Estate Planning: Don't be James Brown

Singer James Brown attempted to have an Estate Plan in place but it seems there were a few glitches which are now resulting in his heirs receiving nothing and a lot of lawyers (21 showed up at the last court hearing) earning a paycheck from the resulting legal battle over his estate.

In August, 2000, Brown signed a will leaving his "personal and household effects" to his six children and created the "I Feel Good" trust to educate low-income kids in South Carolina and Georgia.  And then he married his fourth wife and did not update his will to include her and the son their son. And, to complicate matters, the lawyer he hired to create his will is serving 30 years in a South Carolina prison (another reason to be sure you are using a lawyer who specializes in estate planning and maintains a positive track record).

And then to make his estate situation even more interesting, James mortgaged the royalties to most of his songs to TIAA-CREF, the financial services company which was originally created for teacher's pensions (they opened their doors to all investors several years ago).  James Brown received $26 million in this deal and TIAA-CREF now receives the revenue for his song royalties until his loan balance is paid off.  Because of this, it could be as long as 10 years before the loan is paid off.

James Brown passed away on Christmas Day, 2006, and with his beneficiaries still fighting over his assets, the only real heirs are the lawyers.

What lesson can we all learn from this:  plan ahead, use quality lawyers, update your will when children are born or you marriage status changes and, most importantly, pull the family together in a meeting with everyone present to communicate the estate information to them.  This way you have witnesses for your wishes, to provide added credibility to your written plans, to assist when an heir decides to dispute.  Of course, it probably helps to not have as many wives and mistresses as James Brown had, but such is the life of a rock star!

 

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Comments (1) -

  • Kelly H.

    8/4/2008 3:29:30 PM | Reply

    I never knew how many issues must be addressed for an estate plan - there are 4 kids in my family and many grandchildren which always does complicate the situation.  Thanks for the info!

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