The death of another celebrity has apparently led to more estate litigation and bickering about who is entitled to the assets left behind. Gary Coleman died on May 28, 2010.  The reporting is raising some interesting issues for probate lawyers.  The bare bone facts, as reported by various news outlets, appear to be as follows:

1. Gary Coleman executes a Last Will and Testament in 1999 and a new Last Will in 2005.

2. Gary Coleman marries Shannon Price on August 22, 2007. Neither the 1999 nor 2005 Last Wills mentions Ms. Price, naturally.

3. In the end of 2007, Gary Coleman executes a Codicil (Amendment) to his 2005 Last Will, giving his entire estate to Ms. Price.

4. Gary Coleman and Ms. Price divorce on August 12, 2008, but apparently continue living together until his death on May 28, 2010.

While the Gary Coleman estate will in reality be subject to the laws of the state of Utah, there are several scenarios that could play out under South Carolina law with this set of facts.  (Click here for more…)

Happy Independence Day everyone! Be safe.

Well, we are almost through one half of the year 2010, and there is not much news to report on what will happen to the federal estate tax. As you may know, pursuant to the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), there is no federal estate tax in 2010. There is also no estate tax in South Carolina this year, as has been the case since January 1, 2005.

In December 2009, the U.S. House of Representatives passed a tax bill that would make the 2009 federal estate tax law permanent, thus locking in the 3.5 million dollar per person estate tax exemption and 45 % top tax rate. The Senate never took up this bill. There has been some political rangling in the Senate lately, but Democrats are unwilling to take up a bill unless they are fully confident they can get a floor vote.  The reasons for this are beyond the scope of this post, but suffice to say that political rangling is preventing new federal estate tax legislation.

With the possibility of a double dip recession looming, the oil spill that will not end, and mid-term elections coming up that may dramatically alter the make up of Congress, one wonders whether anything will happen on this issue. 

What is interesting is what will happen to South Carolinians (Click here for more…)

Lives change. Personal relationships change. Assets change. And certainly laws change.  Why then is your current estate plan fifteen years old, or even five years old?   To borrow a common quote about education and learning, estate planning is by its nature a process, not an event.  If your estate plan was put into place greater than five years ago, you should think about a review.

As a demonstration of the estate planning as a process mantra, consider the (Click here for more…)

What do you do if you find yourself a widow(er) and come to find out that your spouse did not mention you in his/her Last Will?

To answer the question, you need to first determine whether the Will was executed before your date of marriage or after. If it was executed before your marriage, you are termed an omitted spouse, and pursuant to S.C. Code Section 62-2-301, you are entitled to receive your intestate share in the estate, notwithstanding that the Last Will says otherwise. (Click here to determine what your intestate share would be.)

If you are an omitted spouse, you must file a written claim with the Probate Court and to the personal representative within eight months after the date of death or six months after the probate of the Last Will, whichever period last expires. You will not be considered an omitted spouse if, however, the will appears to have intentionally omitted you, or your spouse has otherwise provided for you through other assets, such as life insurance, joint bank accounts, etc.

If you are not an omitted spouse under the law, you have the right to elect to receive a one third share of the probate estate, notwithstanding that the will says otherwise. (S.C. Code 62-2-201). The probate estate is defined to include all assets passing by will plus by intestacy, less funeral and administration expenses, and claims. (S.C. Code 62-2-202).

For elective share purposes, the probate estate will also include assets held in a revocable trust. Seifert v. Southern Nat. Bank of South Carolina, 305 S.C. 353 (1991). This is so because grantors of revocable trusts tend to remain in control of their assets, often serving as the trustee and beneficiary during their lifetimes, with full power to revoke the trust or otherwise direct where the assets will go. Such arrangments are considered illusory (for elective share purposes only) and will not be protected from the surviving spouse’s right of election.

To make a claim for elective share, the surviving spouse, his attorney in fact (or a court in the case of a protected person) must, during the surviving spouse’s lifetime, file a written petition for elective share with the Probate Court and the personal representative, within eight months after the date of death or six months after the probate of the Last Will, whichever period last expires.

Now that we have gone over some of the basics of the omitted spouse and the right of election, tune in next time for a discussion of what some unscrupulous people will do to be able to claim an elective share in an estate, and why sometimes it works.      

Like any decent lawyer, I need to add a disclaimer here: unfortunately, it is impossible to offer comprehensive legal advice over the internet, no matter how well researched or written. And remember, reviewing this website and my blogs doesn’t make you a client of my Firm: before relying on any information given on this site, please contact a legal professional to discuss your particular situation.

In Verenes v. Alvanos, (Op. No. 26780, S.C. Supreme Court, filed March 1, 2010), the South Carolina Supreme Court took up the right to jury trial in Probate Court. The case involved claims made against a trustee for breach of fiduciary duty of care, breach of fiduciary duty of loyalty, and for an accounting.The various reliefs requested were for surcharge of the trustee, disgorgement of commissions and profits, and for an account. The trustee sought a trial by jury, the probate court denied his request. Here’s why.

The U.S. and S.C. Constitutions hold the right to jury trial in high esteem, the right is a fundamental one. However, you are not entitled to a jury trial in all cases. The right to trial by jury attaches to actions at law. However, the right to trial by jury does not attach in cases in equity. An action at law is typically a case for money damages. An action for a breach of fiduciary duty is typically an action in equity, however, the court notes that it has been held that an action for breach of fiduciary duty could also be an action at law.

How do you draw the distinction? The Court looks to the remedies requested. In this case, the remedies sought included surcharge, disgorgement, and an accounting. These remedies fall squarely within the equity jurisdiction. Equity jurisdiction does not support a request for a jury trial. Thus, no right to a jury trial for the appellant here.  

While out on the town with some friends the other night, somebody asked me what estate planning was for.  I thought about the question for a moment, quickly racing through what my answer should be, and realized that there are many different ways to answer that question, because the goals to be accomplished by estate planning can be varied, depending on the individual situation.

My answer was three fold.  First, estate planning allows for the orderly transfer of assets to your heirs after your lifetime. Second, estate planning allows you to protect your heirs from the potentially detrimental effects that an inheritance can have. Thirdly, estate planning can be utilized to protect assets. 

The estate planning task can also vary based on the stage of life you find yourself at. If you are at a younger stage of your life, estate planning can address issues such as guardianship for your children, and management of your childrens’ finances.  If you are at a later stage of life, estate planning can address transmission of retirement assets and protection of assets from medical expenses and, if the estate is large enough, from the estate tax. 

The typical estate plan is made up of several basic documents. They are the Last Will and Testament, the General Durable Power of Attorney for Finances, the Durable Power of Attorney for Health Care, and possibly a testamentary or inter vivos trust.  The documents to be used depend on the individual situation.

I am often asked how much an estate plan costs. My standard reply is that that is a lot like walking into a car dealership and asking the salesperson how much for a car. The answer is it depends on what you need. You can expect a truly barebones simple estate plan to run several hundred dollars, to several thousand dollars for an estate plan utilizing one or more trusts. It can seem like a significant investment, but some attorneys will give you a free consultation to discuss your situation.

Like any decent lawyer, I need to add a disclaimer here: unfortunately, it is impossible to offer comprehensive legal advice over the internet, no matter how well researched or written. And remember, reviewing this website and my blogs doesn’t make you a client of my Firm: before relying on any information given on this site, please contact a legal professional to discuss your particular situation.