Many of us are small business owners, including farms and ranches. When you have a farm or ranch or own your own business, there is no guarantee your children will want to run the ranch, farm or business like you are doing. You may know that well in advance. A common scenario which I have frequently dealt with is when a large amount of land, or a family owned business, has been passed on to several children and no one wants to run the farm, ranch or family business. Sometimes one child is willing to take over, but the others want their shares in cash.
In one instance, three male children of adult age inherited 800 acres of ranch land and 1,000 acres of leased BLM land. None of them lived anywhere near the ranch and they each had careers of their own. The eldest son called me from Boston and retained me to help him, as Personal Representative, to handle the estate.
Although they were pleasant and easy to work with, it turns out that a relative who lived adjacent to the ranch had the main source of water for the ranch on her property and she was not happy about being left out of the Will. She wanted to discontinue providing water to the property. We all know how important water is in the desert, and this is when everyone stopped cooperating and made demands that were in conflict with one another, although I was able to settle the matter without going all the way to trial, it could have been avoided with proper estate planning.
In another instance, I was contacted by an elderly widow who lived in Seattle, but owned a very large parcel of prime residential property, at the top of a foothill, in Pima County. She had only visited it once and wanted to sell it. One of the difficulties was in gaining legal access to her property, and the other was in determining if there was water to allow for development of the land. Where the water was and the estimated availability of water would determine how well the land could be broken up into parcels for home construction. The elderly widow needed the money to live on and wanted it sold. She had originally desired to sell it to the government to become part of the national forest land, but the proposed purchase contract did not gain approval. Discussion was entered into with local parties for a natural conservation easement which went nowhere. Ultimately, it took approximately ten attorneys, each representing different interests, to come together and resolve the issues so the property could be sold.
On a much smaller scale, I was retained by a woman who had a residence and ranch property. She left the property, via a Will, to her son and daughter. Because the property passed through a Will, the first thing we had to do was go to court and have the daughter approved as the Executor since she had been named in the Will to handle the estate. The unhappy son filed in court and challenged the
appointment of the daughter as Executor on the basis that she was not paying the bills. The court appointed the son the Executor. One year later the daughter filed suit against the son for stealing from the estate. To make a long story short, they were both poor examples, the estate was, in effect, looted, and the IRS took the property for failure to pay taxes.
The above are only three of a large number of examples where things did not go according to plan. Often we think we have a plan in place but if it is not prepared properly, the State, or unforseen issues, can wreck the plan. Careful planning is the best you can do. That’s where I come in, to help you be sure that your plan stays intact despite unforseen issues. So, if you own a business, property, or have a special needs family member, retirement plan, pension, or for potential charitable gift call me to create the plan you need.
Your Family Lawyer, Drue Morgan-Birch
(Editor’s Note: Drue has her own law office and graduated from the UofA College of Law in December, 1982. She can be reached at 620- 9367 or firstname.lastname@example.org.)