will, and that they will be disadvantaged in an inheritance? At what age should the younger generation come into wealth, and how do the decisions their parents and grandparents make affect their life? Is it fair for a grandparent to spoil a grandchild with money, destroying a parent's attempt to help their children lead a fulfilled life?
There are no right and wrong answers here, but what is clear is that the soft issues count. The families that get it wrong in dealing with the many issues that come up are the families that allow wealth to destroy relationships and enrich the lawyers who make a living from disputes among the younger generation.
Is it possible for a family to get it right?
Chapter 1
Any Amount of Wealth is Enough to Destroy a Family
The Chadha Brothers – Could Thoughtful Succession Planning Have Avoided Their Deaths?
In November 2012, two brothers, Ponty and Hardeep Chadha, were shot and killed in a fierce gun battle at one of their family farmhouses in Chhatarpur, Delhi, in the Indian countryside. Kulwant Chadha, Ponty and Hardeep's father, had recently died without having left much clarity regarding how significant family business and personal assets were to pass to the next generation.
Accompanied by their bodyguards, Ponty and Hardeep were arguing over their inheritance and a settlement that had been brokered by their mother. The brothers were obsessed about a particular family farmhouse that their father had left to Hardeep. Ponty, the eldest son, had contributed hugely to the family business and believed he deserved the property. Hardeep felt that he had not only been bequeathed the farmhouse by his father, but that the overall deal on his father's estate brokered by his mother gave him too little.
For a family reported to have assets worth more than US$10 billion, it would be hard to imagine that Ponty and Hardeep's father had ever dreamed that his sons would die in a gun battle over an asset of relatively irrelevant value.
Jessica Schrader – Do We Need to Do Our Planning Much Earlier?
Jessica Schrader made a will in 1990 leaving her home, Southend Farm House in Essex, England, to her two sons. At her death at the age of 98, the house was worth just under US$500,000. Two years before Jessica died, at age 96, she made a new will leaving the house entirely to her older son, Nick.
A court dispute between the brothers resulted. With legal fees of close to US$170,000, Nick lost the battle, with the court reinstating Jessica Schrader's earlier will leaving the house to both of her sons in equal shares. The judge considered the bad feelings between the brothers, and Nick's perception that his parents had favored his brother Bill. Aggressive and violent, Nick had been jailed for assault, and was viewed as having exerted undue influence on his elderly mother, whom he had been caring for on a full-time basis, prior to her death.
One can imagine Jessica Schrader, in her 90s, being pressured into changing her will by her primary caregiver, her son Nick. Are only millionaires and billionaires at risk of having wealth destroy their lives and their families?
Nina Wang – Why it is Critical to Plan for the Worst, While Hoping for the Best
Nina Wang was a larger-than-life character and, at the time of her death in 2007, Asia's wealthiest woman, with assets of over US$4 billion. Her husband, Teddy Wang, from whom she derived her wealth, had been kidnapped twice, and was never found after his second kidnapping in 1990. Disputes over Teddy Wang's wills made front-page news. A first will divided the estate between Teddy Wang's father, who had started the family business, and Nina. A second will left everything to Teddy Wang's father, and was ostensibly put in place after Teddy found out about an affair Nina was having. A third will, hotly disputed as being a forgery orchestrated by Nina, stated that Teddy had “one life and one love” and purported to leave everything to Nina.
A lower court found Teddy Wang's third will to have been a forgery, and suggested that Nina had been responsible for its creation. On appeal to Hong Kong's highest court, the third will was found to be valid, and Nina escaped the charge of forgery and ended up with Teddy's entire estate.
Nina died in 2007 also leaving a messy estate. Her Fung Shui master, Tony Chan, who was having an affair with the much-older Nina, presented a will suggesting that Nina left everything to him, contrary to what was stated in an earlier will executed by Nina, which left her estate to a family charitable foundation. After a long period of litigation, the will Tony Chan presented was found to have been forged, and the charitable foundation was determined to be the proper beneficiary of Nina's estate.
Jonathan Griffin – An Extreme Example of How Succession Plans Can Affect Family Members
Jonathan Griffin, wearing combat gear, caused thousands of pounds of damage to his brother's farm in Dorset, England. Furious at having been excluded from benefit under his father's will, the family farm having been left only to Jonathan's brother and mother, Jonathan's relationship with his brother, David, was clearly destroyed. Jonathan had worked on his father's farm, and was shocked at his father having left him out of a share, ostensibly for tax reasons.
Tony Marshall – An Example of the Potentially Dangerous Consequences of the Fact that We All Live Longer and Need New Approaches to Our Succession Plans
Tony Marshall, aged 88, exhausted his last legal appeal against a jail sentence for having defrauded his mother, Brooke Astor, a well-known New York socialite and philanthropist, who died at the age of 105. Tony Marshall was convicted together with one of his mother's lawyers, Francis Morrissey, Jr., who was also disbarred.
Sentenced to prison terms of one to three years, Marshall and Morrissey were found to have schemed together to siphon funds from Brooke Astor and alter her will, after she was diagnosed as having dementia and suffering from diminished capacity.
Uncle Law – Lust? Use Caution
Uncle Law, a Hong Kong resident, was 79 when he met a young woman from mainland China in Hunan Province. They soon married and had a son. Six months after mother and son received residence permits to move to Hong Kong, the couple divorced and Uncle Law lost custody of his son and his tiny, 150-square-meter apartment. Left with nothing, Uncle Law had been humiliated and abused by his wife who complained of his impotence and lack of financial resources in front of friends and family.
The Hong Kong Agency Against Abuse, a welfare service for the elderly, reported that as many as 100 Hong Kong elderly men had sought their help in 2013 as a result of problems with much younger wives from the mainland who had apparently entrapped them into marriage to obtain residence permits and their modest homes.
Roy Lam Man-chiu of the Agency Against Abuse was quoted as saying “Lust? Use Caution.”
Gore Vidal – The Importance of Considering Alternative Beneficiaries Early on in the Planning Process
The author Gore Vidal died in 2012 at the age of 86. In his original will, Vidal had left his entire estate (reportedly worth well over US$40 million when future royalties from his books were included) to his long-time partner, Howard Austen, who ended up pre-deceasing Vidal, dying in 2003. Vidal changed his will in 2011, leaving his entire estate to Harvard University, a school he was apparently accepted into but which he never attended. His surviving family members, some of whom challenged the will, received nothing. Vidal's long-time housekeeper and chef, Norberto Nierras, also received nothing. He was reported as having said: “I'm 60 years old and had planned to stay with Mr. Vidal until I retired. I will have to go back to the Philippines, I cannot afford to stay in America. I didn't expect he'd leave me anything – other people are surprised he didn't. If Mr. Vidal did leave me something, I would be very, very grateful
