I have written on this blog of several estate disputes involving celebrities. A recent case is yet another example of controversy that often results after a celebrity’s passing.
James Brown, the “Godfather of Soul” died in Atlanta, Georgia on Christmas Day in 2006. He left an estate estimated between $5 million to over $100 million depending on who you ask.
Brown left a Last Will and Testament dated August 1, 2000 in which he left all of his personal and household effects to his six adult named children. Brown left the remainder of his estate to the James Brown 2000 Irrevocable Trust via a pour-over provision in his Will.
The 2000 Irrevocable Trust was created as a formal trust on August 1, 2000 as part of Brown’s estate plan. He intended through this trust to provide financial assistance for the education of his grandchildren and disadvantaged youths.
Albert Dallas ( Brown’s personal lawyer), Alfred Bradley ( a retired judge who became Brown’s mentor when Brown was in prison) and David Cannon ( Brown’s accountant and manager) were named as the Co-executors of Brown’s estate and as well as the Co-trustees of the 2000 Irrevocable Trust.
Upon Brown’s death, the principal and income contained in the 2000 Irrevocable Trust, as augmented by Brown’s general estate was to be divided into two (2) shares of subtrusts:
1. The Brown Family Education Trust (“Family Trust”) which was capped in the amount of $2 million for tax purposes and designated for the education of Brown’s grandchildren and;
2. The James Brown “I Feel Good Trust” (“Charitable Trust”) which Brown declared “shall be used solely for the tuition, educational expenses and financial assistance of ….poor and financially needy children, youth or young adults who are both qualified and deserving) who seek and have need of such assistance to obtain and further their education at the many educational entities and/or institutions available in the States of South Carolina and Georgia.”
Brown’s Will contained what is commonly known as an in terrorem clause which provided that any beneficiary who challenged the Will or the 2000 Irrevocable Trust shall “forfeit his or her entire interest thereunder”.
Brown left a surviving spouse Tommie Rae Hynie. They were married on December 14, 2001. Brown and Tommie Rae signed a pre-nup agreement in November 2001 in which Hynie acknowledged that she was signing the pre-nup agreement knowingly and voluntarily and that she had been given the opportunity to receive independent legal advice, and waived any right to Brown’s property or the receipt of alimony or any part of his estate.
Following Brown’s death, five of his six adult children and Hynie brought an action to set aside Brown’s Will and the 2000 Irrevocable Trust based on undue influence.
The original Trustees either resigned or were removed by the Court for conflict of interest and for failing to carry out their duties (Cannon was accused of misappropriating hundreds of thousands of dollars and was convicted and sentenced to three years house confinement) and new trustees were appointed. As well, the Attorney General of South Carolina (‘AG”) who had responsibilities for charities in the State, (similar to the office of the Public Guardian and Trustee in Ontario) got involved.
The AG oversaw negotiations which resulted in an agreement at a mediation session on August 10, 2008. Under the terms of the settlement, a new charitable trust was established which provided for a net 47.5% to the new charitable trust for the charitable purposes as set out in the Will, a net 23.75% to Hynie which included any share attributable to the son she had with James Brown and a net 4.79% to each of Brown’s adult children who were parties to the settlement.
The settlement required Court approval. The Court at first instance approved the settlement agreement and directed the Appellants, the new Trustees to execute the agreement.
The new Trustees refused to execute the agreement and appealed the decision of the lower Court.
On February 27, 2013, the South Carolina Supreme Court overturned the settlement that divided the multimillion dollar estate on the grounds that the AG did not follow the late soul singer’s wishes in putting together the deal.
Chief Justice Jean Toal suggested that if the settlement was allowed to stand, it could prevent people from leaving most of their estate to charity because of fear their wishes could easily be overturned. The Supreme Court referred the matter back to the lower Court to deal with the estate and issue directions as to next steps.
Undoubtedly, the last chapter in this case has not been written.
To read the decision of the Supreme Court of the State of South Carolina in Re: James Brown Estate, click here.