On August 16, 2018, the world lost a music legend with the passing of Aretha Franklin, known to all as “The Queen of Soul.” Aretha was surrounded by friends and family when she finally succumbed to a lengthy battle with pancreatic cancer, according to news reports. The question on everyone’s mind now is what will happen to her estate, estimated to be valued at over $80 million, given the fact that she died without so much as a Last Will and Testament in place to direct the distribution of her estate.
Kecalf Franklin, one of Aretha’s four sons, along with a Detroit-area attorney who worked with Aretha for more than 40 years, filed the paperwork to open probate with the Oakland County Probate Court on August 21, 2018. Kecalf asked the court to appoint Aretha’s niece, Sabrina Garrett Owens, as the personal representative to administer the estate. Aretha’s three other sons consented to the appointment, including Clarence whose consent was provided by his court-appointed guardian and conservator.
All too often, when a decedent dies intestate, or without a will or trust, the probate process that follows is more difficult and family fighting is more common in the absence of a Will. When there are children from different relationships, who may not see eye-to-eye, the likelihood of disagreements increases dramatically. The fact that Aretha’s four sons could come together so quickly to appoint a trusted family member to act on behalf of the estate is a great sign that a family feud may not plague Aretha Franklin’s estate, as it has so many others.
In Aretha’s case, it appears that the family met together, along with the attorney who filed the probate documents. This enabled the process to begin very smoothly and quickly, avoiding the necessity of a public court hearing. Instead, the family was able to proceed with an informal application, meaning that it was processed without a court hearing or even review by the assigned Judge. Informal proceedings can only happen in intestate cases under Michigan law if all of the interested persons agree to it.
So far so good — it appears that Aretha’s heirs are working together at this point; however, that could easily change at any point during the probate process. Moreover, conflict could arise between the heirs and the personal representative, despite everyone agreeing to her appointment. Under Michigan law, all four of Aretha’s children are equal beneficiaries to the estate. But, they do not have an equal say on how the estate is administered. Instead, Aretha’s niece (Owens) now has all decision making power and a number of difficult decisions will have to be made in the near future. How are Aretha’s many royalties to be managed? What should be done about the expected numerous offers for sanctioned movies, documentaries, books and specials about Aretha’s life? Should Aretha’s songs be used for commercials? Should her image be licensed to sell products? Not only are these complex business decisions that must be made, but they are also decisions that could lead to significant future earnings for Aretha’s beneficiaries – yet those beneficiaries have no say in the decision-making process.
Other problems may also crop up, such as how much will Aretha’s estate owe in federal gift and estate taxes? Without an estate plan, she clearly failed to take steps to avoid paying taxes. Her estate has to file an estate tax return though to allow the IRS to determine how much will be owed in estate taxes and there could be a major battle over how to value Aretha’s publicity rights. Furthermore, the value of her music, performances, and publicity rights could skyrocket as a result of her death if managed well.
Finally, because she failed to do any estate planning, Aretha’s heirs will receive their inheritance (whatever amount that ends up to be) in one lump sum – for better or for worse. If Aretha had created a trust, either a living trust or a testamentary trust through a will, then she could have determined when and under what conditions her sons would receive their inheritances. The personal representative does not have the right to delay distributions to protect a beneficiary who cannot handle funds so we can only hope they are capable of doing so.
By failing to leave behind an estate plan, Aretha’s wishes about what happens to her assets – and her legacy — do not matter, legally.
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