THE CHALLENGES OF A “CHALLENGING” WILL

by Juli Findling, Senior Paralegal

Wealthmanagement.com Senior Editor, David Lenok, hosts a very interesting and entertaining podcast called Celebrity Estates: Wills of the Rich and Famous, where he showcases everyday estate planning topics with, as the narrator says, “the volume turned up!”  One of his recent shows, with Co-Host Megan Gorman of Chequers Financial Management, discusses the estate of celebrity Michael Nesmith, Monkees pop band member and heir to the Liquid Paper fortune left by his mother, the founder.  When Michael Nesmith died on December 10, 2021, at age 78, he left a 2014 one-page holographic will (handwritten and not signed by two separate witnesses).  His probate estate is estimated to be worth between $2 and $4 million.

Since the airing of that podcast, it has come to light that Nesmith wrote a number of wills during his lifetime.  However, his latest, the holographic will, bypasses his four children and leaves his estate to the Gihon Foundation, a charitable foundation created by Nesmith’s mother.  The will also leaves all of his personal property to his third ex-wife, with whom he did not have any children.

Nesmith’s children are, not surprisingly, contesting the 2014 will, maintaining that their father’s 1994 will is the valid one.  One, amongst other problems: a copy of the 1994 will cannot be found.  Since recently filing their challenge (caveat), complicated legal proceedings have begun that may be what Megan Gorman, CFP, describes as an outcome common to poorly-written wills – Pandora’s Box.

While the State of Georgia does not accept holographic wills as valid, we DO encounter a variety of wills that are poorly drafted by individuals or online will-drafting sites, improperly signed or witnessed, and many that simply do not follow a logical estate-asset distribution to accomplish the testator’s goals.

It appears from Nesmith’s 2014 will that his intent was for everything in his estate to go to the charity. Simple, right!? However, using his 2014 will to accomplish this automatically forced Nesmith’s estate into probate. Here are some downsides to this situation:

PROBATE PROCEEDINGS COST MONEY:

• Because Nesmith’s will did not appoint a personal representative (called and Executor or Administrator in Georgia), a court proceeding to appoint one is required. Further, a personal representative can charge a fee for their services in that role.  In Georgia, that fee equals 2.5% of all funds received by the estate and 2.5% of all funds paid out of the estate.  Assuming Nesmith’s estate was valued at $3,500,000, a personal representative’s fees would total roughly $175,000.

• If a will meets the minimum standards required by the Court, courts are hesitant to digress from what is written therein, if at all possible. Successfully contesting a will requires proof of one of four to five grounds that may be difficult and expensive to sufficiently prove to effectively overturn the will originally filed. Court filing and administrative fees, investigation expenses, attorneys’ fees that result from Nesmith’s children’s caveat could further eat away at the estate’s corpus.

• Some states charge statutory probate fees, like Florida, or California, where Nesmith’s case is in probate. If his estate was valued at $3.5 million at the time of his passing, fees owed to the state would total $34,000.

In summary, all the money spent to pay state probate, court, personal representative, and attorneys’ fees, as well as potential creditor claims, means that a lot less will go to Nesmith’s chosen charity than he had intended.

PROBATE PROCEEDINGS ARE PUBLIC RECORD:

• The will and the court proceeding documents are available for all to see, including creditors. If a creditor of the estate came along with a valid claim, the estate will be required to pay it.

MESSY ESTATES CAN CAUSE MESSY FAMILY FALLOUT:

• While Michael Nesmith thought his handwritten will simply and easily accomplished his single goal, he may have been banking on the fact that his heirs would all be in agreement. However, rarely do multiple family members, especially those from blended parentage, agree on things when it comes to money. Lasting damage to family relations may have never occurred to Nesmith when writing his will, and it will be interesting to see what follows with this case.

Many of our clients also choose to give part of all of their estates to charitable foundations, which we applaud and encourage under the right circumstances. Incorporating a Revocable Living Trust into your estate plan is a simple and cost-effective way to accomplish this and keep things from evolving into a Pandora’s Box!

Our attorneys will be happy to assist you with your entire estate plan, including how to provide for your favorite charity. For more information, please visit the Hoffman & Associates website at www.hoffmanestatelaw.com, call us at 404-255-7400, or send us an email.