The purpose of my calling Ed was to ask his opinion and knowledge regarding the cost experienced in estates after mom and dad are gone and the heirs start trying to address the estate plan, a plan most have never seen nor discussed with mom and dad or their siblings and spouses. The interpretation or the intention mom and dad had with their lawyer and tax advisers are often up for grabs, with multiple interpretations or even issues regarding validity. Ed’s comments were that a frequent cause is lack of trust and communication within the family, likely resulting from inadequate guidance and communication between clients and advisers, causing many to undertake litigation to resolve uncertainties or disputes.
Ed’s wisdom and insight were refreshing in pointing out that fees for executors and trustees and the costs of litigation can be staggering, inevitably varying from state to state and city to city across the U.S. – not to mention variations in issues, amounts in controversy, and degrees of intra-family hostility sometimes generated by such disputes. Many times, multiple lawyers will be involved in litigation involving large estates, possibly with costs of $1,000 to $1,500 per hour, per lawyer. The $100 million executor fee, charged to Leona Helmsley’s Estate, is but one widely known example. We also know of a doctor whose parents died and each sibling hired a law firm to address the plan for an estate worth about $500 million--the legal fees came to $200 million.
My conversation with Ed was about the need to lessen the risk of such failures and to build the trust and communication skills while clients are still alive, and certainly before estate or trust administration is undertaken, long before the need to go to court. It is much less costly, in both expense and family harmony, while creating opportunities for all to use the wealth lesson and grow, not destroy.