Everyone has heard of Larry King, legendary TV and radio host, who spent his life informing us of the many lessons of others. Now, his death teaches us a few more lessons.
Mr. King, died in Los Angeles, California at Cedars-Sinai Medical Center on January 23rd, 2021. He was 87. The December before he dies, Larry was hospitalized with COVID-19, but was removed from the ICU in short time having recovered from the virus. He ended up dying of sepsis, which was a result of an unrelated infection. Throughout his life, Larry suffered from various health conditions, including heart attacks, kidney failure and diabetes.
Mr. King’s career spanned over 50 years, having been the most well-known interviewer of his generation. He started The Larry King Show in 1978, which was a radio show and which was followed by the well-known CNN television show Larry King Live. After retiring from CNN in 2010 he continued his career until his death, streaming Larry King Now, a video cast on Hulu and RT America.
Because of his work ethic, continuing his career well past retirement age, Larry grew his estate to what some estimate as approximately $50 Million.
Larry is known by many to have been married several times. He was to marry eight times to seven different women throughout his life. Larry had five children, nine grandchildren and four great-grandchildren.
The amount of money in conjunction with the number of spouses and children that Larry had, complications to his estate were bound to arise upon his passing.
Three things, in particular, make the settling of his estate complicated.
First, he was in the middle of negotiating a divorce settlement with his seventh wife, Shawn Southwick King, when he died. Second, in 2019 Larry created a new handwritten will in which he stated that $2 Million should be equally divided among his five children. The problem is that he did not mention his seventh wife in the document. Third, and finally, two of Larry’s five children who were named in the new handwritten will, predeceased him and Larry did not amend the will to reflect this change in circumstance.
There is an indication from claims by Larry’s previous wives, that there were other estate planning documents in addition to this handwritten will. Those other documents were most likely trusts, which are private and are generally not made available to the public. Therefore, we don’t know the full extent of Larry’s estate plan, nor do we know all the details of his estate.
Nevertheless, the divorce settlement pending, the new will and the predeceasing of the two children, promise that there will be family disputes that lead to court involvement over the $2 Million referred to in the new will.
Larry King is one of many famous failed estate plan examples. With proper planning, Larry could have saved his family certain heartache from feuding and financial waste. As we do with history, let’s see what we can learn from Larry.
Marriage and Divorce
The first lesson that Larry can teach us has to do with his pending settlement of his last divorce. Although they divorced in 2019, final settlements in divorce can take a long time, especially when couples have been married for many years, as was the case here (23 years). So, they were still negotiating their settlement.
At the time he died, Larry was paying spousal support to his last wife and she was seeking $1 Million in annual spousal support as part of their negotiation, a request Larry undoubtedly opposed. Since the divorce was not finalized before he died, it’s likely that Shawn could inherit far more than that despite his new will or previous planning documents in place.
The reason Shawn stands to inherit more has to do with community property law in California. If no marital agreement was in place, California’s community-property laws apply and Shawn is entitled to 50% of any marital assets, regardless of what Larry’s estate plan states. Marital assets include any accumulated during the marriage.
Because of the length of the marriage, much of the assets were acquired during the marriage, making Shawn’s ultimate inheritance much more than the $1 million per year she was seeking in the divorce settlement. Moreover, when Shawn contests Larry’s new will in court, Larry’s surviving children will have a costly and stressful legal battle to undergo.
So, what’s the lesson?
Lesson #1: If Divorce is Inevitable, Update Your Plan.
Larry tried to do the right thing. He made the new will during the pendency of the divorce. Unfortunately, Larry didn’t work with legal counsel to do so. Had he hired an Estate Planning attorney, ideally before he filed for divorce, he could have avoided his kids being involved in this battle. It is vitally important that you work with an Estate Planning attorney to create a new plan the as soon as you realize you will be getting a divorce.
In many states, once someone has filed for divorce, neither of the parties are allowed to change their estate plan. Therefore, it’s important to act even prior to filing. Don’t wait to meet with your attorney to amend your plan.
Some of the things that will inevitably need to be changed if you are facing divorce is ensuring who will get your assets if you should die. This is likely no longer going to be your spouse. You will also want to update who is going to handle your finances in the event you become incapacitated. It is common for married couples to name their spouse as their agent under a financial power of attorney as well as the Executor of their will and Trustee of their Trust. You will most likely want to update all these roles replacing your spouse with a different, trusted person.
You will want to talk to your attorney to understand whether you are in a community property state and whether, and to what extent, you will be allowed to disinherit your spouse. You may not be able to fully disinherit your spouse, but your attorney will be able to ensure that your wishes are followed to the extend allowable under the law.
If Larry would have worked with his estate planning lawyer, his plan would have been better able to address the unexpected events, such as his children dying before him and could have prevented much of the conflict that has arisen.
Lesson #2: Hire an experienced estate planning attorney, especially if you have a blended family.
Blended families bring added complications to estate planning. It is always a good idea to have a qualified lawyer help you create your estate plan, but it is so much more true with blended families. Second (or more) marriages where one or more of the spouses have children from a prior marriage, bring inherent risk of conflict. This is because your children and your spouse have conflicting interests. The more wealth involved, the more likely to be true this is.
A qualified Estate Planning attorney can anticipate potential legal and family conflicts. They are also trained to consider possible, unexpected events and use contingency language in the documents to address. When Larry attempted to create his own will, he missed out on the legal expertise and experience of his lawyer. It is certain that Larry’s attorney would have built in provisions to address the untimely deaths of his kids as well as Shawn’s contest.
One of Shawn’s potential arguments is that Larry was under duress when he created his will. The fact that it was created in such an informal setting only serves to bolster such an argument. Working with a lawyer would have, in an of itself, served to uphold his wishes. In addition, the lawyer could have taken extra steps to document proof that Larry was not under duress.
In addition, Larry’s attorney would have instructed him that the use of a will was not the preferred document in his situation. Had it been explained to him, Larry certainly would have wanted to avoid probate in California, which is extremely expensive and time consuming. While other states have “probate-friendly” laws, there may still be reasons you would want to avoid probate. An attorney can explain the options to you.
Finally, a lawyer would also have explained options regarding how to leave the money to his children. Instead of an outright gift, Larry could have left the assets to his children in lifetime trusts thereby giving them divorce and creditor protection. The creditor protection Larry could have given to his children is a gift that they could not give to themselves. Surely, he would have opted to bless his children in this way had it properly been explained to him.
In part 2 of this blog, we will further explain the lifetime trust and how it could have benefited Larry’s children.
This article is a service of Bromlow Law, PLLC and Laura L. Bromlow, your family’s lifetime legal counselor. We provide legal advice and guide you through making educated and empowered decisions about life events for you and your loved ones. We offer a Love & Legacy Consultation, where you gain clarity on your finances and we guide you through making the best decisions for you and your loved ones. At Bromlow Law, PLLC, we are dedicated to the practice of Elder Law and Estate Planning. Our practice is comprised solely of working with clients in these and closely related legal fields. Laura L. Bromlow is a Certified Elder Law Attorney with the National Elder Law Foundation. We strive to enhance communication among family members and loved ones and to keep them all out of conflict so they can stay out of court. We want to help you keep your close circle safe! You can reach us at (281) 665-3807 or [email protected] Call our office today to schedule a Love & Legacy Consultation and mention this article to find out how to get this $700 session at no charge.