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Why Is Court Allowing Executors To Profit?

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Dangerous Incorporated

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California Probate Code Section 9657
The personal representative shall not make profit by the
increase, nor suffer loss by the decrease or destruction without his
or her fault, of any part of the estate.
California Probate Code Section 9657 - California Attorney Resources - California Laws
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Therefore Branca and McClain should not have received this:

Michael Jackson Estate Pays 10% to Executors

Posted Feb 4th 2010 4:07AM by TMZ Staff

Michael Jackson The executors for the estate of Michael Jackson just got their 10%.

John McClain and John Branca had asked the judge for 10% of the profits made from a number of estate-related ventures.

The judge just approved the fee request, stating that the arrangement actually could save the estate money -- because the traditional way of making deals with managers, lawyers, etc. costs a bloody fortune.

One item excluded from the 10% -- a portion of the profits from the movie, "This Is It."

The judge also gave McClain and Branca the right to green light deals without going back to court every time for permission.

The judge gave McClain and Branca props for raking in the dough for the estate .... calling their performance "extraordinarily impressive."
Michael Jackson Estate Pays 10% to Executors | TMZ.com
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or this?:

The new Sony deal for Michael Jackson’s new records is actually worth $225 million according to my sources.

That means that Jackson attorneys John Branca (a co-executor) and Joel Katz, with the help of co-executor John McClain, have cut for Michael Jackson’s estate the richest deal ever in recording business history. It far exceeds the deal Sony made with Bruce Springsteen a couple of years ago for $100 million.

The deal is only for records for the next seven years. It already includes the soundtrack to “This Is It.” Come November, the first scheduled release will be a collection of unreleased tracks perhaps including a duet with Paul Anka and one or two songs left off of “Thriller.”

Two more releases will be anniversary editions of “Bad” and “Off the Wall” which will include extra and remixed tracks a la the 25th anniversary edition of “Thriller.” McClain and hopefully Jackson’s longtime manager Frank DiLeo will be involved with those.

There are also enough tracks for at least one or two live albums from various Jackson tours.

The Sony deal does not include anything to do with Michael’s publishing, live shows still to be arranged, or merchandise. A show with Cirque du Soleil, as I’ve written before, will be announced shortly for Las Vegas.

But all of that is separate. What happened: Since his death Jackson has sold 31 million albums worldwide. Sony, which had parted company with Jackson before his death, wants to remain in the Jackson business. With this contract, they will be in business with his estate for at least seven more years.

Insiders say that Jackson’s estate will retain the rights to all the master recordings, too. This is highly unusual. Also: Branca, Katz and McClain also, apparently, renegotiated Jackson’s royalty rate with Sony for this deal. “It’s the highest rate anyone’s ever had,” says a source.

At this rate, the prediction is that Jackson’s huge debt leveraged against his own MiJac Music Publishing will be paid off in a short time. His even bigger debt, secured against his one half interest in the Sony/ATV Music Publishing company–also known as the Beatles catalog–will be refinanced and reduced. When Jackson died, sources point out, he was $500 million in debt.His estate is now solvent, and his children are well taken care of for their lives.

It is the sad irony of the Michael Jackson story that for years he suffered financially, and drifted in his career. Since his death. his career and finances have flourished.

Source: Showbiz 411
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and they asked for more money just because they had to deal with Joe? Well they should be working with Joe not against him:

Jackson Executors -- Beyond the Call of Duty

Posted Dec 17th 2009 2:49PM by TMZ Staff

Michael Jackson The executors of Michael Jackson's estate have filed documents, explaining why they should be entitled to more than the statutory fee most executors get -- a big reason ... Joe Jackson.

According to legal docs filed with the court, co-executors John Branca and John McClain had to defend the estate from a steady barrage of attacks by Joe Jackson and, until recently, by Katherine Jackson.

They also claim they've been working 14 hours a day, 7 days a week since they were appointed. And, they claim, their "business reputations and the character and reputation of Michael Jackson were repeatedly assaulted by personal and unfounded attacks" which they were forced to correct publicly in order to protect the Michael Jackson brand.

Branca and McClain say at the time Michael Jackson died ... Michael and his businesses were defendants in 11 separate lawsuits and it only got worse after his death.

Branca and McClain want more than the statutory fee -- which is a percentage of the value of the estate. They're asking for "extraordinary compensation" for the work most executors never have to do.

Read more: http://www.tmz.com/2009/12/17/micha...te-special-administrator-fees/7#ixzz0jSU8p0kj
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Now of course I think the executors should be paid for working>

But that does not mean getting an increase depending on how much they bring into the estate. Thats what conflicts with the law.
 
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Well if you pick and choose one part of the law , it might sound like that. However if you look to the all of the probate law you'll see that it has a dedicated part just talking about the compensation of the executors.

