notices Deadline Approaches" (09/01/08).