Howard Hughes did not believe in estate planning. He was worth 3.8 Billion Dollars in today’s money when he died. He died with no estate plan. As a result his estate went to intestate probate. A legendary legal battle ensued.
First, California, Texas, Nevada and Florida all claimed to be his state of residence. After several lawsuits, which went to the US Supreme Court, Nevada won. That meant the law of Nevada prevailed.
Then several “wills” surfaced. All were determined to be fake. Following this, several women claimed to be Hughes wife. None of the claims were substantiated. Finally, a variety of people claimed to be Hughes illegitimate children. After lengthy litigation their claims were thrown out.
Under Nevada law if there are no spouses or children the proceeds pass to parents. Since the parents were dead the proceeds passed to their heirs. After the dust settled it was determined that there was one aunt, sixteen cousins on Hughes’ mother’s side, and five on his father’s side. Some of the cousins had died, leaving heirs of their own. Before it all came to a head over 200 people received shares of the estate. Hughes died in 1976. His estate did not fully settle until 2010. The legal fees were in the multi million dollar range.
Proper Estate Planning Can Avoid these Problems
Although this is an extreme example of what occurs when somebody doesn’t believe in estate planning I have seen similar cases. I had one case where there were twelve brothers and sisters. Some had passed – leaving a multitude of children and even grandchildren. By the time this modest estate settled some of the heirs received as little as $15.00 – but the estate cost $10,000.00 to process.
In my opinion even a will is insufficient for the vast majority of people. If you have any assets at all a trust centered estate plan is far more beneficial. This type of plan will protect you while you are alive with powers of attorney and after you are gone with ease of administration and a minimum of cost. You owe it to your heirs to consider creating a plan of this type.
In either example above all of this could have been avoided with a trust centered estate plan. For more information please see the following page: Wills v. Trusts