Mon, 17 August 2009
The recent deaths of two wealthy men, one very well known, the other not, illustrates yet again the complications and costs of not preparing an estate plan. The media has focused in the last few months on the story about Michael Jackson’s death and its aftermath. No doubt we will be bombarded with this story for months and years to come. Jackson left a mountain of debt, assets that in death are probably worth more than when he was alive, and a less than traditional family. Jackson did, however, do some things right. He left a will which included trusts for his children and a clear indication of who he wished to be appointed as their guardian.
Then there is Yung-Ching Wang. Most people probably never heard of Wang but he ranked among Forbes Magazine’s top 200 wealthiest people in the world when he died last year at the age of 91. Wang was a true success story, born into poverty, the son of Taiwanese farmers, he turned a $700,000 loan from the United States government during the height of the Cold War into a multi billion dollar international manufacturing conglomerate. His company, Formosa Plastics, became the largest manufacturer of the ubiquitous plastic materials that we find in all kinds of products today.
By all accounts, Wang was a management guru and a visionary. His personal life was a little bit more, shall we say, messy. He left a wife, to whom he was married for 72 years and 9 children. None of those children, however, were born to his wife. Oh, and he didn’t have a will. No written plan of distribution from a man whose rightful heirs is now open to interpretation and who left property and other assets around the United States and around the world.
One of his sons has filed a complaint in New Jersey state court (he was a part time resident there) seeking to be appointed administrator, the official estate representative charged with gathering assets, paying all debts and taxes and distributing the balance to his heirs. He already has a fight on his hands from two of his sisters. Had Wang executed a will appointing someone this initial fight could have been avoided.
The battle promises to last for years and drain the estate of countless dollars. One of the big questions is who the rightful heirs should be, not an easy answer since Wang fathered his children with several different women. New Jersey’s intestacy laws address distribution of estates when no valid will exists but the laws are not perfect and there, no doubt, will be issues for which clear cut answers don’t exist. Legal battles will ensue.
The lessons learned from the Michael Jackson and Yung-Ching Wang cases are clear for all of us. You can save your family much heartache and expense by leaving a clearly thought out estate plan. In Jackson and Wang’s cases, their estates are so complicated that courts will need to step in at some point to assist in the distribution. However, Jackson’s family will have a much easier time than Wang’s since Jackson at least took care to express his wishes in writing. For the average estate that usually is enough to eliminate the fighting the typically ensues when a loved one passes away.
Category:Estate Plan -- posted at: 6:00am EST