Clark was the daughter, and only surviving child, of William Andrews Clark, who died in 1925 and was believed to be one of the richest Americans at the time. He built his wealth through copper mining and served as a senator of Montana. For many years, his daughter was thought to have died long ago. Indeed, Huguette Clark hadn’t been seen in the Fifth Avenue apartment that she lived in (and still owned when she died) in 22 years.
Where was she all that time? Living in a hospital room, even though she was in good health when she moved there in the late 1980s. Watched over by a private nurse, her attorney, and an accountant — who was a convicted sex offender — Clark was said to have considered her collection of dolls to be her closest companions. She was isolated from her family members, and the Manhattan district attorney’s office has spent months in a lengthy criminal investigation over how her attorney, Wallace Bock, and accountant, Irving Kamsler, managed her vast fortune.
That duo says that she didn’t want to see her family members — all of whom were distant — and that they merely followed her wishes. They deny any wrongdoing.
And perhaps they’re right. Relying on reports of the criminal investigation, some of her relatives filed a court proceeding last year, asking for an independent guardian to be appointed to protect Clark. The judge quickly dismissed the case and found it to be based on nothing but “speculative assertions.”
Now that she has passed away, who stands to inherit her $400 million? MSNBC.com, which has been reporting about Huguette Clark for more than a year, reports that most of her wealth is earmarked to pass to an art foundation that her will created. Her collection of art, rare books, and musical instruments from her Fifth Avenue apartment and her oceanside Santa Barbara, California home, will go to the new foundation under the terms of her will. Her Santa Barbara home will house the foundation.
Clark’s will left the rest of her fortune to her long-time nurse, Hadassah Peri, and various other individuals, including her attorney and accountant who each stand to receive $500,000 each (despite their criminal troubles), not to mention potential millions more as executor fees and as directors of the new art foundation. The will also leaves $1 million to the hospital in New York that Clark called home, and a rare Monet painting (said to be worth around $25 million) goes to an art museum in Washington, D.C.
You can read her April 2005 will, signed when she was 98 years old, here. Reportedly, this was signed around the same point that Clark’s attorney cut off contact with her family members. The will specifically leaves them nothing, noting that Clark only had “minimal contacts” with them over the years.
Interestingly, the attorney who prepared and oversaw the signing of the will works for the same law firm in which Clark’s attorney, Wally Bock, is a named partner. Bock is the attorney who, along with the accountant, Kamsler, is still being investigated for how they managed Clark’s fortune. This is especially curious considering that the attorney named as having supervised the will, Lewis Siegel, is listed on the firm’s website as practicing commercial and bankruptcy law, with no mention of estate planning.
Normally an estate planning attorney would at the very least draft a revocable living trust for someone with this amount of wealth, rather than relying on a simple will as was done in this case. Additionally, many experienced estate planning attorneys would not prepare a will that named a law partner as a beneficiary, due to a potential conflict of interest.
But why the will was created in this fashion is only one of the questions surrounding the estate. The big mysteries involve how much of Clark’s money was spent. MSNBC.com reports that Bock and Kamsler spent $170 million on behalf of Clark over the last 15 years of her life, when she never left her hospital room. That works out to $1 million per month, give or take.
The sum includes $3 million spent on dolls and about $2 million on the attorney’s favorite charity. There was even $1.85 million paid to an Israeli settlement in which Bock’s daughter lived. The hospital’s price tag was nearly $5 million, which would not seem out-of-line for 22 years of time Clark spent there, except that she was reportedly in good health for most of that time.
Not surprisingly, Clark’s distant family members are questioning everything and have filed to challenge the validity of Clark’s will. If they win, 21 distant family members will inherit her wealth, instead of her art foundation and the other named beneficiaries.
In addition to claiming mental incompetency, the challenge undoubtedly will focus on the allegation of undue influence. That is when a person, or people, uses coercion or other improper means to convince someone to leave them assets (such as through a will) when the person wouldn’t have otherwise done so.
This will be a big question in this case, for several reasons. First, the attorney and accountant held power of attorney over Clark. Second, there were her odd and isolated living arrangements. Finally, Bock and Kamsler were both named as will beneficiaries — not to mention that they stand to receive $16 million or more in executor fees (according to the MSNBC.com report). They clearly will not have an easy fight on their hands defending themselves and the will.
In New York, as in most states, the law will actually assume undue influence existed in certain circumstances. This happens where someone had a trusted, confidential relationship with the person in question (such as would exist with a power of attorney or an attorney-client relationship) and that trusted person benefited from the will, especially where the same person or people were somehow involved in the will preparation process. While this law varies from state to state, in New York, it means that Bock and Kamsler will have to present evidence that the will was done without improper influence by them. This is not a simple legal hurdle to clear under the circumstances of this case.
The sad part is that if Clark did indeed want to benefit a charitable foundation rather than her distant family members, precautions could have been taken to protect those wishes. If her will is ultimately stricken based on undue influence by her attorney and accountant, then none of the wishes in her will would be followed.
This is a valuable lesson, even for those with fortunes of far less value than $400 million. Whenever there is a will or trust done under circumstances that are questionable or which could lead to a lawsuit later, extra care should be used to make sure that the documents are done the right way. This can include getting a neutral law firm involved, or even videotaping the will or trust execution to show that the person really did intend what the document says.
These lawsuits are never fun for anyone, no matter how much is involved, so the more care that can be taken to prevent them, the better.
Update —MSNBC recently posted a new court filing by Huguette Clark’s family members, which included an earlier will dated only six weeks before the April 2005 will. This prior will left $5 million to Clark’s nurse, Hadassah Peri, and the rest to her family members. Interestingly, Wally Bock prepared and supervised this prior will, which is as different from the newer will as night and day.
Why the sudden change of heart over the course of six weeks? That’s what Clark’s family members are asking. This certainly makes their undue influence case that much stronger, and deepens the mysteries that will surely be explored through the litigation. This also calls into serious question whether Clark did indeed wish to create an art foundation, managed by Bock, Kamsler and an additional attorney, as spelled out in her most recent will.
Certainly people can and do change their final intentions, even in a short time frame, but the circumstances surrounding the two wills is very interesting, to say the least.
By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs: Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update. You can “like” them on Facebook and follow them on Twitter and Google+.