GIVNER & KAYE BRUCE GIVNER PHONE (310) 207-8008 A - - PDF document

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION SUITE 445 12100 WILSHIRE BOULEVARD LOS ANGELES, CALIFORNIA 90025 www.GivnerKaye.com

BRUCE GIVNER (bruce@GivnerKaye.com) OWEN D. KAYE (owen@GivnerKaye.com) KATHLEEN GIVNER (kathy@GivnerKaye.com) NEDA BARKHORDAR (neda@GivnerKaye.com)

PHONE (310) 207-8008 (818) 785-7579 FAX (310) 207-8708 (818) 785-3027

February 4, 2016 My Client’s Death Is Imminent? What Should I Do?

1. Importance Of Durable Powers Of Attorney. 1.1. Financial institutions hate them: they want a court order. 1.2. California Medical Association Advance Health Care Directive (attached).1 1.3. Uniform Statutory Power Of Attorney (attached).2 2. Competence. 2.1. Definition for simple Will (PC §6100.5) vs Trust (PC §§810 – 812) (attached). 2.2. Sample Jim Spar opinions (competent and semi-competent – attached). 2.3. Contrast undue influence, duress and Elder Abuse. 2.4. Lintz v. Lintz: The Golddigger case (summary below). 3. Last Minute Estate Plan Revisions. 3.1. Bequests to caregivers and others. 3.2. Certificate of independent review (see attached). 3.3. Planning for contests. Potential problem with a video or a medical opinion (why did you do it?). 4. Coordination. Retirement plan (IRA Trust?) and insurance beneficiary designations with the family trust. 5. Assets. 5.1. Who knows what they all are? The CPA? The trustee? The heirs? Schedule to trust? 5.2. Will probate be avoided? 6. Income Tax Planning. 6.1. Purchases from grantor trusts. 6.2. Reduce the value of retirement plans using estate tax planning. 7. Estate Tax Planning. 7.1. Goal: not to file an IRS Form 706. 7.2. Generational Split Dollar (see attached). 7.3. Able to use the annuity tables? See sample physician letter attached.

1 Have never had one come up in practice. 2 Only come up three times in practice. Took us 2 weeks and an opinion letter to convince the bank.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

My Client’s Death Is Imminent! What Should I Do? February 4, 2016 Page 2 of 5 CALIFORNIA PROBATE CODE 6100.5. (a) An individual is not mentally competent to make a will if at the time of making the will either of the following is true: (1) The individual does not have sufficient mental capacity to be able to (A) understand the nature of the testamentary act, (B) understand and recollect the nature and situation of the individual's property, or (C) remember and understand the individual's relations to living descendants, spouse, and parents, and those whose interests are affected by the will. (2) The individual suffers from a mental disorder with symptoms including delusions

• r hallucinations, which delusions or hallucinations result in the individual's devising property

in a way which, except for the existence of the delusions or hallucinations, the individual would not have done. (b) Nothing in this section supersedes existing law relating to the admissibility of evidence to prove the existence of mental incompetence or mental disorders. _______________

• 810. The Legislature finds and declares the following:

(a) For purposes of this part, there shall exist a rebuttable presumption affecting the burden of proof that all persons have the capacity to make decisions and to be responsible for their acts or decisions. (b) A person who has a mental or physical disorder may still be capable of contracting, conveying, marrying, making medical decisions, executing wills or trusts, and performing

• ther actions.

(c) A judicial determination that a person is totally without understanding, or is of unsound mind, or suffers from one or more mental deficits so substantial that, under the circumstances, the person should be deemed to lack the legal capacity to perform a specific act, should be based on evidence of a deficit in one or more of the person's mental functions rather than on a diagnosis of a person's mental or physical disorder.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

My Client’s Death Is Imminent! What Should I Do? February 4, 2016 Page 3 of 5 §811. Determination That Person Is of Unsound Mind or Lacks Capacity—Evidence of One or More Specific Deficits in Mental Function Required. (a) A determination that a person is of unsound mind or lacks the capacity to make a decision or do a certain acts, including, but not limited to, the incapacity to contract, to make a conveyance, to marry, to make medical decisions, to vote, or to execute wills or trusts, shall be supported by evidence of a deficit in at least one of the following mental functions, subject to subdivision(b): (1) Alertness and attention, including, but not limited to, the following:

• Level of arousal or consciousness.
• Orientation to time, place, person, and situation
• Ability to attend and concentrate

(2) Information processing, including, but not limited to, the following:

• Short and long term memory, including immediate recall.
• Ability to understand or communicate with others, either verbally or otherwise.
• Recognition of familiar objects and familiar persons
• Ability to understand and appreciate quantities.
• Ability to reason using abstract concepts.
• Ability to plan, organize, and carry out actions in one’s own rational self-interest.
• Ability to reason logically.

(3) Thought processes. Deficits in these functions may be demonstrated by the presence of the following:

• Severely disorganized thinking
• Hallucinations
• Delusions
• Uncontrollable, repetitive, or intrusive thoughts

(4) Ability to modulate mood and affect. Deficits in this ability may be demonstrated by the presence of a pervasive and persistent or recurrent state of euphoria, anger anxiety, fear, panic, depression, hopelessness or despair, helplessness, apathy or indifference, which is inappropriate in degree to the individual’s circumstances.

• A deficit in the mental functions listed above may be considered only if the deficit, by

itself or in combination with one or more other mental function deficits, significantly impairs the person’s ability to understand and appreciate the consequences of his or her actions with regard to the type of act or decision in question.

