To quote Bob Dylan, “oh the times, they are a changing.” The Illinois Probate Act of 1975 has undergone many considerable changes which will affect our everyday practice of law as to probate and guardianships.
Presumptively Void Transfers. The most substantial of these changes is reflected in the entirely new section of the Illinois Probate Act entitled “Presumptively Void Transfers.”1 The statute, applicable to documents executed on or after January 1, 2015, aims to thwart caregivers who take advantage of their positions to convince an elderly or incapacitated person to change their estate plan or transfer assets to the caregiver. The broad reach of this new statute could directly impact legitimate testamentary gifts.
The statute sets forth certain definitions that by their very terms are subject to wide interpretation. The first term defined in the statute is the most crucial to the implementation of this law, who can be considered a caregiver. A caregiver is defined as “a person who voluntarily, or in exchange for compensation, has assumed responsibility for all or a portion of the care of another person who needs assistance with activities of daily living.”2 The law applies equally to both paid and unpaid caregivers. It is important to note that there is no specific requirement that the person receiving assistance be disabled or elderly, but merely that the individual need assistance with activities of daily living. Neither the specific “activities of daily living” nor the extent of the “need” is further defined within this statute.3 There is no requirement that the person giving assistance ever considers or labels himself or herself as a “caregiver.” Does this now mean the dog walker or cleaning lady is a caregiver? How about the helpful neighbor who takes out the garbage each week? Under the plain meaning of the statute, they most definitely can. What confuses the matter even further is that the definition of caregiver extends to include a spouse, cohabitant, child, or employee of a covered caregiver.4
The statute does not apply to “family members.” The limited definition includes only a spouse, child, grandchild, sibling, aunt, uncle, niece, nephew, first cousin or parent of the person receiving assistance.5 This definition does not include individuals who are considered family in most circumstances, such as unmarried partners and stepchildren, and as such could fall within the definition of a caregiver under the statute. While the statute does not apply to all family members, nothing in it changes or limits existing common law rules or principles that can still apply to both family and non-family members, but merely is addition.6
Now that the players have been identified, what is a “transfer instrument”? A transfer instrument is any legal document intended to effectuate a transfer effective on or after the transferor’s death, and includes, without limitation, a will, trust, deed, form designated as payable on death, contract, or other beneficiary designation form.7 This definition extends beyond the Probate Act, to include assets that are not required to be probated.
The statute is implemented in any civil action where a transfer instrument is challenged.8 There is a rebuttable presumption that the transfer instrument is void if the transferee is a caregiver and the transferred property exceeds $20,0009. Once this presumption applies, it can then only be rebutted if the caregiver proves to the court either:
(1) Proving by a preponderance of the evidence that the beneficiary’s share under the transfer instrument is not greater than the beneficiary’s share already in effect prior to becoming a caregiver.10
(2) The caregiver-beneficiary proves by clear and convincing evidence that the transfer was not the product of fraud, duress, or undue influence.11
If the total transferred property is $20,000 or less, the transfer is considered acceptable. On the other hand, if the threshold is exceeded, then all of the transfer instruments in favor of the caregiver-beneficiary are presumptively void. That is to say, if there is a transfer of $20,001, the entire transfer is void. The issue then arises as to when the value of the transfer is obtained? Is it when the transfer instrument was created or when it is implemented? This is left to be determined by the courts.
The rebuttable presumption is not automatic, but only arises if a transfer instrument is actually challenged in a civil action.12 The statute only applies in situations where the transfer instrument is “being challenged.” However, the statute does not define who can be a challenger. Most likely than not, the challenger could be an interested person. An interested person is defined as one who has or represents a financial interest, property right or fiduciary status at the time of reference which may be affected by the action, power or proceeding involved, including without limitation an heir, legatee, creditor, person entitled to a spouse’s or child’s award and the representative.13
The law further provides if the caregiver attempts and fails to overcome the presumption, the caregiver shall bear the costs of the proceeding, including reasonable attorney’s fees.14 In defending against a possible challenge, the caregiver has much to consider. First the burden of proof is an enormous hurdle to overcome, as he or she is will have to prove a negative, especially after the death of the person whose intent is in question. Second, the caregiver must carefully consider that if he or she loses, not only would the caregiver be responsible for his or her attorney’s fees to fight this uphill battle, but they also could have to pay the challenger’s fees as well. This added to the fact that in the end, the caregiver could end up receiving no beneficial interest.
