Leona Helmsley, widely regarded as the “Queen of Mean” before she died at age 87 in 2007, left behind a fortune valued by some to be worth $40 to $80 billion. She earmarked twelve million dollars to take care of her dog, Trouble, until the Judge reduced it to a paltry $2 million.
Helmsley left most of the remainder of her billions to charity, specifically directing that her trustees were to use their discretion for what charitable purposes to benefit. But she also signed a Mission Statement that instructed the trustees to exercise that discretion first for “purposes related to the provision of care for dogs” and, only secondly, for “such other charitable activities as the Trustees shall determine.”
According to published reports, the trustees of Leona Helmsley’s trust have only given away 100,000 dollars to dog-related charities, out of the 450 million dollars they’ve donated so far to charity. That’s only about one-fiftieth of one percent!
Several notable animal charities, including the Humane Society of the United States and The American Society for the Prevention of Cruelty to Animals, sued to require the trustees to give more money to animal charities, consistent with Helmsley’s apparent wishes as expressed through her Mission Statement.
The Judge recently rejected their bid, saying the trustees have the authority to decide for themselves. She felt that the Attorney General for New York (which already sided with the trustees) could adequately protect the charitable interests of the trust.
The Judge also worried that letting a couple charities intervene would then open the door to conceivably every animal charity, veterinary hospital and university doing animal research also trying to get involved and have their voices heard (and presumably, ask for money too).
The trustees feel they are doing what Leona Helmsley intended, both because her trust granted them this discretion, and because she herself only donated a small amount to dog charities compared to her much more generous contributions to other charities. For example, in the last eight years of her life, they say, she gave fifty-five million dollars to charitable causes, but only one thousand dollars to a dog charity.
The canine charities have promised to appeal the Judge’s decision.
This case presents yet another example of what can happen when estate planning documents don’t fully set forth someone’s intentions. Did Leona Helmsley really want her trustees to practically ignore dog charities? The trust language certainly suggests that. But then, why did she do the separate Mission Statement that said otherwise?
Financial planners, estate planning attorneys and their clients should always be careful to ensure that estate planning wishes — whether they affect millions or a modest sum — are clear, unambiguous and expressly reflected in the will or trust, without other documents which contradict what the will and trust say.
If Leona Helmsley did want her trustees to benefit dog charities, she should have stated so in her trust and not left it up to the discretion of her trustees. If not, then she shouldn’t have put it in her Mission Statement. Perhaps if she had better professional advice, this confusion could have been avoided.
By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of an upcoming national PBS special. The charismatic duo has appeared on the Rachael Ray Show, Forbes, ABC’s Live Well Network, WGN-TV and has lent their expertise and analysis to hundreds of media sources, including The Associated Press, Los Angeles Times, Chicago Tribune, Kiplinger, and The Washington Post, among many others. As dynamic keynote speakers, Danielle and Andy delight audiences nationwide with highly entertaining and informative presentations, dishing the dirt on celebrity estate battles while dispensing important legal information to help people avoid family fights among their heirs. The couple spends their free time with their 8-year old son and seven-year old boy/girl twins.
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