• In determining whether a person suffers from a deficit in mental function so substantial

that the person lacks the capacity to do a certain act, the court may take into consideration the frequency, severity, and duration of periods of impairment.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

My Client’s Death Is Imminent! What Should I Do? February 4, 2016 Page 4 of 5

• The mere diagnosis of a mental or physical disorder shall not be sufficient in and of

itself to support a determination that a person is of unsound mind or lacks the capacity to do a certain act.

• This part applies only to the evidence that is presented to, and the findings that are

made by, a court determining the capacity of a person to do a certain act or make a decision, including, but not limited to, making medical decisions. Nothing in this part shall affect the decision-making process set forth in Section 1418.8 of the Health and Safety Code, nor increase or decrease the burdens of documentation on, or potential liability of, physicians and surgeons who, outside the judicial context, determine the capacity of patients to make a medical decision.

§812. Lack of Capacity to Make Decisions – What Constitutes. Except where otherwise provided by law, including, but not limited to, Section 813 and the statutory and decisional law of testamentary capacity, a person lacks the capacity to make a decision unless the person has the ability to communicate verbally, or by any other means, the decision, and to understand and appreciate, to the extent relevant, all of the following:

• The rights, duties, and responsibilities created by, or affected by the decision.
• The probable consequences for the decisionmaker and, where appropriate, the

persona affected by the decision.

• The significant risks, benefits, and reasonable alternatives involved in the decision.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

My Client’s Death Is Imminent! What Should I Do? February 4, 2016 Page 5 of 5 Lintz v. Lintz. “The Goldigger’s Case” January 10, 2014 Sixth Appellate District No. H037738. Defendant was Robert Lintz’s 3rd wife. They married in 1999, divorced ≈ 6 months later, and remarried in February, 2005. The 2nd marriage ended when DECEDENT DIED in October, 2009, at age 81. He had 2 children from a previous marriage and she had 3. The 9th amendment to his trust, in effect when he married defendant, provided for his children, grandchildren, and former son-in-law. In May, 2005, he executed the 10th amendment to the trust. It provided DEFENDANT WITH 50% OF HIS ASSETS with the remaining 50% to his children and grandchildren. Between May, 2005 and 2008 he executed several additional amendments increasingly providing defendant with more of his assets and disinheriting his two eldest children. In June, 2008, he and defendant as settlors and trustees executed the Lintz Family Revocable Trust, prepared by defendant’s attorney at her direction, PURPORTED DESIGNATING ALL OF HIS PROPERTY AS COMMUNITY PROPERTY, giving her an exclusive life interest in his estate, and giving her the right to disinherit his youngest child and leave any unspent residue to her two children. Upon his death his two older children filed a complaint alleging FIDUCIARY ABUSE OF AN ELDER, BREACH OF FIDUCIARY DUTY, CONVERSION, CONSTRUCTIVE TRUST AND UNDUE INFLUENCE. After a 15 day trial, the probate court found her liable for financial elder abuse, breach of fiduciary duty, conversion of separate property funds, and finding her in constructive trust of decedent’s converted funds and trust property. The court ruled that he had testamentary capacity to execute the trust instruments, but was under undue influence. Family Code §721(b) “imposes a duty of the highest good faith and fair dealing on each spouse…. The presumption should have been applied to the TRANSMUTATION OF DECEDENT’S SEPARATE PROPERTY TO COMMUNITY PROPERTY and to the huge sums of money decedent transferred to defendant. …much of defendant’s credit card spending and writing herself checks from decedent’s bank account during the marriage amounted to financial abuse. …Defendant misinformed decedent’s lawyers of decedent’s testamentary wishes and ULTIMATELY DISCONTINUED THE SERVICES OF DECEDENT’S LONG-STANDING ESTATE PLANNING LAWYERS UNDER THE PRETEXT OF A FEE DISPUTE. The probate court also noted that decedent signed the Lintz Family Revocable Trust-the most recent estate plan prepared by defendant's lawyer-OUTSIDE THE PRESENCE OF HIS NEW COUNSEL AND AGAINST NEW COUNSEL'S ADVICE.”

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CALIFORNIA GENERAL DURABLE POWER OF ATTORNEY THE POWERS YOU GRANT BELOW ARE EFFECTIVE ONLY IF YOU BECOME DISABLED OR INCOMPETENT

CAUTION: A DURABLE POWER OF ATTORNEY IS AN IMPORTANT LEGAL DOCUMENT. BY SIGNING THE DURABLE POWER OF ATTORNEY, YOU ARE AUTHORIZING ANOTHER PERSON TO ACT FOR YOU, THE PRINCIPAL. BEFORE YOU SIGN THIS DURABLE POWER OF ATTORNEY, YOU SHOULD KNOW THESE IMPORTANT FACTS: YOUR AGENT (ATTORNEY-IN- FACT) HAS NO DUTY TO ACT UNLESS YOU AND YOUR AGENT AGREE OTHERWISE IN

• WRITING. THIS DOCUMENT GIVES YOUR AGENT THE POWERS TO MANAGE, DISPOSE OF,

SELL, AND CONVEY YOUR REAL AND PERSONAL PROPERTY, AND TO USE YOUR PROPERTY AS SECURITY IF YOUR AGENT BORROWS MONEY ON YOUR BEHALF. THIS DOCUMENT DOES NOT GIVE YOUR AGENT THE POWER TO ACCEPT OR RECEIVE ANY OF YOUR PROPERTY, IN TRUST OR OTHERWISE, AS A GIFT, UNLESS YOU SPECIFICALLY AUTHORIZE THE AGENT TO ACCEPT OR RECEIVE A GIFT. YOUR AGENT WILL HAVE THE RIGHT TO RECEIVE REASONABLE PAYMENT FOR SERVICES PROVIDED UNDER THIS DURABLE POWER OF ATTORNEY UNLESS YOU PROVIDE OTHERWISE IN THIS POWER OF

