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Ohio Supreme Court Says High Bar to Find Undue Influence in Will

WillA recent case in Ohio demonstrates the very high threshold that must be met to establish that a decedent was unduly influenced or lacked testamentary capacity. In Young v. Bellamy, the Supreme Court of Ohio showed just how difficult it is to overturn a will.

In this case, the person contesting the will—a granddaughter of the decedent—was written out of the decedent’s estate plan in a series of wills executed over a period of five years. In turn, the proponents were incrementally given a larger share of the estate. The granddaughter claimed that her grandfather was unduly influenced and lacked testamentary capacity at the time that he executed his last will.

However, to refute her claim, the other relatives gave the court affidavits of three disinterested witnesses who were with the 96-year-old decedent, when he signed the will. All of these individuals said they saw no indication of lack of capacity, susceptibility to undue influence or actual coercion or duress. One said he was “an engaging elderly man.”

To invalidate a will, undue influence “must so overpower and subjugate the mind of the testator as to destroy his free agency and make him express the will of another rather than his own, and the mere presence of influence is not sufficient,” the Court wrote. Further, proof of undue influence requires: (1) a susceptible testator; (2) another's opportunity to exert influence on the testator; (3) the fact of improper influence exerted or attempted; and (4) a result showing the effect of such influence.

In response to the three affidavits, the contesting granddaughter submitted her own affidavit describing her relationship with the decedent, alleging that the decedent said he had no memory of executing a prior will and asserting that the decedent had requested that she contact an attorney to change the will.

The Supreme Court wrote that testamentary capacity exists when the testator has sufficient mind to: (1) understand the nature of the business in which he is engaged; (2) comprehend generally the nature and extent of the property which constitutes his estate; (3) hold in his mind the names and identity of those who have natural claims on his bounty; and (4) appreciate his relation to the members of his family.

The Supreme Court agreed with the trial court and the Court of Appeals, both of which found that the granddaughter’s self-serving affidavit wasn’t enough to overcome the presumption of validity of the will and the three affidavits of those who observed the testator on the date of execution of the will.

Summary judgment was granted for the other family members and the granddaughter was out of luck.

Reference: Supreme Court of Ohio (May 24, 2017) “Young v. Bellamy”

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Community Activist Flower Shop at Center of Estate Battle

SproutMattie Young battled to maintain her mother's legacy of a lifetime of service to a Florida community. Young is the daughter of the late Veronica Shoemaker, who was a Fort Myers community activist for many decades. Mattie struggled to keep the flower shop bearing her mother's name, after a contested will struggle that threatened her mother's legacy.

The Fort Meyers news-press.com reported on this saga in Shoemaker estate issue settled; florist shop stays open. Family members apparently reached an agreement that assured Mattie would continue to run the Veronica S. Shoemaker Florist Shop in the Dunbar community its founder served for decades.

"It's important that her legacy here, her legacy in the community and her spirit continue," Young said.

Veronica Shoemaker's will was challenged in court by her granddaughter Latoya Shoemaker, the daughter of her late son who died in 1982. Latoya argued that her grandmother lacked capacity to make a will, because she was suffering from the effects of Alzheimer's disease. Latoya claimed at one point in the dispute, that the signatures of Veronica Shoemaker were forgeries. The suit stated that Veronica Shoemaker was diagnosed with Alzheimer's in 2007.

Veronica’s will left the florist business to her daughter. She noted that, as she faced advancing age, Mattie had worked to maintain the store's place in the community. Veronica Shoemaker died Jan. 21, 2016, and the will was filed in probate court in June. It was challenged a month later.

An agreement was struck with the help of a mediator and was filed in court. The trial scheduled to begin that week, was canceled.

Although some of the terms of the agreement were kept confidential, Mattie, her niece Latoya Shoemaker and her brother Bennie will be given equal shares in what remains of Shoemaker's estate, after the final expenses are paid and any property sold. The will filed in court had provided for only a 10% percent share for Latoya.

Mattie will continue to operate the flower shop that her mother founded 42 years ago. She expressed relief that the episode was over and her mother's name will remain prominent in the community she inspired and served.

"She put everything she had into this corner," Young said at the store at the corner of Dr. Martin Luther King Jr. Boulevard and the former Palmetto Avenue Extension, renamed Veronica Shoemaker Boulevard in honor of the first black person to win election to the Fort Myers City Council.

