The defence counsel also pressed her on what had happened to some of Diana's own personal correspondence and documents:
Lord Carlile: "There was a lot of correspondence in the apartments where your daughter lived, and there was a shredder, and you spent many hours on many days shredding documents."
Mrs Shand Kydd: "Not many days…."
Lord Carlile said: "You shredded large numbers, no doubt properly in most instances, you shredded large quantities of correspondence."
Mrs Shand Kydd: "No, I shredded mainly a very small number of a very large amount of correspondence."
Asked how many documents she had shredded, she replied "between 50 and 100."20
Frances went on to say that no documents were from members of the royal family and that most were thank you notes from people like ladies in waiting. However, Rosa Monckton later wrote that "many of my letters and those from another close friend of hers, Lucia de Lima, were among those shredded."21 Paul Burrell claims that after hearing about the shredding he took away some of Diana's documents for safekeeping.
More embarrassing details were expected when Burrell - and possibly even the Prince of Wales - took to the stand. But just a fortnight into the proceedings the trial dramatically collapsed. William Boyce, the prosecution counsel, stood up in court one of the Old Bailey and announced that he would offer no further evidence and invited Burrell's acquittal. The main plank of their case was apparently that there was no evidence that Burrell had informed anyone that he was holding property belonging to Diana's estate. However, a few days earlier the prosecution had been told that the Queen had just remembered having a meeting shortly after Diana's death with Burrell during which he had told her that he had taken some of the princess's property for safekeeping.
Was Her Majesty's delayed recollection the real reason why the £1.5m trial collapsed? Following months of press speculation about the possibility of a royal conspiracy, Sir Michael Peat, Prince Charles’ private secretary, was asked to examine - as part of a wider inquiry into the trial - whether there was anything improper in the conduct of the Prince of Wales's household in the termination of the case. After sifting through the testimony of dozens of witnesses (although not the Queen) Peat came to the conclusion:
"The disclosure made on 28th October 2002 of The Queen’s conversation with Mr Burrell was properly made. Had it not been made, those advising Her Majesty and The Prince of Wales could rightly and strongly have been criticised. The suggestion that the disclosure was made for improper motive and in the expectation of preventing the trial continuing finds no support in the available evidence.”22
Lord Carlile believes the Queen's intervention was just one of a number of factors in the collapse of the trial. In a newspaper interview a week later, he maintained that the overall case of the prosecution had been "severely undermined."23 In court, the prosecution had succeeded in weakening the credibility of the Spencer side of the story and the Queen's intervention merely confirmed the general unreliability of the prosecution evidence. As a result, the Crown had no option but to throw in the towel.
The defendant Paul Burrell offers a slightly different perspective in his memoirs. He was amazed that so much significance was given to his meeting with the Queen since he had told her no more than he had informed Prince William in a letter, Prince Charles's officials in other correspondence and the Crown Prosecution Service in his defence statement. In his view, the written evidence was already available before the trial and he cannot understand why it came as such a surprise to the CPS.24
As for the Spencers, Frances Shand Kydd felt let down by the Queen's eleventh hour intervention. According to her biographers, she was incensed that others had been content to do nothing and observe the Spencers being humiliated in court and the press.25 They go on to repeat the widely held view at the time that there was a strong element of convenient amnesia behind the Queen's delayed recollection and that she was worried that Burrell was about to expose embarrassing information in court about the royal family.
Burrell in his book hints strongly that he had much more information about Diana and the princes that he might disclose in open court and he makes it clear that his defence team were ready to call the Prince of Wales and even Prince William as witnesses. Lord Carlile later stated that “it was always our view that this case – however much we limited the scope of the evidence – had the potential for doing considerable damage to the Spencers and some collateral damage to the royal family."26
Thanks to the Peat Report, we now know for certain that the Prince of Wales was both “concerned” and felt “deep unhappiness about it all”27 regarding the general prospect of him or Prince William being called as a witness. No member of the royal family had appeared in court since 1891 when another Prince of Wales (the future Edward VII) was called to the witness stand in a society scandal. Charles would have preferred if the trial could have been avoided. He was worried that personal information about his family would be revealed and whether true or false, the disclosure would cause distress to his sons.
