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Anna
Nicole Smith's WillAnna Nicole Smith's Will - The Saga
Continues for Her Family
Anna's Estate Plan Is Not Completely Worthless - It Can Always Be Used as a Bad
Example
by Richard
Keyt, Arizona Estate Planning Attorney
June 2, 2007
Poor, poor Anna Nicole Smith, also known as Vickie Lynn Marshall.
Controversy followed her throughout her adult life, and now it follows her in
death. Her untimely death opened a new chapter of prospective litigation
for her family. Anna's legacy to her only living child
Dannielynn is years of expensive public litigation
because she did not have a good estate plan.
Ann Nicole Smith's Will is a Classic Example of Why Everyone Needs a Well
Designed Estate Plan
Some estate planning attorneys might say that even though
Anna Nicole Smith signed a Will on July 30, 2001, she
died without an estate plan. Here are my observations about Anna's Will:
1. Son Daniel is the Sole Heir.
Article 1 states:
“I have one child DANIEL WAYNE SMITH . . . . Except as otherwise
provided in this Will, I have intentionally omitted to provide for
my spouse and other heirs, including future spouses and children
and other descendants now living and those hereafter born or adopted, as
well as existing and future stepchildren and foster children.”
Anna's Will expressly states that it does not provide
anything for
Dannielynn, her child
born after she signed the Will. If Anna married Howard
K. Stern, the Will also excludes him.
2.
Assets Left in Trust to Daniel.
Article II states:
"All of the property of my estate (the "residue") . .
. . shall be distributed to HOWARD STERN, Esq., to hold
in trust for my child
under such terms as he and a court of competent
jurisdiction may declare, such that my
children are
distributed sufficient sums for the health, education,
and support according to their
accustomed manner of living from either the income or
principal of the trust until age twenty-five; and are at
that time given one-third of all of the income of the
trust and one-third of the principal of the trust as
then constituted; and at thirty are given one-half of
the income from the trust and one-half of the principal
of the trust as then constituted; and at thirty-five are
given all of the principal of the trust."
This Article gives everything in trust to Daniel Wayne Smith, Anna's
now deceased son. The Will is silent on whether Daniel must be
alive at the time of Anna's death or if the estate goes to Daniel's
estate if he were deceased when Anna died.
Article I says Anna has one child, but Article II refers to
"children" and "their," which is inconsistent with having one child.
Query: Does the language in Article II suggest that Anna intended
the trust to benefit more than one child?
Note also the particularly troubling language that says the terms of
the trust are to be determined by the trustee and a court. I have
never known an estate planning attorney to create a trust that does not
contain terms, conditions and instructions to the trustee on what to do
with the assets of the trust. Nor is it practical for a trustee
and a court (what court?) to guess about the terms of the trust.
How does the trustee go about drafting the terms of the trust with the
court? This clause is an invitation to all interested parties to
litigate the terms and conditions of the trust.
3. Restatement that After Born Children
Are Omitted. Article 6.2 states:
"Except as otherwise provided herein and in the Trust, I have
intentionally omitted to provide for any of my heirs, or persons
claiming to be my heirs, whether or not known to me."
This provision further reinforces Article I by restating that the Will
provides only for Daniel Wayne Smith, Anna's now deceased son, and that
Dannielynn is excluded.
4. No Living
Trust. Apparently Anna Nicole Smith did
not have a trust. If she had a trust at the time she signed her Will,
the document should have provided that all of the residue of her estate
would go to the trustee(s) of her trust to be held and administered as
provided in the existing trust. A good trust based estate plan
consists of a Revocable Living Trust and a Will with a "pour-over clause,"
which is a clause that says everything in the probate estate that is not
given away goes to the trustee(s) of the pre-existing trust.
Unfortunately for Dannielynn, her mother's estate is a
mess and it may take years of costly litigation to determine, what, if
anything, she inherited from her famous mom, Anna Nicole Smith, aka Vickie
Lynn Marshall.
5.
Who Inherits Anna's Probate Assets?
