Barbie owns the Dream House, so what happens to Ken? - Examining the estate planning and probate issues at stake
By now, you will have likely seen or heard about the new Barbie film, starring Margot Robbie and Ryan Gosling. In the film, the Dream House is owned by Barbie and while she is in the real world, Ken swoops in and claims it as his very own Mojo Dojo Casa House.
From an estate planner’s perspective, this sparks a number of questions but in particular; if Barbie owns the Dream House, what can she do to protect it when she dies?
For the purpose of this article, we will assume the following:
- Barbie does not have a Will;
- Barbie bought the Dream House alone with no help from Ken;
- Barbie has children from a previous relationship;
- Ken lives with Barbie and her children in the Dream House; and
- Barbie and Ken are partners, but they are not married and have not entered into a civil partnership.
As Barbie and Ken are not married and she does not have a Will, if she dies without putting a will in place, Ken will not automatically receive anything from her estate. In the film Barbie also starts to contemplate her own death. The other Barbie’s laugh at her for doing so, so there is a risk that she could die without putting one in place. Under the intestacy rules, Barbie’s children would benefit from her estate equally. Let’s say Barbie wants her whole estate to pass to her children, but she is also very conscious that Ken will have nowhere to live if she dies first. What can she do?
Give the Dream House to Ken
The first and perhaps most obvious option would be to give the Dream House to Ken by way of a Specific Legacy under the terms of her Will. Ken would have somewhere to live and the rest of the estate can pass to her children. However, the Dream House will belong to Ken, so he can do with the dream house what he pleases once he inherits it. This would include leaving it to Barbie’s children, or perhaps leaving it to completely different beneficiaries. Barbie would be putting her complete trust in Ken to pass the property to her children upon his death, despite any future relationships he might have, or disputes with Barbie’s children. Due to its lack of flexibility and Ken’s recent behaviour, there are far better options for her to consider.
Give Ken a right of occupation while he finds his own Mojo Dojo Casa House
If Barbie wants to give Ken time to find himself a new home, she could grant him a right of occupation in her Will which allows him to remain in the Dream House for a set number of months or years following her death, allowing him adequate time to find a new home when she dies. Once the right of occupation period expires, Ken must leave the property and Barbie’s children can benefit as the beneficiaries. This way, the Dream House is protected and Ken isn’t made homeless the moment Barbie dies. In this instance, Barbie has the reassurance that her children will benefit within a certain period of time following her death.
Give Ken a life interest trust over the Dream House
If Barbie wanted to provide for Ken for his lifetime but wanted to ensure the Dream House (or the capital from any potential sale) was protected for her children, this could be an option for her to consider. In granting Ken a life interest trust over the property, he would have the opportunity to live in the Dream House for the rest of his life. In addition, provision can be made for Ken to make a request to the trustees to downsize in property or sell the Dream House, with any surplus capital being invested. This would then generate an income for Ken as he would be entitled to any income generated from the trust for the rest of his life. If Barbie also wanted the trustees to consider advancing some capital to Ken (should there be capital within the life interest trust), then provision can also be made for this.
Barbie can also put limitations on the life interest trust. For example, you may recall from the blockbuster film (or perhaps your childhood!) that Ken had a buddy named Allan. Let’s say that after Barbie has died, Ken and Allan enter into a relationship and wish to live together. Barbie can make provision in the Will Trust that in the event Ken remarries or cohabits with another partner, the life interest trust comes to an end.
Regardless of any downsizing, property sales or trust terminations, the end result would be that the capital (or the Dream House itself) is protected for Barbie’s children who will benefit upon the end of the life interest trust, whether that be upon Ken’s death or sooner.
Put her whole estate on Discretionary Trust
It can be difficult to determine what your circumstances might be when you die, especially when it comes to your estate and relationships. Barbie could therefore put her whole estate on to a discretionary trust and set out her wishes in a detailed accompanying letter of wishes, which might include all of the above options applying in different scenarios.
If Barbie put her estate on a discretionary trust upon death, she can rest easy knowing that the way in which her estate (including the Dream House) is distributed, could be adapted to the circumstances as she would have left detailed guidance to her trustees within her letter of wishes.
What can this all mean for you?
This article does not include an exhaustive list of Barbie’s options, nor does it provide enough detail for you to consider which option might be best for you and your circumstances. However, if Barbie’s situation sounds like one similar to yours, or you would just like to explore your own planning options, we would love to put you in touch with one of our specialist lawyers to discuss your estate and the planning we can help you put in place.
Read more about Irwin Mitchell's expertise in Estate Planning and Probate.