Although the Peat inquiry dismissed any suggestion that he instructed his lawyers to interfere in the prosecution process, the report did disclose one fascinating snippet of information about the behind the scenes discussions at St James’s Palace. One meeting followed a conversation between Robert Seabrook QC, the prince's criminal law adviser, and John Yates, the Scotland Yard Commander in charge of the case, about the possibility of Prince Charles or Prince William having to give evidence.
"Mr Seabrook discussed this with the Prince of Wales on 28th February 2002, having previously been reassured by Commander Yates that the Prosecution would avoid their being called and going so far as to say, as Mr Seabrook, recalled, that ‘the Prosecution would be stopped rather than doing that.’ Commander Yates does not dispute that he may have said something to this effect."28
Even though the inquiry was clear that Prince Charles was not in any way involved in the collapse of the trial, this interchange would suggest that one actor in the case, presumably the Crown Prosecution Service, considered terminating the prosecution if members of the royal family were obliged to take to the witness stand. If this is indeed true, then it might have given the palace some peace of mind and explain why no one sought to stop the case before it came to trial. At the end of the day, whatever may or may not have happened behind the scenes with the prosecution case, information about Diana’s estate and private life was kept safely under wraps.
The collapse of the court case left unsolved the mystery of what happened to Diana's personal possessions. By July 1998, the Kensington Palace apartment had been stripped bare - all the jewellery, furniture and paintings - having apparently gone back to the Windsors and Spencers. One unhappy parent of the godchildren speculated that most of the disputed chattels ended up at Althorp, the Spencer family seat in Northamptonshire, and indeed Diana's wedding dress - along with a few other personal possessions - were put on display in the museum dedicated to her memory and charging £12.50 entrance fee. It was rumoured that her BMW car was sent to a secret location to be destroyed in order to prevent it from being turned into a valuable relic.29
With the help of the Crown jeweller, David Thomas, Paul Burrell was able to provide the probate authorities with an inventory of Diana’s collection of jewels.30 He himself was given a pair of silver cufflinks from Lady Sarah McCorquodale and in his book records how some of the jewels given to Diana by Dodi were ultimately returned in boxes to Althorp.31 This included all her earrings but some of the Spencer jewellery had been on loan. The family tiara she wore at the wedding had already been reclaimed by her brother, Earl Spencer.
It is less easy to trace what happened to the non-Spencer or royal jewellery. This is due in part to the secrecy surrounding the provisions of the divorce settlement relating to royal jewellery and in part to the ambiguity surrounding what is Crown jewellery and what is private property. It is believed that under the terms of the divorce agreement the jewels gi
ven to Diana by the Queen and the Queen Mother on her wedding and engagement were returned at her death (or earlier). These gifts included the pearl drop lover's knot tiara designed by Queen Mary around 1914 and handpicked by Her Majesty before the marriage in 1981 and the emerald and diamond choker that had been created by Queen Mary with some of the Cambridge jewels and then bequeathed to the present Queen. The latter was famously worn by Diana as a squaw-like headband while dancing with Prince Charles in Australia in 1985.
If these gems had been classified Crown jewellery they would have been automatically returned to the Buckingham Palace but according to Suzy Menkes neither item can be classed Crown property or a state piece. It is possible that the Queen reclaimed them as family heirlooms but it is more likely that they passed to their two grandchildren since according to Diana's letter of wishes all her jewellery should go the future spouses of the two princes.
