John Goodman is the 48-year old multimillionaire from Palm Beach, Florida who recently made headlines when it was publicly revealed that he adopted his 42-year old girlfriend to help protect the family fortune.  

Goodman did this in the midst of criminal and civil legal proceedings pending against him.  They arose from the February, 2010 drunk driving incident during which Goodman reportedly ran a stop sign, killed a 23-year old man, and fled the scene.  When it was recently revealed that Goodman, in October of last year, had legally adopted his girlfriend, people across the country were outraged.

Goodman’s lawyer issued a statement defending the adoption.  He states that the adoption was done to protect Goodman’s children, not to shield assets from the family of the slain driver who is suing him.

While Goodman has been bashed across the country for his legal maneuver, it actually makes sense from a probate law perspective.  Years ago, Goodman placed $1.5 million into an irrevocable trust for his two children.  By investing that money into stock of the Goodman Manufacturing Co., which grew extraordinarily well under Goodman’s management, the $1.5 million trust fund blossomed to several hundred million dollars.

In 2009, Goodman turned the management of this trust over to an outside company, Bessemer Trust Company.  Bessemer became the trustee, controlling the trust.

The judge in Goodman’s civil lawsuit already ruled that this money was off limits to the family of the young man Goodman killed.  He decided this because Goodman had no control over, and could not benefit from, the trust money, which was strictly for his children.  But, with Goodman facing a high likelihood of a long jail sentence, he was worried, his attorney said, of not having anyone around to protect the children’s interests in the trust.

Why do they need protecting?  The children are teenagers, so they are at the mercy of Bessemer.  And Goodman feels that Bessemer isn’t doing what they promised when he hired the company, and that someone needs to watch over Bessemer and safeguard the children’s interests.  Because the trust is irrevocable, Goodman has no legal authority to remove Bessemer, even though he created the trust.

So he turned to the unorthodox solution of adopting someone — his girlfriend — so she could then be a beneficiary of the trust.  Because she legally became his “child,” she therefore received the legal right to watch over and challenge anything Bessemer does that she does not agree with.

Goodman’s statement says his girlfriend signed a separate written agreement providing that she receives 5% of the trust fund, and a salary, but the rest is protected for his children.  There was no other way that Goodman could have put someone else in place to protect his children, his lawyer says.

So, from a purely trust law perspective, the moves makes sense.  Where doesn’t it make sense?  Well, in the adoption legal arena for one.  This type of legal maneuvering undermines the very purpose of adoptions, i.e. creating or formalizing a parent-child relationship.  We all know that Goodman and his girlfriend didn’t go through with the adoption for this reason.

It also doesn’t make sense to the judge in Goodman’s civil case.  He modified his earlier court ruling because he is worried this is a scheme which would allow Goodman to regain control, or maybe even benefit by, the trust through his girlfriend.

Because of the adoption, the judge ruled that, given the intimate nature of the relationship between what is now father and daughter, the trust funds are fair game for the jury.  The jury members will be called on to evaluate Goodman’s finances in deciding whether to impose punitive damages against him because of how shocking and callous his actions were which (allegedly) caused the death of the young man.  The jury will now be allowed to take this trust fund into consideration in deciding the amount of the judgment.

So, while Goodman’s maneuver may indeed work under probate law to allow his girlfriend to act to protect his children’s trust fund, it will be Goodman who likely has to pay the price for this. Undoubtedly, there will be a hefty punitive damages award when the jury decides the case, which will likely be higher that it otherwise would have been because the jury can now consider the large trust fund.

What’s the moral to all this?  Be very careful with irrevocable trusts.  While Goodman’s decision to set up this trust for his children did help in many regards — protecting the money from his creditors — the cost that went along with this benefit was high.  Goodman had to give up control of the money and hope that another trustee, Bessemer, would protect the money for his children, the right way.

When Goodman lost faith in Bessemer, he had no ability to undo what he had done, because the trust was irrevocable.

