COVID 19: Quarantine and… Prepare an Estate Plan?

By Jennifer Zegel

By Jennifer L. Zegel and Franca Tavella

Social distancing.  Stay-at-home orders. Quarantine.  Thanks to the COVID-19 pandemic, these phrases have not only become commonplace, they have unfortunately become the new “normal” until April 30th, perhaps longer.  Given all the hours people are now spending at home, and the different projects they are undertaking to fill those hours, what better time to focus on estate planning?  Many individuals probably prefer to organize their spice cabinets than think about their estate plans, but the current pandemic only highlights how important it is to have certain basic estate planning documents in place.  At a minimum, every adult should have a will, financial power of attorney, health care power of attorney, and living will.  There are also various other advanced estate planning techniques available, especially for those wanting to take advantage of planning and gifting opportunities in a low interest rate environment.

A will directs the disposition of real and personal property upon death.  It can also provide for specific and charitable bequests, and create different types of trusts for the benefit of a surviving spouse, minor children, other individuals, or pets.  Even for families without a lot of assets, one of the most important features of a will is the ability to appoint a guardian for minor children in the event both parents are gone.

A durable financial power of attorney allows an individual (called the “principal”) to designate an agent to handle financial matters on the principal’s behalf, especially if the principal becomes incapacitated in the future.  Similarly, a health care power of attorney allows the principal to designate an agent to decide medical treatment on the principal’s behalf in the event disability or incapacity makes it difficult to communicate those decisions; it also allows the agent to have access to medical records and information.  A living will (sometimes referred to as an advance healthcare directive) provides the agent with instructions regarding the initiation, continuation, withholding or withdrawal of life-sustaining treatments if the principal has been diagnosed with an end-stage condition that is certain to result in the principal’s passing, or if the principal is in a permanent coma as determined by treating physicians.

During these unprecedented times, individuals can still “meet” attorneys telephonically to discuss their estate planning needs, and attorneys can draft the documents remotely from the comfort of their own homes, but executing estate planning documents while maintaining social distancing has been more problematic.  In response to the growing need to effectuate legally recognized estate planning documents during these turbulent times, on April 2, 2020, the Pennsylvania Department of State received approval for the temporary limited suspension on the physical presence requirement of notaries for certain estate planning documents that require notarization as well as those that do not require notarization but where notarization is the best practice.  The estate planning documents that can be notarized remotely include: powers of attorney, self-executing wills, temporary guardianships, health care powers of attorney, and living wills.

In order to remotely notarize documents, a Pennsylvania notary must become an approved electronic notary, use certain audio-visual communication technology for remote notarial acts, and adhere to all other requirements of the Revised Uniform Law on Notarial Acts.  Other safe guards that must be followed require the use of multilayered identity verification, tamper-evident technology, and an audio-video recording of the notarial act, as well as long-term storage of these records.  The notary certificate for each remote act must state that the “notarial act involved the use of communication technology.”  While the temporary authorization of remote notarization of many estate planning documents is a huge leap forward, uncertainties remain as the temporary authorization does not address whether witnesses, where required, can also participate remotely in addition to other concerns.  Some estate planning documents require two witnesses in order for the document to be valid.  Many individuals who want to execute estate planning documents now may live alone and have no one that can physically be present with them to witness the document being signed.  In Pennsylvania, a notary is not allowed to serve as a witness in documents the notary is notarizing.

In Pennsylvania, a self-executing will is required to be signed in the presence of two witnesses and a notary, even though this is not required for the document to be valid, these requirements make probate procedures more streamlined since the signature of the testator does not need to be proven.  Technically, for a will to be legal in Pennsylvania, it must be in writing and signed by the testator, who is at least 18 years of age.  By contrast, a financial power of attorney must be executed in the presence of two witnesses and a notary, while a health care power of attorney need only be executed in the presence of two witnesses.  Although it is unclear if these documents can now be remotely witnessed in addition to being remotely notarized, it is best to use remote witnesses if no other signing options are available to at least have estate planning documents in place with the proviso that there could be future issues.  To curtail these signing uncertainties and ensure that important estate planning documents are legally valid, for clients in the Philadelphia area, the Estates and Trusts Department at Kleinbard is fully mobilized and has implemented thoughtful document execution strategies to provide physical witnesses and a notary while still adhering to social distancing requirements, in addition to the Firm’s capability to provide remote notarial services.

Pennsylvania also has pending legislation that authorizes the use of remote notaries for many other types of documents by using the above described methods, and Governor Tom Wolf, also signed an Executive Order on March 25, 2020, temporarily authorizing remote notaries for real estate transactions that were already in progress before the pandemic. Many other states are also scrambling to enact or have already implemented laws authorizing remote notarization.  In New Jersey, Governor Phil Murphy has not yet enacted bill A3864/S2299, which was approved by the State’s legislature on March 18, 2020, and authorizes the performance of certain remote notarial acts through approved communication technology.  Note, however, this law would not become effective until 90 days after it is enacted.  Additionally, at the Federal level, Senate Bill 3533, the Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020 (the “SECURE Act”), was introduced on March 18, 2020 to provide for electronic and remote notarizations that occur in or affect interstate commerce.  If passed, the SECURE Act would authorize all notaries in the United States to perform remote notarial acts by using approved audio-visual and tamper-evident technology as well as other safe guards similar to those illustrated.  Although all of these pending laws will help provide assistance and guidance for the remote signing and notarization of various legal documents during this time, issues still remain as none address whether witnesses, where required, may also participate in the document execution remotely. Many of these concerns will hopefully be addressed with future legislation and amendments.

UPDATE: On April 20, 2020, Pennsylvania’s Governor, Tom Wolf, signed into law S.B. 841, which temporarily authorizes the remote notarization of documents for all Pennsylvania notaries.  The new law expands remote notarization to “every type of record and transaction that may be completed under the Governor’s [Disaster Emergency Proclamation].”  Remote notarization under S.B. 841 will be permitted immediately, and shall continue for a period of 60 days after Pennsylvania’s Disaster Emergency Proclamation is rescinded.  In order to remotely notarize documents under this law, a notary must adhere to the steps outlined above, and use  communication and identity proofing technology as designated by the Department of State (or subsequently adopted by the Department).  However, uncertainties still remain for the execution of estate planning documents, as the new law does not address whether witnesses, where required, can also participate remotely, nor does it address other concerns specific to the electronic execution of estate planning documents.  Additionally, there is pending legislation in Pennsylvania, S.B. 1097, which if passed, would permanently authorize the ability to remotely notarize documents, but in its current form, S.B. 1097 also fails to address some of the additional complexities and concerns surrounding the remote execution of estate planning documents.

 

Kleinbard’s Jennifer Zegel and Franca Tavella are co-authors of this blog. Our Firm’s estates and trusts attorneys are available to discuss and facilitate the execution of important estate planning documents during these novel times.