Discussing Your Estate Plans - Hull on Estates #177
Listen to: Discussing Your Estate Plans - Hull on Estates #177
This week on Hull on Estates, Sharon Davis and Jordan Atin talk about the importance of discussing your estate plans with your family before you pass away . They relate this to a recent article that Jordan Atin wrote on Michael Jackson’s Will.
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Discussing Your Estate Plans - Hull on Estates- Episode #177
Sharon Davis: Hello and welcome to Hull on Estates. You’re listening to episode #177 on Tuesday, August 25th, 2009.
Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada. Hosted by the lawyers of
Sharon Davis: Hi. Welcome to another episode on Hull on Estates. I’m Sharon Davis.
Jordan Atin: And I’m Jordan Atin.
Sharon Davis: If you want to be heard on Hull on Estates, you can participate by leaving us a comment. E-mail us at hull.lawyers@gmail.com or you can visit our blog at estatelaw.hullandhull.com.
Today before we actually get started with Jordan, our extra special guest today. Jordan was one of those lucky people who happened to say some interesting things at lunch, so he got drawn into all of our podcasts for today.
Jordan Atin: I knew I should have just kept eating but…anyway.
Sharon Davis: It’s the Szechuan. Got you all fired up.
Jordan Atin: That’s right.
Sharon Davis: And then all those great things came out and so Jordan not only will be on our podcast today but he will also be on an episode, I think, of our video podcasting as well. So if you want to see what Jordan looks like, you’ll have to keep tuning in to Hull & Hull.
Jordan Atin: God help everybody I think.
Sharon Davis: It’ll be fun. I just want to touch on a couple of things that we have coming up. It’s been kind of quiet over the summer but we do have a lot of events coming up in the fall. We have our Hull & Hull Estate Trust and Capacity Law Breakfast Series. That’s on September 24th. We do not have all of the topics yet but stay tuned to our website in News and Events and you’ll be able to get the registration form and see what topics are coming up for that.
We’ve also got some CLE as well that is going to be in conjunction with the Law Society. A teleseminar on September 17th. Ian Hull and Suzana Popovic-Montag will be looking at understanding joint retainers and on the same day, September 17th, we also have a Probate Essentials. And that’s at the Donald Lamont Learning Centre at Osgoode Hall. That’s also available through webcasts so you can pretty much have all the estates, Hull & Hull information that you want on Thursday, September 17th, either 9:00 to 11:00 a.m. at the Donald Lamont or 5:00 to 6:30 p.m. for the teleseminar.
Suzana has also been very busy. She’s been interviewed for a couple of articles in the Globe & Mail recently. The first one on August 5th was about people who have no Wills and basically leaving the fate of your estate to the government. The other was on August 17th and this one was very interesting. It’s discussing estate plans with family and how important it is in order to avoid all of the squabbling that happens later. And that article was written by Roma Luciw and she comes across with a very important message and that’s to really address what are the key problems that people have in such instances. And the top 5 problems are because people feel: (1) they’ve been unfairly dealt with and it’s not equitable with respect to the distribution; (2) there’s a lack of trust, I think, amongst the beneficiaries who were left behind; (3) distribution of personal items. People get very emotionally attached and I think a lot of our estate battles are based on emotion rather than financial considerations.
Jordan Atin: And teacups.
Sharon Davis: And teacups. Very important. And Will contents are surprising to family members and I think that this is really something that people don’t think about a lot but it causes such distress. And if someone doesn’t agree, for example, and this is the fifth – unpopular choice of executor. If you don’t agree as a beneficiary with the choice of executor and you’re very, you know, upset, surprised, want to be involved as a family member, especially if the executor is not a family member at all. And Jordan has recently written on this with respect to the Michael Jackson because…
Jordan Atin: Michael who? Did he die?
Sharon Davis: I think it was Jackson. Just a little while ago. There hasn’t been much in the news.
Jordan Atin: No, no, it must have slipped by me.
Sharon Davis: Exactly. Jordan has actually written about that in the Huffington Post and you can look at his blogs there if you like. We’re very lucky to have Jordan today commenting on this stuff. Jordan Atin is a senior counsel to Hull & Hull LLP here, which is why he got to share in the Szechuan and share all the nuggets of information with us.
Jordan Atin: That’s the big bonus that I get.
Sharon Davis: Yes, it is. It’s the perks that keep you here, I know.
Jordan Atin: Absolutely.
Sharon Davis: And Jordan has a lot of information on this kind of thing. I know that we all go to Jordan for all the information we need and he knows just about everything about everything, wouldn’t you say Jordan? Now that’s my take on it anyways.
Jordan Atin: You can fool some of the people some of the time is what it comes down to.
Sharon Davis: Well as former Chair of the OBA Trusts and Estates Section, I think that our trust is well placed in you. So perhaps we can just chat a little bit about the Michael Jackson situation.