Reference: (Fort Meyers FL) news-press.com (April 26, 2017) Shoemaker estate issue settled; florist shop stays open

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How Does Pre-Death Probate Work?

People reviewing documents“There are a handful of states that allow a person to probate a will…before the testator… dies. In recent years, there has been a trend to expand this practice to more states.”

This practice, which lets challengers contest the validity of a will before the person who created the will passes away, is explained by Trust Advisor in its recent article, “10 Arguments Against Pre-Death Probate and Will Contests.”

This concept of Pre-Death Probate, or “Ante-mortem Probate,” is only allowed in four states—Ohio, Arkansas, North Dakota, and Alaska. Why don’t more states allow it? It is because of the long-standing legal notion that that a will doesn’t “speak” (or take effect) until the testator’s has died.

You usually can’t bring a suit until the testator dies, because no one has legal standing to contest the will prior to the testator’s death. The trend away from this traditional rule started some years ago.

Recently, a few states have introduced legislation to permit ante-mortem probate and ante-mortem will contests. Ante-mortem probate procedures vary by state, but they generally allow a testator to seek a ruling from the court, while he or she is still living, that his or her will is legally valid. Every heir named in the will must be named as a party to the lawsuit.  Therefore, it binds any potential challengers to the court’s verdict and keeps them from contesting the will when the testator dies.

Those in favor of ante-mortem probate say that there are several benefits to the practice, including: (i) providing certainty and avoiding family disputes after death; (ii) ensuring that the testator can testify in favor of the will; and (iii) discouraging challenges to a will, because if a person opposes the validity of the will while the testator is alive, he or she would be cut out by the testator and disinherited.

Despite these potential benefits, some say the practice is detrimental, leading to increased litigation.

Here are some of the other drawbacks to ante-mortem probate:

Unnecessary Litigation. Litigation is forced on all heirs, when perhaps none of them would have challenged the will under the traditional scheme.

Discomfort. The testator must deal with the litigious heirs, after the litigation is completed.

Do-Over. A pre-death probate proceeding could be a waste of time and resources, since the testator is always free to change his or her will later.

Cost. A pre-death probate proceeding could take a significant chunk of the testator’s retirement savings. Compare this to a conventional will challenge, which is defended by the executor at the expense of the estate since it occurs after the testator is deceased and doesn’t need the money.

Stress. The testator must endure the stress of the pre-death probate proceeding, which entails being deposed, discovery and court appearances.

Privacy. The testator’s privacy could be invaded in any litigation and in discovery.

Reference: Trust Advisor (February 23, 2017) “10 Arguments Against Pre-Death Probate and Will Contests”

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A Few Items to Consider in Your Estate Planning

FamilyIf you have an estate with any real assets, you should carefully weigh the risks of failing to make proper estate plans. This is the message in an article in The Huffington Post, “5 Consequences of Avoiding Estate Planning.” Here is an overview of those risks:

Court. Be prepared with a comprehensive estate plan so your family won’t need a court order to access your funds, if you become incapacitated or die.  You need to consider whether your family can take care of your pets, pay your mortgage, other bills and pay for the cost of your funeral if you unexpectedly pass away. If your family is financially dependent on you, how will they take care of their own needs after you pass?

Probate Expenses. The costs of probate can be significant. Because your family members are bound by the court’s rulings, they might have to spend money on legal fees and get legal representation to dispute the court’s rulings.

Time. Probate can take months or years to settle your estate,  depending on the complexity of the estate and the complexities of your family. The court will designate an executor to your estate, and a family member or a disgruntled heir can contest their portion of the distributions. This adds considerable time and cost to the settling of your estate.

Your wishes ignored. If you don’t detail how you want your estate to be divided, the judge may go with the obvious first choice, a surviving spouse. But is that what’s best and what you want? You should have thought about what happens if he or she remarries and whether the inheritance will pass to the children of the other family instead of your own. Only proper estate planning can ensure that your children and grandchildren will be the ultimate beneficiaries of your estate.

Assets in multiple states. If you have property in multiple states, it can be subject to multiple probate courts, creating separate issues for your vacation homes and investment properties. This means additional probate, time and expense.

Without any preparation, your family will face legal and financial issues that could have been easily avoided. It can cause an otherwise happy family to split at the seams. A qualified estate planning attorney can create planning options tailored to your situation. Take the worry, hassle and expense of your demise out of your family’s hands.

