Empty Mansions

by Bill Dedman

  Fourteen of the nineteen acknowledged in court papers that they had never met Huguette. Of the other five, the last time each of them had met her was in 1957, 1954, 1952, 1951, and “during the second World War.” A few of the relatives said they thought they had gotten a glimpse of her at the funeral for her half-sister’s daughter, back in 1968. A few of the relatives did have limited contact with her. Eight of the nineteen said they had visited Bellosguardo in the 1940s, 1950s, or 1960s, usually when Anna and Huguette were not present. They had been awestruck by the beauty of the property, had played tennis, and sometimes got a peek inside the great house.

  Ten of the nineteen said they had sent cards or letters to Huguette for Christmas or birthdays, and four had received some kind of reply. Most of these relatives were far younger than Huguette. She was born in 1906, and they between 1921 and 1964, so in some cases their parents had sent Christmas cards or lilies, or had received holiday phone calls from Huguette into the 2000s. Huguette on these calls was always very interested in their families, referring to the children and grandchildren by name.

  But in the past half a century, these relatives had only occasionally reached out to their elderly aunt, and she had not reached out to them. After the terrorist attacks of September 11, 2001, Huguette did not call her relatives, as she called her goddaughter Wanda, to give reassurance that she was fine.

  Of these nineteen, the one who came closest to having a relationship with Huguette was André Baeyens, her half-grandnephew, an elegant Frenchman who served as France’s consul general in New York, as his father had before him. André approached Huguette in the late 1990s, after her friend Madame Pierre introduced herself at an event at the consulate. He was writing a book in French about Huguette’s father, the senator. She engaged easily with André, calling him about ten or twelve times from her hospital room through the early 2000s, though as usual keeping control by not giving him her phone number or telling him she was in the hospital. He would call Madame Pierre, and Huguette would call him back. They never met. When André finished his book in 2005, a fond family memoir of “the senator who loved France,” he sent it to Huguette and never heard from her again.

  Huguette had been devoted to helping one of her cousins financially, but that was a LaChapelle cousin, on her mother’s side of the family, not a Clark. She supported this California cousin, Annie, who called Huguette by her early nickname, Hugo. Huguette established a trust for Annie and paid her bills until Annie died in 1995, the last close relative in the LaChapelle line. There were no LaChapelles to fight over Huguette’s estate.

  The Clark relatives said they were always respectful of their elderly aunt’s obvious desire for privacy and dignity, and didn’t thrust themselves into her cocoon until they felt it absolutely necessary. When New York City went dark for three days in an electrical blackout in August 2003 and people were suffering from the heat, Clark relatives who lived within a mile of her apartment did not stop in to check on her. Some years later, one relative did have her attorney call Huguette’s attorney: Niece Karine McCall had her counsel call in 2008 to ask whether she was in Huguette’s will. Karine says she needed that information for tax and estate planning, as she was moving from England. Karine, who had met Huguette as a child but never established a connection, says she always had the impression Huguette was “mentally slow.” She says she was shocked to learn that she was not going to inherit any of the Clark money from Huguette.

  • • •

  The nineteen Clarks seeking Huguette’s fortune include an international campaigner for human rights for torture victims, and an organizer of legal services for people with HIV/AIDS. One is an honored diplomat who served as the French ambassador to South Korea. Many Clarks support symphonies and museums. In recent years, several in the family have donated to environmental causes, such as campaigning against fracking, a method of extracting natural gas that environmental groups say contaminates groundwater. In that way, Clark money is being used to protect the environment from the ravages of mining.

  Although some of W.A.’s children and grandchildren squandered their money on racehorses and divorces, others worked hard, making quiet contributions on Wall Street or in hospitals. Some wrote children’s books or translated Tibetan poetry. Others bred quarter-horses or sailed yachts.

