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The Morning Line Again

I subbed for Paul Daugherty’s The Morning Line blog in the Cincinnati Enquirer again yesterday. The only topic was Mike Brown’s management of the Cincinnati Bengals. I will not be receiving Christmas cards from his family anytime soon.

I hope you enjoy it.

 

 

 

 

Photo Credit:  Kareem Elgazzar for the Cincinnati Enquirer

License:  I wrote the linked article for the Cincinnati Enquirer 🙂

 

It’s Not Right But It’s Okay

The estate of Whitney Houston settled its dispute with the IRS over outstanding estate taxes. The IRS had contended that the valuation of Houston’s back catalog and image and likeness was undervalued by $22 million resulting in $11 million of additional taxes. The settlement was for $2 million. Oddly, or perhaps not given the state of journalism in 2018, the focus of most articles was on the value of her image and likeness but the IRS and the estate differed on that valuation by only $200K.

A few small points:

1. Since the death of Michael Jackson, the IRS has been taxing the image and likeness of dead celebrities with the value based on expected licensing revenues in the future.

2. Cool fact – Robin Williams said that his likeness cannot be used for 40 years after his death rendering its value worthless.

3. In the age of streaming music, the longer the estate held out the less valuable the back catalog of albums became.

4. This was purely a principled, but unemotional, victory for the estate. Houston’s daughter died nearly 3 years ago and Houston was divorced. Any estate tax savings will benefit her mother and her brothers.

Not About the Sport Coats

Craig Sager was a beloved basketball reporter who died last year from cancer. He was known for his colorful sport coats and bantering with Gregg Popovich, coach of the Spurs. He was divorced and re-married at the time of his death with children from both wives. His will is being probated in Georgia. It reportedly left everything to his second wife, Stacy.

His son from his first marriage tweeted yesterday that he was being summoned to court by a sheriff to prevent him from contesting the will even though he was not interested in contesting in the first place. His sister, Kacy, defended her brother while also flaming her step-mother and tweeted a list of grievances. Seeing a moment in the sun, the former girlfriend of the son felt compelled to jump into the fray and call the step-mother a POS in typical coarse social media parlance.

Several points:

1. Georgia is similar to Ohio in that when a will is admitted to probate all of the heirs at law (spouse and children) plus all of the will beneficiaries are required to receive notice of the probate proceedings via certified mail.

2. The son from the first marriage and his sisters were simply receiving the legally required notice.

3. Given the lapse between the date of death of Sager’s death and the date of this process, it is likely that most of his assets were in a trust and that a small account was titled only in his name and hence subject to the probate process.

4. Sager might have excluded his children from his first marriage due to their hostility to his second wife and/or their over-reaction to legal events.

5. Hostility to second wives can be avoided if they are age appropriate and their names do not rhyme with that of one’s daughters.

Happy New Year

From Marco Island.

TML Again

I guest wrote Paul Daugherty’s TML blog on Friday. I covered the best and worst in Cincinnati sports this year, plus some other topics such as possible successors to Marvin Lewis. I hope you enjoy it.

Ocean’s 14

Rande Gerber, husband of Cindy Crawford, recently told a TV program that George Clooney gave $1 million to 14 of his long time buddies four years ago. Clooney invited his friends to his house for dinner and presented each of them with an expensive leather suitcase.

When the friends opened them, each found $1 million in $20 bills. Clooney told them he had appreciated their friendship and wanted to help those who were struggling. He also said he had paid their taxes on the gift. Gerber did not want to take the money, but Clooney said no one would get their money if Gerber did not take his.

Several points:

1. This generosity resulted in a gift tax of $3.0 million to Clooney. In 2013, gifts to an individual in excess of $14K and beyond the $5.25 million exemption were taxed at 35%.

2. Despite his statement about paying their taxes, Clooney was obligated to pay the gift tax – the donor is always liable for the gift tax owed.

3. Having won the lottery twice – marrying Cindy Crawford and selling his Casamigos Tequila brand for $700 million – Gerber donated his million to charity to keep his good karma flowing.

