The lives of socialite Brooke Astor and the Grateful Dead’s Jerry Garcia may have had little in common, but what happened after both of their deaths is unfortunately similar. A look at the disastrous probate wars that engulfed them – and other celebrities – carries important lessons for all of us.
A lifestyle of generous spending accompanies fame and fortune, and such vast wealth may seem far removed from the retirement planning that is the everyday challenge for advisors and their clients. In death, however, those riches often become the subject of divisive and contentious struggles, the result of poor estate planning – a problem any of us can face.
Russell Fishkind, a New York-based estate attorney, has documented the most spectacular such disasters in his recently published book, Probate Wars of the Rich and Famous, which is available via the link above.
Fishkind offers a number of lessons, but first let’s look at how some ill-conceived and poorly executed estate plans led to legal battle among the descendants, executors and would-be beneficiaries of the rich and famous.
Brooke Astor
John Jacob Astor was perhaps the nation’s first multi-millionaire, turning a fur trading business into a real estate empire in the early 19th century. In 1953, his fifth-generation descendant, Vincent Astor, whose father had perished on the Titanic, married Brooke Astor. It was her third marriage, and she had one son, Anthony Marshall, from her first marriage. Anthony later married and had a son, Phillip.
Vincent Astor died in 1959, leaving Brooke as the sole inheritor of the Astor fortune. During her lifetime, she donated approximately $200 million to various charities, but she had $100 million remaining when she died in 2007 at the age of 105.
In the last years of her life, Phillip charged that she was the subject of elder abuse by his father, Anthony. Anthony was also accused of financial self-dealing and other improprieties. In 2009, the then 85-year old Anthony was convicted on multiple counts of fraud and larceny and sentenced to one-to-three years in prison.
Brooke Astor executed a will in 2002 that, according to Fishkind, was tax-efficient and reflected her desire to donate the majority of her wealth to charities ranging from the Metropolitan Museum of Art to the New York Public Library. She amended it, however, with three codicils executed within months of each other. The first two drastically reduced the charitable donations and placed much of Astor’s wealth under Anthony’s control. The purpose of the third codicil was unclear, but Fishkind speculated that Anthony had a nefarious role in its execution. Anyone objecting to the will would have to contest the codicils in reverse chronological order and would likely spend years in court overturning the third codicil, leaving Anthony to enjoy the benefits of the first and second codicils.
The estate of Brooke Astor is still being litigated. Brooke’s friend, Annette de la Renta, has claimed that the 2002 will is invalid and a 1997 will and codicil should govern distribution.
Fishkind offers a number of lessons from the Astor saga. First, be proactive. If you sense misdealing or that someone is being taken advantage of, be forceful in raising your concerns; Fishkind credits Philip with doing this effectively. One can also execute a power of attorney that appoints two co-agents, he points out; Brooke Astor’s will appointed only one – Anthony.
To avoid charges of diminished mental capacity, which may arise in Brooke Astor’s case, Fishkind recommends videotaping the signing of a will and hiring psychiatrist or psychologist to certify mental capacity at the time.
Jerry Garcia
Jerry Garcia came from a very modest background, taught himself guitar at age 15, and founded the legendary rock band the Grateful Dead in the early 1960s. He became an immensely successful and respected musician, but his personal life led to his demise and his estate problems.
He married Sara Lee Ruppenthal in 1963, and they had a daughter, Heather. Garcia and Ruppenthal divorced within a few years, and in the mid-1960s he married Carolyn Adams (more commonly known as Mountain Girl), who already had a daughter, Sunshine, with her previous husband, Ken Kesey. Garcia and Mountain Girl had two daughters, Annabelle in 1970 and Theresa in 1974. In 1973, while touring, he had a relationship with a third woman, Deborah Koons, and provided her with a home, then fathered a daughter, Keelin, with yet a fourth woman, Manasha Matherson, in 1987. In 1993 he divorced Mountain Girl, and in 1995 he married Koons.
All told, there were nine women in his life at various times.
Garcia died in 1995 from a heart attack. According to Fishkind, Garcia’s drug use, which began with marijuana and progressed to LSD and heroin, was the primary cause.
Garcia had executed a will in 1994, which Fishkind praised as well thought-out and reflective of Garcia’s intentions. It was unchallenged, but objections arose as to the decisions of Koons and Garcia’s attorney, David Hellman, who were co-executors.
The first problem Fishkind identifies was appointing wife number three (Koons) as a fiduciary. She was a one-third beneficiary herself and yet was required to look out for the interests of Garcia’s second wife, Mountain Girl, and for Garcia’s four daughters with three other women. “That’s a lot to ask of someone so emotionally and financially vested in the outcome,” Fishkind wrote.
Beyond that, Garcia’s estate was really a business, consisting of residual interests in the Grateful Dead, side projects such as Cherry Garcia ice cream and Garcia neckties, other royalty income, and the intellectual property of Garcia’s assets. It was incumbent on Garcia to select executors who were up to this task.
