Every now and then I will write a post about a celebrity who has passed away, and whether or not their Estate Plan was effective (if there was a plan in place at all). While the Estates of the rich and famous are significantly larger than most of my clients, the lessons that are learned from their mistakes are important to note.
This is not a complete list by any means; my hope is that by reviewing some mistakes that have been made in the past, they can be prevented for you and your estate.
I was reading an interesting blog on royalties and their value to estates after the death of the creator of the work.
The author, Peter J. Reilly, cited a recent Forbes list that indicated among other things that the JRR Tolkien estate is good for $7 million dollars annually. The blog focused on the J.D. Salinger estate and the steps that J.D. Salinger took to keep his writings from being exploited after his death.
After reading the blog, I Googled and found a video from a Forbes writer wherein she provided the amounts that the 5 largest celebrity estates earned from October 2011 until October 2012. I found that taking a look back at this list was very interesting, and worth sharing.
For the most part, the results of our work are not seen by our clients. When we prepare an Estate Plan for someone, it is generally not implemented until the client’s incapacity or death.
What other professions is that true about? You go to the accountant or to the doctor, or to the dentist, or to the mechanic – well you get the picture – and you see the results fairly quickly. When you ask your friends for recommendations or read recommendations on the internet for those professions and most others, you are talking with people who have experienced the results of the work – not just the process of the work.
Why does it seem like so many celebrities have issues with their Estate Planning?
The latest is B.B. King. The Estate of the late great blue’s legend is going to be paying some attorney’s fees. Obviously, when that happens, the beneficiaries of the Estate receive less.
King was the father to 15 children both natural and adopted. Eleven adult children survive. A group of them are alleging among other things that he had a more recent will than the one that has been tendered. They also allege that his business agent for 39 years should not be the executor of King’s Estate.
The children allege that the business manager moved more than one million dollars around; did not allow the family to see King during his final days; and caused him to have improper medical care. As one would expect, through his attorney all of these claims are denied!
In Tuesday, June 2, 2015’s Los Angeles Times, there was an article about the dispute between Robin Williams’ widow and his children. Mr. Williams passed on August 11, 2014. In reading the article by Veronica Rocha, it appears that his real estate and monies have been distributed, in accordance with the Estate Plan he had in place.
The dispute appears to center over personal items. Undoubtedly, some of the personal items are worth a lot of money. However, some probably are not worth all that much, but have sentimental value.
Bobby Kristina, as she is known, is the only child of Whitney Houston and Bobby Brown and is the granddaughter of Cicely Houston. As many know she is in a long term care facility and from what I have read, her long term prospects are not very good.
Recently an Atlanta judge ruled that Bobby Brown and Pat Houston are to be co-guardians of Bobbi Kristina and that an Atlanta based attorney was to be the conservator of her estate.
I just concluded reading the Chicago Tribune Article by Annie Sweeney concerning March 30, 2015’s hearing in Cook County, Illinois regarding the validity of Ernie Banks’ Will.
For those that do not know who he was – almost impossible for someone who lived in Chicago in the 1950s, 1960s, or 1970s – he was given the nickname “Mr. Cub.” He is enshrined in the Baseball Hall of Fame in Cooperstown, New York and is credited with saying “It’s a beautiful day for a ballgame . . . Let’s play two!”
The judge found that the Will was valid based upon testimony of two paralegals who were employees of the law firm that prepared the Will who observed Mr. Banks signing the Will. As one would think, the witnesses testified to Mr. Banks’ competence.
In the Will, Banks did not leave anything to his family. Rather, it left everything to a woman, Regina Rice, who has been described as his caregiver, but also has a talent management company, Ricer Enterprises.
Until he retired when I was almost 13, John Wooden was the “Wizzard of Westwood” to me. My father had me watching UCLA basketball from my earliest days.
During my teens and twenties, there were two legendary college basketball coaches, Dean Smith of the University of North Carolina and Bobby Knight of Indiana University. Dean Smith died earlier this year and it was recently learned that he left his former players a gift – $200 to each of them to be used for a dinner on him.
Yesterday, July 23, the testimony portion of the Sterling versus Sterling Probate trial concluded. While I have written a few posts regarding this proceeding I feel that it is important to stay up to date with such a sensationalized probate matter (with that is mind, I will do my best to keep this brief). During the conclusion of yesterday’s time in court, Donald’s attorneys opted out of calling his estranged wife, Shelly Sterling, to the stand. Instead they brought forward a neurologist who testified that the stress caused by having Shelly present during the doctor’s evaluation of Donald affected the outcome of their conclusions.
Closing arguments are set to be heard this coming Monday, July 28, and as it has been up to now, the conclusion of the court proceedings are predicted to be a ‘fight till the finish.’