  While proud of their association with “the senator,” the Clarks are aware that their family has suffered at least its share of dysfunction: generations of alcoholism, a long stay in a mental hospital, drug abuse, sexual abuse by a trusted family servant, numerous suicide attempts. All while keeping up the façade that everything was well at home. As one of W.A.’s descendants explained, all of the splendor of the mansions seemed so normal that “I didn’t believe that people actually lived in those tiny houses that dotted the edge of our property.”

  One of W.A.’s descendants described the mixed blessing of inherited wealth: “I think having such wealth can lead some people to have a lack of self-worth because of not having developed a lucrative career of their own or even having investigated their own potential. Having an overabundance of wealth can make people insecure around others who have far less than they do, since the former might wonder if potential partners or even friends are ‘only’ after them for their money. Well-meaning people of excessive wealth can feel anxious about the lack of perfection of charities they support, and about the fact that even as willing patrons they are powerless to obliterate suffering—all the while knowing that any small amount of money that they might spend on themselves is still enough to change or even save some lives. Wealth can lead to guilt over the unfairness of people working endlessly for them who have never been included fully into the family. In sum, having immense wealth can lead one to feel isolated and to have a false sense of being special.”

  • • •

  Most of the relatives saw Huguette’s Fifth Avenue apartments for the first time in April 2012, when the administrator of her estate allowed them to take a tour. They marveled at the view of Central Park, the ornate woodwork, the outdated bathrooms.

  Her apartments were vacant, ready for showing by a real estate agent. The only belongings of Huguette, aside from a few pieces of furniture and a Steinway piano, were several of her paintings the agent had hung to give the apartments a bit of her personality. The relatives saw up close the Japanese woman with a dragonfly pin smoking a cigarette, the woman cutting flowers. All the paintings bore Huguette’s signature.

  After the tour, several of the relatives commented that their Tante Huguette couldn’t have done those paintings herself. It wasn’t possible, they said. These must be the work of her painting instructor.

  AN IMPOLITE ACT

  TWO OF HUGUETTE’S RELATIVES didn’t choose to play the inheritance Powerball lottery. One couldn’t be found, and the other said she didn’t want the money.

  The twentieth descendant of Huguette’s father was Timothy Gray, whose life story was one of rags to riches to rags to nearly riches. Born in 1952, he lived in several foster homes before being adopted at age five by one of Charlie Clark’s daughters and her husband, a physician, becoming as a result a half-grandnephew of Huguette’s. Tim had a troubled childhood verging into delinquency and was last seen by his family in 1990, not long after his mother Patsey’s funeral.

  When Huguette died twenty-one years later and it was time to alert all of her relatives of the filing of her will, private investigators were unable to find Tim. If the family was successful in overturning the will, he was in line for 6.25 percent of Huguette’s estate. His take would be roughly $19 million, or about $6 million after all the taxes and estate expenses.

  In late December 2012, Tim Gray, the adopted great-grandson of the copper king and railroad builder W. A. Clark, was found in the desolate mining and ranching town of Evanston, Wyoming, frozen to death under a Union Pacific Railroad viaduct. A boy and girl out sledding found his body. Tim was wearing a light jacket, and his shoes were off, though the temperature that week had dipped close to
zero. He weighed only about a hundred pounds and looked homeless. Blood tests showed no alcohol or drugs, and the coroner listed the cause of death as exposure.

  In his pocket, Tim had a 1905 Indian-head penny that his brother, Jerry, had given him when he took him in at age seventeen for a couple of years. And in his wallet was a cashier’s check from the year 2003, his one-eleventh share of the disbursement of a trust left by his grandmother. The uncashed check was for $54,160.

  Though Tim was dead, he remained a potential heir to Huguette’s estate, because she predeceased him. If the relatives won their case or settled, a share would go to Tim’s estate, and that share would pass to his heirs. If he had no spouse or children and left no will, his three siblings would divide his winnings.

  Tim was not exactly homeless. He’d spent fifteen years in Evanston, the sort of town where people go when they don’t want to be found. He had an apartment and a rented office downtown, where he worked on computer software projects, including voice recognition software, though he had no Internet connection and no phone. He was a loner, neither friendly nor unfriendly, working odd hours, eating alone at Mother Mae’s Kitchen downtown, going to Alcoholics Anonymous meetings.

