26 Jul How You Can Provide For Your Pets When You Die
Do you have pets? If so, have you planned for them in your will in the event you pass away before they do?
There are three ways to provide for your pets when you die:
- Pet stewardship by a friend: Leave a specific gift in your will to someone to whom you will leave your pets, as a thank you and to help them defray the costs of taking care of your pets;
- Pet stewardship by an organisation: Leave a gift to a charitable program that will take care of your pets when you die. One such program commonly used by residents of Ottawa is the Ottawa’s Humane Society’s Pet Stewardship Program.
- Pet Trust: Create a trust in your will for the benefit of someone who will take care of your pets, on condition that the beneficiary takes care of your pets.
This article discusses the pet trust. Among the many types of trusts that can be drafted in your will, one type is a trust for surviving pets. However, doing so requires care and diligence in order to make sure that the trust is not struck down for being unlawful. While the law on trusts for pets is still being developed, three rules need to be remembered.
- A trust must have a beneficiary who is able to enforce the trust instrument, i.e. force the trustee to pay the money out of the trust according to its terms. While some dogs are very intelligent (some say cats are smarter!), they aren’t legally speaking able to enforce a trust;
- A trust cannot exist merely for a purpose, rather than for the sake of gifting something to a beneficiary unless the purpose is charitable. For example, a person may set up a trust in his or her will with the express purpose of creating a scholarship fund to provide post-secondary education to underprivileged children. Such a trust satisfies the test for being a charitable purpose trust in Ontario case law. In contrast, a trust without named beneficiaries that has the purpose of funding venture capital in the biotech industry would not be allowable under Ontario trust law, assuming the end result is not expressly a charitable purpose, such as finding a cure for cancer. Unfortunately, a trust set up by a person for his or her pets arguably does not have a charitable purpose (in contrast, a trust for the benefit of animals would);
- A trust fund may name specific beneficiaries and make gifts conditional on certain things, as long as those conditions are (i) lawful and (ii) not contrary to public policy, i.e. racist, sexist, etc.
It is possible to create a trust fund for your pets that arguably satisfies the rules set out above. To create a pets’ trust, it is necessary to designate specific beneficiaries to the trust, and to make any benefit received from the trust by those beneficiaries conditional on taking care of the pets, with funds from the trust being available for the caretaking of your pets.
Lastly, each trust must specify an end-date or “termination date”, when the balance of the fund, if any, is finally distributed. A pet trust would typically “end” on the date of death of the last surviving pet, with the balance of the trust fund being directed by the terms of your Will. For example, you could direct that when the last pet dies, the balance of the trust fund be distributed to a family member, friend, or favourite charity/charities. It is important to ensure that the trustee of a pet trust not have a financial interest in hastening the termination date, i.e. in order to inherit the remaining balance.
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DISCLAIMER: The contents of this article are information only and should not be construed as legal advice. Please contact us if you would like legal advice. We strongly recommend that you consult a lawyer before taking any actions that are referred to in this article.