Posner estate winding down after 13-year battle

Corporate raider Victor Posner died in a hail of family strife that’s finally ending 13 years later.

When Posner, 83, succumbed to pneumonia in Miami on Feb. 11, 2002, he left an estate valued at $195 million and perhaps more than that in trusts designated for family members. Before and after getting kicked off Wall Street in 1993 for conniving with Ivan Boesky and Michael Milken, he built a real estate empire that’s still controlled by Brenda Nestor, Posner’s last girlfriend.

The beneficiary of a big chunk of Posner’s wealth, Nestor started fending off his relatives during his long decline; afterward lawyers for children and grandchildren filed stacks of motions and briefs. Settlements have resolved practically all the family challenges but one survived.

Wednesday’s decision from the Third District Court of Appeal, where Posner heirs have been frequent filers, means that Posner’s daughter Tracy Posner Ward cannot pursue Nestor personally for $5.8 million in a trust for Ward’s daughter Melody.

Ward can go after Nestor in her capacity as the estate’s personal representative but there’s a problem: The estate is tied up in liens placed by the Pension Benefit Guarantee Corp.

In July 2014 the federal agency that guarantees pensions said it would take over and terminate the underfunded pension plan sponsored by Posner’s estate before all the funds were distributed, the Business Insurance website reported. The plan has a $38.8 million shortfall, reflecting Posner’s habit of treating employee pension assets like free cash.

“They’re not allowing any money out of the estate,” Nestor’s lawyer John Schulte said of the PBGC. Once the agency’s interests are satisfied, he said, “It’s over.”

Tradition

The Posner family had a culture of infighting during the paterfamilias’ lifetime.

While he was taking over and plundering companies including Sharon Steel and Royal Crown Cola, Posner amassed a portfolio of properties in Florida and his native Maryland. His lieutenant in good times and bad was Steven Posner, his son from the first of his two marriages.

In 1995, after a federal judge ordered both Posners to keep away from public companies, Steven sued his father. He claimed the elder Posner had cheated him out of his rightful 25 percent share of Security Management Corp., their main real estate holding company.

Father and son famously resolved their differences with a coin toss. Steven won. In 2001 he selected a 10-acre tract in Hallandale Beach worth an estimated $100 million; in exchange, he gave up his right to a piece of the estate.

Then Posner rewrote his 1996 will and named his former girlfriend Nestor his chief beneficiary. Posner’s three other children—Steven’s twin sister Gail, Tracy and Lance “Troy” Posner—and grandchildren weren’t mentioned. Separate trust funds guaranteed they’d never go hungry.

Hours after Posner died, Nestor filed the 2001 will and ignited a probate contest. Gail argued Nestor had exerted undue influence over Posner so she should be removed as personal representative and the 1996 will should govern distributions.

Eventually the parties made a deal. The settlement was sealed.

Steven and Gail didn’t enjoy their riches for very long. In 2010 Gail died of cancer and Steven perished in a boating accident. For a time Steven’s three adult children went on trying to invalidate the 2001 will.

Abolition

Ward lives comfortably in Norco, California, with her husband, Burt Ward, the actor who played Robin in the 1960s Batman TV series. The couple runs a rescue operation for giant-breed dogs.

Former model/actress Brenda Nestor is CEO of Victor Posner Enterprises. She has five children with her husband Robert Castellano, head of medical device maker Choice Therapeutics. The socially active couple supports Fairchild’s Gala in the Garden and the American Red Cross ball.

Ward sued Nestor and the estate to enforce terms of an arbitration settlement giving her daughter Melody $10 million from a trust that was established for Melody and the late Gail Posner, according to Schulte. Payments from the trust began and then stopped, sending Ward to court.

Miami-Dade Circuit Judge Celeste Muir agreed that Ward’s interpretation of the settlement allowed her to look to Nestor for the $5.8 million. The settlement defined the “V.P. Entities” responsible for payments as “the Estate of V.P. and any other entity formerly owned and controlled by Victor Posner.”

Schulte had some fun with that in his appellate brief. Including Nestor among entities once “owned and controlled” by Posner, he wrote, “would raise obvious problems under … the Thirteenth Amendment to the United States Constitution,” which abolished slavery.

The Third District didn’t comment on that argument but did reverse Muir on this point.

“Nestor’s status as a party to the underlying lawsuit, settlement agreement, and arbitration award does not mean that Nestor was personally liable to comply with the obligations of the other parties to the agreement,” Judge Thomas Logue wrote for the court. “Nor does her status as a party in her individual capacity serve to broaden the definition of ‘V.P. Entities’ beyond the language used in the settlement agreement and adopted by the arbitration award.”

The latest appellate court opinion in the Posner saga was only a little surprising to Harris Buchbinder of Buchbinder & Elegant in Miami.

He represented his close friend Steven Posner against Steven’s father and worked for Ward until they had a falling out years ago.

Buchbinder had this to say about the Posners: “It’s just not an ordinary family, and they don’t function the way most people do.”

BRENDA NESTOR, APPELLANT, V. TRACY POSNER WARD, APPELLEE

Case no.: Nos. 3D14-502, 503 and 504

Date: April 8, 2015

Case type: Trusts and estates

Court: Third District Court of Appeal

Author of opinion: Judge Thomas Logue

Lawyer for petitioner: John H. Schulte, Law Office of John H. Schulte, Miami

Lawyers for respondent: Paul Morris, Law Office of Paul Morris, Miami, and Scott W. Leeds, Cochran Firm, Miami

Panel: Logue, Chief Judge Frank A. Shepherd and Judge Ivan F. Fernandez

Originating court: Miami-Dade Circuit Court

Attribution:

Posner Estate Winding Down After 13-Year Battle
Noreen Marcus
April 13, 2015
Daily Business Review
http://www.dailybusinessreview.com/id=1202723356696/Posner-Estate-Winding-Down-After-13Year-Battle#ixzz3XWXWdGBD

Share
News