Episode Transcript
[00:00:00] Foreign.
[00:00:05] Hey, everybody, it's Lauren. And I'm here today to do the Llamas podcast. I am by myself. Lacey is recovering from a stomach bug, so I'm here to do this by myself today. We will hopefully be back together soon.
[00:00:19] It has just been a little bit of a busy and crazy time for both of us. Lacey's had a big trial out there.
[00:00:27] I have been in court more than I normally am, and my schedule has just been packed. And we're here. Well, I live in the upstate of South Carolina. I'm technically in Spartanburg, which is where we have the massive measles outbreak. And as you know, the flu has been really high. So hope and wish and praying we don't get any of that. And right now we are dealing with the threat of a major ice storm hitting us. So it is a little crazy here right now. And hopefully we will be back together and have a beautiful, better program for you all coming up in February with more topics.
[00:01:00] And I'm kind of wanting to keep with my topic. I talked about of New Year's resolutions and estate planning and to show you why you need to do good estate planning and sometimes why things go south.
[00:01:12] And I wanted to talk about some prominent cases out there that have been dealt with with estate planning.
[00:01:21] So, you know, recently we have seen a lot of celebrities pass away, and a lot of times they have trust that deal with these or they have, you know, all these complex things to be able to handle the estate administration.
[00:01:39] But here in South Carolina, we have a really famous case which just really included a will that we are still dealing with in litigation to this day.
[00:01:49] Many of you know who the singer James Brown is. James Brown is originally from South Carolina. He died in 2006, so we are almost at the 20 year mark. He died at Christmas 2006, so we're almost at 20 years from now.
[00:02:05] He died in Atlanta, but he was from South Carolina, had a lot of property in South Carolina, and his estate has been the subject of a lot of litigation. I remember talking about his estate when I was in law school, which I graduated in 2013. And yet his estate has still not been settled. He had a relatively large estate, but it's complicated because a lot of his estate came from music royalty rights and copyrights and those type things. He had real estate. He had a mansion here in South Carolina. I think he had various real properties. He was what we call cash poor, though, because he didn't have a lot of cash in hand and he also had a lot of debt. I Believe we were around $16 million in debt or when he passed away for some real property and those type things. So nobody knew the extent of his estate when he died because of just a complex estate as far as how do you finance it and those type things. It was anywhere from 6 million to 100 million. So he had some stuff, but how much was it worth?
[00:03:11] And so one thing to know, Brown had a will.
[00:03:16] Brown also had been married four times, I believe four ex wives. And he had six children that were known or he claimed or legitimate or whatever else at the time of his death. So in this situation he wrote a will. He did not leave his estate to these people. Mostly he pretty much wrote them out of his estate. Who he left his estate to was scholarship funds for children in South Carolina and Georgia. He wanted these to go to children in poverty to help them out as that had been his situation in his life and he wanted to help those. So he had a will. He did his will in 2000. He died in 2006. He passed away of congestive heart failure. So I don't think there's really issues when you think about it about mental clarity because he didn't die of Alzheimer's, didn't die of dementia.
[00:04:07] It wasn't like those things were going on.
[00:04:11] He pretty much passed away congestive heart failure. But his will had even been done six years. So he didn't do it on the brink of dying. He had it done many years in advance and from my understanding it was properly executed. We had our witnesses, all that type stuff. But when you're writing out your children and your ex wives, there's probably going to be a will contest no matter if you do everything perfect. Which is kind of why I'm surprised he didn't do like era of trust and those type things to have these assets outside of probate, have these assets where nobody could really. I feel like when you do trust there's a little bit more protection and if you do an irrevocable trust, you know, there's possibly more protection. But at the same point, James Brown grew up in rural South Carolina and maybe didn't think about these things. Cuz even though he had a big estate, he may not have understood all he had in the different ways to be administered. It's a lot to take in.
[00:05:14] So he established in his will a trust for poor school children in Georgia and South Carolina. He had a very good mission and those type things.
