- Monday, 24 April 2017 13:02
Tommy Thompson is a treasure hunter known for locating the wreck of the SS Central America. The ship, laden with 3 tons of gold, sank in 1857 off the coast of South Carolina killing 425 passengers. Thompson, with the backing of 160 investors, located the wreck in 1988 and was able to bring some items to the surface. The value of what remained underwater was reported to be $400 million making it the most valuable ship wreck discovery in history.
By the early 2000s, some of his investors sued him claiming that Thompson had sold the gold and kept the profits to himself. An arrest warrant was issued in 2012 but he was able to stay on the lam until early 2015. As part of a plea deal, Thompson said that some gold was in a trust account in Belize. He now claims to have no knowledge of the location of the gold. A federal judge has ordered him held in prison for the past 16 months for contempt of court. The judge has asked him to sign a power of attorney so attorneys for the investors can examine trust documents. Thompson has refused to do so.
One wonky point, one consequence, and one observation:
1. The trust is what is known as an asset protection trust. It is used by people to shield their assets from creditors. There is likely a provision in the trust that prohibits the trustee from revealing anything about the trust without the consent of the grantor. Thompson has refused to give that consent so the terms remain private. And he remains in jail.
2. Asset protection trusts are great in concept until a court forces the grantor to reveal the contents of the trust or to bring the assets back to the U.S. They then became no more valuable than the paper they are written on.
3. Salvage operations and justice both move equally slowly.
Photo Credit: AP File Photo/Delaware County Sheriff’s Office
License: Fair Use: Education
- Friday, 21 April 2017 09:59
Just back from some college tours with Jack. South Carolina, Clemson and Tennessee specifically. Post about a podcast I listened to to follow shortly.
- Saturday, 15 April 2017 12:28
Three brief points:
1. A standard no contest clause in a will usually provides that if someone contests the will, he will lose his entire inheritance. This is why it is advisable to leave more than $1 to a disinherited heir.
2. This disputed clause seems to be more lenient than the typical no contest clause and definitely does not seem worth challenging.
3. Only in the world of our Trump obsessed media, would Schlafly’s support of President Trump garner the headline and two paragraphs in this article that has nothing to do with the President.
Photo Copyright: David R. Usher/Facebook
License: Fair Use/Education
- Thursday, 30 March 2017 10:16
My friend, and mentor, Bill Keating, Jr. died earlier today. As a graduate of St. Xavier High School he truly exemplified the school’s motto of “men for others.”
Bill was not only a Hall of Fame swimmer at UC and St. X, but also a champion of women’s athletics and athletics for the disabled. I had heard, but forgotten, that when he was a senior swimmer at the University of Cincinnati that he gave his scholarship back so that someone else could benefit from it. I did not know that he donated his first paycheck as a lawyer to UC as gratitude for the education he received and the friendships he made. I do know that when I told him that Jack was applying to St. X, he immediately offered to write a letter of recommendation for him.
His “Thoughts of the Day” which were intended as a means of staying in touch with his son when he left for college were eventually distributed to thousands of people every day and then forwarded from there. My children were recipients of the forwarded advice hundreds of times.
I suspect that I will read tomorrow’s final Thought of the Day with a bit of moistness in my eyes. The City of Cincinnati, and I, will definitely miss him.
- Thursday, 30 March 2017 10:11
A British farmer died and left his second wife of nine years the sum of $155,000. He left each of his sons from a prior marriage the sum of $81,000. The sons contested the will by arguing that their father, who suffered from Parkinson’s disease for 20 years, was incompetent when he made the will. The argued that his prior will which left his wife the sum of $125,000 was his real will. After years of litigation, and $250,000 of legal fees, the court ruled that his last will was valid and that all of the legal fees for the will contest were to be paid by the sons, not the estate
. In his ruling, the judge stated the sons were unreasonable and frivolous for fighting over such a small amount which was motivated by their dislike of their mother.