Photo Credit:  Reuters

License:  Fair Use/Education

I Don’t Think I Love You

Limping to the end of the year while looking for celebrity news. Finally found some with respect to former teen heartthrob, David Cassidy, of Partridge Family fame. The will of the thrice divorced entertainer leaves his entire $150K estate to his son, Beau, from his third marriage. Cassidy specifically excluded his daughter from a previous relationship, actress Katie Cassidy, from the will. Meanwhile, a law firm which represented him has sued the estate for $100K of unpaid fees.

Several points:

1. Cassidy is free to leave his assets to whom he wishes – he is not obligated to leave them to his out of wedlock daughter.

2. The law firm should be paid from the estate before beneficiaries receive any distributions.

3. $150K estate after 50 years in show business? Divorce and drugs are expensive habits.

Photo Credit:  Facebook.com/Respect for Katie Cassidy

License:  Fair Use/Education

 

Happy Thanksgiving

Happy Thanksgiving from our family to yours.

(Apologies for tardiness – I posted this on Facebook on Thanksgiving but have been too slammed at work to post it here).

 

 

Gambling On Intestacy

Famous and infamous people are dying every day – Hugh Hefner, Malcolm Young, Charles Manson – but there is nothing newsworthy in their estates. Digging somewhat deep, it has been reported that notorious Las Vegas mass murderer, Stephen Paddock, did not leave a will to dispose of his reported $5 million estate. A Clark County, Nevada court had a hearing last week to determine who should administer his estate. Paddock’s 89 year old mother has declined to serve as administrator. It is likely that the Clark County Public Administrator, an elected official, will fulfill the responsibilities. The court will eventually determine who is to receive the estate proceeds.

Several points:

1. The complexities of dealing with the issues in this case are certainly above the ability of an 89 year old woman.

2. As meticulous as Paddock seemed, it might appear surprising that he did not have a will. However, maybe that is one more facet he thought through – he did not want to burden a familu member with the task of administering his estate.

3. With respect to who will eventually receive his estate, I am betting on the lawyers.

Photo Credit:   AP/Eric Paddock

License:  Fair Use/Education

 

Vegemite Redux?

Vegemite Redux?

In the intersection of two common themes here (Australian probate craziness and the danger of DIY wills), a terminally ill Australian woman filled in a DIY will while (whilst?) at the hospital. The will was only four pages long, but had multiple pages of attachments addressing her wishes from who would receive her house (apparently multiple charities depending on her thoughts at the moment) to who would receive her step ladder, cow bell, and scrapbook items. The Australian court admitted the will to probate, but the future interpretation and litigation will incur tens of thousands dollars in legal fees for her estate.

A few low hanging points:

1. The cost of attorney fees for preparing a will properly is minor compared to the costs of fixing a will that was not prepared properly.

2. The larger intangible cost for this woman is that her assets might not be distributed to her preferred charities/individuals and under the terms she truly wanted.

3. Call me unsentimental, but I doubt anyone cares about the step ladder, cow bell, and scrapbook stuff.

Photo Credit:  Zicasso Travel Website/unknown

License:  Fair Use/Education

This Explains Vegemite

In Australia, a man who was despondent after his wife left him drafted a text message to his brother saying that he wanted his brother and nephew to keep all that he had, told him where his cash was stashed, provided the PIN to his bank accounts, bashed his wife, then signed it “my will.” He did not send the message. After the man killed himself, a friend found the unsent message on his phone. A court has admitted the text message as the will of the deceased man.

A few points:

1. Although digital wills are around the corner, this would not work in Ohio because it was not witnessed nor signed.

2. Unsent? I find it similar to an unsigned will – there is not enough proof that this is his intent.

3. A court in Australia previously held that a will typed on an iPhone was valid.

4. At this rate, Australian courts will soon declare wills written with all emojis as valid.

Photo Credit:  news.com.au (?)

License:  Fair Use/Education  

“Who Wants Flowers When You Are Dead? Nobody.”

Lamont Buchanan, the reputed role model for the second greatest fictional character of all-time (Holden Caufield of “Catcher in the Rye”) died without a will two years ago. A woman claiming to be his long-lost 80 year old niece was located by several heir hunting firms and has now stepped forward and filed documentation to prove that she is his closest living kin. Buchanan was an author who lived in an NYC rent controlled apartment and essentially stopped working in the mid-50’s. His estate is valued at $15 million.

