Estate Administration

The Bernard Matthews Case: Putting a Mistress in a Will

Published on: September 14, 2012 | by Ettinger Law Firm

Last week AOL Money shared the story of yet another estate planning feud–this time involving Turkish business magnate Bernard Matthews who died two years ago when he was 80 years old. Like many others, Matthews family life did not quite fit the traditional mold. He married his wife decades ago and soon adopted three children. Later on he had a relationship with another woman who bore him a son. Still later he started a long-term relationship with a third woman, Odile Marteyn. He remained in that relationship with Marteyn until his death. Through it all he never divorced his wife, and did not marry Marteyn after his wife’s death.

As it is easy to guess–the convoluted family arrangements spawned bitter feuding following Matthews’ death.

From the information that has been provided so far, it seems clear that Matthews’ wished to have part of his estate go to Marteyn. The estate is worth roughly $64.5 million. Part of that includes a villa in St. Tropez worth about $19 million. Matthews wrote a letter to his children outlining his wishes, noting that Marteyn “has supported me unfailingly for many years and particularly so during my recent illness. Without such support, I might not have been able to continue directing our family company for our mutual benefit.”

Fundamentals of Estate Planning: Naming a Trustee

Published on: September 12, 2012 | by Ettinger Law Firm

A trust is the central legal tool used to provide the flexibility and protection most residents use when planning for their long term financial, inheritance, and health care needs. There are many different types of trusts which provide different benefits to residents; each type comes with its own rules. However, one common theme is that the when creating a trust a trustee must be named. Deciding upon the right trustee in your case is crucial to ensure that things proceed as you intend when you are gone.

The exact role of a trustee varies, depending on the long-term plans of the individual who creates the trust. Yet, in general the trustee will manage the assets and make distributions from it according to predetermined rules and wishes. Some trusts will last for decades, and so the choice can truly can set the course for one’s long-term legacy.

A Wall Street Journal post this week touched on the importance of the trustee selection topic, and provided a list of key factors that should influence the final decision, including:

DOMA Challenges Mount

Published on: September 10, 2012 | by Ettinger Law Firm

The Defense of Marriage Act continues to make headlines, as several states have now challenged the constitutionality of the federal law which defines marriage as exclusively between a man and a woman. New York is among three states (including Vermont and Connecticut) which currently allow same-sex couples to wed and are challenging the law which denies federal recognition to those state marriages. The outcome of the legal challenges will have significant estate planning consequences for local same-sex couples.

The underlying legal issue is an old one–the intersection between federal and state law. The states are arguing that the federal government does not have the power to regulate marriage and family relationships–those issues should be left entirely up to the states. DOMA goes too far, they say, by enacting clear harm on married families in individual states.

Estate taxes are at the root of the issue. The most high-profile DOMA plaintiff, Edie Windsor, was forced to pay $350,000 in estate taxes after the death of her long-time partner (and wife). Because her wife was of the same gender, the IRS did not allow her partner to transfer assets under traditional marital deduction rules. This enacted a very real financial penalty which would not have applied to opposite-sex couples. In this way the state argues that the federal government unconstitutionally “unmarried” the plaintiff.

DOMA Developments May Have Implications for Married Same-Sex New York Couples

Published on: March 9, 2012 | by Ettinger Law Firm

The Defense of Marriage Act (DOMA) is a federal law passed in 1996 that defines marriage for federal purposes as only between one man and one woman. As our New York estate planning lawyers have often discussed, this means that same-sex couples married in our state are still not considered married for federal purposes. This has serious implications for tax preparation, estate planning, and a host of other concerns facing these residents. DOMA prevents married individuals from filing joint federal tax returns, receiving Social Security benefits, or having tax-free inheritances.

Many advocates on all sides of the aisle are working to overturn the law. Bills have been advanced in Congress which would repeal DOMA. However, with the current partisan split it appears unlikely that these legislative measures are likely to pass anytime soon. But that does not mean DOMA is here to stay. Most of the recent action on the issue has taken place in the courts. Several federal lawsuits have been filed which challenge the constitutionality of the legislation. President Obama has refused to defend the measure, and so the law is currently being defended under the auspices of the Republican leadership in the U.S. of Representatives.

