Avoid a legal quagmire with forethought and planning
This week I will discuss a few legal issues for inquiring readers.
Q. My financial adviser suggests that I should have a prenuptial agreement before my second marriage.
A. I applaud your adviser for increasing attorney revenue. The prenuptial agreement may prevent arguments over who gets what property in a divorce or who inherits the deceased spouse’s property upon his or her death. A prenuptial agreement can avoid unnecessary litigation. Both you and your fiancee should seek legal advice from separate lawyers who practice family law. Both parties need to disclose their assets and specify in the agreement what each is entitled to receive in the event of divorce or to inherit if one of them dies. Consult your adviser about your strategy in suggesting the agreement to your beloved. Possibly the approach – “I love you, but won’t marry you without the prenup” – may result in a short engagement.
Q. Our company insists that all employees sign a covenant not to compete.
A. Your employer wants to protect itself in case you decide to work for a competitor. Many employees have information or skills that competitors covet. The courts will enforce the covenant not to compete if it is reasonable in time and distance. Usually covenants last for no more than two to three years. The covenant cannot exceed what is necessary to protect the employer. For example, if your sales territory is Indiana south of US Highway 40, then the covenant will affect your employment in that territory, but not any area north of US 40. If the covenant interferes with job prospects, consult an employment attorney who might suggest a less restrictive agreement to your employer.
Q. I am a widow with two adult children. I am facing an operation in a few weeks.
A. You should designate one or both children as your health care representative in a Health Care Power of Attorney. The hospital and doctors are then authorized to consult your children about medical decisions when you are incapable of deciding. They also can obtain your medical information, which they may otherwise be prevented from receiving under the federal privacy law referred to as HIPAA. This may be a good time to review your entire estate plan. You should have a Last Will and Testament and Durable Power of Attorney, and consider signing a Living Will.
Q. I lent one of my children money with the expectation that he will receive less from my estate when I die.
A. Debtors’ memories are worse than creditors’. Get the child to sign a promissory note that states the note will be due upon your death. Keep the promissory note with your Will and other estate documents. Upon your death, this promissory note is an asset of your estate, which your heirs may collect, reduce the debtor’s inheritance, or forgive.
Q. My neighbor is piling his brush on my property.
A. The civil wrong of trespass occurred when the neighbor dumped his trash on your property. However, what you believe (or the neighbor believes) is the property line may not be correct. The only way to determine the property line is a staked survey. Even a fence may not be located on the line. If things get nasty, you will have to prove that the neighbor trespassed on your property by using a staked survey as evidence.
As always, thanks for reading.
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