By this time Sir Arthur Collins and his replacement as executor of the estate Edward Ram had both died. This left as executors, Prince Richard and Roger Wellesley Smith, a family friend and stockbroker, although in the event it appears that Withers was put in charge of the probate process and permitted an important role in the general management of her estate. When probate was granted in May 2005 the estate was valued at £817,146 gross and £569,849 net. As was the case with Princes Henry and William, the executors were able to deduct several hundred thousand pounds of debts and other liabilities which reduced the chargeable amount of the estate by almost a third. There was nevertheless a considerable tax bill to pay. This might in part have been a legacy of Henry’s estate which may have been subject to a peculiar feature of death duties in the seventies – something that might explain the mystery of what happened to Barnwell Manor.
Prince Henry's death in June 1974 straddled two inheritance tax regimes. The previous regime of estate duty was considered by the new Labour government as almost a discretionary tax because it could easily be avoided by giving away property and living for seven years. One socialist Chancellor of the Exchequer famously joked that estate duty was a voluntary levy paid by those who distrust their heirs more than they dislike the Inland Revenue.
So, in 1975 Harold Wilson replaced estate duty with capital transfer tax which was based on the principle that all gifts of property - whether made at death or during one's lifetime - should be added together and a progressive rate of tax applied to the total. In order to protect a surviving spouse, who might need to stay in the family home, a special exemption was now allowed. This applied to all transfers on death from 3 March 1975 but it did retrospectively cover lifetime transfers from 26 March 1974 to 12 November 1974 (with a slightly different hybrid regime from then until March 3 1975). So, if Prince Henry had gifted members of his family property between March 26 and his death on June 10, 1974 they might have been taxed under the new regime although any transfers on death would have been covered by the old one.
Because the spouse exemption did not operate in June 1974, the estate duty regime allowed some latitude to a surviving spouse so that he or she might not be charged for use of their house. For example, if a husband dies and leaves property to his wife for life, with the remainder to their children and assuming that his wife has no power to use the capital of the trust fund, it will normally be left out of the account in determining the estate chargeable to inheritance tax on her death. In plain language, a widow could receive her husband's property tax free as long as she did not later sell it.
Some press reports suggest that Princess Alice might have benefited from an arrangement of that sort. A well-sourced article in the Sunday Times in January 2006 stated that "when the Duke died, his will left the use of the family's home, Barnwell Manor in Northamptonshire, and his possessions for her lifetime."22 The only problem with this argument is that again the official stated value of his estate - £734,262 - does not appear large enough to include the £500,000 plus Barnwell Manor. Moreover, for the exemption to be available some tax has to be paid on the estate of the first to die. But in the same article Prince Richard is quoted as saying in reference to the estate duty liability: "I couldn't have afforded to pay it in 1974." Speaking in January 2006 he defended his decision to auction off family heirlooms at Christie’s to pay the delayed tax bill: "With the sale, the more that is made, the more goes to the government. There can't be many people left for whom those tax rates apply.”23
At the time of writing, a spokesman for the Duke of Gloucester via the palace press office was unable to clarify the exact details of the inheritance process. But from the evidence available what seems to have happened is that when Henry died in 1974, the Gloucesters having already paid hefty death duties on William's estate accepted a heritage property election whereby they elected to postpone payment on all or parts of the duke's estate until his wife died. It seems highly likely that Barnwell was not part of his estate having been put into a trust at some unspecified time but the contents of the house might have been in the estate and when you include the interest on the outstanding liability there was still an enormous tax bill to pay. Since Princess Alice survived for another 30 years, yearly interest would have been charged on the remaining taxable amount. So, even if one averaged up the annual interest rate to a figure of 5% (a relatively conservative number given inflation rates in the seventies and eighties), the Gloucesters might have faced a total tax bill on Prince Henry’s estate of over half a million pounds. In addition they would have had to pay tax on Alice’s £817,146 estate which might have added another £240,000. When you also include the professional fees of Withers - both solicitors and tax consultants as well as possibly valuers - Prince Richard could easily have been saddled with a bill of one million pounds or more.