[00:05:26] So inside of his will he named three people as his executor. Of his estate. He listed his accountant, his lawyer, and then somebody that used to be a magistrate judge. So three people he thought could handle this. Because a lot of times we do see accountants in those roles. We see attorneys, for sure.
[00:05:45] So he did that. I mean, obviously the kids contested it.
[00:05:51] Just so y' all know, I see a picture of his will. I'm looking at it. It was drawn up by a attorney in Columbia, South Carolina, Dwayne Herring.
[00:06:03] So, I mean, he did a legit will. Everything inside of the will was that trust fund that was established for scholarships, the I Feel Good trust fund.
[00:06:15] You know, he had a lot of big hits. So we're dealing with all of that. So realistically, what happens at first is, you know, the wives and the children are going to contest everything. It seems like some of that gets taken over and, you know, we're dealing kind of with other assets. And then we have the issue that Canon, I believe, the accountant pretty much stole from the estate. So we're dealing with that.
[00:06:46] And so then there was, after that, a judge appointed a different person as executor. The children had asked for a special administrator, that is, somebody to come in and administer the estate.
[00:07:03] And so the judge did appoint person as executor because it looked like David Cannon. And he pled guilty to embezzling $8.6 million of the estate. He was sentenced to three years of home confinement following a plea agreement with the Attorney General's office.
[00:07:26] He did end up spending some time in prison because he was brought in on contempt, I guess, of his home allowance.
[00:07:34] And the other two PRs at the time were not implicated in crimes, but they were forced to resign.
[00:07:42] Now, Cannon and Bradley are both deceased at this point. So at this point, they do appoint another person to handle it.
[00:07:51] And so while the estate is large because he has a lot of assets and different things, there isn't a lot of cash. So they have to have an estate sale to bring in some cash.
[00:08:06] His children had wanted to turn his mansion into Graceland, like we have for Elvis, that, you know, brings in money to this day. But that didn't seem like that was going to happen.
[00:08:16] They did have an auction.
[00:08:19] It didn't go as well as they wanted it to go.
[00:08:22] It really went bad. And then there were lawsuits brought from the children to resolve all of this.
[00:08:33] And then the Attorney General's office got involved, which we see that this happen sometimes with charities. The attorney's office, Attorney General's office will get involved when there's charities here and here we're supposed to have an establishment of, you know, a charity through his will. So the AG's office gets involved with that.
[00:08:53] It was just pretty much a nightmare with all of this. But the judge did appoint that special executor at this point. Pretty much a new person to be praying who's been trying to work through this estate.
[00:09:09] But multiple, multiple lawsuits were bri brought over it.
[00:09:17] There were issues with the his current spouse at the time under the. There's something in South Carolina called omitted spouses where they have a right. If you did your will before you were married, you have a right. And you also have a right to get a third of this state.
[00:09:36] Cuz she was trying to claim like a common law wife situation.
[00:09:41] But all of that is resolved. But it seems that this estate from my reading and I'm trying to look is still.
[00:09:57] There was a major agreement in about 2021, but ultimately the estate estate has not fully been settled and closed at this point.
[00:10:06] From my understanding. I could be a little off with that, but reading some articles. But it did eventually get to fund scholarships for children for the most part. There's still, I think some issues on truly closing the estate. But after lots of litigation and this is the thing, Brown went and did a will. He set it up, he had two witnesses. He did what he was supposed to do, created this fund for children.
[00:10:32] And it still went through 20 years, give or take of litigation to be able to actually find any of these scholarships.
[00:10:43] There is still, I think from looking at this, there still could be some little pending issues, but most of it has been worked out.
[00:10:52] But even though he left a will, most of his estate was not settled until 2022 with still some pending issues. He did have a complex estate because he was cash poor, but had a lot of assets, rights, royalty. We had a common law spouse come in trying to make a claim that she should get part of his assets, which didn't hold up. He pretty much wrote out his children and everything. So overall, even though you have a will, it doesn't always mean that it's going to be perfect. And that's what I tell my clients so many times is well, if we do this, can they contest it?