• ATTORNEY. THE POWERS YOU GIVE YOUR AGENT WILL CONTINUE TO EXIST FOR YOUR

ENTIRE LIFETIME, UNLESS YOU STATE THAT THE DURABLE POWER OF ATTORNEY WILL LAST FOR A SHORTER PERIOD OF TIME OR UNLESS YOU OTHERWISE TERMINATE THE DURABLE POWER OF ATTORNEY. THE POWERS YOU GIVE YOUR AGENT IN THIS DURABLE POWER OF ATTORNEY WILL CONTINUE TO EXIST EVEN IF YOU CAN NO LONGER MAKE YOUR OWN DECISIONS RESPECTING THE MANAGEMENT OF YOUR PROPERTY. YOU CAN AMEND OR CHANGE THIS DURABLE POWER OF ATTORNEY ONLY BY EXECUTING A NEW DURABLE POWER OF ATTORNEY OR BY EXECUTING AN AMENDMENT THROUGH THE SAME FORMALITIES AS AN

• ORIGINAL. YOU HAVE THE RIGHT TO REVOKE OR TERMINATE THIS DURABLE POWER OF

ATTORNEY AT ANY TIME, SO LONG AS YOU ARE COMPETENT. THIS DURABLE POWER OF ATTORNEY MUST BE DATED AND MUST BE ACKNOWLEDGED BEFORE A NOTARY PUBLIC OR SIGNED BY TWO WITNESSES. IF IT IS SIGNED BY TWO WITNESSES, THEY MUST WITNESS EITHER (1) THE SIGNING OF THE POWER OF ATTORNEY OR (2) THE PRINCIPAL'S SIGNING OR ACKNOWLEDGMENT OF HIS OR HER SIGNATURE. A DURABLE POWER OF ATTORNEY THAT MAY AFFECT REAL PROPERTY SHOULD BE ACKNOWLEDGED BEFORE A NOTARY PUBLIC SO THAT IT MAY EASILY BE RECORDED. YOU SHOULD READ THIS DURABLE POWER OF ATTORNEY CAREFULLY. WHEN EFFECTIVE, THIS DURABLE POWER OF ATTORNEY WILL GIVE YOUR AGENT THE RIGHT TO DEAL WITH PROPERTY THAT YOU NOW HAVE OR MIGHT ACQUIRE IN THE FUTURE. THE DURABLE POWER OF ATTORNEY IS IMPORTANT TO YOU. IF YOU DO NOT UNDERSTAND THE DURABLE POWER OF ATTORNEY, OR ANY PROVISION OF IT, THEN YOU SHOULD OBTAIN THE ASSISTANCE OF AN ATTORNEY OR OTHER QUALIFIED PERSON. NOTICE TO PERSON ACCEPTING THE APPOINTMENT AS ATTORNEY-IN-FACT BY ACTING OR AGREEING TO ACT AS THE AGENT (ATTORNEY-IN-FACT) UNDER THIS POWER OF ATTORNEY YOU ASSUME THE FIDUCIARY AND OTHER LEGAL RESPONSIBILITIES OF AN

• AGENT. THESE RESPONSIBILITIES INCLUDE:

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• 1. THE LEGAL DUTY TO ACT SOLELY IN THE INTEREST OF THE PRINCIPAL AND TO AVOID

CONFLICTS OF INTEREST.

• 2. THE LEGAL DUTY TO KEEP THE PRINCIPAL'S PROPERTY SEPARATE AND DISTINCT

FROM ANY OTHER PROPERTY OWNED OR CONTROLLED BY YOU. YOU MAY NOT TRANSFER THE PRINCIPAL'S PROPERTY TO YOURSELF WITHOUT FULL AND ADEQUATE CONSIDERATION OR ACCEPT A GIFT OF THE PRINCIPAL'S PROPERTY UNLESS THIS POWER OF ATTORNEY SPECIFICALLY AUTHORIZES YOU TO TRANSFER PROPERTY TO YOURSELF OR ACCEPT A GIFT OF THE PRINCIPAL'S PROPERTY. IF YOU TRANSFER THE PRINCIPAL'S PROPERTY TO YOURSELF WITHOUT SPECIFIC AUTHORIZATION IN THE POWER OF ATTORNEY, YOU MAY BE PROSECUTED FOR FRAUD AND/OR EMBEZZLEMENT. IF THE PRINCIPAL IS 65 YEARS OF AGE OR OLDER AT THE TIME THAT THE PROPERTY IS TRANSFERRED TO YOU WITHOUT AUTHORITY, YOU MAY ALSO BE PROSECUTED FOR ELDER ABUSE UNDER PENAL CODE SECTION 368. IN ADDITION TO CRIMINAL PROSECUTION, YOU MAY ALSO BE SUED IN CIVIL COURT. I HAVE READ THE FOREGOING NOTICE AND I UNDERSTAND THE LEGAL AND FIDUCIARY DUTIES THAT I ASSUME BY ACTING OR AGREEING TO ACT AS THE AGENT (ATTORNEY-IN- FACT) UNDER THE TERMS OF THIS POWER OF ATTORNEY. DATE: ____________________________ (SIGNATURE OF AGENT) _____________________________ (PRINT NAME OF AGENT)

