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.

Photo Credit: Cincinnati Enquirer/Sam Greene

License:  Fair Use/Education 

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.

Note:  And this is why I am behind on posting 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?

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 a cynic, but I doubt anyone cares about the step ladder, cow bell, and scrapbook stuff.

Photo Credit:  Zicasso Travel Website/unknownLicense:  Fair Use/Education

Apologies

I have been a bit neglectful in posting on this forum (and elsewhere) due to a heavy workload.  If you want the most current blog posts, they are on my Facebook page which is the easiest forum to post to for me (and the most read).  Facebook page link is here. 

I appreciate you reading.   

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, and provided the PIN to his bank accounts, then signed it “my will.”  He did not send the message.  After the man killed himself, a friend found the unsent message.  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 that 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:  Unknown (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 apartment 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 Dailynews
                                           License:  Fair Use/Education

The 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 New York Times (pic is 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 Still Might 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:  Cincinnati Enquirer/Keith BieryGolick
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 this week 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 today 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 Credit:  Bruce Crippin/Cincinnati Business Courier
License:  Fair Use/Education

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 Credit:  Jay Brinker
License:  None

New Sensation

The British press is abuzz with speculation that Tiger Lily Hutchence (full name - Heavenly Hiraani Tiger Lily Hutchence Geldof) will inherit “millions” when she turns 21 next week. She is the daughter of the late INXS frontman, Michael Hutchence, who died in 1997 with a net worth reportedly between “penniless” and $40 million. Tiger Lily’s mom, Paula Yates, died from a heroin overdose four years later. Tiger Lily was later adopted by Yates’ former husband, Bob Geldof, who founded Live Aid and was later knighted.

A few points, only one of them really relevant:

1. I always discourage my clients from allowing their children to inherit any money, much less “millions”, when turning 21. I advise releasing trust funds in increasing amounts over a period of years.

2. Apropos of nothing, I think it is commendable of Bob Geldof to raise the daughter of his ex-wife and the man she left him for after the little girl was orphaned.

3. Whatever she inherits from her dad, nothing can compensate Tiger Lily for the tragedy in her life - the deaths of her parents, the heroin overdose of her half-sister, and the silly name bestowed upon her by her parents.

Photo Credit:  Unknown
License:  Fair Use/Education

Of Memorabilia and Men

Willie DeLuca was the manager of famed Cincinnati restaurant, Sorrentos Pizzeria. He was famous for having a heart of gold, appearing on David Letterman to balance stuff on his nose, and collecting sports and entertainment memorabilia (including hair from JFK and Paul McCartney) that he valued at $1 million. DeLuca died in 2006 and left his entire estate in a testamentary trust to his only child, Enrico. The trust funds and memorabilia were distributed to Enrico when he turned 21 several years ago. Enrico is now suing his uncle, Art DeLuca, for allegedly taking some of the memorabilia that was left to him by his father. The uncle had posted some of the items for sale on Facebook recently.

Several small points:

1. I never prepare testamentary trusts for my clients because they are a public record. A living trust is private and more flexible.

2. I also never advise my clients to have a trust distribute all of its assets when the child turns 21 - that age is too young for most children to manage the inheritance responsibly.

3. Enrico might have a statute of limitations problem with proving his claim because Willie died 10+ years ago and Enrico is only now filing suit.

4. Posting items for sale on Facebook which are a public record as belonging to Willie’s estate and trust is not advisable.

5. Hair snippets from JFK and Paul McCartney? How does one acquire those? Regardless, I would not give a nickel for them.

Photo Credit:   Cincinnati Enquirer/File Photo
License:  Fair Use/Education

Back From Europe

Just returned from 10 days in Central Europe with Janice, Blair, and Jack. Visited Prague, Bratislava, Vienna, and Munich. Below pic is my favorite from the trip. Post to follow later.

The Persistence of Illegitimacy

Salvador Dali died in 1989 and left his entire estate to the Spanish government.  Pilar Tabel is a Tarot card reader and fortune teller who claims that she is Dali’s daughter due to a brief romance between her mother and the famous artist in the mid-50's.  She has tried for 10 years to prove that Dali is her father.  A DNA test conducted from his death mask was inconclusive.  She alleged that she did not receive the results of a DNA test conducted the next year.  Dali was allegedly gay or simply preferred masturbation or voyeurism so the paternity claim of this woman seems far fetched. She also sued an author for supposedly basing a fictional character on her.  Nonetheless, a Spanish court has ordered the exhumation of his body. 