So, what lessons can be learnt from Diana's unsealed will about the financial side of royal succession? The first thing that happens when a royal does not seal a will is that the full extent of his or her wealth becomes public knowledge and thus, a target for public criticism. When Diana's multi-million fortune was revealed, The Independent newspaper immediately asked "why does her pre-tax estate amounting to £21,711,486 not include a single penny for charity…surely this generous caring princess who devoted so much of her life to helping charitable causes could be accused of being heartless or mean?"32 This is exactly the accusation that was soon made by Peter Tatchell, the gay and human rights activist, in another publication: "she was happy to do charity work for people with AIDS providing it didn't cost her anything. But when it came to parting with her own money she chose to keep it in her already super-rich family, rather than share it with those in need."33
The last line might be less than charitable in sentiment but it does point to a fundamental truth about royal succession: the wealth stays in the family. In the end - despite her letter of wishes - Diana left almost everything to her sons. The overriding fear of all rich families - whether royal, aristocratic or landed gentry - is that their wealth will be salami-sliced by outsiders. This was the unvoiced concern during the negotiations over Diana’s divorce settlement with Buckingham Palace fearful that if Diana married again some of the Crown jewellery and family heirlooms might pass to a commoner or someone unsuitable. Similar worries were expressed during the abdication settlement of Edward VIII when there was a possibility that Wallis Simpson might end up with some of the family jewels.
Full disclosure of royal wealth also brings with it a massive inheritance tax bill. Here it might be instructive to compare Princess Diana’s will not with Princess Helena Victoria's open will but with Princess Margaret's closed one. The two princesses were once close friends and neighbours in Kensington Palace and both were renegade royals who flouted convention in their social life. But while Margaret planned meticulously for her death, Diana's foresight did not even extend to wearing a car seat belt that would have saved her life. Consequently Diana's two children paid £8.5 million in tax and Margaret's two children paid £2 million.
A significant slice of the tax liability - perhaps as much as £5 million - applied to the value of the chattels. As we shall see in the next chapter, the executors (and possibly HM Revenue and Customs) were reportedly relatively conservative in their valuation of Margaret's assets underestimating the added value of the assets’ royal provenance that later became apparent when they were sold at auction. Diana's estate was not so lucky. A year after her death, the Revenue reportedly began to challenge the executor's valuation. One report in The Times suggested the taxman thought that her possessions may have been "undervalued, with no account being taken of the higher prices they might face because of who she was,” although officials claimed that such a reassessment was common practice with large estates of this sort.34
Diana's estate also revealed the importance of letters of wishes in royal wills. As we saw with Helena Victoria's will it is a traditional method to conceal the names of beneficiaries but when it came to Diana's will all was disclosed because her executors needed to rebalance the distribution of chattels. If it had all gone to plan, we would never have known that Diana wanted a significant share of her chattels to go to such surprise beneficiaries as the son of Sir David Frost and the daughter of Dominic Lawson. As a second layer of secrecy, the device of a letter of wishes also shows that even if a royal will were made totally public there would be other methods of obfuscation available to the royal family.
From Diana's open will we can see that she used a trust to set aside money for her two children until they were grown up. Again this was inadequately done and the executors had to alter the will to establish a more tax efficient discretionary trust. Altering the will proved a costly business since extra legal help had to be brought in to represent the independent interests of the princes. When the full charges of the solicitors Boodle Hatfield were leaked to the press - a figure of £543,000 was first reported which apparently was knocked down to under £400,000 - there were predictable howls of outrage from the media and John Major was blamed for not exercising proper cost control. This was probably unfair as he worked unpaid and St James's Palace quickly emphasised that the Prince of Wales was very happy with his work for the boys. But once again public disclosure brought public censure.
