Estate Planning

Minutes: November 16, 1999

Offices of Tanner & Tanner,
68 So. Main St., Suite 800,
Salt Lake City, Utah

Present: Kent Alderman, David Castleton, Cynthia Crass, Steve Dixon, Gary Henrie, Mark Lehman, Karl Mangum, Mark Morrisse, Earl Tanner.

1. Minutes of last meeting not available. To be approved at next meeting.

2. Upcoming Programs.

A. Mark advised that the next program is scheduled for January 11th and is a panel discussion of multidisciplinary practice led by Mike Blackburn.

B. February 8th is a presentation by Joseph Hodges of Colorado. The subject is software for drawing estate planning diagrams. There were several positive comments about the speaker who has been active in the ABA and written on technology. Steve suggested that the hour following the meeting be available for members to speak informally with Mr. Hodges about subjects such as current number crunching and picture programs. Cindy was interested in his views on Mark Gillette's artificial intelligence program. Steve was hoping to get his comments on the section's web page.

1. March 14th is scheduled for a joint meeting with the tax section in which Senator Valentine will give us a legislative update.

2. April 11th is scheduled for a speaker on generation skipping tax.

3. May 9th is the final meeting for the section. A suggested topic was preparation of IRS Form 1041. Earl mentioned the Alternative Dispute Resolution group would like to address the section.

3. Amendment of Bylaws. After some discussion, it appears the most recent version of the section's bylaws are those appearing on the section's website. This latest version has addressed some of the problems appearing in the earlier printed version found in the section's binder. Earl will investigate the existing committees reported on the website and report at the next meeting as to whether changes still appear to be needed.

4. ADR & Probate Litigation. Earl requested comments on whether the section should attempt to provide volunteers for early neutral evaluation. The sense of the group was that the amount of time required per case would be greater than one could reasonably expect for volunteer work. There was some skepticism as to whether early neutral evaluation would lead to earlier resolution, a comparison being drawn to the medical malpractice evaluation panel. Earl advised the committee that he had appointed a group from the section to meet with the court's ADR staff to discuss what ADR in probate should look like.

5. Legislative Committees

1. Uniform Principal and Income Act Legislation. Cindy advised that currently she, David Sloan, James Wood, and Gene Maxwell are reviewing the proposed legislation. Many parts of it are not controversial, but section 4 gives a trustee the ability to recharacterize items as income or principal. This has raised some controversy. Senator Lyle Hillyard has introduced a bill on this matter.

2. Uniform Disclaimer of Property Interest Act. Earl advised that a copy of this act had been sent to the section for review. David indicated that he believed that there was a problem in Utah about the time in which joint tenancy disclaimers need to be made, and that this act may be helpful in resolving that matter.

3. Elimination of State Income Tax on Trusts Administered in Utah. Cindy advised that there was a low level of activity and perhaps interest in that subject for the time being.

4. Uniform Trust Act. The final draft of this has not yet been completed.

5. Uniform Disposition of Community Property at Death Act. There's no current bill on this subject, but several members of the committee indicated they thought this would be helpful legislation.

6. Alaska/Dynasty Trust. No current action is being taken on this matter in Utah. Chair Mike Blackburn has accepted the task of chairing the Bar's MDP Committee and is also the President Elect for a CPA association. Earl mentioned recent U.S. case law has been hostile to asset protection trusts although foreign trusts still appear to be effective negotiating tools.

7. Revisions to Limited Liability Company Legislation. Earl reported that the Tax Section didn't have an active group on this, but did have some interest in a merger statute which would apply to multiple types of organizations. Dave commented that merger legislation would be helpful, and that Brent Armstrong was working on the subject about six months ago.

8. Utah Nonprofit Corporation Law. Cindy met with Bruce Olsen and others on this matter a few weeks ago. There's currently no legislation introduced. David commented that the Utah statute needed revising.

9. Vice Chair Kent accepted supervision duties over the section's legislative committees. He will be inquiring at the upcoming section meeting concerning which items should be given the highest priority.

6. Executive Committee Meetings. Steve advised that in the absence of other direction, he had set dates that appeared on the internet site, but could change them. After reviewing those dates, Earl recommends changing them to the following: Tuesday, January 18th, Tuesday, February 29th, and Tuesday, April 25th.

7. Mark Lehman commented that it was difficult to obtain life insurance information necessary to calculate a spouse's elective share. He suggested the section write to the Insurance Commissioner requesting him to require companies to make this information available. He accepted the assignment to create a draft of such a letter.

8. Karl mentioned that he had recently obtained some tapes being published by a Utah lawyer and was surprised to hear the lawyer claim, among other things, to be the premier estate planning attorney in the nation and the originator of asset protection trusts. Earl will make some inquiries concerning the section's duties in investigating and enforcing professional ethics.