Several points:

1.  If you read the entire article, you might wish to shower afterwards.  A guy who is turned on sexually by Hitler is abnormal.

2.  I would think that a case brought 28 years after someone’s death would be barred by the statute of limitations or the principle of laches.  

3.  In the U.S., Dali would not be obligated to leave his daughter, legitimate or illegitimate, anything.

4.  It is unlikely that the woman did not receive the results of the second DNA test - I believe that they were negative and she simply waited another 9 years before pursuing this claim.

5.  I doubt I am the only person who finds this matter incredibly surreal.

Don't Ask - Don't Tell

Resorting again to advice columns for material. In “Ask Carolyn,” a reader with three children including a son with ADHD who has threatened violence is miffed that her pregnant sister has not chosen her to be the guardian of her forthcoming child.  The sister has continued to agree to serve as the guardian for the reader’s three children.  The reader believes that her sister is judging her parenting skills even though “every single day is a struggle for her due to her son.”

A few poignant and sad points:

1.  The pregnant sister has two likely concerns about the reader - the ability of her sister to handle another child when “every single day is a struggle” and the possibility of physical harm to her child from his cousin.

2.  I always advise my clients to discuss guardianship with the potential guardians.  I do not advise telling someone that they are not the guardian because of the possibility of unnecessarily bruised feelings for a scenario that might never arise.

3.   There is a never right answer on the guardianship question - there is merely a best answer or least worse answer.  No one will raise your child the same way you would (nor will someone clean your house like you or cut your grass the way you would), but you have to settle for the best option considering all factors such as location, parenting style, educational beliefs, and demographics.  Not having a child raised by a family with a potentially violent child who causes his mother to struggle every day is an easy decision to make.  

4. I love people who think about estate planning while they are pregnant.

Photo Credit:  Nick Galifianakis/For The Washington Post)

License:  Fair Use/Education

 

Justice Is Blind

Not an estate planning post, but more of a public service announcement in the financial arena. Lori Sattler is an acting NY Supreme Court Judge. In the process of selling an apartment and buying another one, she followed the instructions in an email supposedly from her attorney and wire transferred $1 million to a fraudulent account which then wired the money to a bank in China. The money is long gone.

Several points of varying interest:

1. When transferring $1 million, it makes sense to verbally confirm the instructions regarding the wire transfer.

2. It has been a tough month for judges in NY between this judge getting scammed and the Court of Appeals justice who died with an outdated will that contained deceased beneficiaries and ignored her husband.

3. Perhaps Judge Sattler can commiserate with John Podesta at a Democratic fundraiser about the travails of falling for a link in an email.

Photo Credit:  AP/File

License:  Fair Use/Education

Prayers For Otto

Otto Warmbier is the Cincinnatian who was held captive by North Korea for 17 months for allegedly trying to steal a propaganda sign on a college visit. While starting to serve a 15 year sentence of hard labor, he was beaten so severely that he suffered a brain injury and returned home Tuesday night in a coma. Doctors at the University of Cincinnati Medical Center have described his condition as "unresponsive wakefulness."

One small legal point:

1. Once a child turns 18, I encourage parents to have their child sign a health care power of attorney, living will, and HIPAA Release so the parents can access their child's medical records and make medical decisions for them. Without those documents, the parents might be stymied in making decisions in the best interest of their child.

2. This story breaks my heart. No snark here out of respect for Otto and his parents. Tell your child you love him/her tonight.

Photo Credit:  Christopher Oquendo for dailymail.com
License:  Fair Use/Education

Not A Great Day in Harlem

The suspicious April death of Judge Sheila Abdus-Salaam, the first Black woman to serve on New York’s Court of Appeals (the state’s highest court) has been ruled a suicide. Her body was pulled from the Harlem River the day after her fourth husband reported her missing. Video recorded her walking near the banks of the river.

This is not a whodunnit piece. Instead, the interesting info is that Judge Abdus-Salaam left an estate worth $2 million and a 2004 will that pre-dated her most recent marriage by 10 years. The will left 25% of her estate to her mother who died in 2012 and the balance equally among her siblings, including her brother who died in 2014. The primary asset in her estate was a Harlem brownstone valued at $2 million which she purchased in 1980 for $6,000. Her husband is a minister and has blessedly waived his statutory right to inherit part of her estate even though he was not included in her will.

