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pet trusts

Ruby is a cherished member of the Blokland family. The family is planning to set up a trust for the Havanese dog in case she should outlive them. Unusual? Not any more.

Ruby is a cherished member of the Blokland family. As such, the Bloklands want to make sure that her needs, including possible expensive surgery for an ongoing knee condition, are taken care of for the rest of her life.

So like any responsible parent, they met with their lawyer and are planning to set up a trust for Ruby, a 12-pound Havanese dog, in case she should outlive them. Unusual? Not any more. Although some pet owners may be shy about admitting it publicly, many Canadians are writing provisions for pets into their wills.

"My husband and I feel strongly that Ruby deserves to be taken care of in the same way we take care of our human child," says Kirsten Blokland, a Toronto psychologist, who has also specified that they'd like Ruby to remain with their daughter. "It just seems natural to keep them together, as Ruby and Kara are like sisters of different species."

Saman Jaffery, a lawyer at Hull & Hull LLP in Toronto, says they're seeing an increasing number of people who want to make provisions for their pets just as they would for any other loved one. Since more than half of Canadians have pets, she's not surprised.

"The majority of dog owners consider their pets to be part of the family and often call themselves their pet's mom or dad," Ms. Jaffery says. "But unless there are specific instructions, then the best intentions to have someone care for your pet can be set aside by someone who declines."

Often people think someone will step in to care for their pet – a sister, brother or friend who loved the animal just as they did – but circumstances change, she explains. The person may have moved into a condo, or their health may have deteriorated, and even if you had some sort of informal understanding, they may not be able to honour your intentions even though they wish to.

"The uncertainty is troubling to many people so they do make some formal arrangements for their pets," Ms. Jaffery says. "Not only for after their death, but also in the event that they become incapacitated."

But here in Canada, one cannot outright leave money to a pet, as American hotel magnate Leona Helmsley famously did by leaving $12-million to her Maltese lapdog, Trouble.

"In Canada, a pet is considered property, so you can't gift property to property," Ms. Jaffery explains. "But there are ways of planning."

Some options she suggests include:

• Leaving a gift to a family member designated to be caregiver in your will and expressing your intention and wish that it be used for the benefit of the pet.

• Creating a formal trust. You may want to select a caregiver for the benefit of the pet and conditions that your trustee can monitor.

• Putting some kind of direction into your power of attorney document, allowing your agent to make payments to a caregiver who has your pet, and to pay for extraordinary veterinary expenses or other things that could come up.

When it comes to pets, there are concerns about the number of years a trust can run, Ms. Jaffery cautions. So if you're dealing with exotic pets such as a parrot or a turtle, that has a lifespan that our trust laws can't accommodate, you may need some very specialized planning.

The United States has been more forward thinking in this area, according to Ms. Jaffery. More than 40 U.S. states now have statutes that allow for pet trusts to be established, whereas in Canada we have to rely on traditional trust concepts, and to try and carve out a type of trust that may suit a pet.

"There's a relative ease in being able to create trusts for your pet that we don't have in Canada," Ms. Jaffery says. "In many U.S. states you have the ability, like Leona Helmsley, to leave money to a pet. I've heard that as much as $25,000 is the average amount being left in a pet trust. You can also transfer property to the trust – like an apartment or some other residence – for the benefit of the trust. In Canada, you need some specialized estate planning and to work with a lawyer who knows this area of law to get the same result."

Although Ms. Jaffery says the estate planning community has been talking about these changes for several years, there's been no movement to create a statutory pet trust law in Canada yet.

"It's a trend in the United States, so it should be on the horizon," Ms. Jaffery says. "We'll see it some time soon in Canada."

Her advice to the Blokland family is to make sure they have a frank discussion with the suitable caregiver they've selected for their child – keeping in mind that they want the pet and child to stay together – about whether they're willing to assume that responsibility, and giving them the comfort of knowing that provisions will be made. Then it's essential to ensure they have an estate planning lawyer who can put that put that sort of pet trust together.

"They could have a separate amount set aside designated for the dog's care," Ms. Jaffery says. "In law, the minor child's interests will come first. Pets are still considered property. In the event that there isn't enough money to provide for the child, due to unforeseen circumstances, the child will always get priority."