The Ward Law Firm, L.L.C., on America: The Land of Opportunity – LIVING WELL Magazine

AMERICA: THE LAND OF OPPORTUNITY

By Ronald Ward, Jr., The Ward Law Firm, L.L.C., Northshore LIVING WELL Magazine

As the temperatures rise and summer comes upon us, I look forward to one of my favorite holidays of the year – the Fourth of July. When the flags are flying and we are sharing our collective pride in our country, I am also reminded that our freedom and sense of order differentiate us from most other countries around the world. While our strong constitution is the foundation of our country, it is our exceptional property rights that have always made America economically successful. What does this have to do with estate planning? The decisions you make in forming your estate plan – whether lifetime planning or plans for your assets upon your death – are all dependent upon the right to property that we all enjoy as Americans.

So let’s pause to appreciate our economic rights. America’s growth has always been fueled by individuals seeking to stake their claim. Some sought 40 acres to call their own. Others wanted a storefront in a town to sell their goods. To support these personal desires, our forefathers developed a system that allowed for ownership over their property and the fruits of their labor. Most importantly, a system was developed to verify and authenticate an individual’s ownership over that property. The property did not belong to a feudal lord or a monarch. It belonged to the individual.

From that ownership of land or a business, another asset type developed – credit. A farmer could borrow against his land to buy new equipment or buy his neighbor’s 40 acres. That farmer’s deed would be recorded at the courthouse to put the world on notice of his ownership. These are not new observations in any way. They are relevant, however, when we consider that many parts of the world still do not operate under such an organized system.

A tragic example of a failed or non-existent property law system was on display after the earthquake in Haiti. I don’t suggest that stronger property laws could have prevented the tragedy. But many of the collapsed homes – commonly built one on top of another clinging to a hillside – were a consequence of a system that did not allow an individual to own property. These dwellings were customarily built by private agreement, and without any proof of title. Without title, there is no proof of ownership. Without proof of ownership, there is no credit to borrow to make improvements and no means of obtaining insurance. So when tragedy struck, there was no bank to seek a loan to rebuild, no insurance to make a claim, and no governmental assistance (presuming there is a functioning government) as the occupancy of the dwelling was purely by private agreement not verifiable.

America’s point of differentiation is not just our hard-working populace. It is our system that allows the accumulation of property by an individual. We, the American people, are free to accumulate property. We are free to choose what to do with our property. Here is where your estate planning decisions come into play.

You may choose to start a company by forming a limited liability company. To do so would be part of your lifetime planning decisions. You may wish to establish a trust of a special needs or disabled family member. That, too, is a lifetime planning decision, as would be your choice to make a gift to a child, participate in a retirement account, or create a trust. These are but a few of the decisions that you might make as part of your estate plan – you just may not have taken a moment to realize it.

Your lifetime planning decisions will also impact your plans for your property upon your death. Who will run the limited liability company? Who will act as trustee over the special needs trust? Who are the beneficiaries over your retirement account? These are the types of decisions within your estate plan that you, hopefully, address in your last will and testament.

Just take a moment to appreciate our freedoms as Americans. As you face the many decisions of your household or business, be grateful for our system that preserves your strong property rights.

Ronald Ward, Jr. practices law in the areas of succession, estate planning, real estate, and business formations with his wife, Alycia, in Mandeville, Louisiana. He is a partner in The Ward Law Firm, L.L.C. (www.successionlawyer.com), and he owns Landmark Title Group, L.L.C. (www.landmarktitlegroup.com). He is licensed to practice law in Louisiana, Mississippi and Texas, and can be reached at 985-624-5678.