Trust Provisions Regarding Substance Abuse Can Empower Families of the Addicted
By Gerarda M. Culipher, Esq.[1]
If you are reading this, there is a 50% chance you adore, or adored, someone who has struggled with addiction.[2] Even if you haven’t watched a family member wage war with themselves, as chemicals course through their reluctant and rebellious bodies, someone in your orbit has been the helpless, grasping observer. While addiction is trending, there is good news. Some smart, long-term planning techniques exist which can empower families to bequeath assets in a way that not only doesn’t enable drug and alcohol abuse, but which can affirmatively incentivize diagnosis and treatment.
Enter… Trust Planning. A Revocable Living Trust is basically a private contract for estate planning. It is a highly personal agreement between You, who establishes the Trust (called the “Settlor,” or “Grantor,”) and Yourself, for as long as you are alive, and feeling well. When you create a Revocable Living Trust, you name yourself as the Trustee, and then select someone to be your “back up” (called the “successor Trustee”) who stands at-the-ready, to step-up and oversee all of your Estate if you become incapacitated, or when you pass away. The Trustee is a powerful person, who orchestrates the honoring of your wishes; in this context the Trustee works like, and often as, your Executor when you pass.
Power & Responsibility: Trustee Bias for the Beneficiaries. Importantly, that Trustee who wields control in your name after your death, has a “fiduciary duty” to the Beneficiaries of your Trust.[3] This administrator, as powerful as they may be, must put the interests of your named Loved Ones first, foremost and fairly; it is an unselfish, impartial duty, based on presumed, good faith. That said, while still alive and well, and when creating your Trust, you can embed certain discretion for the Trustee’s work, in observing your testamentary wishes, preferences and desires.[4] Your Estate is, after all, your life’s bounty. It is the by-product of long hours worked, good judgment, and an accretion of wisdom, over a lifetime. At your death, it is altogether fitting that the Trustee’s mission is to make decisions inuring to the maximal good of— the benefit of– your Beneficiaries.[5] Naturally then, the Trustee cannot, by fiat, withhold the distribution of funds to Beneficiaries when the proper time comes, according to your plans in the Trust document. The Trustee cannot power-grab.
Discretion in the Face of Duty: Drug Addiction Needn’t be Funded, but Rehab Can Be.
The terms of your Trust can establish exceptions to this general rule that the Trustee have a Bias in favor of the Beneficiaries; and specific grants of Discretion against Drugs is one example. In the event someone dear to you is addicted to drugs or alcohol, you can anticipate– and provide for– this situation in your Trust document. If, after your death, the Trustee (who often is a fellow-family member) suspects a beneficiary is struggling with addiction in real-time, the Trustee may have the discretion not to make a payout to the beloved addict. While concocting an affirmative “duty to inquire” whether beneficiaries are abusing drugs or alcohol in the first instance, might be too much, the Trust terms may be contoured to allow the Trustee who knows or suspects addiction, to structure the fund-payout, as an incentive for the Beneficiary with the problem, to get help. Encouraging terms can be added into your Trust that empower the Trustee with discretion to have the Beneficiary see a doctor (paid for by the Trust), or even condition the distribution of the Trust funds on the Beneficiary going to rehab (again, paid for by the Trust).
The incredibly talented, (and, yes, tormented) singer-songwriter Amy Winehouse famously belted out her throaty objection to these sorts of interventions, “They wanna make me go to Rehab, and I say ‘No. No. No![6]’” Amy Winehouse, extreme talent that she was, died at just 27 years old, from alcohol poisoning.
But families are not entirely helpless when planning for your Loved Ones through a Trust. You too, can say “No,” by building-in terms to your Revocable Living Trust that arm your Trustee to square-off with a Loved One’s substance abuse, before distributing Trust funds to the unstable Beneficiary. Addiction is an unfair fight. One that many don’t win.[7] But fighting the Good Fight, with a clear-eyed encouragement of Recovery, can be part of your legacy.
To discuss how to establish a Trust that contours discretion in the circumstance of a Beneficiary who may have a substance abuse problem, give us a call at 703-865-2525. Or to find out more about how Dominion Law Group, LLP can help your family with Trust planning more generally, visit our website www.DominionLawGroup.net
[1] Gerarda M. Culipher, Esq. is a member of the DC Bar and Virginia Bar and is not clinically-trained or licensed in the field of substance-addiction or chemical-dependence, or their best-practices. Nothing in this article should be construed as medical advice, but can be considered general, legal information. No family’s circumstance is like another, but we are rooting for Recovery as a general matter.
[2] This number is likely even higher with the onslaught of the opioid crisis; it has been seven years since Pew Research first reported on the derivative impact of substance abuse on American families. 46% in U.S. have friend or family member who’s been addicted to drugs
[3] The Code of Virginia, §64.2-764.
[4] The Code of Virginia, §64.2-776.
[5] NOTE: while you, the original Settlor/Grantor of the Trust, are alive (even if very ill or incapacitated), you are the then-serving-Trustee’s first loyalty. The Trustee serving when you get ill, must put your best interests first; right up to your passing. Your Revocable Living Trust, is itself a self-serving instrument, meant to service its Settlor/Grantor, until her death; the remaining Beneficiaries wait their turn to enjoy the Trustee’s Fiduciary Duties. See: The Code of Virginia, §64.2-752. See also, the classic, law-professor riddle, “How many heirs do I have? NONE! I’m still alive!”
[6] Amy Winehouse’s Lyrics to “Rehab,” copyright by EMI Music Publishing, Nashville TN.
[7] According to the World Health Organization’s (WHO) June 2024 Report, 3 Million deaths worldwide were due to drug or alcohol abuse. www.who.int/news/item/25-06-2024-over-3-million-annual-deaths