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CALIFORNIA GENERAL DURABLE POWER OF ATTORNEY (California Probate Code Section 4401 Prob.) THE POWERS YOU GRANT BELOW ARE EFFECTIVE ONLY IF YOU BECOME DISABLED OR INCOMPETENT NOTICE: THE POWERS GRANTED BY THIS DOCUMENT ARE BROAD AND SWEEPING. THEY ARE EXPLAINED IN THE UNIFORM STATUTORY FORM POWER OF ATTORNEY ACT (CALIFORNIA PROBATE CODE SECTIONS 4400

• Prob. - 4465 Prob.). IF YOU HAVE ANY QUESTIONS ABOUT THESE POWERS, OBTAIN COMPETENT LEGAL
• ADVICE. THIS DOCUMENT DOES NOT AUTHORIZE ANYONE TO MAKE MEDICAL AND OTHER HEALTH-CARE

DECISIONS FOR YOU. YOU MAY REVOKE THIS POWER OF ATTORNEY IF YOU LATER WISH TO DO SO. I ____________________________________________________ _____________________________________________________ [insert your name and address] appoint _____________________________________________________ [insert the name and address of the person appointed] as my Agent (attorney-in-fact) to act for me in any lawful way with respect to the following initialed subjects: TO GRANT ALL OF THE FOLLOWING POWERS, INITIAL THE LINE IN FRONT OF (N) AND IGNORE THE LINES IN FRONT OF THE OTHER POWERS. TO GRANT ONE OR MORE, BUT FEWER THAN ALL, OF THE FOLLOWING POWERS, INITIAL THE LINE IN FRONT OF EACH POWER YOU ARE GRANTING. TO WITHHOLD A POWER, DO NOT INITIAL THE LINE IN FRONT OF IT. YOU MAY, BUT NEED NOT, CROSS OUT EACH POWER WITHHELD. Note: If you initial Item A or Item B, which follow, a notarized signature will be required on behalf of the Principal. INITIAL _______ (A) Real property transactions. To lease, sell, mortgage, purchase, exchange, and acquire, and to agree, bargain, and contract for the lease, sale, purchase, exchange, and acquisition of, and to accept, take, receive, and possess any interest in real property whatsoever, on such terms and conditions, and under such covenants, as my Agent shall deem proper; and to maintain, repair, tear down, alter, rebuild, improve manage, insure, move, rent, lease, sell, convey, subject to liens, mortgages, and security deeds, and in any way or manner deal with all or any part of any interest in real property whatsoever, including specifically, but without limitation, real property lying and being situated in the State

• f California, under such terms and conditions, and under such covenants, as my Agent shall deem proper and may for all

deferred payments accept purchase money notes payable to me and secured by mortgages or deeds to secure debt, and may from time to time collect and cancel any of said notes, mortgages, security interests, or deeds to secure debt. _______ (B) Tangible personal property transactions. To lease, sell, mortgage, purchase, exchange, and acquire, and to agree, bargain, and contract for the lease, sale, purchase, exchange, and acquisition of, and to accept, take, receive, and possess any personal property whatsoever, tangible or intangible, or interest thereto, on such terms and conditions, and under such covenants, as my Agent shall deem proper; and to maintain, repair, improve, manage, insure, rent, lease, sell, convey, subject to liens or mortgages, or to take any other security interests in said property which are recognized under the Uniform Commercial Code as adopted at that time under the laws of the State of California or any applicable state, or otherwise hypothecate (pledge), and in any way or manner deal with all or any part of any real or personal property whatsoever, tangible or intangible, or any interest therein, that I own at the time of execution or may thereafter acquire, under such terms and conditions, and under such covenants, as my Agent shall deem proper. _______ (C) Stock and bond transactions. To purchase, sell, exchange, surrender, assign, redeem, vote at any meeting, or otherwise transfer any and all shares of stock, bonds, or other securities in any business, association, corporation, partnership, or other legal entity, whether private or public, now or hereafter belonging to me. _______ (D) Commodity and option transactions. To organize or continue and conduct any business which term includes, without limitation, any farming, manufacturing, service, mining, retailing or other type of business operation in any form, whether as a proprietorship, joint venture, partnership, corporation, trust or other legal entity; operate, buy, sell, expand, contract, terminate or liquidate any business; direct, control, supervise, manage or participate in the operation of any business and engage, compensate and discharge business managers, employees, agents, attorneys, accountants and consultants; and, in general, exercise all powers with respect to business interests and operations which the principal could if present and under no disability.

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_______ (E) Banking and other financial institution transactions. To make, receive, sign, endorse, execute, acknowledge, deliver and possess checks, drafts, bills of exchange, letters of credit, notes, stock certificates, withdrawal receipts and deposit instruments relating to accounts or deposits in, or certificates of deposit of banks, savings and loans, credit unions, or other institutions or associations. To pay all sums of money, at any time or times, that may hereafter be