For an irrevocable trust to shield money from creditors, this is normally required.  But that loss of control can have dramatic results.  With no ability to change the trust (that’s what “irrevocable” means), the person who creates such a trust is at the mercy of the trustee to do the right thing.

While irrevocable trusts certainly do have an important role in estate planning, generally with high net-worth individuals, they have to be used with caution.  In particular, the person creating the trust should not name anyone as trustee unless he or she is extra confident the person or company selected will do a good job.  This is never a choice to make lightly.

If Goodman had made a better choice of trustee, then he would not have needed to adopt his girlfriend. Of course, if Goodman made a better choice on that fateful morning in February, 2010, a young man would still be alive.

UPDATE -- FEBRUARY 9, 2012 - A court-appointed guardian ad litem who protects the interests of Goodman's children and his attorney have filed a motion with the adoption court seeking to undo the adoption, arguing it was a fraud on the court.  They claim that neither the guardian ad litem nor the children's mother were notified of the adoption.

Goodman's attorney is now using this latest development to seek a reconsideration of the trial judge's ruling allowing the jury to consider the trust as part of the punitive damages award.  They've asked for trial to be delayed until the adoption matter is sorted out.  Here is the local story on these new developments.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation. 

Barbara felt that money was really meant to benefit her.  Whitney had lent her father a great deal of money, some of it to buy a house that John lived in with Barbara.  When John Houston died, Barbara inherited the house.  Because of that particular loan, Whitney owned the mortgage on the house.

Barbara claimed the life insurance money was meant to repay Whitney for that mortgage. When Whitney refused to credit the life insurance money against the mortgage, Barbara sued.

Whitney was not pleased.  She counter-sued, pointing out in a public court record that Barbara met her father while she was a “custodial care service worker” (in other words, a “maid”), cleaning his house.  Barbara was 40 years younger than Whitney’s dad and starting dating him when he was still married to Whitney’s mother.  Whitney also brought up the fact that John and Barbara were married shortly after he divorced Whitney’s mother.

As part of this lawsuit, Whitney also sought a judgment for the mortgage to be repaid, with interest, which totaled about $1.6 million by then.

Barbara and her lawyers brought up several letters, written by various accountants.  They argued to the judge that these writings suggested the insurance policy really was meant to repay the mortgage.  The problem was that there never was a written agreement between John and Whitney Houston documenting this, and everyone from Whitney’s camp denied they had an agreement. Instead, Whitney pointed out that she lent her father lots of money, and this insurance policy meant to repay other loans, not the mortgage money.

The Judge agreed with Whitney and dismissed the lawsuit, without holding a trial, in late 2010.  Barbara filed an appeal. Late last month, the Federal Court of Appeals dismissed the appeal and upheld Whitney’s victory.  This ruling clears the way for Whitney to proceed with foreclosing on the house.

Given the obvious disdain Whitney has for Barbara Houston, as made evident in the lawsuit, the foreclosure will likely follow, paving the way for Whitney to own the house and kick Barbara to the curb.

At least this would give Whitney someplace to live, if those “broke as a joke” rumors are true.

Yes, this family feud turned ugly.  It’s not uncommon when someone dies with a newer spouse and adult children from a prior relationship.  In these families, the proper legal planning is more important than ever.

Clearly, John Houston intended the life insurance money to repay Whitney for money she lent him.  But what money?  No one knows for certain … although it’s interesting that one of Whitney’s accountants actually credited the life insurance money against the mortgage after John died, before later reversing the credit.  Other writings supported Barbara’s claim that this was what John intended all along.  But none of those writings were signed by John or Whitney, so the confusion remained.

The best way for most people to prevent confusion like this from sparking family fights after someone dies is good estate planning, including a will and trust that clearly and completely document the person’s wishes.  Life insurance goes hand in hand with this planning, and beneficiary designations should be coordinated with the estate planning documents.  Without proper estate planning making the intentions clear, court fights in second-marriage families are to be expected.

Don’t let this happen to your loved ones, or to your clients!  Encourage them to work with experienced estate planning professionals and put the right legal planning in place, before it is too late.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.