No wonder in January 2006 he decided to auction his father's movable property. The press release from Christie’s stated that the sale was taking place to "settle the deferred capital transfer tax liability on the estate of HRH the late Prince Henry." The disposal of over seven hundred family heirlooms ranging from the rare 15th century hawking manuscript The Master of the Game to a collection of the duke's sporrans was expected to raise £1 million but in fact realised £5,063,362. The Master of the Game alone fetched £198,000 and two silver George III wedding tureens brought in another £142,000. Intriguingly, two items were removed from the sale at the last moment: lot 502 a medieval manuscript called The Kerdeston Hawking Book and the lot 503 leaves from The Kerdeston Hunting Book. These were offered to the nation in lieu of inheritance tax with the family expressing a wish that they should be housed in the British Library. Given that Henry possessed one of the finest private collections of field sport books in the country, one wonders why other items of national heritage value were not left to the state, although it is possible that the rest of the collection had insufficient heritage appeal.
The reason why Prince Richard was able to put the family silver up for auction is that he had been given control over his mother’s chattels and property by her will. Due to the fact that it was not sealed, for once we know what her wishes were. According to clause four, she agreed to give all her chattels free of inheritance tax to her trustees and clause five allowed them to sell all the property and convert it if necessary into cash. An earlier clause had already appointed Prince Richard and Roger Wellesley Smith her trustees - a term that presumably included both being executor and being in charge of any trusts in the estate. Clause four then established that the trustees should dispose of her chattels according to any memorandum or note that she might leave behind. So, rather like Diana, another princess who lived at Kensington Palace, it is possible that she left a letter of wishes to govern her estate.
Jewellery does not appear to feature prominently in her chattels. Given that her jewel box was once valued in millions and her net estate was only worth £570,000 it is likely that she would have already transferred some of it as lifetime gifts - probably to her daughter-in-law, Birgitte, but possibly to her grandchildren. Jewellery was noticeably absent from the Christie’s auction in January 2006 - although when six months later Princess Margaret's heir chose the same auction house to sell his family heirlooms the catalogue was overflowing with stunning jewels.
Princess Alice's will reveals how she was determined to provide not just for her family but also her wider household. She was an old-school royal for whom loyalty to staff - and vice versa - was paramount. The Gloucesters kept a big household of servants comprising, according to Peter Russell, their butler in the early sixties: one valet, two chauffeurs for the two Rolls-Royces, three footmen, a lady's maid, cook, housekeeper, housemaids and an odd job man.24 The butler’s duties extended to unscrewing the top of Prince Henry’s tube of toothpaste and ensuring that next to every ashtray there was a matchbox with a match jutting out so that he did not have to open it. Another of his special requirements was that all his butter and cheese came fresh from the Barnwell farm
– either by train to King’s Cross or in the back of the Rolls-Royce. When one morning in the early sixties a rail strike halted the dairy delivery, the bereft duke complained to his staff that management should pay off the strikers immediately so that normal service could be resumed.25
Despite this privileged lifestyle, the Gloucesters were kind to their staff and the duchess was generous in her Christmas gifts, albeit a little misguided (the same butler records: "One year, the Duchess presented me with a pair of beautiful, old fashioned fire bellows. It would have been a marvellous present had my wife and I not lived in a centrally heated flat.")26
Peter Russell is not mentioned in her will - the fact that he wrote an indiscreet book about his service with the Gloucesters might have excluded him from their Christmas card (and cash gift) list but another former butler is remembered. He was Alfred Amos who began service in the thirties as Prince Henry's valet, acted as his bat-man in the army, accompanied him and his family to Australia after the war and helped him recover from his first stoke before becoming Princess Alice's butler at Kensington Palace. He was left £1,000, as was the butler at Barnwell Manor, D. Warner, who died too early to enjoy his bequest.
