Estate Planning Issues in the News

Privacy Lessons of ‘To Kill a Mockingbird’ Author Harper Lee

Harper Lee in 2007

Harper Lee in 2007

As the daughter of a country lawyer in Alabama, Harper Lee was able to bring fictional defense attorney Atticus Finch vividly to life in her classic Pulitzer Prize-winning 1960 novel To Kill A Mockingbird.

Given the famously reclusive author’s legal knowledge, you might assume she would have planned to avoid probate court to protect her posthumous privacy by setting up and properly funding a trust. But, when Lee died in February at the age of 89, she hadn’t done so. A judge sealed Lee’s will and sent her estate (worth an estimated $35 million) into probate. This will keep the details of her will private, but probate is a lengthy process that Lee could have avoided simply by setting up a trust to hold her assets. It could well be that the judge chose to seal Lee’s will out of respect for her well-known shunning of the celebrity limelight’s glare, but not everyone gets such special consideration.

If you want to keep your estate affairs private and avoid probate court, place your assets in a trust rather than a will. It’s vital to create a thoughtful trust, with the help of a professional estate planning lawyer, because if you slap one together on the cheap using some no-frills online form you’ll likely get more than you bargained for in the end.

Doing your trust right is a relatively minor, but wise investment that pays off by maintaining your confidentiality, facilitating your end of life care, expediting distribution of your assets and ensuring your wishes are carried out to the letter of the law.

Debtor’s Beneficial Interest in Trust Protected from Creditors

FirstMerit Bank sought to enforce a money judgment from Diana Reese by seeking an order to assign her interest in two trusts to FirstMerit until the debt was paid off.

A trial court denied the motion because a debtor’s beneficial interest in a trust is not subject to an assignment order, and the court of appeal affirmed.

Under California law, a creditor may only enforce a money judgment against a beneficiary’s interest in a trust by obtaining a lien from the court with jurisdiction over the trust.

In this case, the trusts were administered in Ohio but FirstMerit filed suit in California. Even if FirstMerit had utilized the correct California procedure, the California court had no jurisdiction to impose such a lien. FirstMerit Bank, N.A. v. Reese, California, Fourth District, Div.

About the author:

John O’Grady leads a full service estate and trust law firm in San Francisco.  He served as the 2012 Chair of BASF’s Estate Planning, Trust & Probate Section His practice includes Estate Planning & Administration, Probate & Trust Litigation, Collaborative Practice, Mediation, Conflict Coaching, Elder Law & Taxation.