Jordan Atin: Sure, sure. One of the things that you notice about Jackson’s Will is, and I think the caption that they gave to one of my articles was “Jackson’s Will not a Thriller”. It’s a very simple Will in the sense that, and commonly used in the United States, where basically what happened, Jackson says anything that I own in my own name, which is what is governed by the Will, goes to my trust that I’ve established, a family trust that I’ve established prior. And basically that will govern what happens to the assets. That’s used often in the States to avoid estate tax. They use trusts that are created during the lifetime to avoid US estate tax which has a very draconian and substantial impact on estates. It can be 45% of an estate that would go in tax if you don’t plan it correctly. So from that point of view, that Will that Jackson left was pretty…first of all, it was very straightforward because it didn’t talk about who the beneficiaries were. But it also is quite commonly used in the United States and in California particularly.
Sharon Davis: I guess another benefit, too, is with respect to a trust, the terms are completely private and not exposed to the public, like the Will which is a public document once it’s sent to probate.
Jordan Atin: Right. Yeah, I mean the Will does become a public document. That’s why we know about it. Trusts are typically not although I have a sneaking suspicion that somebody will get their hands on it and I’m sure they have and that’s how we know really that the true beneficiaries of Jackson’s estate are, you know, his mom and his kids and charity. So that’s not unusual to eventually find out, especially in high profile cases like Jackson’s.
Sharon Davis: That’s right. And I guess in this particular case, the mom is really playing a driving role in this as well. The executors who were listed, he listed an attorney, a music executive, an accountant. Luckily he didn’t mention any decisions but considering the manslaughter charges being placed against various physicians today for Michael Jackson, lucky he didn’t do that. But still, Katherine doesn’t quite agree with those choices and wants to be involved as well.
Jordan Atin: Yeah. On one side of that decision, I mean it’s not unusual. I mean, obviously, Jackson would have a highly complex and specialized estate. I mean we’re dealing with royalties, we’re dealing with music rights, licensing rights, very high level of sophisticated, artistic rights that you would normally…it wouldn’t be unusual to have somebody with specialized knowledge like his attorney, music executive. I believe his accountant had renounced at one point so it’s really just the two of those.
Sharon Davis: That’s right.
Jordan Atin: But, so that in itself is not that unusual. But the fact is that family members, and you touched on this and I think Suzana touched on this in her article, that family members want a say in their loved one’s affairs after they die. Especially something that’s going to have a legacy to it, that is, you know, his image, his persona, is going to have to be managed by the executors and by the estate and the mom wants some say in that.
Sharon Davis: Yes. And I guess, you know, it really is distressing to be cut out of that and to not have control over your son’s…really what’s going to come out there and be out there for the public and for the children and all of that. I guess this would have been a really good case for perhaps a family conference prior to Michael Jackson dying. Now that would have been a thriller, don’t you think?
Jordan Atin: Yeah, you know what, that could have been a reality…
Sharon Davis: Reality TV.
Jordan Atin: …exactly. I was going to say.
Sharon Davis: Darn it, we didn’t think of it earlier now.
Jordan Atin: That would have got a bunch of high ratings, I’m sure. But I think, you know, here’s a situation where I think what…if the idea for Michael Jackson was to avoid burdening his mother with these issues, then certainly he could have perhaps named her as one of the executors, and at least give her the ability to say look, this is going to be too much for me so I’ll renounce and give her that option. Or give her the option to hire, you know, these experts in the field and let her still have some say and be at the table. Maybe it wasn’t discussed with her. Maybe if Jackson had discussed this with her, she would have said yeah, I’m glad you don’t name me because I don’t know what’s going on. Or, you know what, I really would like a seat at the table. So knowing what the expectations of your beneficiaries are is crucial, I think, to avoiding fights.
Sharon Davis: Well that’s right. And that really is the purpose of a family conference and it makes a lot of sense because you simply don’t know till you ask people. You really do assume things and you know if you want to take a paternal role by setting up a trust, you’re taking it out of everybody’s hands who you love basically, feeling that they can’t manage it themselves. But there’s certainly options and having professionals assist with all of those duties of an executor would be a good option, for sure.
Jordan Atin: Yeah, I mean especially when she’s going to be, you know, the guardian and custodian of his children. You know, she has her hands full but that doesn’t mean that she doesn’t want to have the right to be at the table, which is not the case if you’re not an executor.
Sharon Davis: Well she certainly wants to be at the table and I don’t know about teacups but if she doesn’t…
Jordan Atin: Yeah, I don’t think that’s going to be the biggest fight on this one, yeah.
Sharon Davis: Well, I guess we’ll all have to stay tuned and see…
Jordan Atin: You bet.
Sharon Davis: …how that continues to go. I think that brings us to the end of this week’s discussion. Thanks for listening and thanks for joining me today, Jordan.
Jordan Atin: My pleasure, thank you.
Sharon Davis: And we look forward to hearing from our listeners. You can send us e-mail at hull.lawyers@gmail.com and be sure to visit our blog at estatelaw.hullandhull.com where you’ll find more information and discussion on today’s practice of estates law. We hope you enjoyed the show. I’m Sharon Davis.
Jordan Atin: I’m Jordan Atin. Thanks.
Sharon Davis: Till next week, thanks.
Jordan Atin: Take care now. Bye-bye.
This has been Hull on Estates with the lawyers of Hull & Hull. The podcast you have been listening to has been provided as an information service. It is a summary of current legal issues in estates and estate planning. It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.
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