Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Tuesday, July 9, 2019

Gloria Vanderbilt's Son Anderson Cooper to Inherit Less than $1.5M, Report Says

CooperGloria Vanderbilt's expected fortune at the time of her passing was estimated to be around $200 million, but according to probate documents, her estate is much smaller. Her eldest son, Leopold “Stan” Stokowski, will inherit his mother's Manhattan co-op, and her son Anderson Cooper gets "the rest," which consists of less than $1.5 million.

The reports have indicated that lavish spending and sizable charitable donations largely diminished her family fortune. Even so, it is more than the CNN anchor had expected to inherit, as he believed that he was not going to receive anything from his mother. "Who has inherited a lot of money that has gone on to do things in their own life?" Cooper asked radio host Howard Stern in 2014. "From the time I was growing up, if I felt that there was some pot of gold waiting for me, I don't know that I would've been so motivated."

See Katherine Lam, Gloria Vanderbilt's Son Anderson Cooper to Inherit Less than $1.5M, Report Says , Fox Business, July 8, 2019.

July 9, 2019 in Current Events, Estate Administration, Estate Planning - Generally, Television, Wills | Permalink | Comments (0)

Monday, July 8, 2019

California Probate Administration is no Time for Napping

CourtroomCalifornia's probate process lasts for at least six months and can run much longer depending on the size of the estate and the particular nature of assets. The personal representative (executor) has the responsibility to resolve creditor claims, get the assets to the appropriate beneficiaries, and execute the estate efficiently. In a recently decided appellate case, the court affirmed the lower court's opinion that two decades is far too long of a "nap" for a personal representative.

In the Estate of Sapp, Roscoe Sapp, Sr. died in 1994 and left behind seven living children and an estate worth millions. The will, entered into probate in 1995, stated that his real property should go to his children to  “to share + share alike.” After a daughter was removed as personal representative in 1999, Edith Rogers, a granddaughter, and two other grandchildren were appointed as representatives. But by 2001, only Edith and another representative remained, and they petitioned the court for instructions because they disagreed on how they should proceed because some of the remaining heirs were disabled and unable to care for themselves. The court sided with the other co-representative and instructed the estate to sell all the real property assets and distribute the proceeds. Two years later, the co-representative died, leaving Edith as sole personal representative of her grandfather's estate.

No surprise, but Edith did not follow the court's instructions. Though four real properties were apparently sold in 2004, the remaining nine parcels still were unsold in 2017. Another grandchild, Armuress Sapp, filed a petition to be named successor administrator because Edith was ineffective by removing the real estate from active listings, not paying heirs and creditors, and even allegedly offered to pay approximately ten family members $10,000 each to “just sign off and walk away.”

In April 2017, the probate court in Riverside County granted the petitions to remove Edith as administrator pursuant to California Probate Code section 8502 and appointed Armuress as successor administrator.

See Christopher Miles Kolkey, California Probate Administration is no Time for Napping, Trust on Trial, July 2, 2019.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

July 8, 2019 in Current Events, Estate Administration, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0)

Thursday, July 4, 2019

Article on Parens Patriae and the Disinherited Child

WilltestamentMichael J. Higdon recently published an Article entitled, Parens Patriae and the Disinherited Child, Wills, Trusts, & Estates Law eJournal (2019). Provided below is an abstract of the Article.

Most countries have safeguards in place to protect children from disinheritance. The United States is not one of them. Since its founding, America has clung tightly to the ideal of testamentary freedom, refusing to erect any barriers to a testator’s ability to disinherit his or her children — regardless of the child’s age or financial needs. Over the years, scholars have questioned this approach to disinheritance, which has become more common given the evolving American family, specifically the increased incidences of divorce, remarriage, and cohabitation. Critics of the American approach have offered up solutions largely based on the two models currently employed by other countries: 1) the forced heirship approach, in which all children are entitled to a set percentage of their parent’s estate; and 2) family maintenance statutes, which provide judges with the discretionary authority to ignore a testator’s wishes and instead award some portion of the estate to the testator’s surviving family members. This Article takes a different approach and looks at the issue of disinheritance through a new lens: the doctrine of parens patriae. Just as this doctrine limits the decision-making autonomy of living parents vis-à-vis their children, this Article argues that it should likewise limit the dead hand control of deceased parents. Focusing on minor children, adult children who remain dependent as a result of disability, and adult children who are survivors of parental abuse, it is the contention of this Article that testamentary freedom must sometimes yield to the state’s inherent parens patriae authority to protect children from harm. Specifically, this Article proposes that courts should refuse to enforce testamentary schemes that disinherit those children if that disinheritance would constitute abuse or neglect. Such an approach is not only mandated by the doctrine of parens patriae but, in contrast to the approaches other countries have adopted, is more deferential to testamentary freedom. The limitations it does impose represent a relatively modest curtailment of the rights testators currently possess and, at the same time, are consistent with existing exceptions to testamentary freedom, most notably those in place to protect spouses and creditors as well as those that prohibit the enforcement of testamentary provisions that violate public policy.