A few weeks into the new year, how many of your New Year’s resolutions have already fallen by the wayside?  Exercise more. Eat less.  Spend more quality time with family.  

It doesn’t have to be intimidating! In fact, celebrity stories are a great way to break the ice to remind everyone of what they need to do.

So, with the help of some recent stories in the news, here are Trial & Heirs: New Years Estate Planning Resolutions for 2012.  (We just gave an interview discussing some of these stories, which you can watch here).

1.  Plan Now and Don’t Procrastinate.

R&B legend Etta James was 72 when she passed away last week, after suffering from leukemia, dementia and other problems.  Canadian Olympic skier Sarah Burke was only 29 when she died recently from injuries in a freak skiing accident, despite being one of the top athletes in the world.  It’s a sad reality that accidents and serious medical conditions can affect any of us, at any time.  We all need to be prepared.

While it’s easy to procrastinate doing a will, trust or other legal document, the consequences can be devastating.  Take author Stieg Larsson, whose Girl With The Dragon Tattoo book and sequels achieved global success.  The recent Hollywood movie adaptation has grossed over $140 million worldwide since it was released a month ago.

Larsson died without even a will.  This sparked a huge lawsuit between his live-in girlfriend of 32 years and his brother and father, whom the girlfriend claims were not close with Larsson.  The family members inherited his now-vast estate (conservatively estimated at $40 million) and sued because the girlfriend has possession of a laptop with an unpublished fourth manuscript. You can read about the Larsson Estate lawsuit here, which remains unresolved.

Larsson died unexpectedly at the age of 50 from a heart attack.  His procrastination with his estate planning means he did not get to decide whether his girlfriend or his family members inherited his estate.

Don’t make the same mistake with your estate.  You’ve worked hard your whole life; shouldn’t you decide who receives what, when, and how?  Don’t procrastinate and let the laws in the state you live in determine who receives your property after you pass away.

2. Appoint Medical and Financial Decision-Makers.

Etta James’ final year of life was marred by controversy, between her husband of 42 years and her two adult sons from prior relationships.  Her 2008 power of attorney gave legal authority to one of her sons, but her husband claimed it was signed after James already had dementia and was not competent.  They fought in court over who would make her financial and medical decisions, and even how much money her husband would be allowed to have to pay for her care. You can read our Etta James lawsuit article here.

Luckily, the family reached a resolution a few weeks ago, around the time James’ illness was declared terminal.  The settlement allowed her husband to make her medical and financial decisions as her conservator (called guardian in some states), but only permitted him to control $350,000 for her medical care.

Britney Spears is also under conservatorship, despite being much younger than James … or indeed, the large majority of adults who have conservators or guardians.  Just recently, her father announced that he was going to ask the court to terminate the medical/non-financial part of her conservatorship so she could get married without restriction. Reportedly, he will hang onto the financial control.  We have written before that the reasons for this are suspect, and may be for the purpose of insulating Spears from lawsuits.

Whether you are 30, like Spears, or in your 70′s, like James (or any other age for that matter), it’s critical to have power of attorney and living will documents in place, in case you should suffer a serious medical condition or accident. Without these, your family members — even your spouse — would have no right to make your medical or financial decisions unless they go to court and seek guardianship and/or conservatorship.

As the Etta James case illustrates, this can be a breeding ground for a family fight.  Even when there isn’t family fighting, such as in Britney Spears’ case, these court proceedings are still intrusive, public, expensive and very cumbersome.

It’s far better to keep yourself and your family out of court by having the proper medical and financial decision-makers appointed in your legal documents.  That way you’ll be protected, in case something should happen to you that renders you unable to make your own decisions.

3. Update your Will, Trust and Other Legal Documents.

Think you can stop reading because you already have will, trust and power of attorney documents in place?  Not so fast.  When was the last time you updated your documents?  Have you had a life event like a divorce, the birth of a new child, a new business, or a move between states since then?