At the end of the day, whether they liked it or not, Diana's executors were obliged to use executors or advisors close to the royal circles or the establishment. This slide towards conformity and discretion was reinforced by the death of Frances Shand Kydd in 2004 which necessitated a replacement executor. In fact, she was replaced by three trustees – all with close ties to the establishment. One was Earl Home, the Eton-educated son of former conservative prime minster, Sir Alec Douglas Home, who was an executor of the Queen Mother's estate and later became chairman of the Queen's bank Coutts and Co. The second was Sir Nicholas Bacon, the Eton-educated barrister and baronet who was a page of honour to the Queen and was close to Prince Charles through his work on the Prince’s council of the Duchy of Cornwall. But the most controversial choice was the Duke of Westminster, an old Harrovian and Britain richest landowner. In the bitter break-up of the Wales's marriage, he had clearly sided with Prince Charles's camp and friends of Diana suggested that his appointment as executor flew in the face of her expressed wish that Prince Charles should not have sole control of her sons' upbringing. Now he would seem to be getting some influence over their inheritance. The Duchess of Westminster, Tally, was also close to Prince Charles and a godmother to Prince William. To complete the circle, the duke used to go out with Diana's sister and executor, Lady Sarah McCorquodale, as of course did Charles.
So it was that royal family had to pull out all the stops to clean up the mess left by Diana’s inheritance. The overriding lesson from her open will was that if you fail to do any estate planning you open up a can of worms. Fortunately, there was no chance of her forward-thinking aunt making the same mistake.
11.MARGARET, MUSTIQUE AND MONEY - 2002
“She is far too intelligent for her station in life. She often had a bad press, the usual fate of wits in society”
Gore Vidal on his friend Princess Margaret1
In the last decade of her life Princess Margaret made one important contribution to Princess Diana's legacy. She destroyed Diana’s letters to the Queen Mother. Ordinarily such correspondence would have been deposited in the Royal Archives for future historians to pore over but on the princess’s orders several large black bags of papers were removed for destruction.2 Although the Queen Mother's official biographer has suggested that Margaret did this "to protect” her mother and other members of the family,3 several commentators have wondered whether it was also to protect Diana from embarrassing her own family.
Andrew Morton, who famously collaborated with her on "Diana: Her True Story," has suggested that she might have confided in her grandmother-in-law her antipathy for her real grandmother, Lady Fermoy, who though
t her an unsuitable match for a future king.4 At the time of the destruction of the letters in 1993, Diana was still alive and expected to outlive everyone. Equally erroneously, the destroyer of the letters, Princess Margaret, was expected to outlive their recipient, the Queen Mother.
Shortly after 8.30 am on Saturday, 9 February 2002 Sky News’s colourful graphics flashed with an alert about a royal death. A few minutes earlier Buckingham Palace had announced that at 6.30 that morning Princess Margaret had died peacefully in her sleep in the King Edward VII's Hospital for Officers, London with her two children, Lord Linley and Lady Sarah Chatto, at her side. She was seventy-one years old.
The news came as no surprise to anyone who had seen the princess at the 101st birthday celebrations for the Queen Mother the previous August. In one of her rare public appearances, the cameras captured the image of an erstwhile English rose as invalid. Her wheelchair was rolled out into the Mall with her legs hidden by a beige blanket that did not quite mask her swollen feet and her left arm hanging limply in a lilywhite sling. Her puffy cheeks and skin showed signs of someone on steroids, while the rest of her face was obscured by a large pair of wraparound sunglasses. She looked confused and the next day's papers ran shock headlines expressing “Concern for the Princess” and “The Queen keeps her eye on Margaret."
Her health had been deteriorating for almost a decade. After suffering a minor stroke in 1994 that forced her to curtail her official duties, she had a more serious attack after a dinner party on Mustique in February 1998 and had to be flown back to England for treatment at the King Edward VII's Hospital where she made a good recovery. A year later - again in her Caribbean home - she severely scolded her feet in an accident when she turned on the wrong tap on the shower and was only saved from greater injury from the boiling water by the intervention of her private detective kicking down the bathroom door. She never fully recovered from this accident. She suffered a third stroke on 4 January 2001 that plunged her into depression and a fourth on March 27 that had more serious consequences. As a result she lost sight in one eye and all movement in her left side. A few months before her death she confessed to a friend that she was so tired of being in pain and other acquaintances admitted privately that it was a pity she did not die earlier.5
Royal Legacy: How the royal family have made, spent and passed on their wealth Page 20