July 4, 2019 in Articles, Current Events, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0)

Tuesday, July 2, 2019

Gloria Vanderbilt Leaves Almost Entire Fortune to Anderson Cooper

CooperAnderson Cooper, of CNN fame, told Howard Stern in 2014 in a radio interview that he was not expecting to inherit anything from his mother, Gloria Vanderbilt, who recently passed away at age 95 after being diagnosed with advanced stomach cancer.  As the great-great-great-granddaughter of railroad tycoon Cornelius Vanderbilt, Gloria had originally inherited from a trust fund, but then made a sizable amount from being a pioneer in the fashion industry. Cooper claimed that "there was no trust fund" for him, and actually said inherited money was a bit of a curse and that it is an "initiative sucker."

He may have second thoughts on that, however, as it has come to light that Cooper, the youngest son, has inherited the majority of his mother's fortune, estimated to be $200 million. The eldest son, Leopold “Stan” Stokowski, will get her Midtown pad in a co-op at 30 Beekman Place. The second son, Chris Stokowski, has been estranged from the family for the past 40 and was written out of his mother's will. A third son, Carter Cooper, committed suicide in 1988 by leaping out of his mother's balcony. So "everything else" will be going to Cooper.

See Priscilla DeGregory, Gloria Vanderbilt Leaves Almost Entire Fortune to Anderson Cooper, Fox News, July 2, 2019.

July 2, 2019 in Current Events, Estate Administration, Estate Planning - Generally, Television, Wills | Permalink | Comments (0)

Sunday, June 30, 2019

Family Feud Continues over Estate Left by the Founder of Rush Enterprises

TxW. Marvin Rush II died at the age of 79 back in May of last year, but the battle over his estate is far from over, considering that he was the founder of one of the largest commercial truck dealership chains in North America. Rush Enterprises currently has a market cap of $1.32 billion. W.M. "Rusty" Rush III and his step-mother, Barbara, continue to take the fight to the Texas courts.

Rusty, 61, is the current chairman, current chief executive and president of Rush Enterprises, and began working for his father at the company in 1974. Barbara was Marvin's third wife and previously his secretary, and Rusty claims that his father insisted that she sign a marital agreement before the marriage occurred in 1991. The document stated that she "gave up any rights she might otherwise have, then or in the future, to claim any interest in any of Marvin's separate property or what might otherwise be community property," including any interest or title in Rush Enterprises, according to an amended lawsuit filed in Bexar County district court. However, the lawsuit also says that Marvin signed a durable power of attorney in 2013 that gave Barbara "unilateral control" over all of his assets. Rusty claims this is a clear sign that his father did not have the mental capacity to sign the document, because he did not disclose it to either of his sons, and prior to this Marvin had also been adamant about his wife staying out of the business decisions.

Barbara created the Rush Living Trust in 2017, transferring most of Marvin's assets into it, according to the lawsuit, including real estate, cash, automobiles, and stock to Rush Enterprises. The beneficiaries of the trust, valued at more than $44 million, are Barbara and her daughters. Barbara has also presented two 2013 wills that supposedly revoke the 2006 will Rusty filed.

See Family Feud Continues over Estate Left by the Founder of Rush Enterprises, MSN, June 26, 2019.

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) for bringing this article to my attention.

June 30, 2019 in Current Events, Estate Administration, Estate Planning - Generally, New Cases, Trusts, Wills | Permalink | Comments (0)

Thursday, June 27, 2019

Discovery of Aretha Franklin's Handwritten Wills Throws Her Estate Into Turmoil

ArethaOriginally thought to have died intestate, two possible handwritten wills written by the musical diva Aretha Franklin have caused quite a commotion with her estate. The appointed representative is now asking the court to determine if either of the wills are valid under Michigan law.

