Judge's meddling with Leona Helmsley's vague will is justified.
By ASHER MEIRLeona Helmsley 88(photo credit: )
Leona Helmsley, the late hotel and real estate magnate, was a controversial figure during her lifetime. She was by all accounts a very energetic and able manager and developer, and by no means only the "wife of" Harry Helmsley. But Helmsley managed to rub quite a few employees the wrong way in her quest for perfection. It may be she was no more abrasive than many other successful businesspeople, but the media took a more-than-ordinary interest in her reputation.
Newsweek featured her on a 1987 magazine cover with the caption, "Rhymes with Rich," while a 1990 TV movie about her was subtitled "Queen of Mean."
However, Helmsley created comparable controversy after her death in 2007 left behind an estate valued at about $5 billion. Very recently in New York, Judge Reena Roth ruled that Helmsley was mentally unfit when she executed her will, and modified the terms of the bequest. Let us examine if this change in the will was unjustified, or perhaps could have been made without ruling Helmsley unfit.
During her lifetime, Helmsley defended herself against claims of pettiness with money by pointing out that she was childless, and that she had no motive to cheat the government out of a few dollars to give to charity. The defense is a bit misleading. While it is true that Helmsley had no living children, she did have four grandchildren. She left two of them $10 million (a generous sum, though less than one percent of her estate); two others were disinherited; $12m. was left to take care of her dog.
The vast majority of Helmsley's estate was left in a charitable trust; sometime after her death it was disclosed that she expressed a desire that the money should be used "for the care and welfare of dogs."
Helmsley's instructions illustrate many of the ethical difficulties with wills. We live in a free society and generally agree that a person can do anything they want with their money while alive, assuming it's legal. But there are various restrictions on what people can do with their money after they die. The law tries to prevent what is called a "dead hand," someone exercising control from the grave.
One reason is ethical: We allow a person to get any enjoyment he likes from his money during his lifetime, but there is no enjoyment in death and so we insist they distribute their assets to those who can benefit, rather than exercising arbitrary control.
A second reason is legalistic: Disagreements over instructions are the norm among human beings; when people are alive they can adjudicate their disagreements in court, but dead people have no standing in court.
In fact, the whole problem with Helmsley's instructions is that they are quite grave, yet it is not clear who, if anyone, has standing to challenge them. Many differences of opinion exist as to what advances the welfare of dogs, but none of the different sides have standing to argue their position in court. Dogs themselves have no standing in court, and even if they did they would only be particular dogs, who would have no standing to litigate on behalf of dogdom.
Even the very specific bequest on behalf of Helmsley's own dog, Trouble, was reduced by the court from $12m. to a mere $2m., yet Trouble did not object to the judgment. (Ironically, most of the money is needed for security, which in turn is required only because of animosity to Trouble due to his huge inheritance.)
I perceive a close connection between the reasons. The concept of standing, respected by courts in every country in the world (except for one tiny Middle Eastern democracy), is not merely a technical principle but also an ethical one. Courts exist to adjudicate disputes, not to dispense justice, and disputes exist only among interested human parties. In the context of wills, there is no legal mechanism to exercise control from the grave because it is wrong to allow people to do so.
This is probably also related to the recent ruling of Judge Roth that Helmsley was mentally unfit. Helmsley was able to manage her considerable empire until her last days, and wrote a lucid will that seems to accurately reflect her relationship with family members. But when the disinherited grandchildren come to court and assert that she was unfit, who exactly is arguing the other side? Not a single dog was found to object that giving $10m. to the two grandchildren would reduce their own bequest from $5b. to a mere $4,990,000,000.
However, the "dead hand" principle doesn't mean that vaguely worded wills are ignored. A related principle is the cy pres doctrine, meaning "as close as possible." Courts endeavor to fulfill the desires of the deceased as closely as possible and practical, taking account of the public interest as well.
In the case of the Helmsley estate, the trustees would run into a problem if they decided to give the money to the Red Cross. (Although in the specific case of Helmsley there is a question, since her "mission statement" was not unified with her will.) But if they decided to use it for veterinary education, or for the care of guide dogs for the disabled (this is, after all, the care of dogs), this would likely be considered cy pres.
Much of the commentary surrounding the Helmsley estate boils down to the question of "dead hand versus cy pres." To what extent do we respect property rights and try to fulfill the exact wishes of the bequestor, and to what extent do we consider the public interest, and an abhorrence of legal vacuums, and partially ignore their wishes?
While the dilemma is a real one, I strongly favor the dead hand consideration. People are entitled to enjoy their wealth, and they are entitled to give it away during their lifetime and at its end, but strict limits on the control dictated by the instructions of a dead individual are justified by both ethical and legal considerations.
ethics-at-work@besr.org
Asher Meir is research director at the Business Ethics Center of Jerusalem (www.besr.org), an independent institute in the Jerusalem College of Technology.
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