In the first part of this series, we discussed how failing to address the issue of adult adoption in your estate plan can cause unnecessary litigation after your death, even when there is nothing sinister about the adoption. In this article, we will discuss what happened to a man who attempted to use adult adoption to preserve his lavish lifestyle at the expense of his biological children.
John Goodman, the subject of the recent Florida case of Goodman v. Goodman, had gone from a wealthy polo tycoon to a man with some serious problems. He was awaiting trial for DUI manslaughter after causing a fatal car crash, facing the possibility of serving years in prison. Mr. Goodman was also in the midst of a civil lawsuit brought by the parents of the 23-year-old man he killed, who were seeking millions of dollars in damages. In a scheme to ensure his continued access to cash despite his legal issues, Mr. Goodman adopted his forty-two year old girlfriend so that she would become a beneficiary of the multimillion-dollar irrevocable (and therefore theoretically protected from creditors) trust he set up years earlier for any children he might have.
The adoption of your adult “significant other” is technically legal under Florida law. As discussed in our previous article, Florida statutes provide that “[a]ny person, a minor or an adult, may be adopted.” However, Mr. Goodman’s bad intentions caused him to run afoul of the law.
Mr. Goodman’s critical mistake was that, in furtherance of his scheme, he kept the adoption a secret until the time to challenge it had passed. This violated a Florida law which required him to give proper notice to anyone who would be financially affected by the adoption, such as his two biological children, who now would have to share the assets of the irrevocable trust with the adopted girlfriend. The court ruled that this intentional failure to give notice was enough to make the adoption void, both in and of itself and because it amounted to a fraud on the court.
Mr. Goodman’s attempt to adopt his girlfriend not only failed to obtain the result he desired, it also resulted in expensive and lengthy litigation. Unfortunately, many people facing catastrophic creditors behave like Mr. Goodman and end up committing fraud to try to save or hide their money. If you would like to learn how you can legitimately protect your loved ones from unexpected creditors through proper planning, you are invited to attend one of our monthly “Truth About Estate Planning” workshops.