The wills are seen as holographic, or handwritten, and must meet certain qualifications. They must be entirely in the testator's handwriting, must be dated, must be signed, and must have been intended to be a will. Two were dated 2010 and a third was dated 2014, and it unclear whether any of the documents will meet the other standards, being as they go off on tangents and are difficult to read. Two of Franklin's four sons are contesting the validity of the wills, and though a niece is acting as the representative, one of the documents appoints one of the sons to act as the representative.

All of this expense and turmoil could have been avoided if the diva had consulted with an estate planning attorney and put together a will and/or trust. With a good estate plan, she also may have been able to keep the details of her estate private through the trust instead of having the battle play out in public. 

See Discovery of Aretha Franklin's Handwritten Wills Throws Her Estate Into Turmoil, Elder Law Answers, May 31, 2019.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

June 27, 2019 in Current Events, Estate Administration, Estate Planning - Generally, Intestate Succession, Music, Trusts, Wills | Permalink | Comments (0)

Thursday, June 20, 2019

Note on Character: The Unacknowledged Element in Shifting the Burden of Proof in a Will Contest

WillElizabeth Siefker recently published a Note entitled, Character: The Unacknowledged Element in Shifting the Burden of Proof in a Will Contest, 96 U. Det. Mercy L. Rev. 457-482 (2019). Provided below is an abstract of the Article.

According to Tolstoy, "happy families are all alike; every unhappy family is unhappy in its own way." Often, the doctrine of undue influence requires a court to examine the quality of relationships within a family. A disinherited heir may challenge their disinheritance by attempting to prove the testator's volition was substituted by another at the time the will in question was made, and therefore, is a product of undue influence. If the heir is successful, the will is void. However, since the testator is no longer living at the time of the suit, how can a court determine the testator's state of mind at the time the will in question was made? Rather than rely on direct evidence that usually does not exist, the law creates presumptions to deal with the inability to question the testator.

In Michigan, a contestant to a will may raise a rebuttable presumption that the testator's will is a product of undue influence, thereby shifting the burden to the beneficiary to produce evidence negating the presumption. If the beneficiary fails to produce any rebuttal evidence, a directed verdict in favor of the contestant is proper, without requiring the contestant to provide any further factual support. On the other hand, if the proponent of the will produces sufficient evidence to rebut the presumption, the question of whether the will was a product of undue influence will be decided by the trier of fact. While this seems relatively straightforward, Michigan courts are in chaos regarding the type and quality of evidence a beneficiary must produce to adequately rebut the presumption the of undue influence.

Although Michigan has experienced three different "eras" with respect to its treatment of presumptions in civil cases, courts are in conflict regarding the evidentiary force of the presumption in cases involving undue influence. Prior to 1965, Michigan followed the Thayer "bursting bubble" theory of presumptions. Under Thayer, the presumption had the slightest effect and upon the introduction of any evidence to rebut the presumption, the presumption disappears. In 1965, the Michigan Supreme Court moved away from Thayer and adopted a "modified Morgan" approach to presumptions. When a presumption is met with rebuttable evidence under Morgan, the presumption remains as a permissible inference and the underlying issue is to be weighed by the trier of fact. In 1978, Michigan adopted MRE 301, once again returning to the Thayer camp. However, a host of Michigan cases involving undue influence have been dismissed on summary disposition despite the existence of facts giving rise to the presumption of undue influence throughout every era. This has been true even when the presumption has been met with rebutting evidence. Thus, under the paradigms of Thayer and Morgan, it appears that Michigan courts are in complete chaos over the effect of a presumption.

Responding to the fact that Michigan law is unsettled over the treatment of presumption in cases involving undue influence, this Comment proposes an alternative method of looking at the burden-shifting analysis. The doctrine of undue influence can easily be described as one big evidence issue because the best evidence, the testimony of the testator, is obviously unavailable. Thus, in every case of undue influence, two litigants walk into the courtroom, neither of them with solid direct evidence that the will is a product of undue influence or not. Due to the lack of proof regarding the testator's state of mind, courts must weigh the credibility of the witnesses to the suit. Under this paradigm, parties' "bad character" is an unacknowledged element in the shifting burdens of proof and the courts are placing the ultimate burden of proving undue influence upon the litigant who appears to be lacking in virtuous character.