Several points, some salient:

1. Judge Abdus-Salaam missed many opportunities to update her will - the death of her mother, the death of her brother, and her subsequent fourth marriage.

2. I advise my clients to review their estate plan every five years to assure that key events like the death of a beneficiary or the divorce of the designated guardian are taken into account in the documents.

3. The widower of Judge Abdus-Salaam might have waived his rights to inherit due to a pre-nuptial agreement between him and the judge although he might simply be an honorable man and waived the rights so her family could benefit.

4. I doubt that I am the only person who wishes he had invested de minimis amounts in Harlem real estate in 1980.

5. I am aware of the Hudson River and the East River, but the Harlem River is new to me.

Photo Credit:  AP
License: Fair Use/Education

Memorial Day Fun(draising)

Seven guys, 38 miles, four squares (Mt. Lookout, Hyde Park, Glendale, and Fountain), 2 states, and $1,750 raised for Juvenile Diabetes Research Foundation.

I hope you enjoyed the holiday.

No Winning Here

Barbara Schwartz was a Manhattan socialite who was stabbed to death by her shut-in son, Jonathan, in 2011. She was survived by second husband, Burton Fischler, the son who killed her, and a second son, Kenneth. Her estate was estimated at $6 million at the time of her death.

In the six years since her murder, her widower allegedly lost $4.3 million of her estate in six months due to poor financial management including day trading, Kenneth committed suicide in 2013 when he learned of the financial losses, and Jonathan was found not guilty by reason of insanity. Schwartz’s first husband is now in charge of the estate and has sued to stop Kenneth from inheriting her estate. Got it? Jonathan killed her and survived. Kenneth did not kill her and committed suicide.

As if that is not complicated enough, Fischler is now challenging the pre-nup he and Schwartz signed in 2000. He claims that he signed it under pressure from her family and that he received bad legal advice. He also claims that Schwartz promised him she would tear it up later. His share of the estate under the pre-nup is $1.25 million which is in trust.

There are so many fun issues, let’s address a few:

1. The inheritance of the mentally ill son is being challenged under NY’s Slayer Statute which prohibits individuals from inheriting due to killing someone.

2. The ex-husband is not a truly disinterested party in trying to stop his son from inheriting from Mrs. Schwartz. If the committed son does not inherit, his share will go to the share of the son who committed suicide. Because that son is deceased and did not have children, his share will go to his father (the ex-husband).

3. I think that Fischler might have a statue of limitations issue with his challenge to the pre-nup. Post-2008, NY has a 3 year statute of limitations for such challenges which does not apply to prior pre-nups. That statute was six years although it did not start running during the marriage during some areas of NY. Either way, the statute is most likely applicable to challenges from divorce, not death.

4. Fischler’s arguments for contesting the pre-nup seem to be in the “let’s throw a bunch of mud and hope something sticks” vein. The poor legal advice line might work in a death penalty case with a court appointed attorney but should not work in a pre-nup matter where Fischler chose his own attorney. President Trump would likely call Fischler a “loser.”

Photo Credit:  Unknown/NY Daily News
License:  Fair Use/Education

Dying Pains

Alan Thicke’s sons, who are trustees of his 2016 trust, filed suit this week against his widow, Tanya Callau. They asked a court to enforce the terms of Thicke’s trust. They contend that Callau, who Thicke married in 2005, is trying to void the terms of the pre-nuptial agreement she and Thicke signed.

The pre-nup provided that at Thicke's death Callau would receive 25% of his estate and 5 acres of a ranch Thicke owned. The trust meanwhile provides that Callau will receive a $500K insurance policy, his pension benefits, and 40% of his estate. If Callau wants to live in the house, she may do so if she pays the mortgage and other expenses. Despite these generous terms, Callau’s attorney claims that the trust is “the worst document ever drafted by an attorney” and “the attorneys should still be writing in crayons.”

Trying to piece together several points:

1. The terms of a trust can override the terms of a pre-nuptial agreement if the trust terms are more generous than what is provided in the pre-nup. That seems to be the case here.

