I am leading a will contest on behalf of 17 cousins. Helping my extended family gives me great pleasure, particularly because it has re-connected me with long lost cousins. It has taken me “under the hood” on the subject of estate planning which will be helpful to my advisory clients. And I feel a wrong was committed that needs to be righted, particularly in honor of my father’s generation, which was betrayed by their brother-in-law’s estate decisions.
I now have a greater appreciation for high profile estate planning mishaps and disasters. Actor James Gandolfini’s untimely death (best known for playing Tony Soprano) revealed an estate plan that may result in up to $30 million in federal taxes. Hotel tycoon Leona Helmsley left her dog Trouble a $12 million trust fund which was later reduced to $2 million by a NY Judge due to Helmsley being declared “mentally unfit.” On top of that, Helmsley had intended for the bulk of her $4 billion estate to go to support animal welfare but with court and family intervention, only $1 million did.
How do we keep our family member’s estates from going awry when a family member dies?
The place to begin is to ensure you and your family members have engaged the most competent legal and financial advice you can afford – typically with the help of an estate attorney. It is never too early to prepare your will or encourage your spouse, parents and siblings to plan their estate. And the plan needs to be reviewed for updating by a legal professional on a periodic basis, particularly when you or a family member confront a serious health issue or advancing age. Taking shortcuts to save money or time on estate planning can be extremely costly in the end.
My Lesson: I observed that my uncle’s will was drafted by an accomplished and experienced lawyer who happened to be a member of our extended family. Despite his best intentions, he was not the right attorney, being a litigator, not an estate attorney. And his legal handiwork did not anticipate the worst case which was that my uncle would survive his wife. My uncle did and then became vulnerable to unexpected outside influence and broke the long-held promise he and his wife made to each other to pass down their jointly accumulated assets to their nieces and nephews. Given my uncle’s lack of financial know-how and limited mental capacity, a savvy estate attorney would have hopefully written this promise into their respective wills as an irrevocable provision using trusts and other legal devices.
How do we protect our own and our family members’ intentions in the event of death?
It is not hard to challenge a will. All one needs is a grievance and an attorney who is willing to take the case, good or bad. So write your will carefully. If you intend to disinherit someone, say so. If you want people to know the reason, add that too. Don’t take the chance that someone will say you accidentally ‘forgot’ them. A friend is cleverly providing $1 in her will to those family members who don’t stand to inherit but who may otherwise question their absence from the will. And finally, the law allows a no-contest clause which states that anyone who challenges your estate plan will lose whatever you’ve left to them. It is not fool-proof and is not permitted in some states so its consequences should be well understood before incorporating into your will.
For family members of advanced age and/or declining mental capacity, it is in the best interest of all involved to have one or more trusted family members remain involved in their financial affairs. Is there someone who plays a strong role in their life who you suspect may also be adversely influencing their decisions – like another family member (child, grandchild, etc.), or even a housekeeper? The internet provides an array of articles to help coach you on protecting your vulnerable family members. Government and social service agencies are also helpful.
My Lesson: At age 86 my uncle hired a new housekeeper on his own. After 6 months into their relationship he wrote his nieces and nephews out of his existing will and named the new housekeeper as his heir and his power of attorney and executrix. Great time and expense will go to litigation to get to the bottom of my uncle’s mental state and his housekeeper’s actions. The National Committee for the Prevention of Elder Abuse succinctly outlines on its website the danger signs of abuse and who potential perpetrators are likely to be. We did a background check on the housekeeper after the fact and learned she had a shoplifting offense 2 years prior to her employment by my uncle. Interestingly, she had her attorney draft my uncle’s new will.
With increased longevity and a family structure that is increasingly fragmented, will contests are predicted to be on the rise. One estate attorney I interviewed described a strong increase in her will contests in recent years. Families can avoid will contests and the pain and strife that accompany them with thoughtful and early estate planning, diligence in updating a plan every few years, and regular attention to the financial affairs of vulnerable family members.
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