[00:11:27] I can never guarantee somebody is not going to contest something. All I can do is follow the laws and do it as best as I can to make it as hard as possible for them to contest us. So realistically, what Brown wanted did come to fruition. It did go to children's scholarships. But a lot of that money was lost in the Process due to attorneys fees, cost and everything, administration cost, which I can't stop that. That attorney that drafted that will maybe should have mentioned, you know, let's do some trust or things. But maybe he did. And maybe James Drummel was like, nah, I don't care, let's go to probate. So at that situation, the will was properly executed and you still have these issues. So it doesn't mean that because you properly execute a will there will not be some challenges. We're hoping to do stuff as best as possible to make it where there are as least issues as possible, but we can never guarantee that.
[00:12:22] It's really a complicated situation.
[00:12:27] I will say, if you're thinking about this, you know, even though you have a trust does not mean it's always going to be wonderful either. So there's Jimmy Buffett passed away, what about three years ago now. And his case isn't as exciting as the James Brown case is pretty boring type stuff.
[00:12:46] But when he passed away, he did set up a trust for his wife to get so much of the income of the trust for life. And realistically this trust was a really large trust.
[00:12:56] So the income on it for life should have been like she was getting at least like millions of dollars every year and the trustee who was managing the fund. So with a trust, you have the trust, you have the trustee who's kind of managing the trust, you have the beneficiaries, those are the people getting the money. And you have the settlor, this is the person or grantor creating the trust. So they can be different people. Sometimes it's all the same person, It's a mix of people. So in this situation, Jimmy Buffett created the trust, he's dead, settler's gone. We have trustee, which is some banker company, and then we have the beneficiary as his wife with income for life. But in this situation, the trust was not making as much money as it could have. Like they were investing it in assets that she didn't believe were as income producing as they should have been.
[00:13:46] So she sued the trustee because she's like, okay, I only got a little bit of money from this when realistically I should have got a lot more money from it. And so in that situation, she sued. And I believe the court ordered more better investments make more money, because sometimes if it's not income producing enough, the beneficiary has rights to force the income production. So even having a trust does not guarantee there's not going to be litigation as we see in Jimmy Buffett's estate, we got litigation because the trustee is not managing the money the way the beneficiary wanted to. Beneficiary sues the trustee.
[00:14:26] And then one other case I want to throw out there that we've talked about before is the Menendez brothers. So you know, they murdered their parents. They were their parents, sole heirs. And I don't know if they had a will or not, but probably in the will everything would have went to each other. And the kids is usually pretty normal.
[00:14:42] But I think they forgot about something called the slayer statute. So if you murder someone, you cannot inherit from them. That is a law called the slayer statute. So because of that law, even though they should have been entitled to the estate, they cannot inherit from their parents estate when they murdered them. I mean, I feel like that's kind of common sense, but maybe people don't realize that. Well, obviously they thought they were going to get away with it and everything.
[00:15:09] And I truly don't know how this would play out if they had been found not guilty of murder, but maybe manslaughter because of like. Or if they'd been found not guilty because they'd been abused and those type things how that would roll into the probate court. And maybe I'm gonna do a deep dive and see if I can find some stuff on that. How the slayer statute works when it's justifiable homicide, I guess like kind of seeing like if you killed your husband because he was beating you up, can you inherit then? Like, I don't know. I'm gonna do some research into that, but I just wanted to bring that case up as well.
[00:15:46] So we see here in South Carolina, one of our biggest cases was James Brown, where he had a wheel and it still didn't go easy or right. And sometimes it just. There's nothing you can do but keep watching us. Hopefully we'll get some back together and have some new content for you. As I know some of this isn't the most exciting, but I think it's interesting things to hear and know and on that New Year's resolution, make sure you get your will and estate plan and documents done and we will see you next time. Have a great week and hopefully everyone stays safe and we don't get a ton of ice.