Part I provides background on the doctrine of undue influence and how a contestant may raise a presumption of undue influence. Part II describes the effect of the presumption of undue influence in a will contest. This examination includes a discussion of the two prevalent theories on the operation of presumptions in civil cases and how Michigan has varied its treatment of presumptions in cases involving undue influence. This part then explores how Michigan case law has ignored the applicable rules surrounding presumptions in cases of undue influence in each of the three eras. Part III concludes that while it appears that Michigan courts are in chaos in deciding cases of undue influence, the decisions are actually consistent when the character of the litigants is acknowledged.

June 20, 2019 in Articles, Current Affairs, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0)

Wednesday, June 19, 2019

Aretha Franklin's Youngest Son is Seeking to Gain Control Over Late Star's Multi-Million Dollar Estate

ArethaKecalf Franklin, 49, the youngest son of the later singer Aretha Franklin, has petitioned a court in Michigan to replace his cousin, Sabrina Owens, as the representative of his mother's estate. At the time of Owens' appointment, it was believed that the diva had died intestate. Now, an unverified and handwritten will of the singer, dated 2014, has been entered into probate and named Kecalf as administrator.

Attorneys for the estate are challenging his filing, claiming that the son lacks the ability and the knowledge to manage such a sizable estate. Franklin left an estimated $80 million, with debts totaling $5.3 million. Kecalf claims that Owens has not provided the heirs with an inventory of his mother's assets and property, nor kept them up to date on an investigation into her music catalog. Owens countered that she has been handling her aunt's estate properly.

See Rachel McGrath, Aretha Franklin's Youngest Son is Seeking to Gain Control Over Late Star's Multi-Million Dollar Estate, Daily Mail, June 18, 2019.

Special thanks to Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

June 19, 2019 in Current Events, Estate Administration, Estate Planning - Generally, Intestate Succession, Music, New Cases, Wills | Permalink | Comments (0)

Insight on Estate Planning: Do you know when an FBAR Must be Filed

IrsThe IRS has been stepping up enforcement of foreign account reporting requirements, and therefore knowing when and what to report is vital. Either if you have a financial interest in or signature authority over a foreign financial accounts with an aggregate value exceeding $10,000 at any time during the calendar year, you must file FinCEN Form 114, “Report of Foreign Bank and Financial Accounts” (FBAR).

What is a foreign financial account? It is any financial account that is located outside of the United States, regardless of the nationality of the financial institution. Meaning that if the account is maintained by an American bank but within a branch outside of the country, it is a foreign financial account.

Anytime you designate another person to act on your behalf or transfer interests in your foreign financial account to other people or entities, you may trigger additional FBAR reporting obligations. If you own or control foreign financial accounts, consult your estate planning advisor to discuss your FBAR and other reporting obligations and their potential impact on your estate plan

See Joseph Marion, III & David Riedel, Insight on Estate Planning - June/July 2019: Do you know when an FBAR Must be Filed, Page 5, June 13, 2019.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

June 19, 2019 in Current Affairs, Estate Administration, Estate Planning - Generally, Income Tax, Travel, Trusts, Wills | Permalink | Comments (0)

Tuesday, June 18, 2019

Why Gloria Vanderbilt's son Anderson Cooper Likely Won't Inherit her Massive Fortune

CooperThe great-great-granddaughter of financier Cornelius Vanderbilt, Gloria Vanderbilt, died Monday at the age of 95 after a battle with stomach cancer. Though the heiress inherited a sizable trust fund from her father, it is unlikely that she did the same for her children, including CNN anchor Anderson Cooper. Cooper had told radio host Howard Stern in 2014 that his mother had made it very clear that there would be no trust fund for him.

Cooper said that he believes that people that inherit mass amounts of money have no initiative to work hard for their own money, saying that that type of sizable inheritance is "a curse." When it was pointed out that his mother had made her own money, arguably larger than the amount she inherited from the Vanderbilt name, Cooper said that his mother "was an anomaly."

Vanderbilt had an estimated net worth of $200 million at the time of her death, according to celebritynetworth.com.

See Katherine Lam, Why Gloria Vanderbilt's son Anderson Cooper Likely Won't Inherit her Massive Fortune, Fox Business, June 18, 2019.

June 18, 2019 in Current Events, Estate Administration, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0)