When a celebrity dies, it is far from uncommon for a contentious legal battle to ensue over the fortune left behind. Sadly, the behavior of the litigants is not surprising. What is surprising, however, is how often the rich and famous fail to leave behind a well drafted and thorough estate plan – a plan that would dramatically decrease the likelihood of litigation. The death of actor Alan Thicke, and the battle over his estate that continues long after his death, is yet another example of this phenomena. Hopefully, the rest of us can learn some lessons from the legal drama that has played out since his death.
Remembering Alan Thicke
People of all ages recognize actor Alan Thicke; however, if you are over the age of about 40 you will remember him best from his role as the TV dad’s in the hugely popular 80’s sitcom Growing Pains. Sadly, America lost one of its favorite dads when Thicke passed away suddenly, at age 69, as a result of a ruptured aorta. Thicke was survived by his third wife, Tanya Callau along with two sons, Robin and Brennan, from his first marriage, and a third son, Carter, from his second marriage. Alan and Tanya had been married for over a decade at the time of his death; however, there were no children from the marriage.
The Battle Begins…
You might be surprised to learn how frequently the rich and famous die intestate, or without an estate plan in place. Thicke must be given credit for not being one of them; however, the estate plan he did leave behind left much to be desired. In fact, it has fueled a battle among his heirs since his death.
Given the likely disparity in net worth between Thicke and Callau at the time of the marriage, it is no surprise that the couple entered into a prenuptial agreement. While this was certainly a wise step on Thicke’s part, the terms of that agreement ultimately conflicted with the terms of Thicke’s estate plan. The prenuptial agreement gave Tanya the right to continue residing on the ranch where she and Thicke resided during their marriage, so long as she maintained the property and paid all of its expenses. The agreement also gave Tanya 25 percent of Alan’s personal effects, the ranch’s furnishings and a $500,000 life insurance policy as well as all of his death benefits from pensions and union memberships and 40 percent of his remaining estate.
For estate planning purposes, Thicke established a revocable living trust back in 1988 which was revised several times prior to his death. The terms of the trust indicate that his three sons were to inherit the ranch, most of his personal effects, and over half of the rest of his estate. Callau would get the furnishings from the ranch, Thicke’s pensions and union death benefits, half a million dollars in life insurance, and anything else in the estate not specifically earmarked for the children. Thicke also appointed his sons Brennan and Robin as Co-Trustees of the trust.
So far, we have a less than harmonious blended family, a prenuptial agreement and a revocable living trust that include conflicting and vague terms, and a trust that is to be administered by the step-sons of the surviving spouse. Not surprisingly, the problems began almost immediately. in charge of the purse strings and Tanya’s inheritance. To date, Tanya has questioned the prenuptial she signed, alleging that it did not properly distinguish between personal property and community property. Robin and Brennan also went to court to block her right to challenge the prenup, but lost that legal battle last year. More recently, Tanya filed paperwork with the court alleging that her step-sons have violated their fiduciary duty by spending the estate assets recklessly, denying her the inheritance to which she is entitled, not keeping her informed, and claiming that she is being charged for taxes and other expenses that are not her responsibility. The outcome of the latest round of litigation remains to be seen; however, the legal fees continue to mount and a resolution does not appear to be in sight.
What Did Thicke Do Wrong?
Thicke must be given credit for attempting to head off disaster; however, the quality of the advice you are given and the content of the documents you execute makes all the difference when it comes to creating a successful estate plan. While there is no guaranteed method of avoiding a challenge to your estate plan, the Thicke estate may not be where it is today had Thicke done three things differently:
- Worked with an experienced estate planning attorney when he created his revocable living trust to ensure that the terms were clear and unambiguous.
- Had the same estate planning attorney review the terms of the prenuptial agreement to make sure they did not conflict with the trust he created.
- Appointed a professional Trustee instead of his sons to ensure that there were no conflicts of interest during the administration of the trust.
Contact California Estate Planning Attorneys
Please download our FREE estate planning checklist. If you have questions regarding your estate plan, contact the estate planning attorneys at the Northern California Center for Estate Planning & Elder Law today by calling (916)-437-3500 or by filling out our online contact form.
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