Problems arose when Koons cut off alimony payments to Mountain Girl, contending that this obligation ended with Garcia’s death. Mountain Girl prevailed when the case was tried in court but, rather than deal with ensuing appeals, settled for an amount significantly less than she was owed.
Select your executors carefully, Fishkind urges. Ensure that they will work well together and that there isn’t a history of animosity. Any family issues that have been suppressed by your presence are a warning sign – they may boil over once you are gone. Look for qualities such as diplomacy, fairness, reason and a comfort level working with attorneys, accountants, financial planners and bankers. If you choose co-executors, make sure they will share decisions equally and one won’t antagonize or dominate the other.
Garcia’s will also directed that his guitars should be given to Douglas Irwin, who had made them. But this was contested, with Grateful Dead Productions, Inc. claiming that the guitars (named First D. Irwin, the Wolf, the Tiger, the Rosebud, and the Headless) were company property. Irwin was eventually awarded two of the guitars, which he sold for $1.74 million.
“Heirlooms can define a legacy,” according to Fishkind. To avoid the problems Garcia’s estate faced with his guitars, don’t leave the disposition of them to chance. In your will, describe each item and name a beneficiary. Garcia, in retrospect, should have specifically named the guitars he wanted to give to Irwin, rather than simply bequeathing “all” his guitars.
Anna Nicole Smith
J. Howard Marshall II built a $1.6 billion fortune by co-founding the Great Northern Oil Company with Fred C. Koch, and eventually owned 16% of Koch Industries, the largest privately-owned company in the US. He became famous in 1994 when, at the age of 89, he married Vickie Lynn Hogan, known professionally as Anna Nicole Smith. She was not quite 28 at the time.
Marshall died 13 months later, leaving a will that was executed days before his marriage to Smith. It left nothing for her and named only one beneficiary, his son E. Pierce Marshall, who was involved in his father’s estate planning.
Smith challenged the will and a legal battle ensued. At one point she was awarded $447 million but, after a series of appeals that ended up in the Supreme Court, that judgment was thrown out. E. Pierce Marshall sought to deny her any claim to his father’s estate, but he too died in 2006, leaving the matter unresolved.
Later that year, Smith’s son from her first marriage, Daniel, died, just days after she gave birth to a daughter, Danielynn. Smith died six months later of a drug overdose, leaving a will that excluded her newborn daughter and left everything to her now-deceased son.
Her will also named Howard Stern as executor, the first of several missteps that Fishkind cited. Stern was untrustworthy, since he later falsely claimed that he was Danielynn’s father, but that was disproved through DNA testing. There were two other problems: the will incorrectly stated there were no predeceased children and it precluded a child born after it was executed from being a beneficiary.
In 2008, a Los Angeles court ruled that Danielynn was the beneficiary of Smith’s estate, but J. Howard Marshall’s estate was still the subject of a dispute between Smith’s and E. Pierce Marshall’s estates. That dispute was heard by the Supreme Court on two separate issues. It remains unresolved.
J. Howard Marshall, a Yale graduate and one of the richest men in Texas, should have had a prenuptial agreement, according to Fishkind. That would have avoided virtually all of the ensuing problems. Barring that, Fishkind said that Marshall’s will failed because it did not provide equitably between his second spouse and his children from his prior marriage. Lastly Marshall erred by simply omitting Smith from his will. Better, according to Fishkind, would have been to name her but specifically exclude her.
Are estate problems inevitable?
Fishkind’s book details these episodes, along with those of Michael Jackson, Leona Helmsley and Nina Wang, whose husband, Teddy, built a real estate empire in Hong Kong before he was kidnapped and never heard from again.
Taking stock of the horrors that befell these celebrities, Fishkind finds that probate litigation is almost always caused by an antagonist or by the inaction of a crucial descendant, with one or more of the following scenarios rendering conflict especially likely:
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A dysfunctional family
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A second spouse and children from prior marriages
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Significant wealth involving a family business
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An elder infirm widow or widower who seems to change his or her intentions shortly before death
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A tyrannical or dilatory fiduciary
Fishkind does not offer any specific ways to avoid such situations, but he warns that they often give rise to cases of undue influence or theft disguised as a gift by the antagonist; in the case of Brooke Astor, for example, Anthony Marshall was accused of both.
I will leave it to those with estate law experience to comment on the finer points of Fishkind’s analysis, not all of which have I rehashed here, but his book illuminates a theme I have often seen.
When someone dies and there is money at stake, it doesn’t take much to trigger a dispute and turn friends and family members into enemies. When vast fortunes are at stake, as they were in Fishkind’s examples, it is all the more common – perhaps likely – but it happens with very modest estates as well.
Fishkind’s advice includes carefully assessing who could be an antagonist when your estate is settled. Is there anyone who is likely to feel cheated, but whose concerns may be suppressed while you remain alive? If so, be proactive in dealing with those concerns. Document your wishes carefully, recognize that certain problems may be inevitable, and seek as much professional and personal advice as it takes to mitigate them.
Read more articles by Robert Huebscher
