Modern-Day Picasso, Robert Rauschenberg’s, $2B Irrevocable Trust and Estate Are Scrutinized as Trustees Sue for $60 Million in Fees, According to UltraTrust.com
(PRWEB) February 06, 2014 -- The question at the heart of In Re: The Estate of Robert Rauschenberg, Case No. 08-CP-002479, in the 20th Judicial Circuit of Florida, Lee County Probate Court is friends in need or friends in deed? This probate administration case eventually ramified into a civil action in the Sunshine State. The contentious issue is whether the trustees in this case are entitled to the $60 million they consider to be reasonable estate administration fees.
According to Guggenheim Museum, Robert Rauschenberg was a very important figure in the school of Pop Art. A true American master, Rauschenberg will forever be remembered through the important body of work he left behind (1), the significant influence he made on the 20th century art world, his philanthropic legacy, his enormous heart, his effusive charisma, and just for being an all-around nice guy.
According to Jerry Saltz at Artnet, to get an idea of Rauschenberg's artistic caliber, it helps to note that he was a recipient of the National Medal of Arts and the Leonardo da Vinci World Award of Arts. He was born in Port Arthur, Texas and would later serve as a Hospital Corpsman in the United States Navy. He studied the arts in the 1950s, and by the 1960s his works of visual art were heralding the Pop Art school in the United States. He lived and worked in New York, where he produced collages, paintings, photographs, innovative sculptures, stage sets, costumes, music albums, and more. Rauschenberg also founded an important artistic and cultural international exchange program that promoted peace and goodwill (1). He has been equated to “an American Picasso.” (2)
In 2003, Rauschenberg moved to Captiva Island in Southwest Florida. He had established the distinguished Robert Rauschenberg Foundation a decade earlier, which is dedicated to philanthropy and humanitarian endeavors (3). He sadly passed away in 2008 after a bout with heart failure. According to the New York Times, Rauschenberg entrusted three of his close friends to handle his sizable estate and administer the Robert Rauschenberg Foundation (4).
The trustee friends in question are Bill Goldston, Bennet Grutman and Darryl Pottorf (5). Rauschenberg had every reason to trust them with his estate; after all, Goldston is a long-time business partner, Grutman a long-time accountant and Pottorf his long-time partner and confidant. The bulk of the Rauschenberg estate consists of extremely valuable works of art and choice real estate. The last will and testament of the artist was clear in the sense that he wished to preserve the good work of the Robert Rauschenberg Foundation, which in 2012 was valued at more than $2 billion (4).
In 2013, the three friends asked the Robert Rauschenberg Foundation for $60 million in trustee fees. The foundation's attorneys balked and lawsuits ensued. A hearing is currently scheduled for late March, and it is expected that this case will go to trial (5). The foundation is opposed to disbursing such trustee fees on the basis that they amount to exorbitant hourly fees of about $40,000. Media reports indicate that the trustees have not kept meticulous records that could back up their claims; yet, the Lee County probate court docket indicates that several interrogatories, motions, responses, and depositions have taken place since 2011.
“We are looking at a possible estate planning issue with regard to fair and reasonable trustee compensation,” explains Rocco Beatrice, Managing Director of Estate Street Partners, LLC, parent company of the UltraTrust.com, where individuals can find valuable advice related to estate planning. “Here we turn to the Florida Trust Code for guidance (6), which tacitly explains that trustees are entitled to reasonable compensation. That's pretty much the extent of it, and it leaves the door open for probate litigation in the absence of a solid trust instrument that clearly sets the basis and form of trustee compensation as well as the amount.”
"Florida courts certainly have jurisdiction to determine reasonable trustee fees." States Mr. Beatrice To this effect, West Coast Hospital Association v. Florida National Bank 100 So.2d 807 (1958) often comes to mind (7). That case establishes numerous factors that can be considered by the court for the purpose of determining reasonable trustee fees. The problem is that the factors are not all-inclusive and may be challenged, thereby extending litigation and depleting the estate with prolonged legal fees.
“When it comes to estate planning, proper construction of a trust or will is of the utmost importance,” assures Mr. Beatrice. “At UltraTrust.com we work closely with our clients to ensure that their wealth is preserved to the maximum by the instrument they choose. Customary trustee fees can be freely discussed. In many cases, the customary fees do not exceed one percent of the total value of the estate, but they can be set according to the work that the trustees can actually perform.”
The New York Times explained that a legal expert retained by the foundation determined that reasonable trustee fees in the Rauschenberg estate dispute could be considered reasonable at about $250 per hour, and that the $40,000 per hour claimed by the three friends could be considered unconscionable (4). In this case, the grantor or trustor should have moved to establish a fee agreement between the trustees and the foundation based on their abilities and the amount of work that could be foreseen at the time.
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Sources:
1. guggenheim.org/new-york/collections/collection-online/artists/bios/1396
2. artnet.com/magazineus/features/saltz/saltz1-11-06.asp
3. rauschenbergfoundation.org/index.php?option=com_content&view=article&id=46&Itemid=53
4. nytimes.com/2013/08/22/arts/design/rauschenberg-friends-seek-60-million-from-estate.html?_r=0 - 8/21/13
5. 680news.com/2014/01/06/battle-over-60m-in-fees-at-issue-in-court-case-involving-artist-robert-rauschenbergs-estate/ - 1/6/14
6. floridabar.org/DIVCOM/JN/JNJournal01.nsf/0/4c588b161b4b3db38525719a00542a5a - 8/1/2006
7. leagle.com/decision/1958907100So2d807_1755.xml/WEST%20COAST%20HOSPITAL%20ASS'N%20v.%20FLORIDA%20NATIONAL%20BK - 2/28/58
Rocco Beatrice, Estate Street Partners, http://www.ultratrust.com, +1 (888) 938-5872, [email protected]
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