• wing by me upon any account, bill of exchange, check, draft, purchase, contract, note, or trade acceptance made,

executed, endorsed, accepted, and delivered by me or for me in my name, by my Agent. To borrow from time to time such sums of money as my Agent may deem proper and execute promissory notes, security deeds or agreements, financing statements, or other security instruments in such form as the lender may request and renew said notes and security instruments from time to time in whole or in part. To have free access at any time or times to any safe deposit box or vault to which I might have access. _______ (F) Business operating transactions. To conduct, engage in, and otherwise transact the affairs of any and all lawful business ventures of whatever nature or kind that I may now or hereafter be involved in. _______ (G) Insurance and annuity transactions. To exercise or perform any act, power, duty, right, or obligation, in regard to any contract of life, accident, health, disability, liability, or other type of insurance or any combination of insurance; and to procure new or additional contracts of insurance for me and to designate the beneficiary of same; provided, however, that my Agent cannot designate himself or herself as beneficiary of any such insurance contracts. _______ (H) Estate, trust, and other beneficiary transactions. To accept, receipt for, exercise, release, reject, renounce, assign, disclaim, demand, sue for, claim and recover any legacy, bequest, devise, gift or other property interest

• r payment due or payable to or for the principal; assert any interest in and exercise any power over any trust, estate or

property subject to fiduciary control; establish a revocable trust solely for the benefit of the principal that terminates at the death of the principal and is then distributable to the legal representative of the estate of the principal; and, in general, exercise all powers with respect to estates and trusts which the principal could exercise if present and under no disability; provided, however, that the Agent may not make or change a will and may not revoke or amend a trust revocable or amendable by the principal or require the trustee of any trust for the benefit of the principal to pay income or principal to the Agent unless specific authority to that end is given. _______ (I) Claims and litigation. To commence, prosecute, discontinue, or defend all actions or other legal proceedings touching my property, real or personal, or any part thereof, or touching any matter in which I or my property, real or personal, may be in any way concerned. To defend, settle, adjust, make allowances, compound, submit to arbitration, and compromise all accounts, reckonings, claims, and demands whatsoever that now are, or hereafter shall be, pending between me and any person, firm, corporation, or other legal entity, in such manner and in all respects as my Agent shall deem proper. _______ (J) Personal and family maintenance. To hire accountants, attorneys at law, consultants, clerks, physicians, nurses, agents, servants, workmen, and others and to remove them, and to appoint others in their place, and to pay and allow the persons so employed such salaries, wages, or other remunerations, as my Agent shall deem proper. _______ (K) Benefits from Social Security, Medicare, Medicaid, or other governmental programs, or military

• service. To prepare, sign and file any claim or application for Social Security, unemployment or military service benefits;

sue for, settle or abandon any claims to any benefit or assistance under any federal, state, local or foreign statute or regulation; control, deposit to any account, collect, receipt for, and take title to and hold all benefits under any Social Security, unemployment, military service or other state, federal, local or foreign statute or regulation; and, in general, exercise all powers with respect to Social Security, unemployment, military service, and governmental benefits, including but not limited to Medicare and Medicaid, which the principal could exercise if present and under no disability. _______ (L) Retirement plan transactions. To contribute to, withdraw from and deposit funds in any type of retirement plan (which term includes, without limitation, any tax qualified or nonqualified pension, profit sharing, stock bonus, employee savings and other retirement plan, individual retirement account, deferred compensation plan and any other type of employee benefit plan); select and change payment options for the principal under any retirement plan; make rollover contributions from any retirement plan to other retirement plans or individual retirement accounts; exercise all investment powers available under any type of self-directed retirement plan; and, in general, exercise all powers with respect to retirement plans and retirement plan account balances which the principal could if present and under no disability. _______ (M) Tax matters. To prepare, to make elections, to execute and to file all tax, social security, unemployment insurance, and informational returns required by the laws of the United States, or of any state or subdivision thereof, or of any foreign government; to prepare, to execute, and to file all other papers and instruments which the Agent shall think to be desirable or necessary for safeguarding of me against excess or illegal taxation or against penalties imposed for claimed violation of any law or other governmental regulation; and to pay, to compromise, or to contest or to apply for

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refunds in connection with any taxes or assessments for which I am or may be liable. _______ (N) ALL OF THE POWERS LISTED ABOVE. YOU NEED NOT INITIAL ANY OTHER LINES IF YOU INITIAL LINE (N). SPECIAL INSTRUCTIONS: ON THE FOLLOWING LINES YOU MAY GIVE SPECIAL INSTRUCTIONS LIMITING OR EXTENDING THE POWERS GRANTED TO YOUR AGENT. ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ THIS POWER OF ATTORNEY SHALL BE CONSTRUED AS A GENERAL DURABLE POWER OF ATTORNEY. THIS POWER OF ATTORNEY BECOMES EFFECTIVE ONLY UPON MY DISABILITY OR INCAPACITY. I shall be considered disabled or incapacitated for purposes of this power of attorney if a physician certifies in writing at a date later than the date this power of attorney is executed that, based on the physician's medical examination of me, I am mentally incapable of managing my financial affairs. I authorize the physician who examines me for this purpose to disclose my physical or mental condition to another person for purposes of this power of attorney. A third party who accepts this power