Anna's Will left everything to her son Daniel, but he died before she did.
The Will expressly disinherited her only living child, Dannielynn. The
Will did not contain language normally found in a Will that says that a gift
to an heir will lapse if the heir is not alive when the maker of the Will
dies.
6. Which Law
Applies to Anna's Probate Assets? Was
Anna a resident of California or the Bahamas or else where at the time of
her death? The law of the applicable jurisdiction (where ever that may
be) will determine if Anna's probate assets go to the estate of Daniel Wayne
Smith, Dannielynn or somebody else. A court could apply the law of
intestate succession (i.e., the statutory method of inheritance when
somebody dies without a Will) because the Will does not name an alternate
heir in the event Daniel predeceased Anna. and because Dannielynn was
expressly omitted as an heir.
Lessons to Be Learned
Anna Nicole Smith's lack of a good estate plan illustrates a valuable lesson
for all of us:
Because we will die one day, our families and
loved ones will suffer unnecessarily if we do not have a properly drafted
estate plan in place to protect them.
If you do not have your estate plan in order, the legacy you leave your loved
ones may be:
-
The wrong people may inherit your
property.
-
Wasting large sums of money and time in court
litigating over your assets and/or guardians of minor children.
-
Airing of your "dirty laundry" in open court.
-
Loved ones who inherit property outright at a
young age when they will quickly spend their inheritance because they lack the
maturity and knowledge to protect their inheritance.
- The lack of a properly drafted Personal Asset Trusttm
that can protect an inheritance from creditors, predators (ex-spouses and
con-artists), and bankruptcy court.
It is very common for people to send thousands of dollars on things like
plasma TVs, computer systems, music systems, cameras, cars, boats and trips, but
nothing to protect their families and loved ones if they were to die. As
an estate planning attorney, my motto is:
Spend a little money on a good estate plan to protect
your family and loved ones before you spend a lot of money on your adult
toys and fun.
Attend Rick Keyt's Free Monthly Estate Planning Seminar
Do not procrastinate. Take the first step now toward protecting your
loved ones by creating a good estate plan. Sign up to attend one of
Arizona estate planning attorney Richard Keyt's free (no obligation) monthly
seminars on Wills, Trusts and estate planning held in central Phoenix, Arizona.
See the flyer for the next seminars.
Contact Richard Keyt at
rickkeyt@keytlaw.com or 602-906-4953, ext. 101 if you would like Rick to
schedule a talk on estate planning for your group.
How To Make a Reservation for a Free Estate Planning Seminar
If you would like to attend one of Richard Keyt's free estate planning
seminars, call our reservation line at 800-921-6856. Our customer service
representative will take your reservation 24 hours a day, seven days a week.
Links to Other Stories About Anna Nicole Smith's Will
-
Anna Nicole Smith's Will - Another Fine Mess - Patterico Pontifications
-
Lessons to be Drawn from Anna Nicole Smith's Lousy Estate Plan - from
MarketWatch
-
Lesson From Anna Nicole: Prepare An Estate Plan - from Forbes magazine
-
Anna
Nicole's Daughter is No Million-Dollar Baby - from LegalTimes.com
-
The Litigation-Filled Life of Anna Nicole Smith, and the Legal Aftermath of Her
Demise - by Law Professor Joanna Grossman
-
Even for Anna Nicole Smith - Where There's a Will - Attorney & former U.S.
Congressman Robert E. Bauman.
-
Marshall vs. Marshall - the May 1, 2006, legal opinion of the U.S. Supreme
Court, which was a victory for Anna Nicole Smith.
Arizona Estate Planning Attorney
Richard
Keyt prepares wills, living trusts, estate plans and other related
estate documents for Arizona residents. Rick, a former partner in one of
the largest law firms in Arizona, has practiced law in Arizona since 1980. Rick's email
address is rickkeyt@keytlaw.com.
His direct phone number is 602-906-4953. Rick's web site is
KEYTLaw.com, located at
www.keytlaw.com.