Several non-pithy points:
1. The sons were simply expressing their disdain for their dad’s second wife by fighting over such a small amount and likely hoping to force their step-mother to spend her entire inheritance on legal fees. Bleed her dry, if you will.
2. Unlike the U.S. where each party is responsible for his own legal fees, the British system allows the loser to pay the legal fees of all parties.
3. Editorializing a bit here, I have never understood the visceral dislike or animosity towards second spouses. From a child’s point of view, I embraced my mom’s second husband because he was able to provide her companionship, someone to travel and dine with, a social life, and mental stimulation. He was also able to assist her with her medical needs, whether they were doctor appointments or recovering from surgeries or illnesses (the same applies times two for the woman my father in law has dated for five years – she is an angel). I never viewed him as a replacement for my father, but simply as a good man in the next chapter of my mom’s life. Sadly, I do not think enough children view their parent’s second spouse in a similar manner. These British guys were twits in not appreciating the woman who took care of their ailing father to the best of her abilities.
Photo Copyright: Paul Keogh
License: Fair Use/Education
- Saturday, 18 March 2017 09:33
- Saturday, 18 March 2017 09:25
Audrey Hepburn died in 1993. She left her personal belongings, including costumes, scarves, hats, scripts, awards, and other memorabilia, equally to her two sons. They in turn loaned the memorabilia to a charity to display. After one of the sons ran into financial difficulties, he asked for the return of the property. He and his brother were unable to agree on how to divide the property so they went to court. They just settled their dispute last week.
Several brief points:
1. Most disputes about estate administration that I see are about the personal belongings and not the money. Oddly. And sadly.
2. In Ohio, people can easily specify which child or beneficiary is to receive a particular item by leaving a written document as a will companion so stating.
3. In Hepburn’s case, I feel sorry for anyone fighting over 25+ year old scarves and hats even if they once belonged to a famous person.
Photo Copyright: Paramount/REX/Shutterstock
License: Fair Use/Education
- Tuesday, 21 February 2017 10:49
The State of Ohio is holding an auction this Friday and Saturday to sell the contents of abandoned safe deposit boxes to make room for additional items in the Unclaimed Funds department. The items include Kruggerands, silver bars, coins, and currency. This is the first auction of this type since 1998. The state has had some of the items in its possession since 1968.
A few brief points:
1. Some of the abandoned boxes belonged to decedents. I always advise my clients to notify their executors of the location of any safe deposit boxes to prevent them being lost.
2. The State of Ohio currently has $2.3 billion in unclaimed funds it is holding for their rightful owners. Those funds can be claimed by completing a form on the Ohio Department of Commerce website.
3. Almost 50 years since the state found some of these items? The wheels of bureaucracy grind slowly.
Photo Credit: Joshua A. Bickel/Columbus Dispatch
License: Fair Use/Education
- Monday, 13 February 2017 21:03
When Frank Sinatra, Jr. died last March, he was embroiled in divorce litigation with his ex-wife, Cynthia. When they divorced in 2001, he was ordered to pay her $5,000 per month for a year. Sinatra continued to voluntarily make those payments for an additional 10 years until he was financially unable to do so. Rather than show gratitude, his ex-wife filed for a second divorce claiming that they were in a common law marriage in Texas because he continued to refer to her as his wife both on stage and privately.
Sinatra actually lived in California, paid California income taxes while he could have avoided taxes if he were a Texas resident (Texas does not have an income tax), and filed federal gift tax returns for the payment to his ex (transfers to spouses are not subject to gift taxes). Nonetheless, a Texas court ruled that they were married and awarded her $500,000, half of his $4.5 million house, and $5,000/month for another year. Sinatra died during the appeal which was ultimately decided posthumously in his favor.
So many possible points, but let’s stay with a few.
1. Only 15 states recognize common law marriages. Ohio is not one of them.
2. To have a common law marriage, couples must agree that they are married, tell others that they are married, and live together in the state which recognizes common law marriages.
