A celebrity estate battle that held center state in Houston gives us another valuable estate planning lesson. A recent WealthManagement.com article, titled "Anna Nicole Smith’s Estate Runs Out of Options," illustrates the critical importance of creating estate planning documents that have as much detail as possible.
Anna Nicole Smith was a famous Guess Jeans model and Playboy Playmate. She married J. Howard Marshall in 1994, after meeting in the Texas strip club where Smith worked. Smith was 26, and he was 89. Marshall died 14 months later and left his entire $1.6 billion estate to his son, Pierce. Anna Nicole received nothing.
Smith challenged the will soon after Marshall’s death. She said he promised to leave her more than $300 million in addition to the cash and gifts he lavished on her during his life (which were worth about $8 million). A Houston court found the will to be valid, and the ruling was affirmed on appeal.
Smith then moved to California and filed for bankruptcy, claiming that Marshall promised her a larger share of his estate than she received. The court awarded her $450 million from Marshall’s estate, later reduced to $89 million by a federal judge in 2002. However, on appeal, the Ninth Circuit Court of Appeals reversed the bankruptcy court’s decision, holding that a bankruptcy judge did not have authority to rule on a probate case. Years later, the Supreme Court affirmed the Ninth Circuit's decision.
Marshall’s will had more judges picking it apart than one can imagine. His will had to survive intense examination from federal courts all over the country for almost 20 years.
Billionaires and Bunnies alike need to have the best estate planning. So, too, do those of us who fit into neither of those categories. The way to do this is to speak with an experienced estate planning attorney. Eliminate issues that have a habit of popping up when money is involved, and you are no longer around to tell your family exactly what you meant in your will.
Reference: WealthManagement.com (September 2, 2014) "Anna Nicole Smith’s Estate Runs Out of Options"