A challenger must bring a civil action within two years after the date of death, or sooner if required by the Act.15 If the transfer instrument is a will, the time period is shortened to six months.16
A real life example: What if a “family member” as defined in the statute has strong feeling that an unmarried partner to the transferor should not receive any portion of the decedent’s estate? Under the terms and provisions of this statute, any gift in excess of $20,000 could be considered void. This would apply to transfer of property pursuant to a deed, such as a residence in which both the transferor and the unmarried partner resided, or if the transferor listed the unmarried partner as beneficiary of his or her life insurance policy. The implementation of the new statute can have some very unintended consequences and as such, great care must be given to estate planning.
With that being said, other sections of the Probate Act have received tune-ups as well. They are as follows:
Recovery of Property and Discovery Information. Public Act 99-0093: When addressing the recovery of property and discovery information, Section 16-1 has been modified to include in the persons required to appear, anyone who had in his possession or control any assets which belong to a person whose estate is being administered. A third category of individuals has been added to include anyone who may be liable to the estate of a ward pursuant to any civil cause of action.17 Effective January 1, 2016.
Guardianship of a Minor. Public Act 98-1082: In a petition for appointment of a guardian, if a short-term guardian has been appointed for the minor prior to the filing of the petition, and the petitioner is not the short-term guardian, there is now a rebuttable presumption that it is in the best interests of the minor to remain in the care of the short-term guardian during the proceedings.18 Effective January 1, 2015.
The new provisions go on to provide that the short-term guardian appointment does not constitute consent for the court appointment of a guardian.19 This is important, as it does not affect the rights of the other parent of the minor. If there is a short-term guardian for the minor when a petition for guardianship of a minor is filed, the short-term guardian must be named in the petition.20 Additionally, the statute now requires the petition to state the facts concerning the appointment of the short-term guardian.21 A new duty has been added to the guardian of the minor in that he or she is required to give the court notice via certified mail of his or change of address within 30 days.22
The most important new provision address when a guardian of a minor may move out of state with the minor. The guardian may not move out of state without leave of court and the court may grant leave to remove the minor child if the court determines that it is in the minor child’s best interest.23 The burden of proof is on the guardian. If leave is granted, the court may require the guardian to give reasonable security guaranteeing the return of the child.24 The new provision further addresses temporary removals, such as for vacation time.25 The guardian is required to give notice to the parent or parents of the address and telephone number where the child may be reached during temporary removal and the date on which the child will return.26
These new provisions regarding removal are problematic. In a majority of the matters in which the court appoints a guardian of the minor, the parent or parents have severe impediments for caring for their children. This might make giving notice next to impossible. The statute does provide that these provisions regarding removal may be incorporated into the guardianship order. As counsel for the guardian, in preparing the guardianship order, care must be given to include such language as this will avoid unnecessary problems for the guardian.
Public Act 99-207: Requires the petitioner to give notice of the hearing on the petition for appointment of a standby guardian or a guardian of a minor not less than seven (instead of three) days before the hearing.27 Any order for removal must include the date of the removal, the reason for removal, and the proposed residential and mailing addresses of the minor after removal.28 Effective July 30, 2015.
This new act resolves some of the foreseen problems of the previous act in that a copy of the order for removal must be provided to any parent whose location is known, within 3 days of entry, either by personal delivery or certified mail.
