One solution to a complex problem.
Conflicts regarding an estate:
Where creative problem solving together overcomes ongoing disagreement and possibly court action.
Kendra* and Kirk were a wonderful older couple with a home in Barkell, Nova Scotia. They had committed many retirement years to volunteer service in their community until they became too forgetful to carry on. Sadly, they passed away within 3 months of each other, with Kendra passing first.
Kendra had a will naming Kirk her executor and her primary beneficiary for her estate worth about 75,000. Kirk had just finished assessing her estate when he suddenly passed from a bad stroke. The family of 5 children were distraught.
Kirk had been in the process of making a will when he passed. It was still uncompleted. His lawyer was not able to help the children out on this as all he had done was an initial interview with presenting several options to Kirk only. Kirk had never gotten back to make his choices.
The 5 children, namely Will, Sean, Katherine, Winnifred, and James had advice that the estate was intestate and that the estate was to be equally split between them. They all lived in different places so managing and negotiating was difficult to say the least. There were a few options to deal with:
1. Sell the house and land worth $150,000 (house $100,000, land $50,000), call in all investments worth $40,000, liquidate Kendra’s savings of $75,000, and divide the total equally.
2. Rent the house and land for an income of $25,000 per annum (maintenance of $5000-$8000 per annum approx. for an older building) and divide only the investments and savings.
3. Sell the house and subdivide the remaining land equally between them (35 acres), with equal or even unequal division of the investments and savings.
The boys all lived more than 1000 km from the estate and the girls lived locally within 10-20 minutes each of the house and land. Initially the boys wanted all the land as the girls were not interested. The girls did not want to rent the house and watch it go into disrepair over time with costs rising. The boys claimed they had upkept the house for 20 years of maintenance and the girls claimed they had looked after their parents’ other needs for the last 15 years of their lives and that this had value.
After a month everyone was stressed, and the winter was coming with no one in the house. A solution was not able to be found. The boys grew impatient and one began to accuse the girls of being “typically stubborn females”, and worse. The other boys did not come to their defense. Everyone had children to look after and were all at odds as to how to balance the situation. One of the girls was divorced and her new partner was a lawyer who advised the girls to take the matter to court. Everyone became angry in one fashion or another.
No one knew what a court outcome could be. Partition and sale and divide the proceeds? Certain land would be left to the boys with no compensation for the girls? How many years to get a court to resolve matters? What sort of outcome would there be, and would it be too unpredictable to handle? How could everyone afford the legal fees for a proper division? Would those unable to afford this be shunted aside ? What about their Parents’ will not to have the family be divided by what felt like a war in the family?
Everyone became deeply saddened by these difficulties and of their polarizing behaviours. The girls could not afford a lawyer and they and their spouse/partner did not want the financial strain on the family and children. The boys had threatened to initiate legal claims because they had paid the taxes on the property for the past 10 years. Everyone was anxious.
Then the eldest saw an ad for mediation. He was able to persuade everyone to give it a try because it was confidential, extremely private, and was essentially away from the public eye. People could still go to court if they failed in the mediation. He persuaded everyone that they could possibly each be $10,000 in debt for lawyers’ fees still without a court trial yet, and with a trial even more in debt for fees without a predictable solution. The girls were in agreement because they saw the boys’ stance as essentially an unfair “land grab” which did no honour to their family and which could expose them all to local jeering and ridicule from the locals who knew the family well, and especially the girls who lived locally.
The initial meeting with the mediator was an hour of understanding the process and an hour of getting the initial facts out, including a plan as to how to handle the expense of the mediation and other associated matters. All agreed that the mediation costs would be charged against the more liquid estate savings account which was not in a term deposit. Because the matter was a family matter, the mediator agreed that the fees would be charged out on a sliding scale on the basis of each sibling’s total family income. For instance, James was still a student, so his fees were charged out at $20. per hour. On the other hand, Winnifred’s income was the highest and so the charge for her participation was set at $100. per hour of mediation. All other expenses would be totaled against the savings portfolio because these, such as an accountant’s fees, would be mere facts that would go into the body of facts worth consideration by all. In the end the estate would foot the total bill once calculated.
All agreed to take holidays in the vicinity of the family home over the next March break holiday and try to resolve things in the 10 days of holidays.
In the meantime the family looked into assessing values. It was soon discovered that the land was not all the brothers thought it was. The road to the land portion was not abutting all of the lots but instead led only to one of the lots. The siblings soon found out from a property assessor (hired prior to the March break meeting times) that the roaded lot was worth $12000 and the remaining 4 wooded lots were each worth only $6350. In this instance, the brothers and sisters all quickly understood that mere assumptions made over 25 years were not necessarily true and that misunderstandings had been flying around.
The mediator was able to impress the family that unstated facts could only harm their negotiations. Proper facts began to emerge.
One of the sisters had clandestinely had the house inspected. She coughed up the fact once old misunderstandings came to the fore, and announced her “misdeed” so to speak, and showed them all the inspection report. A major blow to the family was that the sills had all rotted and it would cost $23000. to repair these. Thus, the value of the house was no longer at $100,000 but instead was worth $77,000 or less. As a result, renting the house right away for the winter was impossible and too costly to carry out immediately.
