Shortly after Aretha Franklin died at the age of 76 after a battle with pancreatic cancer, documents filed in the Probate Court of Oakland County, Michigan by her family revealed that the legendary singer, who was estimated to be worth $80 million, did not execute a Last Will and Testament. Aretha Franklin now joins a growing list of celebrities, including Prince, Amy Winehouse, Kurt Cobain, Bob Marley, Jimi Hendrix, and Tupac Shakur, who all died without executing a Will or other estate planning documents. For many of these celebrities, their estates were, or are currently, subject to lengthy and protracted probate proceedings that played out for the media.

There are significant benefits to developing an estate plan, which can include a Will, Revocable Trust, and/or Irrevocable Trusts, even if you are not a celebrity.

First, and perhaps most importantly, developing an estate plan allows you to choose the beneficiaries of your estate, the amounts they receive, and how they receive those amounts. Individuals, like Aretha Franklin, who die without an estate plan will have their assets distributed according to their state’s intestacy laws or, for assets that contain beneficiary designations (such as IRAs, 401ks, and life insurance), according to the terms of the account provider. It is extremely difficult, if not impossible, for the personal representative of an estate to argue after an individual passes away that the intestacy rules should not apply when there is no Will or estate plan.

Second, creating an estate plan gives you flexibility to decide how your beneficiaries will receive assets. An estate plan could involve the creation of trusts, which allow the beneficiary to have the use of funds without having direct access to them. Trusts can be a useful tool for minor or young beneficiaries who may need time to develop prudent money management skills; for beneficiaries with special needs who cannot own significant assets outright without jeopardizing necessary public benefits; or for beneficiaries with significant wealth on their own or liability concerns who want to keep assets out of their own estates.

Third, an estate plan can, depending on the circumstances, allow you to reduce taxes that your estate may be subject to at your death. There are numerous estate planning techniques, many of which involve the use of trusts, that can be developed and implemented to reduce estate, inheritance, and/or generation-skipping taxes that may be assessed against an estate. These tax-planning options are extremely limited for intestate estates.

Fourth, the development of an estate plan may allow certain aspects of the estate administration to be completed in a more private manner than available for intestate estates. Probate records are public documents, so many of the details of an estate administration are available to the public. While a Will must be filed as part of a probate record, many trusts that could be created under an estate plan are not included in the probate record, and therefore do not become public. While public interest in the administration of your estate may be less than the interest in Aretha Franklin’s or Prince’s estates, the ability to shield some aspects of an estate from the public can be beneficial.

So, in the words of the late, great Queen of Soul...."You better think......"

Lis pendens is a powerful tool which can be utilized in civil litigation pertaining to a claim against title to real estate.  The filing of a lis pendens and recording that lis pendens against a parcel of property puts the world on notice that the owner may not have clear title, and thus, may be unable to convey same.  A lis pendens effectively precludes transfer of the real property as any buyer must take subject to the cloud on title.  Of course, a lis pendens must be supported by a writ of summons or a civil action complaint relating to real property.

Curiously, a lis pendens is not an available tool in an Orphans’ Court proceeding.  Accordingly, a lis pendens cannot be utilized to place the world on notice of a claim against an administrator or executor where a transfer of property is made in connection with estate administration.  Nor can it be used to place the world on notice of the claim relating to that transfer or a defect in their authority to effectuate same.  Thus, the lis pendens is not an effective tool to  preclude further transfer or encumbrance by mortgage or other debt instrument. 

Although lis pendens is not available, the same purpose can be accomplished under the Orphans’ Court rules, provided a Petition for Citation has been filed with respect to the administrator’s activity.  Pursuant to 20 Pa. Cons. Stat. §3359, any pleading in Orphans’ Court may be recorded in the Recorder of Deeds Office with reference to the property in question.  While little case law is available to address the impact of such filing, the practical effect of providing notice of any existing claim to title may be satisfied.

Antheil Maslow and MacMinn is experienced in matters of estate administration and litigation pertaining to estate matters.