• f attorney is fully protected from any action taken under this power of attorney that is based on the determination made

by a physician of my disability or incapacity. (YOUR AGENT WILL HAVE AUTHORITY TO EMPLOY OTHER PERSONS AS NECESSARY TO ENABLE THE AGENT TO PROPERLY EXERCISE THE POWERS GRANTED IN THIS FORM, BUT YOUR AGENT WILL HAVE TO MAKE ALL DISCRETIONARY DECISIONS. IF YOU WANT TO GIVE YOUR AGENT THE RIGHT TO DELEGATE DISCRETIONARY DECISION-MAKING POWERS TO OTHERS, YOU SHOULD KEEP THE NEXT SENTENCE, OTHERWISE IT SHOULD BE STRICKEN.) Authority to Delegate. My Agent shall have the right by written instrument to delegate any or all of the foregoing powers involving discretionary decision-making to any person or persons whom my Agent may select, but such delegation may be amended or revoked by any agent (including any successor) named by me who is acting under this power of attorney at the time of reference. (YOUR AGENT WILL BE ENTITLED TO REIMBURSEMENT FOR ALL REASONABLE EXPENSES INCURRED IN ACTING UNDER THIS POWER OF ATTORNEY. STRIKE OUT THE NEXT SENTENCE IF YOU DO NOT WANT YOUR AGENT TO ALSO BE ENTITLED TO REASONABLE COMPENSATION FOR SERVICES AS AGENT.) Right to Compensation. My Agent shall be entitled to reasonable compensation for services rendered as agent under this power of attorney. (IF YOU WISH TO NAME SUCCESSOR AGENTS, INSERT THE NAME(S) AND ADDRESS(ES) OF SUCH SUCCESSOR(S) IN THE FOLLOWING PARAGRAPH.) Successor Agent. If any Agent named by me shall die, become incompetent, resign or refuse to accept the office of Agent, I name the following (each to act alone and successively, in the order named) as successor(s) to such Agent: ________________________________________________________________________ ________________________________________________________________________

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Choice of Law. THIS POWER OF ATTORNEY WILL BE GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA WITHOUT REGARD FOR CONFLICTS OF LAWS PRINCIPLES. IT WAS EXECUTED IN THE STATE OF CALIFORNIA AND IS INTENDED TO BE VALID IN ALL JURISDICTIONS OF THE UNITED STATES OF AMERICA AND ALL FOREIGN NATIONS. I am fully informed as to all the contents of this form and understand the full import of this grant of powers to my Agent. I agree that any third party who receives a copy of this document may act under it. Revocation of the power of attorney is not effective as to a third party until the third party learns of the revocation. I agree to indemnify the third party for any claims that arise against the third party because of reliance on this power of attorney. Signed this _______ day of _______________, 20____ ______________________________ [Your Signature] _______________________________ [Your Social Security Number] PLEASE NOTE: THIS DURABLE POWER OF ATTORNEY MUST BE DATED AND MUST BE ACKNOWLEDGED BEFORE A NOTARY PUBLIC OR SIGNED BY TWO WITNESSES. IF IT IS SIGNED BY TWO WITNESSES, THEY MUST WITNESS EITHER (1) THE SIGNING OF THE POWER OF ATTORNEY OR (2) THE PRINCIPAL'S SIGNING OR ACKNOWLEDGMENT OF HIS OR HER SIGNATURE. A DURABLE POWER OF ATTORNEY THAT MAY AFFECT REAL PROPERTY SHOULD BE ACKNOWLEDGED BEFORE A NOTARY PUBLIC SO THAT IT MAY EASILY BE

• RECORDED. EACH WITNESS MUST BE A MENTALLY COMPETENT ADULT. WITNESSES SHOULD IDEALLY

RESIDE CLOSE BY, SO THAT THEY WILL BE EASILY ACCESSIBLE IN THE EVENT THEY ARE ONE DAY NEEDED TO AFFIRM THIS DOCUMENT'S VALIDITY. STATEMENT OF WITNESSES On the date written above, I declare under penalty of perjury under the laws of California that the person who signed or acknowledged this document is personally known to me (or proved to me on the basis of convincing evidence) to be the principal, that the principal signed or acknowledged this durable power of attorney in my presence, that the principal appears of sound mind and under no duress, fraud, or undue influence, that I am not the person appointed as attorney in fact by this document. I am not related to the principal by blood, marriage or adoption, and to the best of my knowledge, am not entitled to any part of the estate of the principal upon the death of the principal under a will now existing or by

• peration of law.

_______________________________________ [Signature of Witness #1] _______________________________________ [Printed or typed name of Witness #1] _______________________________________ [Address of Witness #1, Line 1] _______________________________________ [Address of Witness #1, Line 2] _______________________________________ [Signature of Witness #2] _______________________________________ [Printed or typed name of Witness #2] _______________________________________ [Address of Witness #2, Line 1] _______________________________________ [Address of Witness #2, Line 2]

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CERTIFICATE OF ACKNOWLEDGMENT OF NOTARY PUBLIC STATE OF CALIFORNIA COUNTY OF ________________ On __________________, before me, the undersigned notary public, personally appeared ______________________________________________, personally know to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. [Notary Seal, if any]: _______________________________ (Signature of Notarial Officer) Notary Public for the State of California My commission expires: ___________________ ACKNOWLEDGMENT OF AGENT BY ACCEPTING OR ACTING UNDER THE APPOINTMENT, THE AGENT ASSUMES THE FIDUCIARY AND OTHER LEGAL RESPONSIBILITIES OF AN AGENT. ________________________________________________ [Typed or Printed Name of Agent] ________________________________________________ [Signature of Agent] PREPARATION STATEMENT This document was prepared by the following individual: ________________________________________________ [Typed or Printed Name] ________________________________________________ [Signature]

