Celebrity lifestyles typically receive an inordinate amount of attention from the media. Frequently there are lessons to be learned, either bad (i.e. substance abuse) or good (i.e. charitable causes). Deaths of celebrities are also widely covered and often have lessons to teach us from the manner of their deaths. Less widely covered, however, celebrity deaths may sometimes teach us lessons regarding proper or improper estate planning. For example:
- Jerry Orbach (actor) – Second Marriage Estate Planning: Battles between the surviving second spouse and the children from the first marriage demonstrated a couple of key points. Specifically, trust planning can be extremely important in second marriages (i.e. controlling the assets to benefit both the surviving spouse during her lifetime and ultimately passing assets to the children at her death). Additionally, the selection of an impartial Trustee to administer the plan is critical to minimize conflicts and help insure the fair treatment of both the surviving spouse and the children from the first marriage.
- Farrah Fawcett (model, actress) – Protection of Heirs from Substance Abuse: Ms. Fawcett recognized that her son Redmond, as her sole heir, was likely to have his substance abuse problems exacerbated by receiving significant sums of money outright. Accordingly, Ms. Fawcett left her estate in Trust for the benefit of her son, apparently providing the Trustees with discretion to use the funds to help Redmond receive the help he apparently needs. This type of planning may encourage future “good behavior” (abstaining from illegal or addictive substances) as well as provide treatment and disincentives for “bad behavior”.
- Michael Jackson (entertainer) – Care for Minor Children: Whatever his troubles in his personal and financial life, apparently Michael Jackson accepted the good advice to provide for both pre-need guardians for his children, as well as a Trust to manage the assets for the benefit of the children until they reached an appropriate age. While his wishes may still be subject to challenge, by formally expressing his wishes, Michael’s plan is likely to provide the framework for the personal and financial care of his children.
- Leona Helmsley (hotel magnate) – Pet Trust: One relatively unique issue in Ms. Helmsley’s plan involved a “pet trust”. Florida law was recently updated to allow a pet owner to establish a trust to care for a beloved pet, so long as the amount of the bequest does not exceed an amount reasonably required to care for the pet. The New York court decided Ms. Helmsley’s $12 million bequest for her dog “Trouble” was about $10 million more than Trouble really needed.
- Heath Ledger (actor) – Failure to Update Your Plan: Dying without an estate plan (or without an updated plan) does not mean that your heirs will not inherit your assets. Florida law (as in most states) makes certain assumptions regarding what you would have wanted to happen. In Heath’s estate, he had created a will leaving assets to his parents and siblings. However, he failed to update his plan when his daughter was born, to provide for his daughter or his long-time girlfriend (the mother of his child). Florida law would have provided for his “after-born” daughter, to the exclusion of the parents and siblings. However, no provision in the law would have provided for the girl’s mother – no matter the length or depth of the relationship.
For celebrities as well as for us “normal folks”, proper planning that takes into account your current wishes and circumstances, that plans for contingencies, and that is periodically reviewed and updated, is the key to making sure your wishes are followed and your heirs are protected.