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Maid For Trouble

The woman at the center of the U.S.’s most expensive probate battle died this week in Poland.   Barbara Piasecka Johnson was a maid who worked for J. Seward Johnson, Jr.’s family, of Johnson and Johnson renown.  Within 2 years, then 76 year old Mr. Johnson divorced his second wife and married the then 34 year old servant.  When Johnson died 12 years later, he omitted 5 of his 6 children from his will and left nearly all of his of $500 million to his wife.  The children contested the will alleging undue influence and settled for $40 million.

Several points:

1.  Mr. Johnson could have provided for both his widow and his children by creating a QTIP trust (a new trust back in 1983) which would have provided assets remaining after his wife’s death would be distributed to his children.

2.  Contesting a bequest to a maid on grounds of undue influence is easy.    Contesting a bequest to a maid who has been married to the deceased for 12 years on similar grounds is nearly impossible.

3.  Marrying someone younger than one’s children is rarely a good idea.  It might be better to date her and leave her a condo and a Bentley in a will and preserve family relations.

Jerry Buss the Sugar Daddy

Los Angeles Lakers owner, Jerry Buss, died in February at the age of 80.  He was known for epitomizing California cool and was often seen with one or more young women on his arm.  In his will, he left a Honolulu condo and a 2009 Bentley to his 20-something girlfriend, and the rest of his assets to his trust.

For privacy reasons, he could have transferred the condo and car to his trust, and made the bequest from the trust.  This also would have avoided the cost of ancillary probate in Hawaii.

Of course, privacy might have defeated the purpose of letting the world know that at the time of his death he was an 80 year old man with a late 20’s girlfriend.    Estate planning always has trade-offs.

The Art of Estate Planning

Merton Simpson – a NY artist , pre-eminent collector of African art, and gallery owner – died 2 weeks ago.  His body remains unburied at the funeral home due to a family dispute.

Prior to his death, a guardian was appointed to manage Mr. Simpson’s affairs.  His estate is valued “in the millions” but the assets are illiquid.   The guardian does not have enough funds to pay for a funeral and the executor of the estate has not been appointed yet and will likely also have insufficient liquid funds in the near term.

The primary lesson is that Mr. Simpson should have included a trust in his planning and transferred his assets to it prior to his death.  The trustee could have sold art pieces as necessary without outside supervision.  Mr. Simpson would have avoided avoided the guardianship, the delay caused by waiting for the court to officially appoint an executor, and the Sherman Hemsley-esque burial fiasco.

Even without estate taxes, trusts are still necessary.

O Revelations!

Willa Cather, author of “O Pioneers”, died in 1947.  She purportedly destroyed much of her private correspondence  and left instructions in her will forbidding the post-mortem publication of any remaining letters.  For nearly 70 years, her executors adhered to her wishes.  However, with the death of her nephew and second executor in 2011, her wishes are no longer being followed and a book containing 566 of the surviving 3,0000 letters will be published next month.  There are various reasons given for her request to not publish the correspondence – a desire for privacy, a late life depression, and a desire to conceal her lesbianism about which scholars have speculated for years.

Several points:

1.  3000 letters survived?  She needed a heavy duty shredder.

2.  The best way to ensure post-death privacy is to destroy the letters while alive.  After a generation or two, those interested in preserving her wishes will have died and successors will be more motivated by money than her wishes.

3.  In an electronic age not prone to letter writing, most people will not be confronted with this issue in the future.  No one will want to read a series of texts.

4.  Who needs to speculate about the sexual orientation of a woman who called herself William in college and who lived with the same woman for 39 years?

5.  I did not enjoy reading her work in American Literature classes so I will not be pre-ordering the book of her letters from Amazon.

 

How Am I Doing? Quite Well, Apparently.

Former NYC Mayor Ed Koch was famous for walking the streets and smiling at people while asking them “How am I doing.”  His will was admitted to probate court this week.   It left $100K to promote government and public service and left most of the remaining balance of $10 million to his sister and her children.

Several quick observations:

1.  A bequest of less than 1% of the estate of a public servant to promote public service seems puny.

2.   There are few, if any, other charitable bequests.  So much for giving back.

3.  A $10.5 – $11 million estate after being a mayor?  Public service is the start of the path to enormous wealth for many.

4.  The large estate reaffirms that it is easier to accumulate significant wealth when one doe not have children.

 

 

 

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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.