The family all agreed that they might have spend $10,000 already on lawyers and court costs based on misaligned assumptions if they had initially hired legal counsel. Their lawyers might have been working with wrong assumptions for some time before discovery proceedings down the road could reveal their erroneous misunderstandings!
It turned out Sean made a suggestion that he would pay the $12000 for the roaded lot and place the sum into the bulk of the estate for division among everyone. The other 2 boys quickly stated they were no longer interested in the remaining lots due to no road access and the cost of building roads. This solution was placed on the board for final consideration once all matters got solved, and the family continued negotiating.
During the discussions a number of sore points came up and things became quite heated. The boys decided they wanted the value of their paying the house taxes back out of the estate plus the value of their efforts maintaining the house (various repairs over the years.) The sisters felt this was too unfair and became angry and one of them left the mediation meeting.
The mediator approached the sister outside and determined they all needed a break. The next day all of the family resumed the mediation.
The mediator immediately began the process of analyzing these claimed “added values” they had all contributed to the estate over years. He asked the girls to assess how much their care of the parents had amounted to, and he asked the boys the specifics of the repairs to the house and the costs of the house taxes. Everyone went home for a short time a and made up a list of their contributions. The girls’ care amounted to a market value of $20 per hour and the boys’ repairs were agreed upon to be valued at the same price because their repairs were often carried out over holidays when they had the ease of residing with their whole families at the parents’ home. The task of enumerating the hours of care and repairs was enormous! Then everyone began to feel badly about claiming this from the remainder of the family because they began to see that these tasks were carried out due to their respect and love for their parents and that this transferred to a “claim” against the rest of the siblings that they did indeed love in any case. One by one the family began to heal their misunderstandings and the hurt began to cool.
No one in the family had kept accurate records of the repairs and the caretaking or the expenditures. The girls best estimate was equally about 12 hours each per month for ten years and then 35 hours per month of more intense care over the past 5 years. The total came to about $70,000.
The boys best estimate for work was for Sean, about 60 hours per year for the 20 years, James did about 20 hours per year for only 5 years of the 20, and Will claimed about 120 hours for each of the 20 years.
Thus, Sean’s claim amounted to 30,000, James’ to 2500, and Wills’ to 60,000. They had all equally shared the tax bill at 1100 each (taxes remained stable at 3300 for the 15 years they had covered them) so each claimed 1100 x 15= 16,500. Thus, Sean claim was 46,500, James was 19000, and Will’s was 109,000. This more global picture drew stark surprise from all siblings due to the global picture being:
Claims against the estate:
TOTAL: $ 244,500
The estate was worth as follows (at immediate fair market value) $265,000.
Each member of the family retired for the day with heavy hearts. They each knew now that if they all went to court there could be nothing left for many of them after intense win-lose arguments in court with legal, and then court fees possibly to also pay, in the balance. The next day they returned and began to analyze their own personal situations in the mix to try to understand how to make things fair given their stages in life. Equal distribution under the law became more attractive without making these large claims, although many felt that their personal expenditure was not previously appreciated by the rest of the family. They each placed their lives before the mediator in an attempt to try to understand what their parents might have done had they been alive, and to understand each others’ lives.
Will was in his fifties, his children almost finished college with the 2 elder of three having moved out and with long term jobs. His house was paid for and he was looking to early retirement at age 60 with full pension.
Sean was 48 had two teenagers in the home and his work life had had many interruptions due to health problems (Crones’ disease). He would not retire until age 67 or more, and his wife would have to work the same time.
Katherine was 45, had one child who took a trade and was gainfully employed as a carpenter full time. She had taken 10 years off work to raise her son and reentered the workforce at age 34. Her income was weak but stable as a dental hygienist and she would have a small pension on retirement at age 67.
Winnifred was 40, had had an expensive divorce from an abusive husband but took medical training after her divorce and was relatively well of in her part time specialty of oncology. She could retire at age 60. She had 2 children who had finished college, one of which was working steadily.
James was aged 35, had gone back to do a Ph.D. but left it due to the sudden death of his PH D supervisor. He had been unable to pick it up with another. He was having difficult time finding work due to the enlarging “jobless economy” and did construction work ad hoc for friends and other contacts. He had one son aged 15 who was doing fairly well but having problems with ADHD.
The siblings all sat and finally understood how difficult it was for their parents to make a will. Leaving an estate equally for children with serious differences in their lives was a massive challenge. How to divide it fairly knowing all of their circumstances??
A whole new attitude began to overtake the family.
They were now in their 7 th day of negotiations with two days to go before the mediation “holiday” time was over. They had done about 12 hours total of mediation. Will determined that his wish for the roaded property section was minor compared to the rest of the problems to be solved. A court order following the usual prescribed law over a possible equal, or even unequal, split seemed now unfair. How to manage all of this??
