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HOW DO I KEEP MY ESTATE OUT OF LITIGATION? NEVER APPOINT CO-FIDUCIARIES ESTATE OF MICHAEL JACKSON

3
Jun

By Jason Stern

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Any experienced NY estate lawyer who has successfully litigated an estate will tell you never appoint co-fiduciaries. This might be the best advice you ever take. As a NY wills lawyer I do many wills a year. For sentimental reasons or to avoid offending their family, NY estate clients will often try to appoint two fiduciaries as Co-Executors in their will. It is my job to talk them out of it.

If we are well prepared we should all have an original copy of an attorney drafted will kept someplace safe. As a NY estate lawyer practicing in Forest Hills, New York, I can tell you appointing co-fiduciaries in your will is never a good idea. If the idea of having someone in complete control of your affairs when you are gone is not scary enough, having two people in charge of your NY estate is downright frightening.

Once appointed as a fiduciary, or Co-fiduciary, NY Court’s are very hesitant to remove them as executor. In a recent NY estate litigation one of the Co-fiduciaries who did not get along with the other brought a proceeding to have their counterpart removed. The court ruled that the allegation of wrongdoing had been warranted as to nullify the testatory choice of executor.

How badly does the fiduciary need to mess up to be removed in NY?

Very badly. In the above matter the NY estate lawyer for the petitioner made a clear and convincing showing of serious misconduct that endangered the welfare of the estate. As such once a court is satisfied that a co-fiduciary endangers the welfare of an estate the Surrogate’s Courts of NY have the power to judicially nullify the executor’s appointment. In this NY estate matter the NY estate lawyer for the petitioner established that the co-fiduciary refused to communicate with her own attorney, permit the effectuation and sale of the estate property and subsequently failed to prevent the same property from being lost in an ensuing foreclosure proceeding.

Any experienced NY estate lawyer will tell you why no one in his or her right mind should ever want to be an executor. The list of reasons is long. First of all, as a fiduciary of an estate you are responsible for preserving, liquidating and eventually distributing the contents of the estate. Additionally, this usually entails paying off the debts of the estate, mainly estate taxes and income taxes. Depending on the size of the estate this could not only be tedious work but hazardous as well. If the Court finds that you mismanaged the estate you could be personally liable for any and all financial damage to the estate due to your negligence.

To see an estate nightmare going up in flames you do not have to look any further than the Estate of Michael Jackson. In his will Michael Jackson appointed two co-fiduciaries, his attorney John Branca and music executive John McClain. Naming an attorney and music executive with competing interests to your estate co-fiduciaries is definitely suspicious. To make matters worse his executors estimated the net value of his estate at $7 million dollars. However the IRS later revised that number to $1.1 billion dollars. There’s a pretty big disparity between those two figures and his beneficiaries will be greatly affected by them. The IRS preferring to work off of their larger figure, has since levied more than $700,000,000.00 of taxes and fines against Michael Jackson’s Estate for tax evasion. The fact that each executor had opposing interests to the Jackson Estate undoubtedly compounded the estate problems for the Jacksons by encouraging each executor to file their false valuation.

When disagreements arise between co-fiduciaries your estate suffers. To make matters unbearably worse, Surrogate’s Courts in NY are required to exercise their removal powers sparingly. In fact a fiduciary can even have a clear conflict of interest with an estate as you can see above in the Jackson Estate and still not be justifiably removed.

As an experienced NY estate lawyer I can tell you a will is a powerful legal instrument. As such NY courts are bound by its contents and are hesitant to question or contradict its contents. For these reasons you should always have an experienced NY wills lawyer draft your estate documents with great care.