Trusts and Trustees Act. Public Act 99-337: Authorizes trustees to use a “certification of trust” form that may be relied upon by third parties without obtaining a copy of the trust instrument.29 Effective August 10, 2015.
Health Care Power of Attorney. Public Act 99-328: Provides the following modifications and additions: (1) a “psychologist” is no longer an authorized witness the signing of a health care agency but removes the current prohibition for “mental health providers;”30 (2) the statutory short form health care power of attorney now permits a person to appoint his agent as guardian if necessary; (3) modifies the naming of a successor health care agents; (4) provides an alternative that a physician may determine that the individual is unable to make decisions; (5) adds an option for a principal to select whether the agent can have access to the principal’s medical records and information; (6) expands the definition of individual who can witness a signature; (7) and allows the agent to apply for government benefits.31 Effective January 1, 2016.
Disabled Adults. Public Act 99-302: Forms a rebuttable presumption that a will or codicil is void if it was executed or modified after the testator is adjudicated disabled and either: (1) a plenary guardian has been appointed or (2) a limited guardian has been appointed and the court has found that the testator lacks testamentary capacity.32 This rebuttable presumption is overcome by clear and convincing evidence that the testator had the capacity to execute the will or codicil.33 This subsection only applies to wills or codicils executed or modified after the effective date of this act. Effective January 1, 2016.
Elder Abuse. PA 99-272: Eliminates the need for an individual to be charged or indicted with the offense of financial exploitation for the civil cause of action of financial exploitation of the elderly or disabled to be maintained. Effective January 1, 2016.
Temporary Guardians. Public Act 99-70: Amends the Probate Act of 1975 providing that the temporary guardian shall have the limited powers and duties of a guardian of the person or of the estate which are specifically enumerated in the court order (instead of “all of the powers and duties”).34 Effective January 1, 2016.
Visitation Rights. Public Act 99-90: Modifies the statute to include the new statutory references to the new Illinois Marriage and Dissolution of Marriage Act.35 Effective January 1, 2016. When January 1, 2016 arrives, family law and probate practitioners will face these myriad of changes, as each statute will in some way be effected by the overhaul of the Illinois Marriage and Dissolution of Marriage Act. The coming year will bring a flurry of new litigation as practitioners work to implement the new statutes and learn the nuances of these major changes.
1. 755 ILCS 5/4a-5.
2. 755 ILCS 5/4a-5(1).
3. 755 ILCS 5/4a-5(1).
5. 755 ILCS 5/4a-5(2).
6. 755 ILCS 5/4a-20.
7. 755 ILCS 5/4a-5(3).
8. 755 ILCS 5/4a-10.
10. 755 ILCS 5/4a-15(1).
11. 755 ILCS 5/4a-15(2).
12. 755 ILCS 5/4a-10.
13. 755 ILCS 5/1-2.11.
14. 755 ILCS 5/4a-25.
15. 755 ILCS 5/4a-10(b).
16. 755 ILCS 5/8-1.
17. 755 ILCS5/16-1(a).
18. 755 ILCS 5/11-5(b).
19. 755 ILCS 5/11-5.4(e).
20. 755 ILCS 5/11-8(a)(ii).
21. 755 ILCS 5/11-8(a); 755 ILCS 5/11-8.1.
22. 755 ILCS 5/11-13(a).
23. 755 ILCS 5/11-13 (f).
27. 755 ILCS 5/11-13(f).
29. 755 ILCS 5/8.5
30. 755 ILCS 45/4-5.1
31. 755 ILCS 5/45-10(b).
32. 755 ILCS 5/4-1(b).
34. 755 ILCS 5/11a-4.
35. 755 ILCS 5/11-7.1
Emily R. Carrara is a partner of the Naperville law firm of Sullivan Taylor & Gumina. P.C. She focuses her practice in the area of family law including guardianship, child support, adoption, appellate practice, and child custody. She earned her B.A. degree in political science at Boston University and her J.D. degree with honors at The John Marshall Law School.