Some of you might say, "No way." These are probably the same people who talk about how close they are to their family, how they talk to their mom every night on the phone or go on hunting trips with their dad. That's nice. But throw a $300 million estate into the mix, and I'm sure even the Beaverest of Cleaver families would start nitpicking each other.
Prince's family is about to undergo a monumental challenge -- which would be difficult for experienced trusts and estates attorneys and possibly insurmountable for the average civilian. That would even include lawyers who don't practice in this specialized area.
The superstar musician, who left behind an estate that could reach into the hundreds of millions, may not have had a will that would have directed how his assets were to be divided among his heirs.
This week a court in Minnesota appointed
a special administrator and made a determination that all possible heirs have been identified and given the opportunity to be part of the probate proceedings. Since there are six siblings, and no other closer relatives, for now those are the heirs.
Probate court is rarely a place for high-profile cases. Most of the courts in the news are criminal courts, or the civil courts if the case involves some serious money, or a former wrestler's leaked sex tape. You don't often see news trucks parked outside probate court. But because Prince died without a will, a battle for an estate of inestimable value will play out in probate court.
The probate process has its own set of rules and procedures in Minnesota, as in most states, which will be tested in this -- sure to be one of the most complex and unusual probate cases ever. Sure, wealthy people with large estates have died before. But it's not often that people with Prince's wealth die intestate (without a will).
It's also one thing for an estate to have money and property. But Prince's assets were singular indeed -- how can someone place a value on his hits, his unfinished works and the use of his image for commercial purposes? These are just some of the issues the legal system will confront during the probate process -- believe me, it's just the beginning.
What is probate?
Probate is a legal process of settling an estate after a person dies. The court determines
heirs and appoints a personal representative, who is responsible for protecting the estate's assets, paying its debts and distributing the assets to those who are entitled to it under the law.
Here's the thing: If you were a renter and your assets consist of a commemorative spoon collection and some threadbare "Star Wars" bedsheets, your "estate" doesn't need to be probated. If a person had less than
$50,000 and no real estate, Minnesota really isn't interested in probating the estate.
Prince's family will find this probate experience to be a nightmare. Probating Prince's estate is going to be more like complex bankruptcy proceedings for an Enron-size company. If you haven't seen a lot of corporate bankruptcy proceedings, they involve a number of parties with competing interests trying to liquidate a large company and fighting over who gets what. But even those bankruptcy and restructuring cases involve sophisticated professionals who have made a career out of this highly nuanced practice area.
When an estate is as large as Prince's, his family will be overwhelmed with depositions, testimony, private investigators, perhaps even handwriting or DNA experts. Maybe these things appear in probate court from time to time, but this case could see this court operating outside of its normal capacity.
How much will it cost -- and how long does it take?
The classic attorney answer? It varies. And in this case, it will vary. If there is a challenge to heirship or creditors -- people who allege the estate owes them money -- then there will be additional costs and time. And it's not just the lawyers getting paid. In a typical probate case there are executors' fees, accounting fees, court fees and costs for appraisals and surety bonds.
that these costs can be up to 7% of the total estate value. As for time, probate proceedings normally take up to a year and a half, but that's only if there's no litigation. In this case, there will be some litigation. About the only thing the average time and cost estimates can do for us in this case is establish a minimum, or floor.
What if a 'will' shows up?
Prince's siblings have to consider that someone could show up in a year claiming to have found Prince's will scribbled on a cocktail napkin. "Holographic wills
" are handwritten by the testator and are not witnessed.
Many states recognize holographic wills, but Minnesota is not one
of them. A will, among other statutory requirements, must be signed by at least two witnesses to be valid. It may not sound that significant, but the implications are huge for Prince's siblings: The stricter the will requirements in their state, the fewer potentially fraudulent challenges to this process.
Prince's family may also have to deal with the miraculous discovery of a will (one that also miraculously gives a gift to that same someone who finds it) after the estate has been administered as intestate. The Prince heirs will be watching the clock closely: Minnesota law bars
someone from trying to probate a newly discovered will after three years.
In general, American law often imposes penalties in the spirit of "you snooze, you lose." Probate court is no exception. Indeed, if the heirs cannot be found, Minnesota law only requires that a notice of the court date be published
just twice in two weeks in a legal newspaper.
Think about it: Most of us lawyers don't read a legal newspaper every day ... what are the odds that a random civilian will be randomly perusing the town of Funkley's Law Journal looking for his or her name in probate court notices? It's another example of a legal fiction -- an unreasonable expectation foisted upon citizens, but to achieve a greater good: finality. The law has always favored finality in proceedings; probate is no different.
A newly discovered heir?
Right now, Prince's siblings have to be wondering if the singer has any surviving children out there. This could be their greatest concern. Children are far ahead
of the deceased's siblings when it comes to priority and taking in an estate. And, as with political primaries, when it comes to intestate succession, it's "winner take all": Children would take the entire estate, and Prince's half-dozen siblings would be entitled to nothing.
Assuming no surprise child emerges, how will the court figure out which siblings get what share of the estate? Siblings in this situation
take by "representation." That means the estate is divided into as many equal shares as there are (i) living siblings, and (ii) deceased siblings, but only if the deceased siblings left children of their own. Each surviving sibling gets one share, and the surviving descendants of the dead sibling(s) themselves have to share the share that their deceased parent would have received. Confused yet? This is why trusts and estates exams in law school feel like brain-busting riddles.
Prince's siblings are likely in for a fight, even though they may have been judicially identified as heirs, and the law may be relatively straightforward. There will be many nail-biting moments for those probating this estate.
There will also be potentially novel legal issues for the rest of us spectators. Many cases have been called the "trial of the century." Rarely has a probate case been a candidate for that title. This one may not qualify, but it sure will be interesting to see what happens.