The amount bequeathed to different staff speaks volumes about the social stratification within the Gloucester household. Princess Alice's lady-in-waiting, Lady Jean Maxwell Scott, was allocated £5,000 as was Lieutenant-Colonel Sir Simon Bland who over four decades had served as comptroller to the duke, private secretary to Prince William and finally extra equerry to the duchess. A step or two down the pecking order, the head gardener at Barnwell, Nicholas Walliker, received £3,000 and the farm worker Ian Hamilton just £1,000 - although in fairness it could be argued that Alice was under no obligation to leave them anything and she did go out of her way to specify in her will that these individual legacies be free of inheritance tax.
The division of these cash gifts take up the first two pages of the will - the remaining twenty-eight deal with a trust. The will names the primary beneficiaries of the trust as her grandchildren and the other beneficiaries are listed as the issue of the grandchildren, their spouses and finally Prince Richard. So why would Princess Alice leave her will trust primarily to her grandchildren rather than her son?
Having lost her husband and her eldest son, she derived immeasurable joy from her three surviving grandchildren.27 The eldest Alexander, the Earl of Ulster, was born in 1974 and then followed by Lady Davina in 1977 and Lady Rose in 1980. Being merely great-grandchildren of the sovereign, they did not possess royal titles nor did they later carry out official royal duties and as such received no Civil List payments or annuities from the Queen.
All three appeared on a Christmas card marking Alice's 80th birthday on 25 December 1981. Around about this time she also agreed to accompany the two eldest grandchildren on an exhausting flight to join up with their parents in Australia. But she was too frail to attend the wedding of Lady Davina to Gary Lewis, in July 2004, just three months before her death. Present at the ceremony was the bride's godfather, Roger Wellesley Smith who had been named along with Prince Richard as executor of Alice's estate and trustee of her grandchildren's trust. He was no doubt chosen partly on account of his financial expertise gained in the City as an executive director of the bank Société Generale.
One reason presumably why Alice left her trust fund to her grandchildren rather than her son is that he was already well provided for. Shortly before Alice's death the Royal Rich Report estimated his wealth at £19.5m.28 In hindsight this appears an inflated figure, although he would have undoubtedly been wealthy in the light of his grace-and-favour apartment at Kensington Palace, the £175,000 annuity he received from the Queen to fulfil royal duties and everything he would have inherited from his grandfather, George V, his brother and his father - not to mention any lifetime gifts from his mother. Then, of course, there was also Barnwell Manor and the rental income of up of £60,000 a year. When the original tenant Paul Howell vacated the property around 2002 he did not apparently return to the family home.
Prince Richard's name, however, does not appear on the Land Registry documents for either Barnwell Manor or the many other units of the larger estate including Armston Grove. Instead one finds three non-titled names: Roger Wellesely Smith, James Palmer-Tomkinson and Murray Hallam. Wellesely Smith, a City financier, we know from his trusteeship of the Alice's estate and trust and Palmer Tomkinson was another family friend, probably best known as the brother of the socialite Tara, and son of Charles, the Olympic skier (who skied regularly with Prince Charles whom he first met through the old Duke of Gloucester) although he had carved out a career in his own right as a fund manager in the City. He worked as head of portfolio management with the private bank, the Torquil Clark Group, after having cut his teeth in financial services with Kleinwort Benson.
But the most intriguing name on the documentation is that of Murray Hallam. His address is given as care of Withers LLP, 16 Old Bailey, London EC4. Withers is today not just a leading City firm of solicitors but one the largest law firms in the world with offices in Europe, the United States and Asia. They also have a specialist probate and trust department where Hallam worked and which offers among its services an in-house trust corporation WITCO to act as executor or trustee for UK wills and trusts. He joined the firm as long ago as 1970 qualifying in 1973 and becoming a partner in 1977. His stated speciality is probate, estate planning and trust law and he is the author of two books on trusts and one on wills.