If so, or if you haven’t had your documents reviewed in the last three to five years, you still have work to do.  Heidi Klum and Seal, take notice!  When couples — especially those with children — file for divorce, it’s important to visit your attorney or financial planner and start the process of updating your legal documents.  Would you want your ex-spouse to make your medical decisions or receive your life insurance?  That often happens when documents aren’t updated.

Author Michael Crichton’s estate highlights this point.  He died at the age of 66 from throat cancer, when his wife was six months pregnant.  He never updated his will to include the new child, and in fact, his will had language excluding any new children.  His adult daughter from a prior marriage and his wife fought in court over whether the baby should be allowed to inherit.  You can read about the Crichton Estate case here.

Ultimately, the Judge ruled in favor of the wife, and the baby was allowed a share of the inheritance.  But it never should have gone that far.

4. Get Your Affairs Organized.

This is a critical step in the estate planning process which many people overlook.  What good are properly-drafted wills, trusts, and power-of-attorney documents if no one can find them?  Let your loved ones know where they are stored. And we highly recommend using an estate planning organizer to list out legal and financial documents and assets, so your family members know right where to go if tragedy should strike.

Look at the recent Italian cruise ship disaster.  There were reports of passengers stuck on board, calling loved ones to make sure the kids where going to be taken care of and telling people where to find their wills and other legal documents. Here’s an example.  But, where the will is located is just the start.  What about your life insurance policies, bank accounts, deed to your house, and all that other important information stored in your head that no one else knows?

Don’t wait for a personal tragedy; get prepared now.  Once you organize your affairs and let your trusted loved ones know where your important legal and financial information is located, you can rest easier at night and not worry about protecting your family if something should befall you.

5. Talk With Your Family.

The proper estate planning is an act of love for family members, because family members pay the price when it’s not done or is done improperly.  So talking to your loved ones is an important part of the process.  It’s not a matter of telling people what they will receive — that can certainly be kept private. But it’s very important to let loved ones know you’ve done your planning, where your documents and information are located, and who the professionals are that you work with.

You should also talk to your family members to see if they’ve done their own estate planning.  Not sure how to bring up the conversation?  Celebrity stories are a great way to break the ice and get the dialogue started.  Today we’ve shared just a few stories to get you started; you can visit TrialandHeirs.com for many more.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.

Richard Pratt had a colorful life, until he died at age 74 on April 28, 2009.  A former professional Australian rules football player and stage actor, he inherited his father’s small cardboard business in 1969 and grew it into one of the world’s largest privately-owned recycling and packaging companies.  

Pratt peaked on Forbes’ list of the world’s billionaires at number 321 in 2005.  Two years later, his fortune was valued by Forbes at $2.5 billion (in U.S. dollars).  His fortune declined from there, and Pratt eventually admitted to a massive price-fixing scheme, paying a record $33 million fine.  Pratt still managed to wind up as Australia’s fourth wealthiest person, leaving behind a $5.5 billion estate (in Australian dollars).

It was well known in Australian society that Pratt enjoyed the company of mistresses, one of whom gave birth to a daughter by Pratt in 1997.  But it’s another mistress who  caused the biggest headache for Pratt’s estate. Madison Ashton (also known as Christine McQueen) was a Penthouse Pet. She sued Pratt’s estate for millions, claiming he reneged on a “business agreement”.

Exactly what type of business agreement?  According to Ashton, Pratt agreed to pay her $500,000 per year if she became his full-time mistress and gave up her lucrative work as an escort.  She claims he also promised her a $100,000 Mercedes Benz, $66,000 per year for her rent and travel expenses, and another $5 million in trust funds for her two children.  Ashton even alleges that Pratt required her to “service” one of his bodyguards so that he wouldn’t spill Pratt’s secrets.

Pratt’s wife of 50 years and the Estate’s legal team said the only thing Pratt ever promised was to help Ashton set up an accessories business.  They feel that Ashton is, shall we say, less than honest.  They claim she was a drug addict who actually settled claims against Pratt before he died, accepting a total of $150,000 after the relationship ended.

