Michael Jackson executors sorting through requests for money
January 24, 2010
It's been seven months since the King of Pop died suddenly at the age of 50, and fights surrounding his estate seem like they may last for many years to come. Creditors are coming out of the woodwork, with new ones surfacing on a weekly basis. The latest, a management company, joins a series of business, medical and spiritual advisers and others who insist they are owed money, totaling more than $20 million, already. That total will certainly climb.
The estate co-executors, John Branca and John McClain, have to sort through the requests for money and try to determine the legitimate ones from the ones that are, well, more fiction than fact. It's common when someone wealthy and eccentric passes to have all sorts of people saying they are entitled to money. (Jerry Garcia, James Brown, and Marlon Brando are a few notable examples that we cover in Trial & Heirs: Famous Fortune Fights!).
One of the more interesting requests is from Michael's father, Joe Jackson, who wants $15,000 per month in support. He says that his famous son supported him financially while he was alive and that he doesn't really have any other source of income. Executors Branca and McClain recently filed an opposition to the request.
As they point out, Joe Jackson is not a beneficiary of Michael's will or trust, which would normally end the story. However, in California, the law allows him to receive support if he can prove he was financially dependent on his famous son while alive. His attorney promises to show that they were not only close, but that Michael did in fact support his father.
Branca and McClain say they want to preserve money for Michael's beneficiaries -- his kids, mother and still unnamed (at least publicly) charities. An admirable position, to be sure, but rather interesting in light of something else the pair did a few days ago.
Branca and McClain asked the California judge overseeing the estate for permission to pay themselves 10% of earnings they create for the estate for business deals they reach using some of Michael's assets. Specifically, they want to take unreleased music he recorded and promote it, keeping the 10% fee as a commission. They aren't asking for this fee for money made from Michael's previously-released music, "This Is It" movie proceeds, and his share of the Sony-ATV music catalog.
The co-executors point out that this is actually less than what advisers for other musicians' estates receive (15 to 25% they say). But, normally, an estate executor would hire an outside adviser to negotiate deals like this. Branca and McClain want to do it themselves and receive this fee.
This is curious, especially for Branca, because was also Michael Jackson's attorney. In fact, he was the attorney who reportedly drafted the 2002 will through which he was named as an executor. An attorney who prepares a will or trust and then is put in a position to earn a hefty fee through that very document does raise some questions. And Branca and McClain both aren't shy about trying to make money from their positions as executors.
Is this consistent with trying to maximize what Michael's children, mother and favorite charities receive? That is what they point to as driving their efforts to oppose Joe Jackson's request for money.
Of course, by allowing them a percentage-based fee, it would maximize their incentive to generate more money for the estate. But, that is part of their job, already.
But, it's not like executors receiving a percentage fee is unheard of. Corporate executors and trustees (banks, for example) are often named by wealthier people to administer their affairs after death, and in those cases, they are usually paid a percentage fee as their payment.
And, if Michael Jackson's estate is going to pay someone a fee to do this anyways, why not pay them? They are an experienced entertainment lawyer and music executor, so they are qualified for the job, it would appear.
Ah, the complex world of estate and trust administration. It isn't always black and white. This is true for wealthy estates, and modest ones as well. While most families don't have to worry about what percentage of music royalties should be paid to whom, questions of whether executors and trustees are being fair, charging too much money, or treating the beneficiaries equally arise time and time again.
If you are in a situation and have a question of whether an estate is being properly administered, don't hesitate to consult with an experienced probate attorney.
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.Follow us on Google+