CHAPTER 1. AMOUNT OF COMPENSATION
Article 1. Compensation of Personal Representative ......... 10800-10805
Article 2. Compensation of Attorney For the Personal Representative .................................. 10810-10814
CHAPTER 2. ALLOWANCE OF COMPENSATION BY COURT ............... 10830-10832

You can read about the compensation section from the above posted links, in short it says the following
10800. (a) Subject to the provisions of this part, for ordinary services the personal representative shall receive compensation based on the value of the estate accounted for by the personal representative
10801. (a) Subject to the provisions of this part, in addition to the compensation provided by Section 10800, the court may allow additional compensation for extraordinary services by the personal representative in an amount the court determines is just and reasonable.
and
10830. (a) At any time after four months from the issuance of letters:
(1) The personal representative may file a petition requesting an allowance on the compensation of the personal representative.
(c) On the hearing, the court may make an order allowing the portion of the compensation


additionally in my opinion by
The personal representative shall not make profit by the increase, nor suffer loss by the decrease or destruction without his or her fault, of any part of the estate.
Click to expand...

the law is trying to say that an executor cannot profit or suffer from the change in the value of the estate that has nothing to do with them.

For example if the estate has $10,000 in a savings account and that brings an interest of lets say $100, the executors cannot take a share from that increase as the interest payment had nothing to do with them.

Similarly for example if the estate has stocks and that stocks lose value the executors will not be responsible for that loss too.

Overall what the total probate law is saying that executors will be compensated for their work by a reasonable amount that is either determined by the provisions in the will, state laws or the court. Furthermore executors cannot benefit or suffer from a change in the estate value that happened without their control.

Plus managing an estate (especially a big estate such as Michael's) requires a lot of work, time, effort. It's just like a job and no one will do it or legally expected to do it for free. Any executors are compensated for their work for any estate. It's as simple as that.

BTW I think the superior court Judge Mitchell Beckloff will know the whole probate law better than anyone else on any internet website.
 
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Ok, I understand that they can get paid for doing their job. Im not expecting them to do this for free. lol Come on now.

But getting paid more depending on how much they bring in to the estate is what is against the law.

The personal representative shall not make profit by the
increase, nor suffer loss by the decrease or destruction without his
or her fault, of any part of the estate.
Click to expand...
 
ivy said:
Well if you pick and choose one part of the law , it might sound like that. However if you look to the all of the probate law you'll see that it has a dedicated part just talking about the compensation of the executors.

CHAPTER 1. AMOUNT OF COMPENSATION
Article 1. Compensation of Personal Representative ......... 10800-10805
Article 2. Compensation of Attorney For the Personal Representative .................................. 10810-10814
CHAPTER 2. ALLOWANCE OF COMPENSATION BY COURT ............... 10830-10832

You can read about the compensation section from the above posted links, in short it says the following
10800. (a) Subject to the provisions of this part, for ordinary services the personal representative shall receive compensation based on the value of the estate accounted for by the personal representative
10801. (a) Subject to the provisions of this part, in addition to the compensation provided by Section 10800, the court may allow additional compensation for extraordinary services by the personal representative in an amount the court determines is just and reasonable.
and
10830. (a) At any time after four months from the issuance of letters:
(1) The personal representative may file a petition requesting an allowance on the compensation of the personal representative.
(c) On the hearing, the court may make an order allowing the portion of the compensation


additionally in my opinion by


the law is trying to say that an executor cannot profit or suffer from the change in the value of the estate that has nothing to do with them.

For example if the estate has $10,000 in a savings account and that brings an interest of lets say $100, the executors cannot take a share from that increase as the interest payment had nothing to do with them.

Similarly for example if the estate has stocks and that stocks lose value the executors will not be responsible for that loss too.

Overall what the total probate law is saying that executors will be compensated for their work by a reasonable amount that is either determined by the provisions in the will, state laws or the court. Furthermore executors cannot benefit or suffer from a change in the estate value that happened without their control.

Plus managing an estate (especially a big estate such as Michael's) requires a lot of work, time, effort. It's just like a job and no one will do it or legally expected to do it for free. Any executors are compensated for their work for any estate. It's as simple as that.

BTW I think the superior court Judge Mitchell Beckloff will know the whole probate law better than anyone else on any internet website.
Click to expand...

Thank you for providing all of that...very informative! :)
 
Dangerous Incorporated said:
Ok, I understand that they can get paid for doing their job. Im not expecting them to do this for free. lol Come on now.

But getting paid more depending on how much they bring in to the estate is what is against the law.
Click to expand...

please read the whole probate law. IMO You are understanding it wrong. It means you cannot make profit / get money without doing anything but you can get compensation on the work you do/money that you bring in. Nothing is against the law.

See the examples that I gave above. The reasoning is something like this (although these might not be perfect examples)
- you have money in a bank, it increases due to interest earned - executors cannot profit (get a share) from that interest income
- you have a house, it's value increases over time - executors cannot profit from that increase in value
similarly
- you have stock , they lose value in the market - executors are not to have any negative consequences
- you have a house, it's value decreases over time - executors are not to have any negative consequences

the executors are being paid according to this section

10801. (a) Subject to the provisions of this part, in addition to the compensation provided by Section 10800, the court may allow additional compensation for extraordinary services by the personal representative in an amount the court determines is just and reasonable.

because of the estate size and the ongoing business deals etc what they have been doing is classified as an extraordinary services and the judge decided on a amount that is reasonable.
 
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They get paid a set % per the Trust documents. Anything else is profit and against the law. It's pretty simple.
 
If the executors are involved in anything that brings in further revenue to the estate, music deals, games, records, etc., then it is my understanding that they will also receive a percentage of those profits that they were involved in as far as negotiating the details to put it together. Since Michael's estate will ultimately benefit from whatever monies are made, and the executors were part of those negotiations, how would it be illegal?
 
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