Pets are more than just animals – they are family. They provide companionship, love and support. It’s therefore only natural that we want to ensure they are looked after when we are gone, so estate planning involving pets should not be overlooked.
The importance of pet estate planning has been highlighted by a number of high-profile cases involving celebrities. For instance, designer Karl Lagerfeld reportedly left £1.2 million to his beloved cat, Choupette, after his death in 2019 and it has been rumoured that Oprah Winfrey has set aside $30 million in a trust to look after her three spaniels.
These examples highlight a concern that applies to every pet owner. However, despite what has been reported in the media, you cannot leave money in a Will to a pet itself. Under English law, a pet is normally considered to be personal property, unless they are a working animal, such as a sheep dog on a farm, which might be regarded as a business asset. Any gift in a Will made directly to a pet would fail and the gift would instead pass to the beneficiaries named to receive the remainder of the estate. However, the Courts have held that a testamentary gift providing for a pet’s maintenance is a valid gift. What is important is to ensure that a comprehensive pet estate plan is put in place which deals not only with who looks after the pets but also financial implications which arise.
Aside from requesting that the pet is looked after or rehomed by a named animal charity, there are a number of options available to provide for a pet in a Will:
1. Absolute gift to a beneficiary
The most common option is to leave the pet and a sum of money to a named individual in the Will. This works well when there is a particular family member or friend who is willing and able to care for the pet in the event of the owner’s death. For example, some pet contracts provide that the breeder must be nominated in such a case.
A specific gift of a particular pet will fail if the testator no longer owns it when they die. The testator should therefore be careful when referring to the pet in the Will and stipulate whether any funds provided to the caregiver are for the care of their current pet only or any pet that is alive when they die. Similarly, it would be sensible to provide for a substitute beneficiary if the designated beneficiary is unable or unwilling to care for the pet at the relevant time. If no substitute is included in the Will and the named beneficiary dies before the testator, the gift will lapse and pass into the residuary estate.
The sum of money left should be calculated to ensure that it is an appropriate amount to cover the expense of ongoing care. For example, considering costs of food, insurance and vet bills, as well as taking into account the age of the pet and likely life expectancy. If the financial provision in the Will turns out to be inadequate, the executors’ power to adjust the level of financial provision may well be limited.
It is also important to be aware of the risk that the person receiving the pet may accept the gift and take the money but not follow the testator’s wishes. The gift of the money can be made conditional on the beneficiary undertaking to look after the pet. However, this can create problems for the executors if the beneficiary refuses to give the undertaking or later does not comply with it
2. Pet maintenance trust
English law does not generally allow non-charitable purpose trusts because there are no beneficiaries to enforce them. However, one exception to this rule is trusts created with the purpose of providing for the maintenance of animals. Under this exception, a trust set up for the maintenance of the testator’s pet can be valid so long as the trust is limited to a period of 21 years.
Under a “pet trust”, funds are left to trustees for the specific purpose of caring for the animal. The funds are usually invested to generate an income which can be used for the pet’s ongoing care. However, in practice, trusts of this kind are relatively unusual and may give rise to practical issues such as who the trustees should be and how their expenses will be met if the sum of money left is insufficient.
3. Discretionary trust
A third and most flexible option would be to exclude the pet from any gift of personal property and instead include them in a discretionary trust of the residuary estate. The Will would normally be accompanied by a detailed letter of wishes providing specific instructions from the testator on what should happen to the pet.
As the trust would not exist for the sole purpose of caring for the pet, the perpetuity issues and potential problems relating to trustee expenses mentioned above should not arise. A discretionary trust arrangement would also provide a level of flexibility as the executors and/or trustees could decide at the relevant time who should look after the pet and how much should be set aside from the residuary estate to do so.
Whatever option is chosen, it would be sensible to provide the caregiver/Will trustees with detailed instructions regarding the pet’s care, including their feeding habits, medical needs, personality quirks, and more. By taking the time to create a comprehensive pet estate plan, you can have a peace of mind knowing your pet’s future is secure.