This legal dispute is very reminiscent of one we include in our book, Trial & Heirs:  Famous Fortune Fights!, involving the heir to the Bloomingdale fortune, Alfred S. Bloomingdale.  His mistress, Vicki Morgan, similarly sued his estate after Bloomingdale died in 1982.  Morgan claimed Bloomingdale promised her financial support as his mistress, but the case was thrown out. Broke at the time, Morgan moved in with a psychologically-disturbed roommate, who tragically murdered her in 1983.

Morgan’s son then appealed the lost lawsuit and eventually won a $200,000 judgment against the Bloomingdale Estate. How did Morgan’s son win the case?  Morgan had saved letters written by Bloomingdale promising a lifetime of support, which proved to be the difference in the lawsuit.

So could Ashton’s case have similar success?  The newspaper coverageincluded no mention of similar evidence to the Bloomingdale letters.  Without something strong to corroborate her story, Ashton faced an uphill battle.  On the other hand, Ashton’s case did survive attempts by the Pratt Estate to have the case dismissed, so maybe she could prevail.

To her dismay, the New South Wales Supreme Court ruled this week against Ashton.  This time the judge dismissed her case, not doubting that conversations took place in which Pratt said he would support her.  Instead, the Court determined that no legally binding agreement was made.  The judge also ruled that even if there had been a valid claim, Ashton already accepted two settlements which meant she did not have the right to sue for a third payday.

Stories like these do have a lesson, even for those without billions of dollars or mistresses.  Far too many people make the estate planning mistake of relying on verbal or written promises that contradict the will or trust.  Lawsuits involving whether the person who died promised something are never easy for either side, because proving or disproving what the person said is not easy.

That’s why putting those promises in writing can undermine what someone really intended with the will or trust, at least where the writing differs from the estate planning documents. Everyone should work with their legal and financial professionals to properly document their wishes, and not rely on verbal or written promises.

If you are a billionaire with mistresses on the side, no amount of estate planning can prevent a lawsuit like this one.  But for the rest of us, more-common estate battles can usually be avoided.  Comprehensive estate plans, prepared the right way, are the best way to prevent lawsuits over your estate when you pass away.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation. 

Seventies beauty icon Farrah Fawcett died in June of 2009 at the age of 62, following a terrible battle with cancer.  She did the proper estate planning, complete with a will and a trust.   [You can read the trust here].  So why are there not one, but two lawsuits over one of her assets?  

Fawcett’s trust provides that her art collection passed to the University of Texas, her alma mater.  The University received one of the two Warhol paintings, but not the other.  So where is it?

In the possession of Fawcett’s  former on-again, off-again boyfriend, Ryan O’Neal … and he doesn’t even dispute that he has it.  So the University of Texas sued O’Neal, claiming the painting belonged to Fawcett when she died and should now belong to it.

O’Neal denies it.  He says he was friends with Warhol even before Fawcett, and Warhol gave him the painting.  He’s so incensed about the lawsuit that he started one of his own … against a man named Craig Nevius.

Nevius is a Hollywood producer.  At one time, he was working with Fawcett to develop a TV documentary about her struggle with caner.  He and O’Neal already sued each other before, about the Fawcett documentary, and each claimed the other exploited Fawcett as she was dying with cancer.  Nevius gave up the lawsuit because, he said, he couldn’t afford to fight O’Neal.  It’s clear to say the two men do not like each other.

That’s why, O’Neal says, Nevius told lies about him and the painting.  O’Neal sued Nevius for defamation, blaming him for causing the University to sue O’Neal. O’Neal claims that Nevius falsely said O’Neal stole the painting, when O’Neal says the truth is that he owned it all along.

So far, O’Neal is winning the lawsuit.  Last week, a Los Angeles judge refused Nevius’ request to dismiss the case.  She pointed out that Nevius denies having told anyone that O’Neal stole the painting, but apparently he had sent an email to the University saying that O’Neal’s ownership of the painting was a “fraud” and a “theft.”  The Judge was clearly bothered by Nevius’ inconsistent statements.

