The Estate Plan of Anna Nicole Smith

By Larry Stratton

Anna Nicole Smith is a prime example of a fact: It's often later than you think. In her case, she probably did not realize that she would not live to the age of 40. She probably did not attach great importance to having an updated will or estate plan.

However, the latter stage of life is simply not the best time to plan. The best time to engage in estate planning is when you are young and healthy. Then as age sets in, or as life circumstances change, the plan should then be updated.

Anna Nicole Smith's death, and her estate "plan," provides instructive lessons for all of us concerning our own estate plans:

Lesson 1: You never know when...

This is self-evident. Barring the autopsy report concluding that her death was a result of suicide, it is doubtful that Smith knew that she would never see her 40th birthday.

This highlights the fact that the best time to engage in estate and financial planning is when we are healthy. Yet, it's very easy to wait -- and to simply not think about it until we have to. But we never really know when that crisis will occur.

Remember: Planning for the future does not make it happen any sooner, or later.

Lesson 2: Keep it current.

Smith's will shows that it was prepared before two major events in her life: Before the death of her son, Daniel, and before the birth of her daughter, Dannielynn. But her 2001 will made no provision for Dannielynn.

In fact, Smith's will apparently disinherits any future children, arguably including Dannielynn. The first Article of the will provides that "I have intentionally omitted to provide for my spouse and other heirs, including future spouses and children and other descendents now living and those hereafter born or adopted..."

Little did Smith realize in July 2001, when she executed her will

• that her son Daniel would predecease her (he died in late 2006),
• that she would give birth to a daughter Dannielynn,
• that she would not survive her daughter, and
• that the United States Supreme Court would ultimately revive her claim to her late husband's estate, estimated in the amount of $474 million.

Again, the lesson: Keep your estate plan current.

Lesson 3: An outdated estate plan will have unintended consequences.

Given the language in her will, including the clauses specifically omitting gifts to those not named in the will, it is possible that daughter Dannielynn will not receive any part of Smith's estate. However, on the other hand, it is also possible (but not certain) that Dannielynn's rights to the estate might be established through California's "Pretermission Statute" [Probate Code Section 21620].

It is highly unlikely that Smith truly wanted to disinherit her future daughter when she prepared her will. Unfortunately, however, disinheritance is one possible outcome given the wording of her will. If nothing else, the unnecessary ambiguity almost guarantees extended litigation.

Failing to plan your estate in a timely manner almost guarantees unintended consequences.

Lesson 4: How about your child's guardian?

One major purpose for having a will is to nominate a guardian for your children. Smith nominated a guardian for Daniel, but of course did not nominate a guardian for her daughter Dannielynn.

Given the fact that paternity will probably be established (from a bevy of potential dads, I might add), the lack of a named guardian will probably not be a problem in Dannielynn's case.

However, even if your estate is not worth $474 million -- and few are -- it is still worthwhile to have a will. Most of us will still need to identify a guardian for our children.

And who knows what else life has in store for you? Again, keep it current.

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