From Prince To Tony D: Intestacy And Fiduciaries When Dying Without A Will
Two recent high-profile examples teach critical lessons about the importance of having a Will. We lost Prince on April 21, 2016 and popular Rochester restaurateur Tony DiCesare (“Tony D”) of Tony D’s on July 20, 2016. Neither had a Will. The fate of their estates is left to the applicable state’s intestacy laws.
What is Intestacy?
For every estate, each distributee is entitled to receive a copy of the decedent’s Last Will and Testament in order to examine the Will and sign a Waiver agreeing to its validity. A distributee is someone, usually a class of living relatives, who are entitled to inherit from the decedent’s estate if there is no Will. For Prince and Tony D, the court will determine the legitimacy of each estates’ distributees and ensure each distributee is afforded appropriate notice.
When I meet with a client with no spouse and no children, I always bring a family tree for them to complete. Using this form can save considerable time and expense during the estate administration process when identifying distributees should the client pass intestate.
In New York State, intestacy law outlines the inheritance each distributee is entitled to receive in the absence of a Will. The percentage of an estate inherited by distributees depends upon what class of distributees are living at the time of the decedent’s passing. The class of distributees and their inheritance rights are as follows:
- Spouse and children: $50,000 plus half of the residue to the spouse, half to the children
- Only issue (children, grandchildren etc.): Entire estate
- Only parents: Half to each parent, or all to a lone surviving parent
- Only issue of parents (brothers, sisters, nieces, nephews): Entire estate to grandparents or their issue; half to paternal and half to maternal or issue
- Only first cousins once removed: Half to paternal first cousins once removed, half to maternal first cousins once removed
If none of the above family members exist, then the estate will escheat (be given) to New York State.
For Prince, this process is underway in Minnesota. He was married, divorced twice and has no known surviving children; he lost one child to miscarriage and another shortly after birth. By mid-July, over a dozen siblings and half-siblings have come forward as potential distributees, and others claiming to be unknown children. The legitimacy of the unknown child claims is being determined by DNA testing.
For Tony D, the process is underway in New York. Since his untimely and tragic death, in the absence of a Will, several different parties have claimed that they are entitled to inherit his wealth. This requires the court or a court-appointed fiduciary to conduct due diligence on constructing a family tree and notifying any identified distributees. This is referred to as obtaining jurisdiction over the necessary parties, and it can take months, thousands of dollars in expenses, and even DNA testing.
Who is the Fiduciary?
In the estate context, a fiduciary is an individual or an institution who is appointed to act on behalf of the beneficiaries to administer someone’s estate. When a Will is drafted, an individual selects who is going to be the estate’s fiduciary by selecting an executor. This executor is entitled to payment of a statutory commission for serving as executor.
When there is no Will, a fiduciary referred to as an Administrator has to petition the surrogate to administer the estate. If there is no such acceptable person, then a Public Administrator or a court-appointed representative administers the estate.
Minnesota District Court Judge Kevin Eide appointed a Trust called the Bremer Trust to manage Prince’s estate, whereas Monroe County Surrogate’s Court Judge John Owens appointed Public Administrator Frank Iacovangelo to administer Tony Decesare’s estate.
From each family’s perspective, it can be difficult to witness an appointed Trust or Public Administrator sorting through personal belongings of a loved one, running a family business, or making decisions regarding a notoriously private artist’s unreleased recordings.
Prince’s Trust attorney indicated in court that “we have literally been through thousands of boxes of documents and four physical locations…there is no indication a Will exists.” Prince fiercely protected his music, from its production to its release and use. There is also the issue of listening to and handling the thousands of unreleased recordings, determining Prince’s intellectual property rights, and the future of Paisley Park, most recently said to be opening as a museum in October 2016. These decisions are being made by the Bremer Trust, not Prince or anyone chosen by him. Now, without a Will, his work may wind up in hands or uses that he would not like.
In the case of Tony D, the Public Administrator, Frank Iacovangelo, was running Tony D’s at the rate of $2,000 a week per Judge Owens’ order. That rate was paid for several weeks through mid-August, but Mr. Iacovangelo will still receive attorney’s fees as ordered by Judge Owens for administering the estate until the estate is closed. Just recently, Tony D’s announced that their doors are closed for business. Tony D’s was a beloved family business. Decisions regarding the fate of that business were made by a court, not Tony or anyone chosen by him. Now, without a Will, the business has closed.
Whether you are a musical force, popular business, or individual, careful estate planning and making a Will are critical to avoiding the impersonal, time-consuming and costly intestacy process.
This publication is intended as an information source for clients, prospective clients, and colleagues and constitutes attorney advertising. The content should not be considered legal advice and readers should not act upon information in this publication without individualized professional counsel.