  The owner of his apartment building said Tim spent only what he needed from the investment checks he received. He gave most of his money to charity, sponsoring children in Guatemala and handing cash to needy people in the neighborhood. He wrote to politicians, opposing the Bush tax cuts of the early 2000s as giveaways to the wealthy. He told the apartment building manager that he resented his Clark relatives, who he said had not made good use of their inheritances.

  About a year before his death, Tim seemed to disappear. He stopped paying for the storage space in Utah where he left his cars. The owner of his building didn’t rent out his apartment, knowing that Tim was good for the money. But Tim had staked out a prime sleeping spot under the viaduct, a corner of dirt that he and other men called Suite No. 3. There’s no indication that he knew anything about his great-aunt Huguette or the money he stood to inherit.

  Tim Gray left behind an apartment stuffed to the ceiling with scrap metal that he had been hoarding: rusted handsaw blades, automobile exhaust pipes, and wire, mostly aluminum and copper.

  • • •

  Huguette’s twenty-first relative said she could not justify opposing her great-aunt Huguette’s last will and testament.

  This half-grandniece, Clare Albert, born in 1947, told lawyers that Bock and Kamsler seemed highly untrustworthy and she hoped the two men would not profit in any way from the estate. Nevertheless, Clare later said, she was reluctant to join the family’s challenge, not finding enough evidence for her to swear that her great-aunt’s will was invalid, that Huguette was mentally incompetent. “I do in fact believe,” Clare said, “that my aunt well understood how she was dividing up her wealth, and that her final will represents her own intentions.”

  She continued, “In my view, it would be a terrible waste for the relatives to drain the Bellosguardo Foundation to the point of extinction and to deny the Corcoran its Water Lilies. More than half the wealth Aunt Huguette left to charities would now have to go toward paying huge estate taxes and the staggering commission for the relatives’ own lawyer. The gain for any single member of the family would be small compared with the loss for these charities supporting the arts.”

  She concluded, “Altogether, I find the prospect of challenging my Aunt Huguette’s will to be disrespectful of what could be her true wishes, an impolite act not in accordance with my values.”

  THE TAX BILL

  HUGUETTE DIED owing the IRS $82 million in gift taxes, with the bill rising $9,000 per day from penalties and interest.

  The tax bill was discovered because the judge decided that Bock and Kamsler needed a chaperone. In light of all the news coverage, the judge declined to let them administer Huguette’s estate alone. The judge appointed a third financial watchdog, an official known as the New York County public administrator. That administrator’s attorneys soon discovered that Huguette had not paid millions in gift taxes on her spree of generosity. One-quarter of her estate could be eaten up by the bill from the Internal Revenue Service.

  Taxes on gifts are paid by the giver, not the recipient. No gift tax returns were filed for Huguette from 1997 through 2003, during which time she gave approximately $56 million in gifts. Some of her gifts were subject to another tax as well, the generation-skipping transfer tax, which must be paid when the recipient is much younger than the donor. The total due in taxes for all years was about $34 million, but that was just the beginning. Add on penalties of $16 million and interest of $32 million, for a total liability of $82 million.

  Kamsler was responsible for the finances and was paid $5,000 a month for his accounting work. Records show that he warned Huguette repeatedly to stop making gifts because she didn’t have enough liquid assets to cover the gift taxes. He never mentioned the generation-skipping tax, which came into play when she gave money to Hadassah and some others. The public administrator’s lawyers also found that Kamsler prepared false gift tax returns claiming that the previous returns had been filed, and he lied to the IRS by claiming he didn’t know about the $5 million given to Hadassah.

