Celebrities are constantly in the news and not just for new movies or shows in which they are appearing. Celebrity divorces are matters of intense interest not only because of the personalities involved but also due to the millions of dollars that are often the subject of intense disputes. When a celebrity passes away, heirs may fight over being disinherited or may challenge the mental capacity of the celebrity who may have left millions to an immigrant housekeeper or a very young wife whom the celebrity married only a few years earlier but who stands to inherit the bulk of an enormous estate.
Celebrity estate disputes that come to mind include that of James Brown, Michael Jackson, Doris Duke, Jerry Garcia of the Grateful Dead, Jimi Hendrix, Anna Nicole Smith and Robin Williams.
Whatever the nature of the conflict, we can learn from complex celebrity estate battles when we formulate our estate plans so that we may avoid having our relatives fight over our estate and possibly squander thousands of dollars in litigation or in taxes that could have been legally avoided. The following are some topics involved in celebrity estate battles from which some lessons can be learned.
These contracts are not just for the rich and famous. Any couple can draft one but before you do so, there are some guidelines to follow:
-Fully disclose all assets and debts, sources of income and overseas assets as well.
-Have the agreement reviewed and signed by an attorney for each party.
-Be sure the party with the greater assets leaves a reasonable sum of money to the other in case the marriage lasts a number of years since it may be viewed as unreasonable especially if the one party sacrifices a career or lacks the means for self-support when the marriage terminates.
-Limit your liability for the other party’s debts or obligations.
-Be specific as to who gets what upon divorce.
-Keep personal or non-financial agreements out of the prenuptial agreement and deal with them separately.
Proper Trust Administration
Although many celebrities do establish trusts for their real and other valuable personal property, disputes have arisen because property was not transferred to the trust, as in Michael Jackson’s case, or it was allegedly mismanaged by the trustee. You can name a professional trustee to administer the trust if it is considerable or not, or at least have someone whom you have confidence in as the trustee when you pass away.
Challenges to Mental Capacity
In a number of celebrity estate battles, the issue raised by disgruntled heirs is the mental capacity of the celebrity testator, also referred to as testamentary capacity, at the time the Will was drafted and signed. If the Will’s validity is disputed on this basis, the claimants will look for:
Symptoms and records of dementia around the time the Will was drafted such as impulsiveness, delusions, hallucinatory episodes, aggressiveness and failure to recognize familiar people.
Evidence of an unusual relationship with a caregiver who gives comfort to the elderly celebrity who leaves him or her a substantial part of the estate.
Evidence of a neurological deficit or mental disorder that can affect judgment.
What you, as the testator, can do if you anticipate or suspect that your mental capacity may be questioned is to be examined by a psychiatrist and/or neurologist before making your Will and gathering statements from witnesses regarding your judgment, decision-making, communicative skills, memory and demeanor in the weeks or months before the Will is drafted and signed.
Wills are Public Records
What many celebrities fail to recognize is that a Will is a matter of public record since it needs to be probated. If you wish to have your assets and wishes remain private, consider putting most if not all of your assets either in trusts or in other instruments that have designated beneficiaries and need not be probated. These include POD accounts, retirement accounts, life insurance policies and business agreements where your interests upon your retirement or death are easily passed on to family members.
If you have any questions about Estate Planning or are involved in an estate battle, contact Christopher JohnsonIf you have any questions about Estate Planning or are involved in an estate battle, contact Christopher Johnson, an experienced attorney, in Pasadena., an experienced attorney, in Pasadena.