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Providence: 401-421-7500 | Narragansett: 401-789-1800

Restaurateur's estate virtually gone in six years

When setting one's estate plans in Providence, it is vitally important that the right people be asked to fill the right roles. Selecting an executor, personal representative or trustee should be a decision that a testator takes very seriously, given the authority that the people in those roles are empowered with. Typically, one establishes a very clear direction with how they want their estate to be managed, whether that be to immediate disperse funds to beneficiaries or generate income for them over time. Poor decisions on the part of a trustee or personal representative can easily derail those plans. 

The case of a late restaurateur's estate may serve to illustrate this point. The man's original restaurant chain sold for $154 million in 2000, and when he passed away in 2012, his estate was valued at around $20 million. Now, according to his stepson, its assets have dwindled to include only a few real estate holdings, which the stepson believes to be worthless. He blames the estate's financial decline on the poor management of the decedent's former financial advisor (who is also the trustee of several of the estate's trust). He even went so far as to file a lawsuit accusing the trustee of fraud. The trustee, for his part, does admit that some poor decisions contributed to the estate's losses, but also claims that a declining real estate market and poor choices by the decedent himself are equally to blame. 

Trustees and personal representatives are expected to act with prudence when managing the assets entrusted to them. While some bad luck may be expected, beneficiaries should expect that those in the aforementioned roles know enough to avoid extreme losses. If that expectation is not met, beneficiaries may want to work with an attorney to question a fiduciary's actions. 

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