Hey there, Legal Tea Listeners –This is your host, Jenny Rozelle! Today’s episode of Legal Tea is the “cautionary tales” topic. And on these “cautionary tales” episodes of Legal Tea, we normally talk about real-life cases with real-life clients that are things me or my office have worked on -or they are things that I think are generally good things to be aware of, so you don’t turn into a cautionary tale on my Legal Tea podcast one day! Well, today is a good one, my friends, and the story I’m going to share is going to have this moment of “oh my gosh – no way!” and when I get to it, you’ll know, I promise. I won’t even have to say anything. Anyway, the story is about a couple of siblings that fought over a piece of their deceased parent’s jewelry – specifically Mom’s wedding ring. So, today’s episode is going to be about the story, of course, but also perhaps things you can do to try and prevent this type of thing from happening with your beneficiaries.
Let’s dive into the story, shall we?
Alrighty, let’s give the people some fake names first. So, we have Mom, let’s call her Ruth, and Ruth’s two sons, let’s call them Sam and David. Ruth had created an estate plan, specifically a Trust plan, while she was living. Fast forward time, Ruth passed away and it was time to administer her estate – now, that phrase “administer her estate” is kind of a fancy way of saying, “We need to put this estate plan into action, get the person in charge in motion, start figuring our debts and assets, determine what the general game plan is, etc. etc.” Now, just one of the sons, Sam, was the “Executor” of his Mom’s Will and the next-up “Trustee” of his Mom’s Trust. So, consider Sam to be the one in charge.
Well, Sam gets underway with everything and one day, we get a telephone call from Sam that he and his brother, David, are in a bit of a dispute over Mom’s/Ruth’s wedding ring … essentially, they both wanted it and they’re both digging their heels in about it. They could not come up with a “fair” solution. Long story short, I got them to agree to have one take the ring and the other get cash equal to the ring’s value. Sure, there’s sentimental value there, too, but at the end of the day, we can’t just magically come up with a second one. There is only one, right? So, the most fair-ish thing to do was for one to get the ring and the other to get “extra” cash equal to the value of the ring.
I somehow got them to agree to that and the next step was to get the ring appraised. My plan was to take it to 2-3 appraisers and take the average of the values they provided. I further shared that rather than them bickering over “Well, that’s SAM’S appraisal contact…” or vice versa, I said, “I will take the ring, I’ll go get appraisals, and I’ll come back to you with what I have found out, the appraised values, etc.” They agreed to that. So, I march my happy little self to a well-respected jeweler in our area that is also well known for helping with appraisals too. I drop in, share what’s going on, and that I needed an appraisal done for an estate case. They said it’d take a day or so and would call me when they were done. I was like, “Okay, great” and left.
The next day or so, I received a call from the jeweler and they said, “We’re done with the appraisal, so you’re welcome to swing by, pick up the ring, and the appraisal.” I happened to have some time that afternoon, so I headed over (it was only like 10 minutes up the road), walked in, and the same gentleman that I talked to when I dropped it off was there. He recognized me and said, “Oh, let me go get the ring and paperwork.” He rounded the corner and made his way to where he was standing and said, “Well, we could have told you this over the phone, but I asked the receptionist not to say anything because … well, honestly … I wanted to see your face when I told you.” In that moment, I was thinking, “Well what the heck? Is this ring worth like a whole bunch of money or something? You know, made with rare stones or something!”
He said, “This ring is made with cubic zirconia. They are not real diamonds, Jenny.” I think my mouth dropped and stayed open for at least 15 seconds. WHAT?! In that moment, he handed the appraisal paperwork to me and said, “Yeah, that ring is only worth $225 … and that’s just because the gold. I also was being generous because, well, I don’t envy you having to go tell those sons that Mom’s ring is only worth a couple hundred dollars.” I looked down, saw the $225, and, whether you want to judge me or not, I laughed. You have got to be kidding me. I think I laughed because on the surface, this ring looked nice … it had four fairly large “diamonds” (said in air quotes) … and just judging by the sons’ behavior, I sort of figured it wasn’t really about the sentimental value of the ring – it was the monetary value. That, they looked at it as someone was “winning.”
