Berman & Asbel, LLP

April 2012 Archives

Be careful with life insurance beneficiary designations when planning estate

Let's suppose you have gone to your attorney for your estate plan.  You have a will which provides your children's inheritance will be held in trust until they are old enough that their education is paid for and that they are not so likely to blow the money on fancy cars, vacations, dating expenses or other uses of which you might not approve.  You have named guardians for your children if they are underage.  Are you done?  Not necessarily.

Standby Guardianship Designation - Important for All Parents of Minor Children

Parents of children who have done their estate planning should already be familiar with naming a guardian for their children in a will.  This provision states who should care for the children in the event of the parent's death (usually if the other parent is also deceased or otherwise unable to care for the children).  However, that is not the end of planning for who will care for your children.  Suppose you become seriously ill or injured or you are going to be traveling without your children.  Who cares for your children then?

To help address problems over care of children when a parent is unable to do so, for whatever reason, the Pennsylvania legislature enacted the Standby Guardianship Act.  This law enables parents to state in writing who is to be the legal guardian of their children if certain events, referred to as "triggering events" occur.  Triggering events can include illness or injury which cause the parent to be unable to care for the children, travel without the children for an extended time, and, of course death of the children's parents.

To name a Standby Guardian, a parent signs a document called a Standby Guardian Designation.  This document also states who are the children covered by the document, who are the parents, whether the other parent is living, whether the other parent consents to the designation.  The person named as the standby guardian must sign it as consenting to the appointment.  

With this written document, if a triggering event occurs, the named standby guardian has legal authority regarding the children for sixty days.  Within that time, the standby guardian must petition the court for approval of the appointment as standby guardian.  Alternatively, the parent signing the document can opt to file a petition in advance for approval of the appointment.  If the court approves the appointment in advance, then if a triggering event occurs, the standby guardian's authority is automatically in place until such time as the triggering event were to end (such as recovery from illness or return from a trip).

The process can become more complicated when the child has two parents living but they are separated from each other and not cooperating in this process.  Under the statute, a standby guardian cannot act if the child has another parent who 1) whose parental rights have not been terminated or relinquished; 2) whose whereabouts are known; and 3) who is willing and able to carry out the day-to-day childcare decisions concerning the minor.  - See 23 Pa.C.S. section 5611.

Clearly there is a potential for dispute over whether the other parent, who probably is the one who does not have primary physical custody, is willing and able to carry out the day-to-day childcare decisions for the child.  For parents who have primary custody of their children who believe that someone other than the children's other parent should be caring for them in the event of death, illness, injury or absence, they can be proactive.  Such parents can sign a standby guardian designation and then file a petition immediately for approval of that designation.  This way, a court decision on the matter is obtained in advance rather than waiting for a crisis to occur in which the chosen guardian must institute a custody action against the other parent.Readers should not solely rely on this note as legal advice but should consult with a competent attorney licensed in their state. You can also find more information in our firm's websites on Family Law and Wills and Estate Planning and Administration.

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