Nevius’ attorney vows to appeal the Judge’s ruling.  He says that Fawcett always had two Warhol paintings hanging in her house, repeatedly told people she owned them, and O’Neal took possession of the painting after Fawcett died, despite not being a beneficiary of Fawcett’s will or trust.  Nevius feels the truth will come out, likely in the University of Texas lawsuit, and Nevius will be vindicated.

So it really all comes down to one question:  Did Fawcett own that painting, or did O’Neal?  It shouldn’t be that hard to determine, because a painting with substantial value like this one (which a BBC article claimed was worth in the neighborhood of $30 million) should have been insured while Fawcett was alive. If so, there would be records of whether Fawcett or O’Neal was the one to insure the painting.

Even if it was not insured, there would presumably be pictures or other evidence to establish whose house it really was hanging in.  Fawcett and O’Neal separated, according to most reports, in 1997 (although O’Neal said they remained close thereafter).  Regardless of the nature of their relationship, determining whose house the painting really hung in can’t be that big of a mystery, can it?

We’ll find out.  And in the meantime, there is a lesson which all families can learn from this celebrity estate.  Items of personal property with significant monetary value should be specifically mentioned in a will or trust, or in a separate written document that is mentioned in the will or trust, so there is no confusion over who owns what, and who receives what.  While it is not necessary to list out every item of personal property, something of unusual value should be listed out in accordance with a complete estate plan.

It’s a sad reality that many families fight over personal property, usually accompanied by claims of “Mom gave it to me” or “Dad said I could have it.” These can turn into ugly and expensive lawsuits, and often shatter family relationships. Full and complete estate planning is the best way to prevent a fight like this from happening to your family after you pass away.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.

She ranks as one of the greatest civil rights icons of all time, all starting with a seemingly simple act of refusing to move from a bus seat.  Rosa Parks passed away at age 92 in 2005, living in a modest apartment in Detroit, Michigan.  Her estate was modest too. Officially valued at $372, 624 in monetary terms, but of course priceless in terms of memories and historical significance.  

On the eve of trial, the parties settled with a confidential settlement agreement that upheld the will and trust as valid, re-instituted Steele and the retired Judge as the executors, and gave the nieces and nephews additional rights and royalties related to Parks.  This left Steele in control of Rosa Parks’ Institute.

That didn’t end the fighting though — far from it in fact.  The parties continued to battle in court over the amount of fees charged by the two attorneys who still, despite the settlement, were allowed to remain in charge of the estate and trust.  The fee dispute went to the Michigan Court of Appeals.

It was at that stage that an attorney representing Steele and the Institute was accused of violating the confidential settlement agreement by revealing certain information in open court in front of a newspaper reporter.  The probate judge was so incensed at this that he ordered that Steele and the Institute both forfeit all rights to Rosa Parks’ property and royalties.  This meant that Rosa Parks’ express wishes as set forth in her 1998 Trust were completely changed by the judge … all because he felt an attorney disclosed something about the confidential settlement agreement in a court proceeding.

Steele and the Institute filed appeal after appeal, and finally the case worked its way up to the Michigan Supreme Court.  Just last week, the Court ruled:

The reference by counsel for the Raymond and Rosa Parks Institute for Self-Development and Elaine Steele, during the course of oral argument in the Court of Appeals, to the respective percentages of the fees charged by the court-appointed fiduciaries for which he believed the parties to the appeal would be liable, without referring to the terms of the Settlement Agreement, did not constitute a breach of the Settlement Agreement’s confidentiality provision …

The Court  ordered that Steele and the retired Judge were to be restored to their positions in charge of the estate and trust, and all of Parks’ wishes as expressed in her trust were to be, once again, followed, in accordance with the settlement agreement.

The Supreme Court’s ruling was only a page and a half long.  The seven judges found the probate judge’s prior ruling to be “clearly erroneous.” They slapped the hand of the probate judge and mandated that Steele and the other executor be put back in place within 30 days, or the judge would have to explain to the Supreme Court why that could not be done.

Before this recent Supreme Court ruling, Rosa Parks’ belongings were scheduled to go to auction.  Now the Institute she created will be in control of them, as Parks wished (according to her trust) all along.