A few points:

1. A childless widower worth $15 million should take the time and splurge on legal fees to prepare a will so his fortune ends up with those charities or people important to him rather than defaulting to a woman who was unaware of his death.

2. After estate taxes, a $15 million estate in NY is worth $10 million.

3. Perhaps the owners of his rent controlled apartments should share in his estate because the mandatory low rents likely contributed to his accumulated wealth.

4. It would be ironic if the woman claiming to be Buchanan’s niece is a phony.

Photo Credit:  NY Daily News

License:  Fair Use/Education

King of Cruelty

When unfunny comedian, Jerry Lewis, died last month, he was survived by 5 sons from his first marriage, his second wife (SanDee, a former Vegas dancer 25 years younger than him), and a daughter from his second marriage.

His 2012 will left his entire estate to his wife and daughter. He purposefully excluded his six sons (including his son who died of a heroin overdose in 2009) and their descendants. Lewis’ sons had long accused him of treating them cruelly with the deceased son claiming that he had beaten them viciously. When that son died in 2009, Lewis refused to pay for his funeral. Lewis is reportedly only worth several million dollars, but the value of his estate is in the movie rights he owns to his movies.

Several minor points:

1. Lewis was not obligated to leave anything to his sons.

2. It was smart of him to specifically exclude the descendants of the deceased son so someone cannot try to claim part of the estate by alleging to be an illegitimate grandchild.

3. I would have taken the under on an allegedly cruel man remaining married to a Vegas dancer with two capital letters in her name for 35 years.

Photo Credit:  WireImage

License:  Fair Use/Education

When Plans Work Out 2

Jack won the open race at yesterday’s Lebanon Cross Country Invitational. When he learned he would be running the open race, he softly mentioned that he could win it. His plan was to be near the front and then take the lead – which he did at the 1.5 mile mark. As proud as I am of him, I am even happier for him.

I Have My Stuff, I Do Not Need Yours

It is another fallow period for celebrity estate planning news – the deaths of Jerry Lewis, Dick Gregory, and Ara Parseghian have yielded nothing newsworthy to date. Meanwhile, the NYT has an interesting piece on how children do not want their parents’ possessions when the parents downsize or move into a retirement home (or die). I see this with many of my clients and their children.

A few brief points:

1. In the age of furniture and decorations from Ikea and Wayfair, people do not want to decorate their homes with their parents’ 50 year old household items.

2. Unless an item is incredibly unique (i.e. Tiffany lamp, Baccarat crystal), it likely has little monetary value.

3. Personally, when my grandmother moved into a nursing home 20 years ago, all I wanted was her vintage lava lamp but I was also given (i.e. asked to remove) the bedroom set which I quickly disposed of.

4. If you have something you do not use or like, throw it away so your children do not have to throw it away after you die.

Photo Credit:  T.J. Kirkpatrick for the New York Times (from linked article)

License:  Fair Use/Education

Following the Eclipse Herd

Would you have either of these guys draft your will? I ran into Chuck Meyer (Santen and Hughes) during the eclipse at the Banks.

 

They Might Still Get Away With It

A Mason family – Mitch, Patricia, and Candace Stevenson – was indicted by a federal grand jury in June for money laundering associated with the receipt of life insurance proceeds. Allegedly, Patricia and Candace were the beneficiaries of two policies totaling nearly $3 million on the life of Mitch’s sister, Tina.

The 2009 application for life insurance stated that Tina had never been diagnosed with diabetes nor had taken medication within the previous 12 months. A physical exam was performed on a woman in Texas weighing 170 pounds. Tina actually weighed 380 pounds when she was in an emergency room three weeks prior to the application. Tina died in early 2012. Patricia and Candace received the death benefits and used them to purchase a Bentley convertible, make a $280K down payment on a former Homearama house, and other purchases. Unrelated, or perhaps not, Mitch and his son, Steven, have also allegedly been involved in a scrap metal scan.

Whew. Several points.

1. In Ohio, life insurance policies become incontestable two years after the application even if there is fraud. Companies have to pay the death benefit.

