TRUSTS 101:

ETHICAL CONSIDERATIONS

PRESENTED BY:

HOWARD H. COLLENS, ESQ

NOVEMBER 13, 2015

I. Who is Your Client?

II. Confidentiality in Third Party Communications

III. Assessing the Client’s Capacity

IV. Avoiding Fraudulent Transfers

Useful Resources:

• Michigan Rules of Professional Conduct

• The State Bar of Michigan – Ethics Opinion Service

Relevant Rules of Professional Conduct

• MRPC 1.6 Confidentiality

• MRPC 1.7 Conflict of Interest

• MRPC 1.14 Client under a Disability

Testamentary Capacity

• Testamentary and Capacity Needed to Make a Trust Now The Same Standard

• MCL 700.2501

Who is Your Client?

Who is the client?

• Married Couples• Third Parties Involved in the

Planning Process• When A Third Party Pays• Representing A Fiduciary• Client Who Lacks Capacity• Protecting Yourself

Confidentiality in Third Party Communications

Confidentiality of Information

Rule 1.6

• A fundamental principle in client-lawyer relationship is that the lawyer maintain confidentiality of information relating to the representation

Confidentiality in Third Party Communications

• Maintain Confidences and Secrets• Don’t Inadvertently Waive the Attorney-Client Privilege• Obtain Waivers of Conflict and Confidentiality • Beneficiaries and Interested Parties During

Administration• Working with other Professionals• Discussing Who Our Clients Are• Transferring Files• Maintaining Confidences After Client’s Death

Assessing The Client’s Capacity

Client Under Disability/Lack of Capacity

Rule 1.14

• When a Client’s ability to make decisions in connection to representation is impaired, the lawyer shall work to maintain a normal client-lawyer relationship

Assessing Client Capacity

• Incapacitated Individual

• MCL 700.1105 – Legally Incapacitated Individual

• Testamentary Capacity

• MCL 700.7601

• What to Look For and Tools to Use

• Challenges to Capacity

Fraudulent Transfers

Fraudulent Transfers

• Use of revocable trusts to avoid creditor’s claims

• Use of revocable trusts to avoid spousal allowances

• MCL 700.7506 and MCL 700.7605

Thank you!

Howard H. CollensGalloway and Collens, PLLC

26075 Woodward Ave, Suite 200Huntington Woods, Michigan

48070248.545.2500

GallowayCollens.comHoward@GallowayCollens.com

Twitter: @HowardCollens @ProbateLawMI