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3 Estate Planning Mistakes Learned from Nobel Prizes

Posted on: October 23rd, 2015
estate planning mistakeWhile many people are familiar with the Nobel Prizes awarded annually in various areas of the arts and sciences, not many are aware that the awards’ origins trace back to their namesake’s last will and testament. Alfred Nobel, the esteemed wealthy inventor, included provisions in his will that became the foundation for these globally-recognized awards. 

Alfred Nobel executed his will in the year prior to his death. Leaving behind no children or wife, other relatives contested the terms of Nobel’s will. Nearly three years later, a foundation was ultimately established to honor Nobel’s wishes and begin awarding prizes. Nobel made several estate planning errors that delayed the implementation of his intended estate plan:
 
  1. No accountability. Nobel named a number of institutions that he wished to handle the process of awarding the prizes. According to the will, the prizes were to be awarded to “those who, during the preceding year, shall have conferred the greatest benefit on mankind” in a handful of categories. However, Nobel did not consult with the institutions during his lifetime to learn if they would be interested in participating under these terms to oversee the selection and distribution process. 
  2. No executor. Nobel did not name an executor in his will. The executor named in one’s will typically is a trusted person who is intimately familiar with the testator’s wishes. Depending on the jurisdiction where estate administration takes place, generally the absence of a named executor will trigger a court-appointed executor. This individual might have little to no personal understanding of the testator’s intentions. (In North Carolina, for example, an individual can petition to become the executor or, if no one so petitions, a court-appointed official will take on the duty.)
  3. No transparency. Individuals who have a last will and testament in place should advise those named in the document how assets will be distributed. For example, if a mother of a son and daughter tells her daughter she is dividing her entire estate in half to be split between both children, an estate dispute could arise if, upon the mother’s death, the will directs the entire estate to pass to the son. In the estate of Nobel, he made no mention of his plans or wishes for his fortune to be used toward annual prizes. When his will was revealed following his death, a few relatives contested the will and attempted to void it. As a lesson in contemporary times, advising a trusted person on the contents and location of a will may be advisable, particularly if one makes significant changes to one’s plan or has detailed provisions that must be implemented. Testators should also maintain a list of digital account information that will be accessible by the executor after the testator’s death. A current list of usernames and passwords for online accounts helps to minimize conflicts and asset transfer delays during estate administration.

Although Nobel’s provisions were eventually honored and the Nobel Foundation was formed, the multi-decade delay and estate conflicts likely could have been avoided with mindful planning.

By Attorney Samantha Reichle

 
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