ROBIN WILLIAMS’ ESTATE – THE VALUE OF WELL DRAFTED TRUSTS

A year after his death, Robin Williams’ third wife, Susan, and his kids Zachary (from his first marriage), Zelda and Cody (both from his second marriage), are still at war with one another.  The issues at stake are: division of his personal property, which was not explicitly dealt with in his trust, and; how much money is needed to maintain the residence that Susan shared with Williams, for which, per Williams’ estate planning documents, his estate is to provide sufficient funds to maintain during Susan’s life.

The personal property at issue reportedly includes Williams’ bicycle collection, artwork and books, as well as seemingly banal items such as his slippers and boxer shorts which Susan, his wife of only three years, has apparently insisted on keeping. Williams gave his trustees ultimate discretion to determine who would get what, and the trustees have reportedly accused Susan of holding on to property they are trying to distribute to Williams’ children.  Despite the authority imputed to them by the trust document however, all trustees must adhere to the strict legal standards applied to fiduciaries in California.  Williams’ wife apparently feels the trustees failed to meet those standards in making decisions about distribution of the personal property, which gave her grounds to fight the intended distributions.  This issue could potentially have been avoided by having Williams provide more specific directions about how to divide his personalty, and may – depending on personal comfort and family dynamics – have included a discussion with his children and wife about what items might be of particular sentimental value to them.  Given Williams’ fame and blended family (three kids from two prior wives, and a current, otherwise unrelated wife), battles over his personal items should have been anticipated by his estate planning attorneys.  Had Williams specifically articulated who would get what (perhaps even just by calling out categories – clothing and household items to Susan; books and bicycles to Cody; artwork to Zelda, etc.), then his beneficiaries would have had no grounds to fight the distributions since Williams, as trustmaker (aka grantor, aka trustor), has the ultimate and unassailable authority to devise and bequeath his property as he sees fit (assuming he was competent at the time).

Regarding the amount necessary to maintain the residence he shared with Susan, Williams’ trust apparently did not specifically identify this amount.  This is an issue that likely could have been resolved or avoided by Williams’ estate planning attorney prior to his death, by having Williams tally up the monthly expenses and estimating an overall average cost and inserting that indexed number into the trust, or by at least itemizing the costs that should be accounted for. However, because this exact number was left open, Susan’s attorneys are fighting with the trustees of the trust over the amount actually necessary to maintain the house; and this is a topic that could be an ongoing issue, as changing circumstances may give Susan’s attorneys, or the trustees, grounds to try to change the amount.

Williams apparently also set up separate trusts for his three kids in 2009, which supposedly pay the trust assets outright to the children in increments: 1/3 of the trust share when they turn 21; ½ of the remainder at 25, and; the remainder at 30.  The wisdom of having outright distributions to his kids – particularly at such young ages (what is the typical 21 year old going to spend a big chunk of free money on?) is also questionable.  While estate planners in the past regularly drafted trusts for their clients’ children that paid out in stages similar to those for Williams’ children, the value of continued asset management and creditor protection has become increasingly recognized.  This is especially true for high net worth clients.  Good estate planners these days will generally steer their clients into setting up trusts which continue beyond the children’s lifetime, and which turn over control of the assets to the child at a gradual rate – sometimes only upon determination by an interim trustee that the child is capable of responsibly managing the funds.  If properly drafted, this not only protects the children from themselves (see our blog “Protecting Family Wealth” for more on this), but from the children’s creditors, such as future ex-spouse’s – an issue Williams himself was painfully familiar with.

This post is not intended to be a criticism of Williams himself, who suffered from depression and had been diagnosed with Parkinson’s disease.  On the contrary, to his credit, he had the forethought and initiative to set up trusts for his kids and for his own estate.  Williams was a talented comedian and actor – his job was to entertain and bring art to the masses.  It was the job of his estate planning attorneys to anticipate and prevent issues such as those identified above.  Whether he was given proper advice which he chose not to follow (not an unheard of problem in the estate planning realm; the average client is often somewhat naïve about the probably of their loved ones fighting over property once they’re gone), or he received less than comprehensive legal advice, is unknown.  Unfortunately, it is his widow and children that are paying the price.