5 Devastatingly Mishandled Estate Planning Cases That Went to Probate

If a loved one has recently passed away, you have probably heard the word “probate”.  As an estate planning attorney in San Diego, one of the questions that I receive revolves around the meaning of this word. Going through probate is the process of administering the estate of a deceased individual – basically, asking a Judge for permission to pass someone’s stuff on to their rightful heirs. The probate process in California can be long and arduous due to court involvement, even when the person that has passed away has a will in place.

 

If you find yourself in a fortunate position where you have many assets, estate planning becomes all the more important. There have been countless high profile probate cases over the years that made headlines not only because of the celebrity’s name associated with the case but because of the estate planning issues that surfaced after death. The best way to avoid issues for your family or friends left behind is to work with an experienced estate planning attorney and create documents that clearly indicate your final wishes.

 

Related post: Living Will vs a Last Will & Testament: What’s the Difference?

 

The Top Examples of Celebrity Estate Planning Missteps

Here are some examples of well-known estate administration cases where proper estate planning techniques weren’t utilized:

Marshall Estate: The unfortunate events surrounding J. Howard Marshal’s passing were due to a lawsuit filed against his son, E. Pierce Marshall, by Howard’s widow, Anna Nicole Smith. Anna claimed that her former husband promised her half of his fortune, an unverified amount. She was eventually awarded $88,000,000.00 but from winning a claim against J. Howards’ property.

Pierce, however, petitioned the California Supreme Court to question the Texas probate court’s legitimate authority to rule over a case of this nature. Although E. Pierce subsequently died of infection, his wife continued the legal battle on the grounds that there were two different rulings. The case went to the U.S. Court of Appeals to decide on whether the Texas or the California Supreme Court’s ruling was official. They, too, ruled in favor of Anna Nicole. Before the case concluded, however, Anna Nicole passed away. The court ruled that her claims were invalid and consequently rescinded the $88,000,00.00 award.

 

Whitney Houston: Given the singer’s stature, ideally, there should have been a living trust in place that would have prevented the public disclosure of her will. Instead, because it had to go through probate court, its contents became publicly available.

In her will, Whitney’s wishes were to leave her assets to daughter Bobbi Kristina in a testamentary trust and space their contributions at 10% when she reached the age of 21, one-sixth at 25 and the rest at 30. Tragically, however, Bobbi Kristina died when she was 22 years old, and proceeds went to her next of kin, which in this case is her father Bobby Brown, Whitney’s two brothers and her mother. Through the use of a proper living trust, techniques could have been put into place to better direct where funds should pass in the event of Bobbi’s passing while funds were being held.

 

Leona Helmsley: The fate of this billionaire hotelier’s estate ended up in a charitable trust. One particularly quirky provision she left was a 12-million-dollar pet trust to ‘Trouble’, her beloved Maltese poodle. The probate judge later reduced this value to two million in line with legislation. A particularly shocking thing we find in the Helmsley case is the cost of executor fees in a Probate process. What amount was paid to the executors for their role in managing her estate? A whopping 100 million dollars! Believe it or not, they felt cheated by this number as they were originally asking for 200 million dollars, in line with the percentage set out by law.

 

Prince. The ‘Purple Rain’ singer’s estate dilemma was that the executors undervalued it by 50%, a value that translates to $80,000,000.00. The reason for this was that they excluded Prince’s music publishing and recording interests. As a result, his estate owed millions of dollars in federal tax with additional monies owed in penalties, all at the expense of his six sibling heirs. Not to mention the fact that his estate never should have ended up in Probate or with heirs coming out of the woodwork left and right making claims to his estate!

 

Kobe Bryant. This legendary basketball players untimely death came at a time where he had not updated his estate planning documents in years. As a result, his 9-month-old daughter was not listed as a beneficiary of his estate. In turn, his wife had to file a petition to the probate court requesting her inclusion. Fortunately, this inclusion was allowed but it highlights the need to always keep your documents updated to avoid the need to ask a Judge for permission later.

 

Although it’s impossible to plan for any and every possibility, the above case studies reinforce the need for thorough estate planning to not only avert the need to go through a long court process but to make things easier and less stressful for your loved ones left behind. To set up your own estate plan, get in touch with us today and schedule a free consultation.

 

Testimonial from Jose, Satisfied Estate Planning Client 

Caroline and Michael helped my wife and me update our estate plan and we could not be happier with their kind service and knowledge! We had another San Diego estate planning attorney write our original documents, but we learned that they were lacking in many ways and had a few pitfalls that could have been a big problem for our children. Caroline and Michael updated the documents and explained everything along the way, pointing out what makes the most sense for our family and taking the time to make sure we understood the plan we now have. We can now rest easy knowing that the plan we have will actually work as intended when the time comes. If you’re looking for a fantastic estate planning attorney in San Diego, look no further than this couple.

Michael Jenkins

Leave a Reply

Your email address will not be published. Required fields are marked *