Oh What
a Tangled Web We Weave When First We Practice To Deceive
Franklin McRoberts, writing on Peter Mahler’s blog New
York Business Divorce, has recently discussed a most interesting case of a
man, now deceased, leading a double life. The title of the blog posting is How
to Resolve Competing Estate Plans of an LLC Owner with a Double Life; HERE IS ALINK TO IT.
Essentially, the decedent was
originally a 50% member in an LLC. Over time he gifted certain interests in the
LLC to his daughter; presumably she was admitted as a substitute member. The operating agreement provided that upon
his death the balance of his interests in the LLC would go to his daughter (a
transfer upon death). So far, so good.
Not so fast. After his death it came to be discovered that
his will provided that his remaining
interests in the LLC would go not to his daughter, but rather to a life estate
for his mistress with the remainder interest to his OTHER daughter by said
mistress. The dispute will turn on
whether the operating agreement and its transfer on death provision to the
first daughter or the subsequent will and the bequest to the second daughter
will control.
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