The family returned on the eighth day in serious thought. Katherine stated, “What if we all pretend we are our parents and think of how they would make this decision?”
Suddenly after what seemed an endless silence, Will said, ” How about some kind of trust fund?”
Suddenly they all began to talk. “ Yes, what about sell everything and put all the money in a trust fund for needy members of the family or for joint family efforts supporting other causes, “ …….”with each funds request to be spelled out on its own merits” ….. “We as a team of 5 siblings could decide the matters by an anonymous majority vote”….!
The family brightened. Everyone was finally released from the burden of claiming against each other. Hope for the future wildly overcame exacerbations and grinding out the past….. They could all enjoy themselves as a united family once more……
The mediator quickly asked for an action plan: How to fix the sills on the house before sale, how to market the remaining lands with or without the land, how to continue the investment plans and who to manage them and the savings, etc. A mutual agreement was drafted and signed by all the family members.
The family went home having solved their problems with a repair crew in place to fix the sills and a realtor assigned to the sale.
They employed an accountant for advice and voted by email on how to invest the liquid funds and investments, and how to pay the taxes on the earnings.
The mediation lasted only 15 hours in total over nine days, which was excellent for such a complex situation. The family agreed to come back to do a short re-mediation for a trust plan for the long term in 3 years’ time.
The total cost of the mediation was $3450. (charged to the estate) with settlement happening within 9 days due to the concentrated effort and the pre-preparation of values done prior to the mediation.
In 10 months, their mutual efforts came to fruition. James had had a car accident and was carless. But he had a job now to go to so long as he had a car. The five siblings voted to make the first 6 months payments including the down payment on a car for James so he could go to his new job. One success!
And more successes followed.
*Names and facts are fictitious
MEDIATION AND CAREGIVING
Living the “golden years” can often seem a huge challenge for both an elderly parent and family caregivers. Everyone wants positive life experiences for themselves and for their loved ones.
However, finding that you have a family member who is very ill over the long term, or aging , can often feel confusing and exhausting. Also, the person who is ill or the elderly person may often feel guilty for asking for certain care needs, and refrain from stating their needs. And sometimes the needs are too subtle to notice, or the care given is inappropriate!
This column is about how mediation can improve success with meeting these challenges.
Sometimes relationships can suffer when the family caregivers miscommunicate their interpretations as to how this care should be handled. Failure to communicate ones own needs in the face of a very needy invalid or parent can cause overwork and exhaustion, financial depletion, and relational rifts among siblings.
Finding a healthy balance for caregivers between their own needs and that of the person with needs is critical for long term adequate and positive caregiving. And the subject person who is ill or elderly needs to voice their own preferences, resources, and abilities, or lack thereof.
It is reported that in some areas, 40% of caregivers report having serious conflicts with their siblings. Time resources, distance problems, travel needs, conflicts with employment responsibilities, being sandwiched between the needs of your own growing family and that of a sick or elderly sibling or parent, unstable or dwindling financial resources, and relational problems between sibling caregivers are only a few of the matters that arise in the caregiving function,
Many shy away from open recognition and dealing with how these Iissues affect their lives and loved ones, causing further exhaustion and emotional distancing from siblings.
For example, one may say the car keys should be taken, others may disagree, and so on. With whom should the ill or elderly person live and where, for instance, when mobility issues arise? The caregiver with the most time available may be the one with the most distance to travel.
Sometimes caregivers with sibling rivalry issues can feel forced to interact when their relationship has been tenuous for years. Can the elderly person be approached calmly and sensitively to better describe their needs when they are only too aware of sibling rivalries? Who should do the cooking and does the needy person not even like that person’s cooking!
Many families can find that while some needs are met, other needs get lost in the shuffle of miscommunications among themselves, and the elderly person is unable to pursue these needs otherwise. Whether there is an impasse or not, mediation will often help with finding a fair and appropriate structure for total ongoing caregiving plans, complete with “go to” plans and resources for unexpected circumstances.
Mediators are facilitators who help family caregivers improve communications and build these plans. Housing, meal preparation, medical care, finances and even end-of-life planning need solutions that are found in a thoughtful calm manner: this helps people focus on the most important issues.
Mediation is a confidential way to come to a healthy resolution for all, including involvement of the subject person who can voice their needs and preferences where possible.
The goal in mediation is to help the caregivers voice their difficulties, better define their resources and balance needs, solve problems, and find common ground. This often results in more efficient caregiving, and relaxed and more positive communication among caregivers. Once issues are faced and discussed, and once a plan is in place, much time previously spent in indecision and failed communications is replaced with positive ongoing relations, understandings about more fair division of resources and finances, and improved harmony in the family.
Adult children who are caregivers can find some serious relief in a confidential private mediated plan which is determined by way of objectively reviewing resources and abilities, talking about compromise and balance of complex issues and determining fair division of labour and resources that is easier on the provider.
This usually serves to enhance relationships and allows them to find a happier and more giving sense of sharing the responsibilities of caring for the loved one.
And the loved one KNOWS this.
KEEPING THOSE "GOLDEN YEARS" GOLDEN