The South Carolina Supreme Court heard arguments Tuesday in the attempt by former James Brown trustees Robert Buchanan of Aiken and Adele Pope of Newberry to set aside a 2008 deal between former S.C. Attorney General Henry McMaster and some of Brown’s disinherited claimed heirs to transfer about $50 million from Brown’s “I Feel Good” Trust.
McMaster’s deal rewrote Brown’s estate plan, giving McMaster control of Brown’s assets through a trustee selected by the attorney general and can be removed at will. The agreement also gave away more than 50 percent of Brown’s assets to disinherited relatives and claimed relatives.
Buchanan and Pope argue the court’s decision may determine the future of private philanthropy in South Carolina.
Brown’s estate plan dedicated his entire $100 million dollar music empire to education. After providing education trusts for seven grandchildren, Brown put the rest in the James Brown “I Feel Good” private foundation to be used solely for scholarships to needy children.
In the Aug. 10, 2008, agreement, McMaster rewrote Brown’s estate plan to give 25 percent of the music empire to Brown’s companion and another 25 percent to five of Brown’s more than one dozen claimed children. McMaster’s rewrite was subsequently amended to leave the “I Feel Good” foundation with only about 47 percent of Brown’s music empire.
At Tuesday’s hearing, Chief Justice Jean Toal asked hard questions about McMaster’s decision to give Brown’s companion, Tommie Rae, a quarter of the music empire, even though: she had signed a pre-nuptial agreement before their marriage ceremony; she was married to another man at the time she and Brown exchanged vows; and after an annulment of her previous marriage, she agreed in a settlement that she would never claim to be Brown’s common-law wife.
William Wilkins, counsel for the settling parties, argued the S.C. Supreme Court misinterpreted its 2008 “Lukich v. Lukich” decision which holds a second marriage is void when a party is married even if an annulment is obtained later.
Also at issue was whether McMaster should have spoken for Brown’s 2000 trust in the settlement, giving more than half of its assets to persons Brown had intentionally disinherited.
James Richardson, attorney for Buchanan and Pope, argued no attorney general in the nation has the authority to take over and sign documents for a private foundation and even though the attorney general may enter legal proceedings and speak for the charitable beneficiaries, there is no precedent for an attorney general to give away a trust’s assets.
Richardson argued the right of the attorney general to enforce the proper operation of a private foundation does not give him the authority to dismantle it. Deputy attorney general “Sonny” Jones was asked why McMaster did not use his authority to enforce the “I Feel Good” trust, including the enforcement of the “in terrorem” clauses against Brown’s children.
“In terrorem” clauses state anyone who challenges the will or trust receives nothing.
The will was challenged on the assertion of undue influence and Justice Toal wanted to know what steps were taken to determine the strength of such a claim.
Jones admitted the attorney general’s office did not interview any of the witnesses to Brown’s 2000 will and trust as to his mental competence and that the lower court judge made no baseline determination about the strength of the challenge to the will. Jones claimed the shrewdness of the original trustees convinced him of undue influence but Toal responded that was not the law in South Carolina.
Jones referred to last week’s plea by original trustee David Cannon who, according to court documents, paid himself almost $12 million of the $80 million Brown took between 1999 and 2006. Although indicted two years ago, it was only on Oct. 27, 2011, Cannon was found guilty of breach of trust. Cannon was sentenced in Aiken County to three years of home confinement.
Attorney general Alan Wilson’s office sought no restitution for the $12 million taken by Cannon, leaving Cannon with a $1 million retirement home he purchased in 2007 on the exclusive island Roatan in Honduras.
Brown’s will and trust directed his fiduciaries were to “vigorously defend” his estate plan. In fulfillment of their duty as fiduciaries, Buchanan and Pope appealed McMaster’s rewrite of Brown’s will and trust.
The appellant’s filings assert if McMaster’s destruction of the “I Feel Good” foundation is not reversed, it could destroy private philanthropy in South Carolina by discouraging wealthy citizens from creating charitable trusts in the state.
Former James Brown trustees ask S.C. Supreme Court to restore “I Feel Good” Trust to original $80 million
November 2, 2011
The Newberry Observer
James Brown estate feud heads to S.C. Supreme Court
November 2, 2011
COLUMBIA — On Tuesday the South Carolina Supreme Court took a swing at the hornet’s nest that hangs over the charitable legacy of James Brown.
Former state-appointed trustees Robert Buchanan, Jr. and Adele Pope are appealing a two-year-old settlement that they say thwarts Brown’s intentions as laid out in legal documents from 1999 and 2000. The suit pits them against the artist’s children and his wife Tomi Rae Brown.
More than a dozen attorneys representing an even larger volume of heirs and trust managers on both sides of the dispute are expected to pack the high courtroom.
The central dispute is whether to throw out a settlement that Judge Jack Early of the 2nd Judicial Circuit Court approved on May 26, 2009, which replaced the charitable trust with “The Legacy Trust,” gave control to the S.C. Attorney General, and shuffled trustees.
The 2009 agreement gave half of the legendary entertainer’s assets to a James Brown Scholarship Fund, a quarter to Tomi Rae Brown and a quarter to the six adult children named in James Brown’s will.
“My clients are very desirous of the Supreme Court approving Judge Early’s careful consideration of the settlement and his approval of the settlement,” said Atlanta-based attorney, Louis Levenson, who represents Brown’s children and spouse.
“I’m hoping the Supreme Court will recognize the importance of the family and the Attorney General and Tomi Rae, bringing peace to what was a contentious estate.”
Levenson added: “The appellants don’t — according to law in South Carolina — don’t get to disagree with that. It’s not their right to disagree (with what was agreed upon).”
But a final brief from the appellants say the settlement takes away more than half of what he wanted to give to his private foundation for needy students and instead shifts it to his adult children.
The side consisting of appellants Pope, Buchanan, and former trustees David Cannon, Buddy Dallas and Alfred Bradley and others also suggests the circuit court was wrong to to discard trustees “solely because they opposed the settlement agreement negotiated by the Attorney General.”
Brown died at age 73 on Christmas Day of 2006. He left his personal and household effects to named adult children, a maximum of $2 million for a family educational fund, and the James Brown I Feel Good Trust to benefit poor students in Georgia and South Carolina schools, according to the appellants.
Brown’s family members challenged the plan, alleging that he had suffered from the “undue influence” of others. The South Carolina Attorney General intervened, said spokesman Mark Plowden, because the office is charged under state law with protecting all charitable trusts.
The trust/estate’s original tax counsel had valued Brown’s assets at $80-$120 million with at least $20 million already in the 2000 Trust, according to the appellants’ final brief. In 2008 Brown’s assets were pegged at $100 million with $40-$50 million assigned to publicity rights for his image and likeness, and $36-$45 million to royalties for his more than 800 published and unpublished songs.
The most recent development in the strife over the soul singer’s legacy came last week.
A circuit court judge sentenced Cannon to three years of home confinement after being charged with stealing money from James Brown. Cannon did not admit guilt but acknowledged that he could be convicted.