Hallam - as we have also seen - is part of a long line of Withers lawyers who have handled the affairs of the Gloucesters - not to mention representing other members of the royal family including Lord Snowdon. Princess Alice's original choice of trustee/executor was Edward Abel Ram, an erstwhile consultant with Withers as well as a director of the Daily Mail and General Trust, but he predeceased her dying in November 1996 (Murray Hallam was part of a large delegation of Withers staff who attended his memorial service along with the present Duke and Duchess of Gloucester and Roger Wellesley Smith). In the end, as we saw earlier, Princess Alice was aided by another Withers solicitor - Sir Arthur Collins.
According to the land registry documents, the last recorded time when Sir Arthur and Princess Alice were in control of the property was 5 July 1996 when they issued a grant of access to East Midlands Electricity. Sir Arthur died in December 2000 and Alice in November 2004. At some time between 1996 and January 2007 ownership of the property would have changed hands - at least once. Obviously Alice's death might have triggered some form of transfer but it could have happened before her death or after if as is likely the house was already in a trust. It is even possible that the house stayed in the same trust and all that happened is that the names of the trustees changed for reasons of death or otherwise.
This leaves the question of why Princess Alice's executors did not seal her will. One explanation might be that there was nothing to hide in so far as both her estate and estate planning would have been watertight. Barnwell would have been transferred and the rest of her assets put in a trust for her grandchildren. Since she lived to the ripe old age of one hundred and two there was no shortage of time to put her affairs in order. But this argument could also apply to the Queen Mother who survived to one hundred and one, undertook considerable estate planning for her castle of Mey, but whose will was nevertheless sealed.
One other explanation for the openness is the outlook of her heir and executor whose responsibility it was at the end of the day to decide whether to keep her testamentary affairs under wraps or not. Alice and Henry were determined to give their children a relatively normal upbringing. She took immense pride in the fact that her boys were raised with the minimum of fuss and formality.29 In fact, they both went to an elite prep school and Eton but the desire for normality was genuine as being the son of the George V and the brother of Edward VIII Henry must have known only too well the psychological damage that could be wrought by an overbearing parent with a Hanoverian bent (“the House of Ha
nover are like ducks,” wrote George V’s biographer, “they trample their young”). So, even though he would have liked Prince William to follow in his footsteps and pursue an army career, he did nothing to discourage him from reading history at Cambridge University and then completing his studies in business administration at Stanford University in California.
Prince Richard followed a similar academic path going to Magdalene College, Cambridge where he studied architecture. After completing a five year diploma, he did his practical work with the Ministry of Public Building, bought a property in Camden and became a partner in a nearby firm of London architects. But his professional career was cut short by the deaths in quick succession of his brother and father which required him to take on increased royal duties. Had he not succeeded to the title, his mother believed that he would have become well known in his own right as an architect but she once admitted that she could never quite decide whether her children should lead a formal royal lifestyle at the service of the sovereign or be allowed to pursue their own chosen career.30
But in his choice of bride he decided to go down a distinctly non-royal route. In July 1972 he married the daughter of a Danish lawyer Birgitte van Deurs, whom he first met at Cambridge and who was then working as a secretary in the Danish Embassy in London. The wedding took place not at Westminster Abbey or St Paul’s, but the petite St Andrew's Church, Barnwell which found space for the Queen Mother, Princess Margaret and Prince William, his brother and best man. He would be dead less a month later and the church today contains a plaque and wooden bench commemorating his life.
By all accounts, the marriage proved a happy union - untarnished by any hint of marital scandal that beset other Windsors. Birgitte, modest and well liked, divided her time between her relatively light royal duties (a patron of the national asthma campaign and various military patron work) and raising her three children. When her daughter, Davina, married in July 2004 again it was to a commoner, Gary Lewis, a New Zealand former sheep shearer who achieved the distinction of becoming the first Maori to marry into the British royal family. After the wedding a traditional haka dance was reportedly performed in the gardens of Kensington Palace.31
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