2. The claims by Callau’s attorney about the quality of the trust drafting are obnoxious, but a trust typically would not address insurance policies and pension benefits because those are non-probate assets (i.e. they have their own beneficiary designation) and not included in a trust.

3. Perhaps the attorney who drafted the trust is the same attorney who advised Robin Thicke to foolishly sue Marvin Gaye's estate over "Blurred Lines" which resulted in a $7.2 million judgment against the younger Thicke.

                                          Photo Credit: Matt Baron/BEI/REX/Shutterstock
                                                                  License:  Fair Use/Education 

Rules Are For the Little People

In an unusual moment of sanity, the federal government announced on Friday that it would stop seizing the tax refunds of taxpayers whose parents owed money to Social Security from years ago.  This has been governmental policy since late 2008.  In typical bureaucratic efficiency, the IRS would send letters to addresses that had not been used in 40 years or would inexplicably be unable to contact someone who had lived at the same address for 40 years.  In its defense, the IRS does not pass these inane laws, it merely enforces what Congress has passed.

Three quick points:

1.  Typically debts die with a person and the heirs of an individual are not liable for his debts.  This is an exception. 

2.  If you want to point fingers for this law punishing innocent taxpayers for the alleged sins of their parents, point to Todd Platts, a former Republican Congressman; a Democratic House and Senate in 2008; and a legislative process that allows crap like this to get inserted into a Farm Bill.

3.  It is nice of the WaPo to take a breath from its anti-Trump obsession and to focus on the injustice caused by this process.  

Photo Credit:  Evelyn Hockstein for the Washington Post
License:  Fair Use/Education

Gronk Would Not Do This

Aaron Hernandez is the former New England Patriot who committed suicide last month while imprisoned for murdering a friend.  He had only recently been acquitted of the murder of two other individuals and was still appealing his prior murder conviction.  Since his suicide, the Commonwealth of Massachusetts has vacated his murder conviction because his appeals were still in process.  Within hours after his arrest in 2013, the Patriots terminated his contract and did not pay the remaining guaranteed money owed to him.  

In his suicide note addressed to his fiancé, Hernandez wrote “you’re rich.” Many reporters have interpreted that to mean that he was thinking not only of what money he still owned but also that she would collect $6 million owed to him by the Patriots under his last contract.  Some think that the Patriots would be on the hook if they terminated Hernandez’s contract because he was convicted of murder but was later exonerated due to this peculiarity of Massachusetts law.  

A few points on the intersection of two of my favorite topics - probate law and the NFL:

1.  Hernandez and the Patriots actually settled his grievance for unpaid guaranteed money under his last contract for $1 million in 2014 likely meaning there is no further money to collect from the Pats.

2.  The victims of Hernandez have filed lawsuits against him.  Any judgments against him would be paid from his estate probably rendering it insolvent.  

3.  Unless Hernandez signed a will, his fiancé will not receive any portion of his estate because fiancés are not statutory heirs.  His daughter would inherit his estate if he did not leave a will.

4.  Drafting a will and thinking about the application of an obscure Massachusetts law involve long term planning and thinking which seem beyond the acuity of a guy seemingly lacking impulse control. 

Photo Credit:  AP/Elise Amendola

License:  Fair Use/Education

Fountain of Youth = Deprivation and Sorrow?

Besides people battling over the release of Prince’s music, there is not much happening in the wills and trusts arena.  Somewhat related, Emma Morano was the last living person born in the 19th century when she died last month at the age of 117.  The NYT has a brief piece on her possessions and possible reasons for her longevity.  

Morano had been married briefly before separating in her late 30s, had a son who died before turning one, and worked until she was 75.  She lived in a two room apartment for the past 27 years, had not left the apartment in years, ate 3 raw eggs per day for 100 years, and usually ate pasta with raw ground beef until she stopped cooking five years ago.   

No points of any significance, just two observations:

1.  The article did not mention a will but I doubt she had any assets any than a few tchotchkes left in her name.

2.  If eating three raw eggs and raw ground beef daily while staying housebound is the secret to longevity, count me out.  I will gladly live a shorter life to enjoy cooked food and going outdoors.

