To Amend or Restate — That is the Question

At Bulman Dunie, we regularly assist clients, review their planning documents, and implement changes to their documents.

Clients understandably want to limit the costs of these changes. And we share that objective! But there are times when an entirely new instrument, as opposed to a mere amendment, might be in order.

When we guide clients through this decision, here are three things on our minds:

1. Scope of the Changes

Are we tinkering? Or are we rewriting? Are we simply changing a nomination – such as who is nominated guardian or Personal Representative (executor)? Or, in addition to changing a nomination, are we also changing who will inherit and in what amounts?

Bear in mind that an amendment is a counterpart to the original instrument. For example, an “amendment” to a trust stands alongside the original trust instrument, and the two will need to be interpreted and administered in tandem. The same principle holds true to a “codicil” to a will.

For one discrete change, an amendment is likely suitable. If we are changing multiple provisions of the document, a new instrument is likely the better decision. The new instrument can avoid confusion in interpreting and administering two separate instruments.

2. How Many Prior Amendments Exist?

As stated, an amendment is a counterpart document to the original instrument.

If you only have one prior amendment and you are contemplating one further discrete change, another amendment might be perfectly acceptable.

However, once a client is on their third (or even fourth) amendment, we often recommend an entirely new instrument that incorporates the prior amendments.

Why? It can be unwieldy at best – confusing at worst – for the Trustee of your trust or Personal Representative of your Estate to be presented with multiple amendments to the same operative instrument. The fiduciary will need to carefully review each amendment and ascertain, after each amendment, which terms of the original instrument remain in effect.

3. Is There Anything in Prior Versions That Might Hurt?

This consideration is sneakily important to family harmony.

Was there a child who was disinherited in the original instrument who has been added as a beneficiary in an amendment?

Conversely, was there a beneficiary who was a beneficiary in the original instrument who has been disinherited?

Because amendments exist as counterpart documents to the original instrument, usually the original instrument and all amendments must be produced. In the case of a will, the will and all codicils must be filed with the Register of Wills. In the case of a trust, the original trust instrument and all amendments must be made available to the qualified beneficiaries of the trust.

If a client is substantively changing the beneficiaries of their estate or trust, and particularly where a beneficiary is being added or removed, we will usually recommend the creation of a new instrument. This avoids the shock that may come to a beneficiary to learn that they had earlier been disinherited. Conversely, the disinherited beneficiary would not know that they had been included in the earlier estate plan.

How can we help you adjust your estate plan to account for change in your life? Reach out to Jeremy Rachlin (jrachlin@bulmandunie.com) or Liz Farley (lfarley@bulmandunie.com). We are here to help you implement the plan that you desire in the most cost-efficient way.