Is Your Will Up-To-Date?

Please contact Norbert Cornell at norbert@accountants.com.au, 61 2 99568008 or 61 0437 381288

Once upon a time, there was a very, very old billionaire named J. Howard Marshall. One day he met a beautiful model named Anna Nicole. J. Howard Marshall fell in love with Anna Nicole because of her wonderful personality. Anna fell in love with J Howard Marshall because of his chiselled good looks. Because they loved each other so much, they got married. Sadly, J. Howard Marshall died unexpectedly. The terrible tragedy in their family continued with Anna Nicole also dying, leaving an inheritance worth hundreds of millions of dollars.

Sorry, but we don’t think this story will have a happy ending. Why? Because Anna Nicole didn’t pay enough attention to her will

Anna Nicole’s Will is apparently out-dated. Everyone wants custody of her infant daughter. Her advisers are being threatened for not addressing her Estate Planning. The people most likely to end up with Anna’s estate are the lawyers.

Nicole’s Will surfaced last week. Her Will resolves nothing. It states that her entire estate goes to her son Daniel. Sadly, Daniel died in September of 2006. Who gets the dough now?

The Will is poorly drafted and is deficient in many areas. There is nothing regarding her new-born baby Danneilynn. Anna’s friend “Stern” is not mentioned at all even though Anna joined in a “commitment ceremony” with Stern late last year.

Adding to the confusion, Smith’s will contradicts itself. In one section, it includes a curious provision which appears to specifically disinherit future spouses and children, which would include Danneilynn. It reads:

“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”.

However, in other sections, it specifically instructs the executor of Smith’s will to manage the estate to provide for her “children.” This language appears to provide a portion of the estate for the care of Dannielynn.

If there is still any chance that a husband and wife (or de factos) might have children a Will should include “unborn children” as beneficiaries. That’s how I would have done it.

The next issue is Guardianship. Money does not follow the Guardian. Money follows the Executor. The Executor generally keeps the money in trust for the minor. That money is protected by the financial planners and accountants. Often you may want the Guardian and Executors separate.

Regardless of the size of Anna’s fortune, the confusion surrounding her estate could have been avoided by following a few simple estate planning guidelines.