Photo Credit:  Gianni Cipriano for New York Times

License:  Fair Use/Education

No One Has A Dead Overseas Relative Who Left Them a Fortune Who Will Contact Them By E-Mail

Copyright:  Wulff & Morgenthaler
License:  Fair Use/Education

Faking Amnesia Does Not Pay

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 Sheriff's Office
License:  Fair Use/Education

Don't Be Like John B. (Estate Planning Tips From “S-Town”)

“S-Town” is the critically acclaimed successor podcast to “Serial.”  The anti-hero, John B, lives in a Faulkner-esque house on 128 acres in Woodstock, Alabama with his octogenarian mother who suffers from dementia.  He is a genius horologist (clock repairman), builder of a “Shining” type maze on his property, hypocrite about tattoos, and so obsessed with climate change and other problems that he makes Thomas Malthus seem optimistic.

John B. was thought to be worth a large amount of money by residents of Woodstock.  During the podcast he mentions that he wants to leave $20,000 to his friend, Tyler.  He also tells Tyler (spoiler alert) on the night that he commits suicide that Tyler can have his property.  Sadly, John B. died without writing a will or without having a plan for someone to take care of his mother.  Mystifyingly, John B. claims to have been unbanked which led Tyler and others to search his property for locations where he could have buried gold and cash.  He did leave instructions with a friend about what to do and whom to contact after his death.

Several points:

1.  If one has to choose between leaving a will or instructions about what to do after death, one should choose a will.

2.  Embrace the power of “AND”.  One should be able to leave a will AND instructions about what to do after death.

3.  Without a will, John B’s assets if found legally will go to his mother.  Without a health care power of attorney, the care of his mother will go to a relative willing to serve as guardian.

4.  Being unbanked might make sense for someone of little financial means.  For someone who might have made hundreds of thousands dollars annually and is prone to suicidal threats, being unbanked can only lead to one’s property looking like a scene from “Holes.”    

 
Photo Copyright:  James Breeden for Daily Mail (?)
License:  Fair Use/Education

College Visits

Just back from some college tours with Jack. South Carolina, Clemson and Tennessee specifically. Post about a podcast I listened to to follow shortly.

It Is Always About Trump Even When It Is Not

Phyllis Schlafly was a noted conservative icon known primarily for opposing the proposed Equal Rights Amendment to the Constitution in the 1970's.  She died last September at the at age of 92 survived by her six children.  Her daughter, Anne, is contesting the last revision to her will which provided that any legal challenges to the will are to be paid out of the share of the person bringing them. Her brothers claim that Anne’s legal challenges have already cost $1 million in legal fees.  

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

A Man For Others

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.

Not All Step Mothers Are Evil

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

The Morning Line - March Madness

I subbed for Paul Daugherty's The Morning Blog again yesterday in the Cincinnati Enquirer. I covered a bit of March Madness, the firing of Indiana's Tom Crean, and the Bengals free agency moves (or lack thereof). I hope you enjoy it.

War and Peace

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

Modern Love

Lawyers handling the estate of David Bowie have set a date of May 4 for anyone claiming to be a child of Bowie's or a creditor of his estate to file a claim. The "child" part is important because the allegedly once bi-sexual Bowie left 1/4 of his estate to each of his two acknowledged children and half to his wife. The issue is that Bowie claimed to have been "incredibly promiscuous" during the 70's and 80's. His romances are alleged to have included Mick Jagger's former girlfriend (Marianne Faithfull), Mick's ex-wife (Bianca), Mick himself, Susan Sarandon, Charlie Chaplin's widow (Oona O'Neill), and Slash's mom. And your childhood best friend's mom. Or dad.

Several brief points:

1. Under Ohio law (and Bowie would be the last person to claim residence in Ohio), creditors have six months from the date of death to file a claim against the estate for money owed by the decedent.

2. Illegitimate children generally can only claim from their dad's estate if they were acknowledged by the decedent or if the child proves paternity after the death of the decedent.

3. In drafting estate documents for the Thin White Duke, it would have been best to specifically name the children rather than use the term "my child" which opens the door for illegitimate children to inherit.

4. The good part of May-December romances (i.e. Oona O'Neill) or bi-sexual couplings (yeah, we are looking at you, Mick), is that paternity is not a concern.

5. Bowie definitely knew about the power of charm, but he never let love walk on by.

                                               Photo copyright:  ZZ/NJ/RY/REX/Shutterstock
                                               License:   Fair Use/Education