UNIVERSITY OF CALIFORNIA, LOS ANGELES BERKELEY - DAVIS • IRVINE • LOS ANGELES • RIVERSIDE • SAN DIEGO - SAN FRANCISCO August 4, 2000 Ronald _______ _______________ Los Angeles, CA 900__ Dear Mr. H____: UCLA SANTA BARBARA • SANTA CRUZ NEUROPSYCHIATRIC INSTITUTE AND HOSPITAL CENTER FOR THE HEALTH SCIENCES JAMES E. SPAR, M.D., DIRECTOR GERIATRIC PSYCHIATRY DIVISION 760 WESTWOOD PLAZA LOS ANGELES, CA 90024-1759 At your request I evaluated your mother, Stephanie _____, in her home at _____ , Encino, CA., on August 3, 2000. During the one-hour evaluation she was friendly, cooperative and forthcoming, and seemed to make a serious effort to perform at her best. When I asked her to explain the reason for my visit she said, "Ronnie wanted you to come" but was unable to provide any more detail. When I asked her what you wanted from my visit, she said "Whatever it is, I want Ronnie to handle it because he's good at handling those things", and when I pressed her on what "things" she was referring to, she was unable to

• say. For the remainder of the examination her responses to most questions about her past or present

circumstances were similarly vague and lacking in substantive or factual content. Most were of the general form, "I don't remember because I don't think about those things". I mentioned that you had described a Trust, and she said, "I know I did something, but I don't know what it was" and was unable to tell me what a trust was, or if she had one, or what, if anything, it contained. She didn't know what a trustee was, or who hers were, but said, "It should be Ronnie because he's the only one I trust". She did not know her age (but did know her birthdate and year), what year she came to America, how long she had been living in the house, what year her husband died, or what his illness had been. She did recall that you were married to _____ ("She knows what she's doing. They have a good marriage") and have no children, and that she had a housekeeper/cook/caregiver named Lily. I also asked her about her assets, and she said, "This house"; and denied owning any other property, securities, or other major assets; she said, "I think I have some money in the bank" but could not name the bank or specify the sum. I administered a Folstein Mini-Mental State Examination (MMSE) and several additional tests of naming, comprehension, remote memory, general fund of knowledge and reasoning, and frontal executive functions, including word list generation, similarities, and proverb interpretation. Her performance on each

• f these tests reflected significant global cognitive impairment, consistent with moderately advanced
• dementia. On the MMSE she did not know the year, date, season, or day of the week, and also lost points
• n attention and concentration, immediate recall, and design copying. Her total score was 13/29, which

reflects moderate to severe impairment for her age and education (normal would be 24). Her performance

• n the additional tests was slightly more impaired. For example, in one minute trials she could name only

two animals and eight words beginning with "F" (lower limit of normal is 12 and 10, respectively). She could not name the President, and produced only Roosevelt when I asked her to name any presidents. She did not know which countries fought in World War II, or even

which country invaded Poland, and could not tell me anything about any of a list of well publicized news

• events. However, when I asked her about a recent event in Paris and added "it involved an accident" she

was able to recall "An airplane crashed". She generally retains her social skills and awareness, but has little or no insight into her cognitive impairment, at least that she will admit to. However, she clearly struggles to cover her deficits, so must be "aware" of them, if only unconsciously. If presented with a problem that is articulated in simple terms, with few elements requiring attention or recall, she may be able to engage her generally intact intelligence and produce a reasonable response, but I do not believe that she can handle problems with multiple elements,

• r that require her to recall significant facts. Therefore, on the basis of these findings, it is my opinion that

she does not meet the California statutory criteria for testamentary capacity (as defined in Probate Code section 6100.5), contractual capacity (as defined in Civil Code sections 38 and 39a & b), or any other decisional capacity (as defined in Probate Code sections 810-813). I also believe that she does meet criteria for the appointment of a Probate Conservator of Person and Estate (as defined in Probate Code sections 1801(a & b), although there appear to be less restrictive ways to meet her needs, at least at present, based upon my discussion with your attorney, Bruce Givner. Thank you for the opportunity to meet and evaluate this interesting and charming woman.

• J. Edward Spar,

Professor of Psychiatry Director, Division of Geriatric Psychiatry cc: Bruce Givner 12100 Wilshire Blvd. Suite 445 Los Angeles, CA 90025

21384. (a) A gift is not subject to §21380 if the instrument is reviewed by an independent attorney who counsels the transferor, out of the presence of any heir or proposed beneficiary, about the nature and consequences of the intended transfer, including the effect of the intended transfer on the transferor's heirs and on any beneficiary of a prior donative instrument, attempts to determine if the intended transfer is the result of fraud

• r undue influence, and signs and delivers to the transferor an original certificate in

substantially the following form: "CERTIFICATE OF INDEPENDENT REVIEW I, _______________________________, have reviewed ___________________ (attorney's name) (name of instrument) and have counseled the transferor, ______________, on the nature and consequences

• f any transfers of property to ______________________________________________

(name of person described in PC§21380) that would be made by the instrument. I am an "independent attorney" as defined in §21370 of the Probate Code and am in a position to advise the transferor independently, impartially, and confidentially as to the consequences of the transfer. On the basis

• f

this counsel, I conclude that the transfers to ______________________________________ that would be made by the instrument are not the product of fraud or undue influence. ____________________________ ___________________" (Name of Attorney) (Date) (b) An attorney whose written engagement, signed by the transferor, is expressly limited solely to compliance with the requirements of this section, shall not be considered to otherwise represent the transferor as a client. (c) An attorney who drafts an instrument can review and certify the same instrument pursuant to this section, but only as to a gift to a care custodian. In all other circumstances, an attorney who drafts an instrument may not review and certify the instrument. (d) If the certificate is prepared by an attorney other than the attorney who drafted the instrument that is under review, a copy of the signed certification shall be provided to the drafting attorney.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION SUITE 445 12100 WILSHIRE BOULEVARD LOS ANGELES, CALIFORNIA 90025 www.GivnerKaye.com

