WILLIAMSBURG, Va., Jan. 31, 2017 /PRNewswire/ -- Ask most people about top controversies during the just-ended year of 2016, and they're likely to zero in on politics. But for attorney Will Sleeth, estate disputes should also be high on the list.
"With the end of 2016 upon us, now is a fitting time to look back at some of the top estate disputes from this past year," notes Sleeth, a partner in national law firm LeClairRyan's Williamsburg office and leader of the firm's Estate and Trust Litigation team. "A long-running trend continued in 2016, as people continued to die and families continued to fight over estates."
Sleeth addressed some high-profile clashes in a recent blogpost, Top Four Estate Disputes from 2016. His post appears in the firm's Estate Conflicts blog, which focuses on disputes involving wills, trusts, guardianships, and celebrity estates.
When pop artist Prince passed in April, the rock star didn't leave a will, although his estate was valued in the hundreds of millions of dollars, Sleeth notes. This meant that that the Minnesota judge overseeing the administration of Prince's estate has had to deal with numerous issues, including individuals who claim to be children of Prince and could stand to take a share of the assets under Minnesota's intestacy laws. "The judge has also excluded approximately 30 would-be-heirs from inheriting a portion of his estate," writes Sleeth. "Based on recent developments, it appears that Prince's younger sister and five half-siblings were the singer's only heirs."
The court has said the individuals have to undergo genetic testing, but the incident "underscores what is probably the most obvious lesson that I repeat on this blog time after time," warns Sleeth. "Enact an estate plan, and put the instruments in a place where people can locate them upon your passing."
Frank Sinatra Jr.
When it came to marriage, Frank Sinatra Jr., the son of the famous singer, did things his way. But that also meant that when he passed away in March 2016, no one got any satisfaction, Sleeth says.
"Frank Jr. and his wife, Cynthia, had originally divorced in 2001, but continued to live together," Sleeth notes. "They even purchased a home together after their separation. Sinatra Jr. had also been ordered to pay Cynthia $5,000 a month in spousal support in the divorce decree. While this decree only required the support to continue for 24 months, Sinatra Jr. paid for almost 10 years. Cynthia also claimed that Sinatra Jr. called her his wife at social events."
All this apparently led Cynthia to believe the two were in a common-law marriage, and at the time of his death, the two were locked in litigation.
"Sinatra Jr. could have avoided this mess in large part by having been more careful with his decisions and actions, chiefly by consulting with and listening to his attorney," advises Sleeth. "Many states do not recognize common law marriage, but in those states that do, people need to be extremely careful that their actions don't give their lover a basis to claim that the parties had a common law marriage."
In September 2016, Florida Marlins pitching ace Jose Fernandez passed away in a boating accident off the coast of Miami Beach. The 24-year-old athlete was unmarried, and one media report appears to indicate that he named his mother as the sole death beneficiary in his trust.
At the time of his death, Fernandez's girlfriend Maria Arias was pregnant with their child. But since Arias was not named in the trust and was not married to Fernandez at the time of his death, "she stands to miss out on inheriting what otherwise could have been millions of dollars," Sleeth says. "Had Arias been married at the time of his death, even if he had intentionally disinherited her, she still could have claimed the elective share rights of a married spouse. If Arias had to do it all over again, she almost certainly would have sought to marry Fernandez before (or at least shortly after) she became pregnant."
Sleeth says he hasn't yet seen reports indicating that Fernandez's estate is the subject of litigation, but points out that "the scenario has all of the classic signs of what could make for a dispute."
Well-known author Tom Clancy passed away in October 2013, leaving behind an estimated $80 million estate that saw significant litigation in 2016. The writer's estate plan provided for three buckets of assets: the first funded a trust for the benefit of Clancy's second wife, Alexandra Clancy, as the sole beneficiary. The second funded a trust for the benefit of Alexandra Clancy and Alexis Clancy, the minor child of Tom and Alexandra's marriage. The final bucket was for the benefit of each of Clancy's four children from his first marriage.
Originally, the liability for the estate tax on Clancy's estate was to be shared equally between the second and third buckets. So, the four children from the first marriage would be responsible for a total of $7.85 million of taxes, and Alexandra and Alexis would also be responsible for a total of another $7.85 million.
But just before he died, Clancy signed an ambiguous codicil, or amendment, that included a clause that spurred the Court of Appeals of Maryland to decide that the four children from Clancy's first marriage will be jointly responsible for $11.8 million worth of the estate taxes.
"The moral of the story is that estate planners need to be very careful about language that could arguably be construed as ambiguous," Sleeth warns. "With an estate in the tens of millions, it was almost certain that all of the parties involved in Clancy's estate would retain legal counsel who would pore over each word in his estate plan to seize on any ambiguity that could benefit their clients."
Estate planning can be tricky at times, Sleeth adds. But paying attention to some basic principles – and consulting with your legal and financial advisors early on – may mean that loved ones will have one less issue to worry about at a sad time.
The full column is available at estateconflicts.com/top-four-estate-disputes-from-2016/
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