  Bock said that when notices from the IRS came to him, he sent them to Kamsler, but Bock also had responsibility for taxes. His monthly invoices for $15,000 listed his duties, including filing estate and gift tax returns. When Huguette paid $1.85 million for the security system on the West Bank, a gift solicited by Bock in 2000, he did not tell her that she already owed more than $5 million in taxes for gifts given that year and that she had not filed gift tax returns from 1997 to 1999. Bock said he accepted Kamsler’s assurances that he had taken care of any late filings.

  WHITTLING DOWN A FORTUNE

  Huguette’s estate was worth about $308 million before the payment of taxes. Following is a listing of her assets and how they were to be distributed according to her will.

  Her largest assets:

  • $84.5 million for Bellosguardo in Santa Barbara.

  • $54.5 million for three apartments at 907 Fifth Ave., New York City.

  • $14.3 million for Le Beau Château in New Canaan, Connecticut.

  • $79.3 million in stocks, bonds, cash, and trusts, including $4 million in her checking accounts and $4,039 in unclaimed funds received from the State of New York.

  • $75.4 million in personal property, including her $25 million Monet Water Lilies painting, $14.2 million in jewelry and furniture, $1.7 million in dolls and castles, and $34.5 million in paintings, books, and other property.

  That $308 million would be whittled down pretty quickly. Here’s an estimate of how it would get carved up if the will were carried out as Huguette signed it.

  • $7.9 million to pay off a line of credit at JPMorgan Chase.

  • $66.3 million for gift taxes, assuming the public administrator was able to reach a settlement with the IRS to eliminate the penalties.

  • $6.3 million in executor commissions for attorney Bock and accountant Kamsler.

  • $3 million in estate operating expenses for about three years while in court.

  • $21 million estimated legal fees for attorneys representing the public administrator, and attorneys for the presenters of the will (attorney Bock and accountant Kamsler), and others.

  • $23.6 million in estate taxes.

  • $5.4 million in generation-skipping transfer taxes. (A bite comes out of the bequests to younger beneficiaries.)

  That would leave about $175 million after taxes to distribute to beneficiaries. If Huguette’s last will were upheld, it would be paid out roughly like this:

  • Bellosguardo Foundation: $123,751,465† (70.94 percent)

  • Corcoran Gallery of Art: $25,000,000 (14.33 percent)

  • Hadassah Peri, nurse: $15,287,554‡ (8.76 percent)

  • Wanda Styka, goddaughter: $7,897,430 (4.53 percent)

  • Beth Israel Medical Center: $1
,000,000 (0.57 percent)

  • Wally Bock, attorney: $500,000 (0.29 percent)

  • Christopher Sattler, assistant: $370,370 (0.21 percent)

  • Irving Kamsler, accountant: $370,370 (0.21 percent)

  • John Douglas, manager, Bellosguardo: $162,924 (0.09 percent)

  • Henry Singman, doctor: $100,000 (0.06 percent)

  • Tony Ruggiero, manager, Le Beau Château: $12,444 (0.01 percent)

  When Kamsler was called to give a sworn deposition in the estate case, he wouldn’t answer questions about the gift taxes, exercising his Fifth Amendment right against self-incrimination 192 times. He did say that he never lied or deceived Huguette and never stole from her.

  Bock and Kamsler faced more trouble. The public administrator filed malpractice claims against them on behalf of Huguette’s estate, and the judge suspended them as preliminary executors. Their $6 million in fees, the payday they had toasted that day in the restaurant in 2005, was gone.

  • • •

  The public administrator also aggressively went after the gifts themselves, demanding the return of more than $40 million to Huguette’s estate. More than half of that amount had been given to Hadassah. If the administrator were successful, that also would reduce the gift tax bill: If there was no gift, there was no tax due. The administrator did not seek to recover gifts given to Madame Pierre and her family, Wanda Styka, or Chris Sattler, focusing on those whose financial or medical roles put them in confidential relationships.§ Under New York law, any gift to a person in a confidential relationship is presumed to be the result of undue influence. The recipient has the burden of establishing that the gift was proper. The public administrator’s office argued that Huguette’s close circle of caregivers used their positions to exert influence and control over her, in effect looting her assets.