2. The Stevensons are likely being charged with money laundering because they cannot be charged with insurance fraud.

3. Money laundering is the crime of hiding the source of proceeds from a crime. I am not sure that using funds from a life insurance policy to purchase lots of bling amounts to money laundering.

4. In the bizarre coincidence category, the house purchased by the Stevensons was the subject of bank fraud 10 years ago that caused the builder to spend time in prison.

5. The Stevenson parents remain unindicted for naming their son Steven Stevenson.

Photo Credit:  Keith Biery Golick (KBG) for the Cincinnati Enquirer

License:  Fair Use/Education

Shooting and Drowning, Oh My

John Chakalos was a Connecticut octogenarian worth $40 million when he was murdered in 2013. No one has been charged with his killing although he was shot with the same type of gun his then 20 year old grandson had recently purchased.

Chakolos’ estate is to be distributed equally among his 4 daughters. However, last year one of his daughters, the mother of the gun owning grandson, disappeared at sea after the boat she was in with her son sank at sea after some holes were improperly repaired. The son/grandson was found 8 days later on a life raft. Now the 3 surviving daughters have asked the Connecticut probate court to declare the grandson as the murderer of Chakalos which they hope will prevent him from inheriting his mother’s share of the estate (and leave more for them).

Several points and one question:

1. The grandson should inherit his mother’s share of the estate. Slayer statutes apply when someone has been convicted of murder not merely suspected of murder.

2. Getting a bit wonky, the share of the now deceased daughter vested in her so technically she will inherit it and her estate will receive it and distribute it pursuant to her will.

3. If the Slayer Statute were to be applied, it should be applied to her estate although once again the son/grandson has not been convicted of her murder.

4. Is a 20 year old really capable of pulling off a perfect crime then repeating his success three years later?

5. If not, bad luck and odd coincidences certainly seem to follow the grandson.

Photo Credit:  Facebook?

License:  Fair Use/Education

Griffin Appeal Is Road Kill

A slow news cycle finally ended today with a local story. The Griffins are a large Northern Kentucky family which owned a rendering business (think road kill and restaurant grease) that was sold for $840 million in 2010. The business was operated along traditional gender roles with the males running the business and the women not participating.

The 6th Circuit Court of Appeals upheld a $584 verdict against two of the Griffin brothers in favor of three of their sisters. The verdict stemmed from the brothers’ handling of their parents’ estates two and three decades ago. The sisters became aware that something might have been amiss with the way the estates were handled when a piece of real estate they should have inherited was transferred to the family company for $1 in 2010 to facilitate the sale of the company. A federal court’s award of $178 million to each daughter was the subject of the appeal.

Four points and one disclaimer:

1. In the interest of full disclosure, half of my life ago I worked for the firm which represented the Griffin sons although I have no knowledge of the family or the matter.

2. I remain surprised that some of the claims by the sisters are not barred by the statute of limitations because the parents died 20 and 30 years ago respectively and their estates were probated then.

3. Good estate planning documents and/or a buy sell agreement which provided that the family business was to be transferred to the sons would have prevented most of this dispute.

4. The Supreme Court only hears cases involving questions of law or where courts differ on legal interpretation of an issue. Neither seems to apply here so this case is likely over.

5. Sale of real estate for $1? One would think that people in the rendering business would certainly know the mantra that pigs get fat, hogs get slaughtered.

Photo Copyright:  Bruce Crippen/Cincinnati Business Courier 

 

 

TML Again

I guest wrote Paul Daugherty’s TML blog today in the Cincinnati Enquirer. I cover Zach Cozart, OJ, some UC stuff, and a report from a family vacation (including a slideshow) that Doc suggested.

I hope you enjoy it. Thanks to Dan Izenson and Mark Sims for some topic ideas.

Photo:  Prague

Photo Credit:  Jay Brinker

License:  None   🙂 

Contact Me

All Posts By Jay Brinker

I am an attorney located in Cincinnati, Ohio who practices in the areas of estate planning, probate, asset protection, and small business advice. I make a difficult and bewildering process as simple as possible. Most importantly, I provide "more for less" for my clients.