Probate and Trust Administration

• Seniors duped into buying living trusts
  Jul 25, 2010

  Senior citizens in Washington State who were duped and/or pressured into buying living trusts are getting a refund.  This story shows how unscrupulous insurance agents used the information collected from preparing the living trusts to sell other financial products to their customers.  Of course, the insurance agents were not attorneys.
  
  Living trusts are useful estate planning tools for many people.  But, not everyone needs one and no one should get a "cookie cutter" document because it is unlikely to meet their needs.  Getting a a trust that isn't personalized may result in unintended consequences and a battle in the probate court. - 1 - 10

• Probate rules vary greatly from state to state
  Jul 05, 2010

  This question and answer column in the Houston Chronicle really illustrates the importance of getting a local attorney for your probate case.  The attorney who writes this column is a certified specialist with the Texas Board of Legal Specialization.  I've never met him but assume he is well qualified to answer questions about Texas probate cases.
  
  His response to the first questions concerns the mechanics of probate in Texas.  Apparently, there are unsupervised probates in Texas.  He warns the reader to hire an attorney to guard her children's interest in the estate because they won't know what is happening in the probate otherwise.
  
  This is quite different from California probate cases.  All California probate cases go through probate court and require notice to all the beneficiaries.  There is an affidavit procedure in Calfornia for small estates without real property that does not go to court but that is the only exception.   
  
  Don't be lulled into a false sense of security because a California probate goes to court.  If you think something is wrong you can't rely on the judge to catch and correct the problem. I've lots of people over the years who have contacted my firm after the probate was closed to complain about something that happened.  The entire purpose of giving notice to beneficiaries in a California probate is to give them the opportunity to come into court and object to anything that's wrong.  Failing to object means you have waived your right to do so.  If something is wrong then act now.  You won't get a second chance.  - 2 - 10

• Estate tax repeal means some spouses are disinherited
  Jan 02, 2010

  Estate tax repeal may result in surviving spouses being unintentionally disinherited.  This results from Congress spectacular failure, with 10 years warning, to pass a successor estate tax law to the one that allowed the estate tax to expire for 2010.
  
  Spousal disinheritance may occur under wills and trusts that have pecuniary funding formulas to determine how to fund the decedent's trust for estate tax purposes.  With no law having been passed to implement an estate tax, the decedent's share is now unlimited.  Under the old law there was a built in assumption that the decedent's share would be capped and the "overage" would go the surviving spouse.  The current state of the law may be a real quandry for some surviving spouses. - 3 - 10

• Estate taxes set to expire in 2010
  Dec 19, 2009

  Congress' failure to pass a new estate tax law means decedents who die in 2010 won't owe any estate taxes no matter how large their estate.  The current estate tax law calls for the repeal of the estate tax in 2010 and its return in 2011.  Congress spent most of this year making various proposals to extend the current law but none of them passed.  It now appears no new estate tax law will be passed this year.
  
  Congress almost surely will pass a new estate tax law in 2010.  As the article in the link above mentions, Congress will probably make whatever estate law is passed retroactive to the beginning of 2010. - 4 - 10

• Probate lawyer under criminal investigation for taking money from estate
  Dec 08, 2009

  A Milwaukee probate attorney is the subject of a criminal investigation for allegedly taking $1.6 million from his clients.  This is a lesson to anyone engaged in probate.  It is perfectly fine to deposit small amounts of money in an attorney's client trust account.  It is also acceptable to have money received in a settlement be sent to your attorney's client trust account.  It is never a good idea for that money to sit there for an extended period of time.  It is also a terrible idea to have your attorney invest your money for you. - 5 - 10

• Steve McNair's estate free to sell share of restaurant
  Nov 24, 2009

  A Tennessee probate court judge has ruled that Steve McNair's probate estate can sell the estate's ownership interest in a local restaurant.  Unsurprisingly, the probate court judge ruled that McNair's estate was not required to maintain its 80% interest in the restaurant.  Rather, the judge allow the probate estate to sell the interest in the restaurant in order to maximize its value. - 6 - 10

• Trust mills fined over $6 million
  Nov 01, 2009

  Some times bad things happen to bad people.  American Family Prepaid Legal Corp. and Heritage Marketing and Insurance Services Inc. were fined over $6 million by the Ohio Supreme Court.  The firms used high pressure sales tactics to inappropriate products to their clients.
  
  Both companies were found to be practicing law without a license.  Though not stated in the article, they probably left trust funding to their clients.  This will likely result in some families facing a probate that could have been avoided. - 7 - 10

• Katherine Jackson fires her probate attorney.
  Oct 23, 2009

  Michael Jackson's mother, Katherine Jackson, fired her to attorneys in her battle over her son's probate estate. Mrs. Jackson hired a new probate attorney to represent her. Mrs. Jackson was apparently dissatisfied with the two attorney, she had representing her and decided she needed a tried-and-true probate litigator to represent her in the ongoing battles over her son's estate.

  - 8 - 10

• Yes, a bad father can luck into an inheritance
  Sep 17, 2009

  A Ventura County probate court, and the appellate court that heard the case, ruled an absent father that owed back child support, and hadn't seen his son in 42 years still inherited from his probate estate because the son died without a will. Laura Barnes and Clifford Shellenbarger divorced over 40 years ago.  Shortly after they were divorced their son Lesley was born.  42 years later Lesley died intestate.  In other words, he didn't have a will.
  
  Under California probate law because Lesley didn't have a will, spouse, registered domestic partner, or children, his parents inherit.  Each parent gets half the probate estate. 
  
  Laura petitioned the probate court to prevent Clifford from receiving any inheritance.  She alleged Clifford hadn't seen their son since their divorce and owed back child support.  She felt it would inequitable for Clifford to receive any of their son's money based on his conduct and inattention.
  
  The appellate court followed the law by holding both parents inherit equally.  It may seem unfair on these facts but the law is the law.  The lesson to take from this case: if a person dies without a will then the rules of intestate succession will apply. - 9 - 10

• Michael Jackson's estate will pay for his lavish funeral
  Sep 13, 2009

  The executors of Michael Jackson's estate sought probate court approval to pay the extraordinary expenses for his funeral.  Though the amount sought would be enormous for most families, given the size of Jackson's estate it is a relatively small expense.  The probate court judge approved the expense. - 10 - 10