We plan for many things in life, such as our meals, plans for the weekend, celebrations for important life milestones, and our monthly budget. Far too many fail to plan for the inevitable – death. Let the death last month of legendary pop singer Prince (age 57) be an example and motivation for us to take action. Although it seems unfathomable that someone with an estate worth over $300 million (and growing after death due to increased sales with all the publicity of his death), Prince would not be the only one that didn’t adequately plan for death. He is joined by Bob Marley, Amy Winehouse, Jimi Hendrix, Sonny Bono, and Kurt Cobain. Even if you’re not lucky enough to be famous and extravagantly wealthy, if you have preferences as to what happens to you and your money after death, it is definitely worth the time (and money) to plan ahead.
If you have considerable assets, you need to consider nominating a professional to handle your affairs. In Prince’s case, his bank Bremer Trust, N.A. was recently appointed as special administrator to handle his business interests. This appointment was made by the probate court in a conference call with his family after Prince’s sister filed a request for the court to appoint a special administrator. Bremer Trust’s role as temporary (six months in length) will likely include managing his business affairs, which may involve the inventory of unreleased musical material rumored to be stored in an actual bank vault in the basement of his Paisley Park complex. Is Bremer Trust, N.A. the company in the best position to handle Prince’s affairs? Had Prince taken some time to establish multiple trusts to handle his assets, Prince would be in a better position to ensure that his wishes are being followed. If the story of Michael Jackson’s estate with the IRS is any prelude of what is to come, such trusts would have been able to avoid unnecessary drama with the IRS over valuation of assets and taxes due.
So far the Prince estate has raised two interesting points of discussion: (1) the need for a Will to avoid disputes regarding persons entitled to an estate and (2) the role of a Special Administrator. Prince’s sister has alleged that Prince died without a Will. If Prince, in fact, died without a Will the Court will need to determine his intestate heirs under Minnesota law. As is often the case when the famous and wealthy die, several people have already reportedly come forward to claim they are an heir to Prince. Last week, over their objection, the Court ruled that anyone claiming to be an heir may have to submit to DNA testing, at his or her own expense. It already appears that there will be significant litigation over the determination of persons entitled to a share of Prince’s fortune. If there is a Will, however, the Will would answer this question and Prince’s own wishes would be honored.
In many states, including Arizona, a Special Administrator is a person or entity appointed by the Court in a probate proceeding to identify, marshal, preserve the assets, and report to the Court when a delay is foreseen in appointing a permanent personal representative. A special administrator can be appointed whether or not there is a Will. A special administration is the only form of temporary administration available when it is necessary to protect the estate of a decedent prior to the appointment of a general personal representative. The Special Administrator for Prince’s estate Bremer Trust, N.A. had provided financial services to Prince for a number of years and had knowledge of his personal financial and business financial affairs, and was appointed to “to preserve the estate and to secure its proper administration until a general Personal Representative is appointed by the Registrar or by the Court.” If the first 30 days are any indication, there will likely be many more interesting issues raised during the administration of Prince’s estate.