Fact Background

A prosperous businessman, married for 30 years with four young adult children, embarks on an affair at a time when his company is engaged in a merger, swapping private for public stock. The revelation of this affair leaves the children feeling humiliated and their mother devastated, leading to her eventual departure from the family home. Subsequently, a marital settlement agreement is established where the husband retains company stock on the condition that he divides it among their children. Tragically, not long after, the mother passes away. The businessman, now burdened with the responsibility of awarding half of his stock to his children, finds himself in a complicated position, as the woman with whom he had an affair was already pregnant with another man’s child.

The businessman and his children have intertwined interests in stock holdings and complex business structures that were part of elaborate estate plans. These plans had been formulated and established long before the end of the businessman’s first marriage. The intricate architecture of these business, tax, and estate plans is depicted in the diagram below:

Eventually, the businessman marries the woman he had an affair with and passes away after 20 years. Following his death, a new will surfaces, disregarding all previous estate planning and entrusting everything to his second wife and her child.

Despite the suspicious nature of these documents, the widow gains control of all accounts. She defies the marital settlement agreement, refusing to distribute the children’s rightful share. Even properties that once belonged to the family are now under the control of the second wife.

Law Firm Strategy

Injustice often seems more potent than justice. The theory that drove the legal strategy was: jurors might not sympathize with wealthy children fighting their near-age stepmother for their father’s fortune. However, they would feel the need to address the injustice if they discovered that the second wife was unjustly claiming the portion of the fortune that should have been secured for the children according to a 30-year-old Marital Settlement Agreement.

First Steps

Initiate legal proceedings to revive the rights of the deceased first wife and launch litigation against the second wife in her name. Seek enforcement of the Marital Settlement Agreement, trace all funds back to their source, and make claims for the receipt of stolen property.

Outcome for Clients

Case Information

Attorney Fee Structure: Hybrid model, incorporating both hourly fees and contingency.

Arbitrator: Hon. Stewart Waldrip, Judicate West

Superior Court San Bernardino: Hon. Thomas S. Garza

Superior Court Orange County: Hon. Ronald Bauer, Hon. David Belz, Hon. James Crandall, Hon Gerald Johnston; Hon. Glenda Sanders; Hon. Randall Sherman

Plaintiffs’ Expert: Carol Schaner, Esq.

Family Dynamics and Legal Complexities

Watching your parent date someone your own age can be disconcerting, to say the least. Adding divorce to the mix can leave emotional scars, and the subsequent passing of a parent can be devastating. The probate process that follows can add confusion and frustration to an already challenging time.

Blended families are particularly prone to probate litigation, especially when there is a significant age gap between the surviving parent and the new spouse, and suspicions arise regarding the motives behind the union. This case – one of the largest and most complex civil and probate litigation settlements in Southern California history – is a prime example. For anyone facing probate, please don’t hesitate to seek legal counsel. Contact our office at +1 (949) 662-6000.