Sunday, June 21, 2015

Father's Day, Fashion, and Football

On Father's Day, let's briefly recap the will of fashion designer, Oscar De La Renta, who died last Fall.  It was recently reported that he snubbed his adopted son, Moises, in his will because he was upset that his then 20 year old son had tried to compete with him in the fashion design business by producing five or six pieces under his own name 10 years ago.  De La Renta left $18 million of real estate to his second wife of 25 years, then put the rest in trust for her, her children, and his son.  That amount likely was $5.34 million.

Several points:

1.  Funds left to his wife will not be subject to estate taxation until her death while leaving anything in excess of $5.34 million in trust or to his son will be taxed at a rate of 40%.

2.  Context is everything.   I doubt De La Renta was so insecure as to have been threatened or annoyed by his son's attempt to follow him into the business.  Reporting that the son was disinherited for that reason makes for a nice narrative, albeit false.



3.  After 25 years of marriage, it is not unusual to leave a significant portion of an estate to a spouse, even if there are children from a prior marriage.  Leaving a football team worth $1 billion to a third wife of 10 years is questionable, though, Tom Benson.

Sunday, June 14, 2015

Cheat His Mom Then Cheat His Son

Anthony Marshall was the son of socialite Brooke Astor.  He was convicted of elder abuse of his mother and served two months in jail for stealing $14 million from her.  In his will, which was recently admitted to probate court, he left all of his assets to his second wife and her children.  He specifically excluded his son, Philip Marshall, who was the individual who notified authorities of his father's treatment of Ms. Astor.  The younger Marshall will not contest his father's will.

Three quick points:

1.  The will would be difficult to challenge unless the younger Marshall could prove that his father lacked mental capacity to execute the will.

2.  The purposeful omission of the younger Marshall for ratting out his father is evidence that the father was mentally competent.

3.  If a man steals from his mom, it is not beneath him to vengefully disinherit his son.


Wednesday, June 3, 2015

Dead Actors Society

The children and widow of Robin Williams are continuing to fight over his estate.  His widow is seeking items left in the house even though Mr. Williams' will left his jewelry, clothing, memorabilia, and awards to his children.  The list of 300 disputed items reportedly includes underwear, slipper, and t shirts.  More importantly, the widow will receive in trust an undetermined amount of money to care for the house he left her.  Of course, the parties cannot agree on this amount.

Several points:

1.  Williams and his attorney should have determined a specific amount for the upkeep of the house and erred on the high side.  Vagueness in a will/trust only leads to disputes.

2.  Fighting over underwear etc. proves that some people want to fight simply because the probate process is their last chance to fight with their siblings or step-parent.

3.  Even though the parties both claim the underwear, rumor has it that they left the Patch Adams memorabilia at the curb for the garbageman.

Sunday, May 31, 2015

The Thrill Is Gone, Part II

Since BB King died two weeks ago, some of his family members have accused his manager of poisoning him and have also threatened to challenge his will.  King allegedly left his 13 children $5,000 each and left $3,000 to his grandchildren.  He left the balance of his estate in trust for the education of future descendants.

Several points:

1.  When children make ludicrous accusations against a long time friend and confidante, it is easy to see why Mr. King would want to leave them a nominal amount from his estate.

2.  To ward off a will contest, Mr. King could have left them a larger sum i.e. $50K and tied the acceptance of it to not contesting the will.  If someone contested the will, she would not receive her inheritance.

3.  With their educations funded by Mr. King, perhaps his future descendants will realize that 89 year old diabetics in hospice care die naturally and not from poisoning.


Monday, May 25, 2015

Memorial Day 2015

Taking a break from people fighting over estates, let us remember those who fought for us and our country.  I read the following for the first time this weekend and found it to be poignant about the sacrifices of our military men and women.

"It is, in a way, an odd thing to honor those who died in defense of our country, in defense of us, in wars far away. The imagination plays a trick. We see these soldiers in our mind as old and wise. We see them as something like the Founding Fathers, grave and gray haired. But most of them were boys when they died, and they gave up two lives -- the one they were living and the one they would have lived. When they died, they gave up their chance to be husbands and fathers and grandfathers. They gave up their chance to be revered old men. They gave up everything for our country, for us. And all we can do is remember."

President Reagan, 1985


Wednesday, May 20, 2015

Big Tips and Big Bequests

Late NYC art dealer, Robert Ellsworth, was in the news recently because he left $50,000 in his will to two waitresses at his favorite restaurant. He also left $10 million, a house in Connecticut,  and $5,000/month to his boyfriend of 50 years who was 17 when he moved in with Ellsworth  The boyfriend is challenging the will because of bequests made in trust to various charities, including Harvard, which would result in the estate planning attorney earning fees for serving as trustee of the trusts.  The boyfriend alleges that Ellsworth was suffering from dementia when he revised his will to include the charities.

Several points:

1.  Presumably a prior will made by Ellsworth was more favorable to the boyfriend because it would be reinstated if the most recent will is declared invalid.

2.  $10 million and $5K/month seems generous, but is barely 5% of Ellsworth's $200 million estate.

3.  Regarding the attorney serving as trustee of the charitable trusts, I generally decline to serve as executor or trustee for my clients because of perceived conflicts of interest.

4.  If Cher could live with Sonny when she was 16, I guess it was then socially acceptable for the 17 year old boyfriend to move in with the then 37 year old Ellsworth.  Now, Ellsworth would be arrested for being involved with a minor, unless he was Doug Hutchison and she was Courtney Stodden.

5.  With its $32 billion endowment, can we all agree that Harvard does not need a nickel more and should use its endowment to lower its tuition?