3. If Sinatra was filing income tax returns as a California resident and filing federal gift tax returns for the payments to Cynthia, he did not consider her his wife.
4. Being a gentleman got Sinatra nowhere – he was trying to be considerate of Cynthia by not referring to her as his “former wife.” If he had to do it again, I suspect he would introduce her as “my EX-wife, hear that? My EX-wife.”
Photo Credit: Michael Ochs Archives
License: Fair Use/Education
- Monday, 13 February 2017 21:00
Apologies for the sporadic posting. There is not much happening in the world of celebrity wills and trusts, plus I was out of town for six days on the annual guys ski trip. Pic below, post to follow.
- Wednesday, 01 February 2017 13:52
When Zsa Zsa Gabor died prior to Christmas, it was announced that her 9th husband had 90 days to vacate the Bel Air house she had owned since 1973. She had tried to sell the house several years ago, but finally accepted a lower offer in 2013 on the condition that she be allowed to reside there for the rest of her life. Now that she has died, her residency has terminated and her widower must move. The buyer will allegedly tear down the house.
A few minor points:
1. This arrangement is known as a life estate. Given her paralysis and amputations, I doubt the buyer thought she would live 3 more years.
2. Hugh Hefner allegedly has a similar arrangement for the famed Playboy Mansion.
3. Crazy times we live in when an $11 million property is a tear down.
- Thursday, 05 January 2017 16:29
The Walt Disney Company is reportedly set to receive $50 million due to the death of Carrier Fisher. Disney owns Star Wars and had taken out an insurance policy on Fisher in the event she was unable to complete the new three film trilogy. Filming had wrapped on Episode VIII but Episode IX, due in 2019, will need a script re-write.
Several minor points:
1. The insurance on Fisher is a form of “key man” insurance which many companies purchase on the lives of their valuable employees to protect the company in the event of the death of the employee.
2. $50 million seems excessive given the limited role that Fisher played in The Force Awakens.
3. The insurance carrier is likely wishing that it had rather insured the life of Harrison Ford, whose Han Solo died during Episode VII, and who will not appear in any more episodes.
Photo Copyright: REX/Walt Disney/Shutterstock/Robot
License: Fair Use/Educational Purposes
- Thursday, 05 January 2017 16:22
Apparently I am only in the seasons’ greetings business. Celebrity estate planning blogging to pick up soon. Best wishes for the new year.
- Thursday, 05 January 2017 16:19
From my family to yours. We are thankful for your friendship.
- Thursday, 05 January 2017 15:47
- Wednesday, 07 December 2016 17:18
Illustration from New York Times License: Fair Use for Education Purposes
Robert Oesterland and Sarah Pursglove made an enormous fortune in various business such as promising people credit cards, forming membership style clubs for various items such as DVDs, and selling web browser toolbars promising to remove computer viruses. When Pursglove started divorce proceedings, Oesterland swore in court that he was only worth several million dollars. Although Pursglove was unaware of their financial details, she knew they had several assets alone worth more than that, including a $30 million Toronto penthouse and a yacht that cost several million dollars annually to operate. When Pursglove started investigating their finances, she discovered they were difficult to determine because of the opacity provided by the use of myriad LLCs and trusts in tax haven destinations. The divorce is still on-going.
1. Wealthy individuals use off-shore trusts to protect their wealth from creditors as an advanced form of asset protection planning.
2. Wealthy individuals also use off-shore trusts to hide their assets from taxation in an illegal form of tax avoidance.
3. It is no surprise that a man who made money by signing people up for memberships that continually charged their credit cards, promised credit cards to people but only gave them a list of credit card companies, and sold browser toolbars with no benefits would deceive his wife in divorce proceedings.
- Tuesday, 29 November 2016 08:27
The photo is from the front page of today’s Cincinnati Enquirer. Jack, in yellow, and his St. X teammates wanted to run all out for 400 yards in the Turkey Day Race so they could be in the lead and “make the paper.” Somehow, that plan came to fruition. I love the smiles and the gap to the pack.