It’s a sad reality that the final wishes of someone who died are not always followed, and instead, often lead to expensive court fights.  The best prevention is good estate planning, done early, before there is a question of someone’s mental competence or whether they are being unduly influenced.  Too many people think that only “old” people have to do their estate planning, so they wait.

Rosa Parks was in her mid-80′s when she created her trust.  Her nieces and nephews feel strongly that the trust was not what she really wanted.  Because of this, they filed a challenge that ultimately caused Rosa Parks’ wishes to be undermined for years.

It’s a good lesson for professionals and family members alike to share with their clients and loved ones.  Encourage others to take care of their estate planning, with an experienced estate planning attorney, early, and not wait until they are “old”.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.

There is no doubt about the greatness of Reverend Martin Luther King, Jr. Unfortunately, his estate planning wasn’t so great.  In fact, King made a mistake that too many people make everyday in our country … he procrastinated with his legal planning and died without a will.  

In large part because of this, his legacy has been marred by fighting among his children over the handling of his estate, including claims of secrecy, mismanagement and misappropriating assets.  Years ago, MLK’s heirs formed a corporation to manage King’s estate, but then they fought over control over the corporation. You can read Trial & Heirs’ coverage of the lawsuit between the King children here.  Luckily, the heirs were able to reach a settlement and ended that round of fighting.

But, that doesn’t mean the court battles have ended.  The corporation which operates the estate turned its attention to a television anchor in Southern Mississippi, named Howard Nelson Ballou.  The Estate of Martin Luther King, Jr., Inc., sued Ballou and claimed he has possession of historic documents relating to King.

Ballou’s parents had been close friends with King and his wife, Coretta Scott King.  Ballou’s father was King’s fraternity brother, and his mother had been King’s personal secretary in the 1950′s.  She helped him research, type and edit his speeches, answered his mail and made his travel arrangements.  She says that, through her relationship with King, he gave her the documents.

Ballou’s mother, Maude Williams Ballou, now 86 years old, recently said in a sworn statement that King wanted her to keep the documents by giving them to her at different times, and telling her, “[H]ere, Maude, this is for you.”  She says she always considered the writings to be her personal belongings, and King never asked for them back between then and the day he was assassinated in 1968.

Ballou’s husband stored the documents at Elizabeth City State University, in North Carolina, where he worked until he passed away.  The University found the documents in 2007 and gave them to their son, Howard Nelson Ballou. When a local newspaper story mentioned the discovery of the documents, the King heirs took notice.

They sued Ballou in federal court in Mississippi.  The Ballou family, unlike the King Estate Corporation, likely does not have endless funds available to pay lawyers for a lawsuit over what King really intended.

Howard Ballou is trying to end the lawsuit early.  He filed a motion asking the Judge to dismiss the case, based on the sworn statement of his mother.  The King Estate Corporation is arguing against it, saying it’s premature to even think about dismissing the case before its lawyers have been able to question Maude Ballou in a deposition.  Those lawyers have pointed out that that any documents which Maude Ballou came to receive as an employee of King may not qualify as gifts.  The Judge has not yet ruled on the dismissal request.

Ultimately, it all comes down to what Reverend King intended when he gave the documents to Maude Ballou.  Did he want her to hold onto them as an employee, or keep them as gifts?  Obviously, no one really knows, making this lawsuit a difficult one.

That is the nature of lawsuits involving gifts and verbal promises.  They happen to families of all different means, especially when those who passed away failed to make their intent clear in a will or trust.

King could have clarified his intent rather easily by creating even a simple will. Because he didn’t, the result is an expensive lawsuit where no one really knows what he intended … although Maude swears under oath that the documents were gifts to her and remained as personal belongings to her family ever since.

In our law practice, we see fights over personal property such as jewelry, artwork, furniture, and even Christmas ornaments and family pictures.  It’s sadly too common, especially considering how easy it is to prevent court battles like this one.

That’s why everyone should clearly document their intentions in a will or trust, with the help of an experienced estate planning attorney.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.