I got back to the office and drafted an email to Sam and David, explained the discovery of cubic zirconia, and attached the appraisal. Would you believe me if I said neither wanted it at that point? Well, believe it – because that’s what happened. Once they learned that their Mom’s wedding ring was not real diamonds and worth very little, they both declined to take the ring. Even today, I think about this case and think, “Well if it WAS about sentimental value, one would have taken it … and kept it as ‘Mom’s wedding ring’ and not for the money.” Nope, that did not happen. Rather, Sam, as Executor and Trustee, once both declined to take the ring, Sam took the ring and sold it primarily for the gold – just as the jeweler had said. Then, those proceeds went into Mom’s Trust, which was ultimately split between the two of them (amongst, of course, all of Mom’s other assets).
That’s the story, guys. All the saga over a ring. Can you believe it? I share this story often … I’m not sure if it’s because there are some good lessons in it, or if it’s because all these years later, I’m still a little shocked that the ring’s diamonds weren’t real! I mean, oh my goodness…
So what can you learn from this story? Or maybe what you can do or consider relating to tangible personal property (so things like jewelry, guns, tools, collections, etc.) in your estate plan? Sometimes, in someone’s estate plan, they’ll designate who they want to get specific items (the fancy word is called specific bequests) – so in an estate plan, you could say, “I want my diamond ring to go to my granddaughter, Susie.” Or, “I want my classic car to go to my son, Johnny.” Now, these specific bequests get honored “off the top” meaning that they take place FIRST before, like, final distributions of money are made. These specific bequest items can be ANYTHING – so sometimes, I see jewelry, antiques, sentimental items, coins, Waterford crystal, chinaware, etc. etc. The list could go on and on and on…
Interestingly, where I sit, I am often the one that the client is telling me to put the “ring to Susie” and “car to Johnny.” So, I’m the one incorporating these things into their estate plan. But say, they don’t have any specific bequests/specific wishes on items – all of that personal property is STILL the estate’s asset and property, and therefore, subject to the person’s Will or Trust. So, last fast forward some time, and the person has passed away. So, as part of the Executor or Trustee’s duties and responsibilities, they’ve got to deal with your stuff in your house, condo, apartment, whatever. Now, that was the case with the story on this episode – Mom/Ruth did not have any of those specific bequests. That means her personal property, which included her wedding ring with cubic zirconia, just had to be dealt with by her son, the Executor/Trustee.
So, something to know and take away from this episode is that needless to say, “stuff” inside or outside your house is definitely related to my little estate and elder law world –whether it has monetary value, sentimental value, no value – it’s all still part of your estate. Even if it’s worth 5 cents. Still part of your estate, my friends. Now, along these lines, I also find many, many clients that think some of these items are worth mega bucks. Well, mega means different things to different people. What I mean by this is oftentimes, people think that personal property stuff is worth a lot … and studies show, more and more generations don’t give a hoot about this stuff leaving it to result on fairly low value or completely valueless. It’s something I see over-and-over-and-over in practice.
So, dealing with personal property in your estate plan is hard – it’s like, “Well I could specific who I want to get what” and try to eliminate fighting, but if you do that, consider a back-up person in case the first person does not want the items. Or, if you say, “Oh I’ll just let them figure it out when I pass away” – sometimes they do and it works out just fine. Sometimes, they don’t and it results in hurt relationships and sometimes extra legal fees. One LAST quick thing on this – I’m also seeing more and more clients give these kinds of personal property items to their family and friends while they are alive. They do it so they can see them enjoy it, or wear it (if it’s jewelry). I just had a meeting this week where the Dad teared up during the meeting when his son, who was wearing a necklace that Dad gave him. He said, “I decided to give them some stuff know so I can see them enjoy it!” So sweet, right?
Alrighty … let’s wrap up this episode. Let’s shift to a sneak peak of next week, which we’re circling back to the “current trends” topic where we talk about things that are going on currently that impact my estate and elder law world – or maybe, things that I have stumbled upon on the news or social media that is relevant to this podcast. Well, on next week’s episode, we are going to talk about a story I stumbled upon regarding Sharon Stone … well, if you didn’t know, she had a pretty significant health event in 2001 and it’s being released that at that time, a significant chunk of money, to the tune of around $18 Million Dollars, had been squandered due to supposedly, as she says, people taking advantage of her at that precious time. So, we’ll dive into that story next week, Legal Tea Listeners, so until then, be well and talk soon!
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