Tom Petty’s Estate Planning Mistake

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Tom Petty’s Estate Planning Mistake

What does “participate equally” mean? That’s a phrase from one of musician Tom Petty’s Trusts that is now being debated through probate court filings. While the singer had the foresight to create Trust instruments and plan his estate before his unexpected death in October 2017, his loved ones disagree about what his intentions actually were. Unfortunately, legal disputes about deceased people’s wishes often turn on the choice of language in a Will or Trust instrument.

In the case of Petty’s “Artistic Property Entity,” a separate Trust instrument created to hold his extensive collection of music, the Trust agreement benefits his second wife and his two daughters. The beneficial interest of the Trust is not being debated; instead, the question is one of control. Rather than naming one person or a professional fiduciary to manage the Artistic Property Entity, the Trust agreement states that Petty’s widow and two daughters “shall be entitled to participate equally in the management” of the entity.

Petty’s daughters now assert that this language gives them a two-thirds majority stake in management, giving them control. In court filings, Petty’s widow disagrees with this interpretation, claiming that her late husband’s intention was to require unanimous consent of all three stakeholders. She believes that a more expansive reading of the Trust agreement makes this clear. The probate court hearing this matter has not yet issued its determination.

Unfortunately, while Petty no doubt knew what he wanted, his heirs cannot agree on what his intentions were. This case illustrates the importance of using clear, unambiguous language in Wills, Trusts, and other estate planning documents, especially when business succession planning is involved or when planning to provide for both a current spouse and children from previous relationships.

Do your estate planning documents accurately reflect your wishes, removing any ambiguity about what you want? A skilled estate planning attorney can help ensure your goals for your estate are accurately captured. To learn more, contact our office today.