Last month a U.S. District Court judge in one of those cases found that DOMA (or at least section 3 of the law) violates the equal protection clause of the U.S. Constitution. The case is being appealed to the federal appellate court. This particular ruling relates only to one provision of the law as applied to one couple. However, it is a clear indicator that the entirety of DOMA may one day–perhaps soon–be found unconstitutional.

Digital Assets May Seem Unimportant, But Families Will Want Access

Published on: December 26, 2011 | by Ettinger Law Firm

Modern New York estate plans require consideration of a range of issues that were unheard of even a few decades ago. Of course some of the core aspects remain the same, such as deciding how to pass on tangible assets like the house, car, and personal property. But in this digital age, our New York estate planning lawyers know that complete preparation now must take digital assets into account. Many researchers who have looked into the subject have found that even when an individual does not place any value in their own digital assets, the surviving family members usually have great interest in accessing them.

A story this week from KHAS TV explored the issue. Many community members–including a growing number of older residents–have a wide range of digital data. Interpersonal communication is tracked on Facebook, photos are stored on Flickr, articles are written on blogs, and a range of other information is stored on personal laptops. When a loved one passes on, having access to these sentimental items is something that many grieving family members deem very important. As the story explained, “those things that we sort of use as a vehicle to remember each other by, those things have now become digital.” These days many more items are viewed on a screen than a piece of paper.

But when proper steps are not taken, it is not always easy for family members to access those digital items. As many estate planners are realizing, it is increasingly important for access to these digital assets to become integrated in long term plans. Stories continue to accumulate of widows and children who are desperately searching for information about computer passwords in order to get access to important photos, videos, stories, recipes, and other information that exists only in digital form.

Estate Plan Still Needed to Divide Properly Equally Between Children

Published on: August 18, 2011 | by Ettinger Law Firm

Some local residents believe that they do not need to worry about creating a New York estate plan if they only want to divide all of their assets between their children equally. These community members are under the incorrect assumption that the default legal rules will ensure that everything works out as they wish. Unfortunately, this is rarely the case.

This weekend My SA News discussed this all-too-common mistake of voicing intent to be even-handed with asset distribution but not taking the proper legal steps to carry out that intent. For example, the story used the real example of a family with two parents and five daughters. Both parents had been married to one another their entire lives with no divorces. They did not conduct any estate planning because they always explained that they wanted everything to be divided equally among their children at their death. They did not even have wills drafted.

However, their actions did not reflect that voiced intention, and there was no plan in place to protect the family. For example, after the father died, the mother deeded the family home to the first sister. Later, a second sister deeded another house to the mother, but upon the mother’s death that sister wanted the home back. A third sister visited an attorney and asked for help. She wanted the family home and the second home to be divided equally among the children as the parents always wished.

New Website Services Offers Online Method of Distributing Personal Property

Published on: August 10, 2011 | by Ettinger Law Firm

Most New York estate plans have various components and include several legal documents. Most will have a Revocable Living Trust, Medicaid Asset Protection Trust, or both. A pour-over will is also frequently added as a failsafe to cancel an old will and ensure that any assets left outside the trust are brought into it after death. The plan will have various other facets, including a Power of Attorney, Health Care Proxy, burial instructions, and other final instructions for a family.

In addition, a common practice is to leave a list which indicates which valuables will go to each heir. This list is usually handwritten and specifically requests that a trustee honor its terms. In this way, if a client changes their mind about the distribution of their personal property they can simply handwrite a new list without needing to visit their attorney to cement the change. This step is important because many local families experience in-fighting when trying to distribute sentimental personal property without the guidance offered by a New York estate plan. When more than one family member wants the same item, the stage may be set for strong disagreements that often profoundly and permanently affect relationships. Most family members are under immense stress at the time of a passing which makes the situation even worse.

A few online web services have recently sprung up which claim to help families distribute this property in a fair manner. For example, one of the more popular services is eDivvyup. The website essentially sets up a family auction using non-monetary “credits.” A family first selects an “executor” to set up the auction by cataloging personal items, inviting family members to participate, and assigning credits. Each family member then visits the site and places bids on items of interest to them using the non-monetary credits they are provided. The auctions usually work like eBay, spanning anywhere from a day to several weeks. The goal is that by the end of the auction each family member will have gotten the fair chance to indicate which items mean the most to them.