Michael Jackson Estate already in turmoil
June 29, 2009
This may shape up as an estate mess for the ages. For some reason, problems like this seem to follow musicians: Ray Charles, James Brown, Jimi Hendrix . . . the list goes on. I've already written many articles about the legacy problems that these and other musicians have left behind.
So it should come as no surprise that the Estate of the King of Pop will follow the same course of wacko-ness. It's been only four days since Michael Jackson suddenly died, at the age of 50, on June 25, 2009. Already, we have a preview of several likely legal challenges.
First, and foremost, there's the question of who will serve as guardian for his three young children. Courts first look to a person's will to answer the question of who should serve this crucial role when the parent dies young. But that only holds true when the second parents dies. In this case, the mother of two of the three children, Deborah Rowe, is still alive. Normally, there wouldn't even be a question; if one parent still lives, that parent gets custody.
But Rowe signed off on her parental rights, as part of a divorce settlement, years ago. But it seems that her rights may not have been legally ended. In 2003, she petitioned to have her rights restored, after one of the child molestation charges against Jackson, and a court of appeals ruled in her favor. She and Jackson then settled in 2006, with the terms being kept confidential (but undoubtedly involving a large sum of money).
Now, Rowe has reportedly vowed to fight for custody, telling friends that as their mother, the kids need her. And to complicate the matter further, because Rowe is mother to just two of the children, the children could be split apart if she prevails.
So it is no surprise that Jackson's mother, Katherine, took the aggressive first step of seeking temporary guardianship before Rowe had a chance to take the matter to court. Katherine's lawyer filed the paperwork for guardianship, listing Rowe's address as "unknown". Today, the court granted the request for temporary guardianship. Katherine contended she has a close relationship with the children, while Rowe has no relationship with them at all.
The question of whether Katherine will become full guardian, or if custody will ultimately be granted to Rowe, won't be answered for months. The judge will have to balance the legal preference in favor of a biological parent against the relationship the children already have with Katherine, as well as Michael's stated wishes. The question of whether Rowe's rights were legally ended, and whether they can be restored, will also be important.
And there's another added complication. Katherine also filed paperwork today asking to be appointed as administrator of Michael Jackson's estate. The catch -- her petition says that Jackson died without a will. Others had stated he did have a will -- and old one -- but at this point, Katherine apparently doesn't have it. Whether a will surfaces or not may play an important role in the custody struggle.
And of course, this battle will only be the first. The Jackson estate will also have many, many creditors to contend with. Reportedly, Jackson was not only deeply in debt, but he may have left behind an insolvent estate -- with debts exceeding the value of the assets.
At first blush, this seems odd when reports are that Jackson grossed roughly one billion dollars during his long and illustrious career. He also owns one-half of the rights to the Beatles songs, purchased for $47.5 million in 1985. Jackson sold the other half to Sony in 2005 for a reported $95 million, because of his extensive debt.
In fact, this fascinating article in The Daily Mail by British journalist Ian Halperin suggests that Jackson's debt was so great it actually drove him to his death, in what insiders felt was not only predictable, but inevitable.
Halperin reports (based on his five years inside the Jackson enclave) that those close to Jackson knew he was in such poor health that he could never have physically made it through a few concerts, much less the 50 booked for his tour.
Michael hid his grey hair behind wigs, often used a wheelchair because of his frail legs, and suffered from a rare lung condition left him scarcely able to talk, much less sing, Halperin wrote. He never could survive the grueling schedule set for him. Yet he was pressured into the tour to satisfy creditors.
Halperin even says that he publically predicted six months ago that Jackson had six months to live. Apparently he was right about that. Is he right about this?
Not all the news Halperin reported was bad. He said Jackson had some 200 unpublished songs that he had already placed into the name of his children. Depending on when and how he did so, this would mean Jackson's valuable music would not go to creditors, but would insure his beloved heirs would be financially supported.
Which brings us full circle back to the custody battle. Does Rowe know of this financial treasure trove reportedly belonging to the children? Or does she really care for them, despite rarely -- if at all -- having seen them for years?
And will the creditors (said to be numerous) allow the children to keep the musical legacy without a fight? Speaking of the musical legacy -- who gets to control the royalties and publicity rights to Michael Jackson's songs, name and image? Are these so valuable that there will be enough to both pay off the creditors and still leave enough to support the children?
And, of course, is anyone legally to blame for Jackson's unexpected demise? What lawsuits will his estate administrators bring, and to what result? Are doctors at fault for allowing him to take excessive medications? Who provided him with the drugs that may have led to his death?
These are only some of the questions. There will be many more to surface in the month and years to come.
More than anything, this interesting drama -- which is just beginning -- serves a very valuable lesson. Don't want until tomorrow to protect your family and secure your legacy. See a good estate planning lawyer now. You don't want your children to be fighting -- or fought over -- in probate court when you're gone.
Michael Jackson is far from the first person -- celebrity or otherwise -- to leave his estate in turmoil. He certainly won't be the last.
Posted by: Author and probate attorney Andrew W. Mayoras, co-author of Trial & Heirs: Famous Fortune Fights! and co-founder and shareholder of The Center for Probate Litigation and The Center for Elder Law in metro-Detroit, Michigan, which concentrate in probate litigation, estate planning, and elder law. You can email him at awmayoras @ brmmlaw.com.
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