Estate Planning

Leona Helmsley's Charitable Trust

By Hull & Hull LLP

On September 2, 2008, my colleague Megan F. Connolly blogged on Leona Helmsley, the deceased billionaire who settled a $12 million trust for the benefit of her Maltese, named Trouble. 

As it turns out, in 2003 Ms. Helmsley drafted a mission statement to establish goals for a multibillion dollar trust. Under the 2003 mission statement, Ms. Helmsley directed her trustees to make grants from the trust, in their sole discretion, for the benefit of:

1.                  indigent people;

2.                  for the care of dogs; and

3.                  such other charitable activities as the trustees shall determine.

A year later, Ms. Helmsley executed a subsequent mission statement (link 2004 mission statement), which revokes all prior mission statements and essentially removes the first goal from the mission statement. 

Up until February 19, 2009, experts in trusts and estates had debated over the validity of the mission statement. The judge overseeing the probate of her Will, Judge Troy K. Webber of the Surrogate Court in Manhattan, held 'the trustees may apply trust funds for such charitable purposes and in such amounts as they may in their sole discretion determine'. Accordingly, Judge Webber's ruling will permit billions of dollars to flow into a charitable trust to be distributed not only for the care and welfare of dogs but in other areas such as health care, medical research, human services, education etc. Given the state of the U.S. economy, there will clearly be no shortage of willing grant recipients.

Thank you for reading.

Rick Bickhram

Full post as published by Toronto Estate Law Blog on March 05, 2009 (boomark / email).