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

Two Words, George. Pre-Nup.

Johnny Depp and Amber Heard settled their divorce case this week for $7 million which Heard has pledged to charity. She had reportedly been seeking spousal support and half of his net worth as a result of their 15 month marriage. During the proceedings, Heard alleged that Depp had abused her. The couple did not have a pre-nuptial agreement.

Several brief points:

1. Depp should have insisted on a pre-nuptial agreement which could have provided that he owed Heard nothing in the event of a divorce.

2. The absence of a pre-nup does not entitle Heard to half of Depp's net worth, but only to what he earned during their 15 month marriage.

3. Anyone making bets on the length of a marriage between a hard partying heterosexual male and a declared bi-sexual woman 20 years younger than him should always take the under.

4. I have long told Janice that her crush on Depp was misplaced. I might finally be vindicated for that opinion.

The Curious Case of Brangelina

Not being a reader of People magazine, I missed the news of the Brad Pitt- Angelina Jolie August wedding.  I had assumed they were married years ago.  Apparently they executed a fairly public pre-nuptial agreement prior to their wedding.  The agreement provides that in the event they divorce they will each keep their respective assets but any marital assets will mostly benefit their children and various global orphanages.  The odd provision is that in the event Mr. Pitt is unfaithful due to Ms. Jolie's children penchant for adopting children as if they were Tamagotchi, she will receive most of the custody rights for the children.

Several points:

1.  Pre-nuptial agreements are advisable in the event of second marriages or where there is disparate wealth between the parties.  When both parties are Hollywood A Listers with similar net worths, they are more for show than practical effect.

2.  The behavior clause about infidelity of Mr. Pitt is unlikely to be enforced by a court.

3.  Am I the only one who appreciates the coincidence that Mr. Pitt finally tied the knot with 

Ms. Jolie only a month before his bromance  buddy, George Clooney, married?

4.  Presumably Angelina will keep the vial of Billy Bob Thornton's blood in the event of a divorce.

If At First You Don't Succeed . . . . ..Forge? (No, Just Kidding).

This is out of a horror movie.  A Kansas City attorney was recently charged with murder for killing her father's girlfriend of 20 years.  Her father was shot and his girlfriend was repeatedly stabbed then shot at their vacation home in 2010.  Her father did not die from his wounds.  The woman then allegedly forged a health care power of attorney so she could withdraw his medical support 4 days later.  She was charged with his murder a year ago.  Apparently, she was concerned that her father would leave all of his assets to his soon to be wife.  In an odd but clarifying footnote, her mother (her father's first wife), had spent 11 months in jail for stealing $100,000 from her own mother by forging a power of  attorney 10 years ago.

Points?

1.  If the father had wanted to preserve assets for his daughter he could have executed a pre-nuptial agreement to set forth which assets he would leave his soon to be wife (and what would be left for his daughter).

2.  Along the same lines, he could have executed a trust to provide for his new wife while leaving the remainder to his daughter after the wife's death.

3.  Preparing a health care power of attorney to address medical needs is essential.   So is ensuring that the person with that responsibility has a copy of the document and is aware of the duties.

4.  When a daughter resents her father and his girlfriend, and her biological mother has already stolen from her own mother, an active alarm system  and a multitude of security cameras would be a worthy investment.  And perhaps a Kevlar jacket.

Prepare a Will Not a Letter

I confess to never having heard of Latin music and Mexican TV personality Jenni Rivera prior to her death in a plane crash in December.  I similarly confess to never having heard of her estranged 3rd husband, Esteban Loaiza, who plays for the Detroit Tigers.  So why am I blogging about them?

Rivera and Loaiza separated two months prior to her death.  After separating, River left a detailed letter to her sister asking her to take care of her children and business enterprise valued at $25 million in the event of her death.  It is unknown if she had other estate planning documents or a pre-nuptial agreement.

What lessons can be learned from her estate?

1.  When marrying for a 3rd time, one should definitely have a pre-nuptial agreement.  If Dennis Hopper can do this, others should, too.   

2.  When leaving on a trip, consult an estate planning attorney about preparing a will/revised a will.  A handwritten note is generally not effective.  

3.  When separated from a spouse, revise the estate plan immediately and implement a trust to preserve the assets for the children.

4.  $25 million net worth?  Apparently there is money to be made on Mexican TV and Latin radio for tumultuous personalities. 

Shades of Gray

No, not the book.  The Monkees song.

After Davy Jones of the Monkees died in February, the probate court agreed with his executrix to make his will unavailable as a public document.  For most estates, though, wills are public records and can be viewed by anyone. The speculation about the privacy request centers around Jones' marriage to a woman half his age which occurred 5 years after he made the will and possible financial problems he was suffering.  The widow has already filed a claim against the estate asking for the statutory share allowed for surviving spouses.

I doubt that his estate is proceeding as Jones would have wanted.  We can learn four lessons from Jones' errors.  

1.  The use of a funded trust avoids the probate process and provides privacy in administering estates abnegating the need to seal the will.

2.  When marrying for the second (or especially third time), a pre-nuptial agreement is essential so that spouses know what to expect and do not file claims against the estate.  It is hard to believe that Dennis Hopper got this, but Davy Jones did not.  

3.  Estate planning documents should always be updated after marriage.

4.  As appealing as it sounds, it is never a good idea to marry someone younger than your children.      

Mike, the smart Monkee, is probably aware of all of this.  

Smart Rider

The late Dennis Hopper made several wise estate planning moves late in his life. First, he had a pre-nuptial agreement when he married his fifth wife. Second, when he was dying and was in the midst of an acrimonious divorce with her, he created a trust for their then 7 year old daughter to which he left nearly $3 million. The then estranged spouse/now widow has no control over the trust assets.  

Two points. When a couple is divorced with minor children, I always advise my client to create a trust to hold assets for the children upon the death of the client. Otherwise, the former spouse will control the assets until the child turns 18 and may benefit from the assets. Second, when marrying for the 5th time, I am glad to see that Mr. Hopper had learned enough from his 4 previous failed marriages to execute a pre-nup. Old dogs can learn new tricks.