Reference: Huffington Post (February 11, 2017) “5 Consequences of Avoiding Estate Planning”

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The Worst Estate Planning Mistakes by Celebs in 2016

Lawyer buried under paperworkA wealthmanagement.com article, “Top Four Estate Disputes of 2016,” gives us a sampling of some of the major estate planning issues among the recently passed celebrities.

Prince. The rock star died in April of 2016 without a will. Since his passing, a will still hasn’t popped up.  As a result, the Minnesota judge overseeing the administration of his estate has had to handle all of the people claiming to be his kids, who’d get a share of his estate under Minnesota’s intestacy laws. The judge has already excluded 30 would-be-heirs from inheriting a portion of his estate. It looks like Prince’s younger sister and five half-siblings were his only heirs. The judge ordered genetic testing to make sure, and pending the results of the tests, they’ll divide his estate, which is valued at about $200 million. The lesson here, of course, is the most basic: complete an estate plan and keep the documents in a safe place where people can locate them when you pass away.

Frank Sinatra Jr. The son of the famous crooner died in March 2016. At the time of his death, his ex-wife Cynthia had filed for divorce and the two were in litigation. They had originally separated in 2001, but continued to live together, even buying a home together during their separation. Sinatra was ordered to pay Cynthia $5,000 a month in alimony and did so for eight years more than the judge required. Cynthia also said he called her his wife at parties. This supports Cynthia’s claim that the two were in a common-law marriage. In 2013, she filed for divorce again, and a Texas district judge awarded Cynthia the second divorce. This judgment included a $500,000 equalization payment, a share of his property, and another $5,000 per month in spousal support. Sinatra’s appeal was pending when he died, and the appellate court reversed the trial court. That court cited the fact that the couple filed separate tax returns, listed themselves as single tenants in common for the house they purchased, and that Sinatra labeled Cynthia as his ex-spouse in tax returns. The court also noted that a common-law marriage requires a specific and mutual agreement in Texas.

Sinatra could have avoided this by being more careful with his decisions and actions (like consulting with and listening to his estate planning attorney!). Many states don’t recognize common law marriage. Where it is valid, however, folks should exercise extreme care so that their actions don’t give their lover a basis to claim that the parties had a common-law marriage.

Jose Fernandez. Marlins pitcher Jose Fernandez died last fall in a boating accident off the coast of Miami.  The 24-year-old was unmarried, and he reportedly named his mother as the sole death beneficiary in his trust. At the time of his death, Fernandez’s girlfriend was pregnant with their child, but because she wasn’t named in the trust and not married to Fernandez, she’ll miss out on millions. It also looks like Fernandez’s child wasn’t provided for in his trust, but the child wasn’t intentionally left out of the will, so little Penelope still is entitled to a portion of the estate. Time will tell if this will end up in court.

Tom Clancy. Best-selling author Tom Clancy passed away in 2013, leaving an estimated $80 million estate that saw a lot of litigation in 2016. Clancy’s estate plan had three groups of assets. One funded a trust for his second wife, Alexandra Clancy, as the sole beneficiary. The second funded a trust for the benefit of Alexandra and Alexis Clancy, the minor child of their marriage. And the final bucket was for the benefit of each of Clancy’s four children from his first marriage. Originally, estate tax on the estate was to be shared equally between the second and third buckets—the four children would be responsible for $7.85 million of taxes, and Alexandra and Alexis would be responsible for another $7.85 million of taxes. But just before he died, Clancy signed a codicil including a clause that stated that “[n]o asset or proceeds of any assets shall be included in the Marital Share of the Non-Exempt Family Residuary Trust as to which a marital deduction would not be allowed, if included.” The Court of Appeals of Maryland said that the codicil shifted the entire tax burden to the four children’s trusts to maximize the amount exempt from federal estate taxes under the marital exemption. The four children will now be jointly responsible for $11.8 million worth of estate tax. That’s a lot of Bourne novels.

The lesson for “regular” folks: sit down with an estate planning attorney and map out an estate plan, then execute the necessary documents. Your personal business might not be the stuff of gossip columns and celebrity websites, but that’s no reason not to protect your current spouse, your children and your legacy by taking care of these matters.

Reference: wealthmanagement.com (January 31, 2016) “Top Four Estate Disputes of 2016”

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