As news breaks that Bobbi Kristina Brown will be moved to a long term care facility, one wonders what will become of her estate. Or at least those of us in the estate planning field wonder. Her mother, Whitney Houston, left her reportedly $20 million estate in trust for Bobbi Kristina per the terms of her 1993 will. Bobbi Kristina should have received 10% of that on her 21st birthday last year under the terms of the trust. Bobbi Kristina’s assets will go to her closest living relatives i.e. her father, Bobby Brown. The remaining 90% of the trust will be distributed per the terms of Whitney’s will which means to her mother and her two brothers. Bobby Brown was also listed as a trust beneficiary, as was her father who died in 2003, but is precluded from inheriting from Whitney due to their 2007 divorce.
1. Whitney should have updated her will multiple times – as her daughter aged, after the death of her father in 2003, and after her divorce in 2007.
2. Distributing trust assets to a child at the age of 21 is a bad idea. I never draft a trust that permits a distribution prior to age 25. I also have a clause prohibiting distributions to beneficiaries suffering from drug use, alcohol abuse, or a gambling problem.
3. Recreational drug use is expensive. In an age where Lou Reed’s estate was valued at $20 million primarily based on one song (“Walk on the Wild Side”), a $20 million estate seems small for an artist of Whitney’s stature recording in an era of larger royalties and multi-platinum CDs, with a film career to boot. Not that Lou Reed did not do drugs.
A couple prepared wills leaving all of their assets to each other. The husband’s father was the beneficiary if they both died. The couple subsequently divorced. The woman allegedly prepared a new will, which she gave to her neighbor, leaving her estate to her brothers. That will has not been found. After the woman died, her ex-husband produced the will from their marriage. Although the divorce precluded the ex-husband him from inheriting from her, his father was still considered a valid beneficiary. Courts have ruled that the will from her marriage controls and that the former father-in-law will receive her estate. The New York Court of Appeals will hear her family’s appeal.
1. Most states have laws treating a divorced spouse as a pre-deceased beneficiary of a will, trust, insurance, and retirement plan. Those laws do not affect the contingent beneficiaries.
2. Divorced individuals should immediately update their wills and beneficiary designations as soon as possible during the divorce process. This is more imperative for those without children.
3. My policy is to retain my clients’ original documents, send them copies, and urge them to notify their designated executor of the location of the copies (which have my name on them).
4. In desperate times, leaving a copy of the will in the refrigerator is always preferable to giving the original will to a neighbor even if it ends up smelling like rotten vegetables, spoiled mayo, or Green Goddess salad dressing.
Photo by Mark Brewer
Happy 15th birthday to my son, Jack.
The NYT reported about the revival of downtown Cincinnati real estate. If you are from out of town, come visit us. If you are from Cincinnati, brag about us. It is a great time to be a Cincinnatian.
In playing his entire Hall of Fame career for the Chicago Cubs, Ernie Banks became the most famous and beloved player in Cubs history. At the time of his death last month, he had been estranged from his third wife for 7 years. He revised his will several months before his death to leave all of his assets to his caregiver of several years and to nominate her as his executrix. His sons are questioning the validity of his will while his ex-wife has gone to court to prevent the caregiver from cremating his body and spreading his ashes in Wrigley Field. His sons and estranged wife both allege he was suffering from dementia prior to his death. The funeral home which handled his funeral and the cemetery where he was supposed to be buried both state that they have no knowledge about the location of his body.
Three quick points:
1. A will revised by an individual immediately prior to death which leaves assets to a care giver instead of children is ripe for contesting on the grounds of both lack of mental capacity AND undue influence. I doubt this will work out in the favor of the care giver.
2. It is possible that the body of Mr. Banks is located with the head of Ted Williams.
3. Steve Bartman wishes he could have vanished as effortlessly as the body of Mr. Cub.
Facebook today announced a change in its policy towards the accounts of deceased users. It will now allow a user to designate a “legacy contact” to manage the account of a deceased user. Previously, Facebook froze the account of a deceased user which left the account in a state of virtual purgatory.
What you need to know:
1. To designate a legacy contact, go to Settings, choose Security, and then Legacy Contact at the bottom of the page.
2. Stupidly, you may not designate a contingent legacy contact so do not choose someone you travel with frequently or who might kill you in a murder-suicide.
3. Legacy contacts may not alter what you have previously posted. If something is embarrassing while alive it will remain embarrassing post mortem.
4. This might all be for nothing anyway. How fun will Facebook be if one cannot post a picture of himself with the most hated man in Kentucky?