I just read a fascinating story in Forbes, about the battle over the estate of the famous painter Thomas Kinkade. This is high drama, worthy of a soap opera! It has a little of everything – a celebrity, lots of money, and an epic fight between the jilted wife and the girlfriend. Here’s the story, in a nutshell:
At the time of his death, Kinkade was separated from his wife of 30 years, and living with his girlfriend, with whom he had a relationship for the last year and a half of his life. The wife submitted a will for probate that Kinkade had signed in 2000, leaving an estimated $12.5 million in assets to a living trust that he had set up in 1997. Most of Kinkade’s remaining assets – including original art works, copyrights, and shares of his retail art business – were reportedly included in the trust already. (Unlike a will, which is a matter of public record, a living trust is private.)
The girlfriend has challenged the will, and submitted two handwritten documents for probate, claiming that the painter left her over $66 million in assets, including various art works, cash, and a house/studio valued at $7 million. These documents, if authenticated as Kinkade’s handwriting, could be considered a valid “holographic” will. The will contest raises a number of estate planning issues, which we can all learn from. Here are some of the main points:
- When two different documents meet the legal requirements for a will, the more recent document controls.
- One of the handwritten documents supposedly left $10 million in life insurance proceeds to the girlfriend. Unfortunately for her, even a valid will doesn’t control insurance proceeds – they go to the designated beneficiary on the policy. (This subject deserves a post of its own – coming soon!)
- You can’t give away something in a will which you don’t own. Once you transfer ownership of assets to a living trust, it is the trust document that controls them, not your will. Similarly, in a community property state (like Texas), you can only give away your own share of the community property – not your spouse’s.
- If you have conflicting or ambiguous documents in your estate plan, your beneficiaries should be prepared to spend a lot of money (and time in court) to sort it all out!
This story shows why it is important to have a clear and consistent estate plan in place. A knowledgeable estate planning attorney can help you save your family and loved ones a lot of trouble down the road!