Prince's Estate: If it Happened in Texas

As of today, it appears that musical legend Prince died without a will*. When a person dies without a will, or “intestate,” his property passes according to a formula prescribed by state law, not the decedent’s wishes. Prince was known to be a devout Jehovah’s Witness and might have wanted much of his estate to go to his church. But if he never created an estate plan to give that wish effect, it will pass instead to his heirs as defined by law. In effect, the state wrote his will for him.
 
* Note that it’s possible he has trusts, legal entities, or some other manner of legal planning that provides for the distribution and management of some or all of his assets. As of now, the only detail shared is that a will has not been found. But for sake of example, let's assume he had none of those things.
 
Celebrity estate plans gone awry often make interesting cautionary tales for the rest of us. Prince lived in Minnesota so his estate will be distributed and administered according to Minnesota law. But by way of example, what if he had been a Texas resident?
 
Who would get his property under Texas law? When a person dies without a will, we look to see who his closest living relatives are.
 
In Texas, the first thing we have to consider is whether the decedent was married at death or not. If they were, then we have to consider whether we’re dealing with community property, separate property, or both. In this case, Prince was unmarried at the time of his death, so that issue wouldn’t apply.
 
Next issue to consider is whether he was survived by any children or other descendants (grandchildren, great-grandchildren, etc.). It appears that Prince had only one child, who tragically died as an infant. So, Prince was not survived by a spouse or descendants. In other words, if you picture a family tree, there’s no spouse to go across to and no descendants to go down to.
 
The next direction to try is up. If Prince’s parents had both survived him, they would each inherit half of his estate. If only one survived, the survivor would claim half and Prince’s siblings (or descendants of deceased siblings) would collectively split the other half. If he was survived by only his mother but Prince’s father and Prince’s siblings all predeceased him, Mom would get 100%. But Prince’s mother and father both predeceased him.
 
So to recap, we’ve looked for and not found heirs at any of the following levels: spouse, descendants, parents.
 
Next up is siblings, and here we finally find some heirs. Reportedly, Prince was survived by one full-blood sister and five half siblings. Here is at least one area where Texas and Minnesota probate law differ: in Texas, half siblings inherit half as much as full-blood siblings, whereas in Minnesota they are apparently treated equally.
 
So, we’ve concluded that Prince’s heirs are his full-blood sister and 5 half-siblings. What percentages would they all get under Texas law? Brace yourselves, we’re gonna math.
 
Think back to when you learned fractions. The top number is the numerator, the bottom is the denominator. To come up with our denominator, we add up the total number of shares at play: one for each half-sibling, two for each full. That gives us 5+2=7. Now, for the numerator, each half-sibling gets 1, each full gets 2. So our full sister gets 2/7 of the estate while each of the five half-siblings gets 1/7. Add them all up and you get 7/7=100% accounted for.
 
Now, to take it a step further, let’s suppose one of Prince’s half-siblings predeceased him but was herself survived by children. That half-sibling’s children collectively share her 1/7. So if she had three children, they each get 1/3 of 1/7. Add those pieces together, and collectively, that branch of the tree gets 1/7.
 
So now that we know who the heirs are, they just show up and get their money, right? Not quite. Again, I’m using Texas law here, so the process that actually plays out in Prince’s estate may well look different, but there is as yet no legal finding of who Prince’s heirs are.
 
The process of obtaining that legal declaration of heirs is called a judicial determination of heirship. One or more of the heirs files an application asking the Court to declare heirship. The Court appoints an attorney to serve as attorney ad litem for unknown heirs-in essence, to fact-check the application. Often this is a fairly straightforward undertaking involving speaking with the applicant and other people who don’t stand to inherit but knew the decedent’s family history and reviewing relevant records. In a situation like this, though, it could get a lot more interesting.
 
Once the Court has heard sufficient evidence to determine the heirs, the Judge signs an Order declaring heirship, and that Order is analogous to a will that divides the person’s property among the declared heirs.
 
So what if, perhaps unbeknownst to any of his family members, or even Prince himself, Prince fathered a child? (Let’s just say the life of a famous celebrity might present more opportunities for casual “relationships” than the average person’s.) If paternity could be established, now that child skips to the head of the line in front of the siblings and inherits the full estate. Is there any child out there? Who knows, but it wouldn’t surprise me at all to see allegations of it, given Prince’s celebrity and large estate.
 
But let’s assume that there are no surprise children out there, and the siblings are in fact the only heirs. Well, now you have 6 people who may not get along, who may be in very different financial circumstances, who may have different opinions, all co-owning some very valuable property. Doesn’t sound like a recipe for trouble at all, right?
 
Texas law allows for independent administration-that is, for the administrator to act largely free of court supervision, when provided for in a will or, in the absence of a will, when all heirs consent. If all 6 of these people were willing to consent (and there are no minor heirs who are legally incapable of giving consent), that might be an option. But would they all agree to that? And even if they did, would anyone want to serve as an independent administrator in these circumstances?
 
Most likely, it would end up being a dependent administration. That is, the administrator would essentially be playing “Mother May I?” asking the Court’s express permission for nearly every action taken, from resolving creditor claims to selling property to managing ongoing business to distributing assets. If you’re thinking that sounds like an expensive, complicated process, you’re right.
 
Okay, so most of us don’t have $300 million estates, including valuable intellectual property and other complex assets. But take away the money and fame and the story looks not so different from those of some of my own clients. Fortunately, sometimes the family members all get along and the estate can be administered fairly easily and inexpensively. But take an already strained family dynamic and throw in an intestate death and things can get messy quickly.
 
None of us know what Prince was thinking or why he didn’t have an estate plan. It’s safe to say, though, that whatever his wishes for his estate, there was a better way to achieve them than dying intestate. The same is true for us non-celebrities too.