Jan 17, 2014

Estate of mysterious heiress stil not settled

Clark (right) with her father and sister
The Huguette Clark estate has been in limbo for three years. A tentative settlement was reached in the fall of 2013 after several contentious legal battles, but the lawsuits just keep coming. The entire saga is worthy of a long-running soap opera - with ample material for several spinoffs, too. Money, greed, family, and questionable estate planning are the main plot points. While mind-boggling sums of money are at stake in this conflict, there are lessons to be learned for those with more modest means, too.

In case you've been hiding under a rock for the past three years, here are the basics: Huguette Clark was the highly reclusive heiress to a vast mining and railroad fortune. Clark was briefly married and never had children, and her one sibling died at a young age. At the time of Clark's passing, her only family members were 20 very distant relatives, the product of her father's previous marriage and with whom she had little or no contact.

Pathologically shy, Clark lived a hermit-like existence in a palatial 42-bedroom apartment on New York City's tony Fifth Avenue. She had lived with her mother there until her mother died in 1963. Clark rarely ventured out over the years except to purchase clothing for her extensive doll collection, valued at $1.7 million. In 1991, an emaciated Clark was carried out of her apartment; she had skin cancer on her face so advanced that she is said to have resembled a leper. She was admitted to Beth Israel Hospital in New York, where she was treated and returned to relatively stable condition. But even then, she never checked out, continuing to reside in the hospital until her death two decades later. She remained there under the alias Harriett Chase, in an unmarked room to protect her privacy The only people who saw her during that time were her accountant, lawyer, and a team of private nurses. 

In the many lawsuits that have cropped up since her death, the hospital and its supporters have argued Clark chose to remain in the hospital, an arrangement that suited her because it provided security and a surrogate family. Others allege she was coaxed to remain there and her whereabouts kept hidden from the world, so that those around her could pressure her into giving them money. And give she did, regardless of why she remained at the hospital. Over the tears the heiress provided frequent and extravagant gifts into the millions to the people in this tiny inner circle - her physician, nurses, lawyer, etc.

When Clark died at age 104 in 2011, among the assets in her $307 million estate were the New York apartment; a 22-room mansion in New Canaan, Connecticut; and a 21,000 square foot Santa Barbara, California home overlooking the Pacific housing an original Renoir and other valuable paintings, a Stradivarius violin, and an original edition of "Paradise Lost." All her homes had been meticulously maintained over the years, even though Clark never went to any of them.

Two wills were found. The first will, signed March 7, 2005, left everything to her distant relatives.  It had the word "revoked" handwritten and a line drawn through the first page. The second will, signed just a few weeks later on April 5, 2005, cut out the relatives, stating: I intentionally make no provision in this my last will and testament for any members of my family, whether on my maternal or paternal side, having had minimal contacts with them over the years. Instead, the new will left $1 million to Beth Israel Hospital; $100,000 to her personal physician, Henry Singman; additional gifts to the caretakers of her various properties and to her lawyer and her accountant; the California property to a foundation to be established to promote the arts; a Monet painting, "Water Lillies," to Washington, D.C.'s Corcoran Gallery of Art, an institution her father had supported; and her collection of dolls and dollhouses and 60% of the rest of the estate to her longtime daytime nurse, now-retired Brooklyn resident Hadassah Peri.

You don't need a degree in rocket science to figure out what came next: The relatives contested the April 2005 will, claiming that Clark had been coerced into excluding them from her estate. After years of legal back-and-forth, a tentative settlement was reached in September 2013. Under the terms, the relatives would divide $34.5 million among themselves. Clark's attorney and accountant would be stripped of their bequests. The doll collection would go to the arts foundation, not Peri. The hospital would get $1 million. Peri also would be required to return $6.7 million of $31 million she received from Clark during the heiress' lifetime, and also forego  the $30 million earmarked for her in Clark's will. (There are still other, separate lawsuits pending: the executors of the estate are trying to claw back some of the money that Clark gave out over the years; Beth Israel Hospital is also being sued.)

But this January, there was a new turn of events: Geraldine Coffey, Clark's night-duty nurse for two decades, said she would not agree to the settlement, threatening to derail it. She claims she was not consulted during the negotiations, and that, in addition to the gifts she'd received during Clark's lifetime, Clark had also told her she would be provided for in her will.  Coffey received about $1 million in gifts before Clark passed on, monies used to purchase real estate and pay her children's tuition, in addition to a $130,000 annual salary.. Attorneys for the estate have countered that Coffey caused Clark distress by pressuring her for money. The matter is due back in court this month.

Of course, the conflict is also generating enormous fees for the lawyers involved.
These high-profile legal conflicts over huge fortunes are intriguing, to be sure, and Clark's eccentricity and unusual circumstances make this one more intriguing than most. However, at its heart it is an everyday and common drama: An isolated, elderly person whose competency is questioned along with the motives of those around her, and estate planning documents that arouse suspicion. Multi-millionaires or not, all of us should take steps to ensure that in death, our wishes are carried out, and those we care about most are protected. If you need help to create a sound and thoughtful estate plan,  contact our lawyers for a consultation.

1 comment:

Anonymous said...

That 'family' needs to but out and not get diddily squat. The fact that you are taking money from someone who was given it WHILE THE PERSON WAS ALIVE, is a completely stupid move. I hate my family and hope they never do something as stupid as this.
Phillius | http://www.rigaziolaw.com

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