Recently a survey, developed by Wealth Council, estimated that 35% of people have drafted estate management plans in order to safeguard against the mismanagement of their estates after they have been inherited. One of the simplest and most effective ways to keep your kids from blowing their inheritance is to talk to them. By discussing options with them, and allowing them to meet with a financial advisor, children inheriting large sums of money will be much more prepared to manage it. Another facet of this same idea is to allow for practice by passing down sums of money, so you can deal with the aftermath (good or bad).
The use of a trustee as a third party regulator, and the implementation of certain provisions, ranging anywhere from clean drug tests to getting a college degree, can also assist in the management of inheritance. Despite the benefits of using some of these practices, countless celebrities have still opted to leave their children with nothing, or incredibly small inheritances (in comparison to the value of their estate). A recent article in the Money section of Time online outlined some of these celebs, below are a few highlights.
Broadcast legend and the voice of American Top 40, 20, and 10, Casey Kasem (82) passed away in the early morning hours of Sunday June 15th due to health complications in association with Parkinson’s disease. Working in the industry for thirty-nine years, Kasem became a household name through radio work, cartoon voiceovers, and commercial work with companies such as Oscar Myers, Ford, Sears, Dairy Queen, and many others. He was won countless awards throughout his career including spots in; The National Association of Broadcasters Hall of Fame, The National Radio Hall of Fame, and a coveted star on The Hollywood Walk of Fame.
Kasem’s achievements were recently overshadowed by a family feud that went public in the wake of his worsening and ongoing health issues. He is survived through his first wife, their three children, and wife (Jean Kasem) and their daughter. Kasem’s children claimed that his second wife was not allowing them to see their father in his final days; they began a public protest after three months of being denied the right to see Kasem. In response, Jean claimed that Kasem did not want his family members to see him in his deteriorated state, which had also led him to lose his ability to speak. Eldest daughter Kerri was granted full control over her father’s medical decisions on June 6th, and after much consideration she decided to withhold food and fluids, which doctors claimed were resulting in additional pain for Kasem. Despite the public disagreements between family members, Kerri maintained that the importance of family meant having all members present, including Jean and her daughter.
Interesting issues in Probate Law are often brought to light in the wake of celebrity cases. The recent outrage over Donald Sterling’s racially inappropriate audio recording has quickly led to a battle over control of the trust that owns the Los Angeles Clippers. Donald’s wife of 58 years, Shelly contends that due to Donald’s mental state, he no longer has the capacity to serve as trustee of their living trust. She is contending that three doctors who have recently examined her husband find him unable to perform his duties as trustee. Most trusts provide that upon the finding of incapacity of one spouse, the “healthy” spouse then takes over management of the trust, leaving Shelly with control of the Clippers.
Mrs. Sterling has entered into a deal with Steve Balmer, the man who ran Microsoft for over a decade, concerning the sale of the team which essentially was ordered by the National Basketball Association. The debate over Donald’s mental state partially hinges on his performance in several psychological tests, as well as a brain scan that displayed signs of early stages of Alzheimer’s disease. Mr. Sterling contends that he is still competent and, that, therefore his wife does not have the authority to sell the team.
As an estate planning attorney, I am always interested in the stories of the rich and famous. Recently, I came across an article dealing with the richest woman in Australia, Gina Rinehart. In fact, Ms. Rinehart might be one of the five richest people, if not the richest, in the world!
While she has money in many industries, her primary source of wealth is mining. Her net worth is well over 20 billion dollars and some believe that her worth is close to 100 billion dollars which would put her ahead of Carlos Slim and Bill Gates and make her the richest person in the world.
Two things are inevitable, or so the saying goes, death and taxes. Elizabeth Taylor passed on March 23, 2011 at Cedar-Sinai Hospital in Los Angeles. She was probably the first actress that I ever knew the name of as my parents spoke about her frequently while I was growing up. I could not have told you that she won two Oscars (“Butterfield 8” and Who's Afraid of Virginia Woolf”), but I did know that she had more than her share of husbands!
Ms. Taylor had a trust known as The Elizabeth Taylor Trust which she signed on June 23, 1998. The reason that I know this is that two days after her death, on March 25, the attorney for her trustees filed a notice to creditors in the probate department of the Los Angeles Superior Court. It is a court with which I am very familiar. One of the purposes of filing the notice to creditors is to begin the running of the statute of limitations.
As of now, it appears that the distribution of Ms. Taylor's estate is not going to be as “public” as that of many of our other celebrities. She appears to have planned and to have utilized a living trust correctly.
Estate Planning and Probate Attorney, Manhattan Beach Local, Sports Enthusiast