BRUCE GIVNER (bruce@GivnerKaye.com) OWEN D. KAYE (owen@GivnerKaye.com) KATHLEEN GIVNER (kathy@GivnerKaye.com) NEDA BARKHORDAR (neda@GivnerKaye.com)

PHONE (310) 207-8008 (818) 785-7579 FAX (310) 207-8708 (818) 785-3027

September 17, 2015

Generational Split Dollar The Set-Up

80 Year Old Parent Irrevocable Trust Insurance Company

Step 3: trust pays $1,000,000 premium Step 1: Parent establishes irrevocable trust to buy policy on 60 year old Child for Grandchildren’s benefit. Step 2: Parent and irrevocable trust enter into a split dollar

• agreement. Parent

contributes $1,000,000 to the irrevocable trust for it to buy an insurance policy on Child’s life. Parent is entitled to the greater of the premium or the cash surrender value at “policy maturity”.

60 Year Old Child

Step 4: Insurance company issues $5,000,000 policy

• n Child

(amount is hypothetical)

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

Generational Split Dollar September 17, 2015 Page 2 of 4

Generational Split Dollar The Termination

Note: If Child is 55 years old when this starts, the savings is $209,000 per $1,000,000. If Child is 50 years old when this starts, the savings is $235,000 per $1,000,000. If Child is 45 years old when this starts, the savings is $254,000 per $1,000,000.

Ideal situation: young parent, because (i) Parent will live long after the split dollar agreement has been terminated; and (ii) Children will be young which means that (a) the cost

• f insurance will be low and (b) the discount will be high.

80 Year Old Parent Irrevocable Trust Insurance Company

Step 6: Trust cancels the policy and receives a $1,050,000 refund. Step 5: In year 5 the irrevocable trust offers to buy Parent’s interest in the split dollar agreement. Parent’s interest is calculated as follows: $1,000,000 at policy maturity – a 65 year old has a 21 year life expectancy – is worth $538,000 at 3%. Step 7: Trust pays Parent $538,000 to cancel the split dollar agreement, leaving Trust with

• ver $500,000.

Step 8: result – Parent’s estate is reduced by $462,000,

saving $185,000 in estate tax per $1,000,000.

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

Generational Split Dollar September 17, 2015 Page 3 of 4

Advantages

Term Of Loan. Normally a 30 year loan between an 80 year old parent and a 50 year

• ld child would not work. The IRS would be able to use IRC §2036 to include the note in the

parent’s taxable estate. By transforming the transaction into the Split Dollar context, the problem of the loan’s term disappears. Interest Rate. The other benefit (also available in family loan situations) is that the 80 year old parent can make the loan at the long-term applicable federal rate, which is considerably less than the market rate of interest for that length of a loan. Therefore, on the parent’s death, the note’s value in the parent’s estate is discounted for two reasons: the long remaining term and the low rate of interest.

Issues

1. Financial Aspects Of The Transaction. Does the loan make sense? Interest rate. Security. Term. Renewal. Events which cause a breach. Is the guaranty fee appropriate in light of the marketplace? Overall analysis: will the costs (legal fees, commissions, on-going mortality costs and non-deductible interest paid on the loan) make sense in light of the benefits, which include the insurance coverage and the eventual possible estate tax savings? As tax lawyers we are not best situated to analyze this. The client is in a better position. Or the client has a business lawyer used to reviewing loan documents. 2. Insurance Aspects Of The Transaction. Is it a good carrier? Is it the right type of policy (maximized for death benefit or maximized for cash value)? Is it priced right? Are the right parties being insured? Is the correct party the owner? Is the correct party the beneficiary? As tax lawyers we can give input on the last two points. But it would take an (impartial) insurance agent to give input on the first four points. 3. Tax Law Aspects Of The Transaction. Is it a valid split dollar agreement?

LAW OFFICES

GIVNER & KAYE

A PROFESSIONAL CORPORATION

Generational Split Dollar September 17, 2015 Page 4 of 4

Are all the necessary documents for a split dollar arrangement done? Should a protective gift tax return (IRS Form 709) be filed? Do the discounts make sense? Should the interest rate used to determine the discount be the IRS’s applicable federal rate or a market rate of interest? Will it withstand an audit? If there is an audit, how do you handle it? Do the proposed regulations under IRC §2704 apply? Presumably not since those regulations will apply to a taxpayer creating a discount by contributing assets to an entity. It helps to get a legal opinion for the first two points. The discounts are based upon a quality

• appraisal. You should assume that the IRS will challenge the structure if it is discovered and that it

can be resolved in the IRS Appeals Division (after the audit).

ENCINO CARDIOLOGY GROUP

A PROFESSIONAL CORPORATION SUITE 445 16130 VENTURA BOULEVARD ENCINO, CALIFORNIA 91436

January 2, 2015 To whom it may concern: John Jones has been a patient of mine since 1980. During that time I have met with him for a checkup at least once every two years. He is now in my care on a more intensive basis due to a myocardial infarction that occurred on December 15, 2012. He is taking a small dose of aspirin and Clopidogrel on a maintenance basis. His heart rate and pulse are

• normal. His blood tests are within the normal range.

In my opinion he does not have an incurable illness or deteriorating physical condition. Therefore, I believe there is a greater than 50% chance that he will be alive for more than one year. Please let me know what more I can do to help with this evaluation. Very truly yours, EUGENE B. COHEN, M.D. Encino Cardiology Group EBC:jb