A true story from a friend in New York who did a fair amount of estate planning in the late ‘90s in Manhattan.
Paul owned brownstones in Manhattan, apartment complexes in Brooklyn and Queens, co-ops scattered across some famous addresses, and varying ownership percentages in a dozen companies, two in Europe.
Paul was a cool guy – French aristocracy, big in Big Oil in the ‘50s and early ‘60s, he started buying New York real estate in the Mayor Lindsey era when it was considered insane to invest in the city. I always met him at either his office in a brownstone off Madison Avenue or at his club on Fifth.
He was a nice guy, very laidback, who much preferred to talk about France, art, history, Manhattan in the ‘60s – anything but his business, even when he needed advice. It took forever to get down to business but it was hardly onerous to be doing it over lunch overlooking Central Park.
At some point he decided it was time to ‘wrap up the business’ and turn it over – minus a few pieces – to the next generation. It was extremely complex. Family issues, personal and business assets intermixed, daughters getting married, problematic son-in-law-to-be already working in the family business, much more.
But, finally, we got it done, produced documents for him, his wife, the business, the works. It promised to be a long signing, the client decided that we should do it over a meal at his home on Park Avenue. His co-op was amazing - it was like walking into Versailles. After the initial ‘WOW’ moment I settled down and started to recognize pieces and artwork from the appraisals – all listed as owned by one of the businesses.
He had brunch laid out – every meeting with him always revolved around food – we piled up plates, sat down, he and his wife were on a couch I was nervous eating within ten feet of, I was over an ornate, three-foot-high coffee table that Napoleon had probably snacked on.
It was all nice and relaxed and so very civilized. While we ate, an ornately framed drawing hanging over the couch caught my eye, then grabbed it.
“Ah, is that a Picasso?”
“I suppose so.”
“Suppose or know, ‘cause I think I’d know.”
“Well,” he started, “I didn’t buy it . . .” then he launched into this: he worked in the Cote D-Azur in the late Fifties. He went to the same café for breakfast every morning without fail. The same crowd was there every day. One of the regulars was an older, somewhat familiar, balding man.
One morning, he approached Paul. He had forgotten his wallet and was hoping he could ‘impose’ on him and pay him back the next day. Paul invited him to sit.
Breakfast melded into lunch, then dinner, wine flowed. The next morning, Paul’s new friend met him for breakfast. He asked to have the table cleared, ordered a new tablecloth, opened the bag he had been carrying, pulled out brushes and paint, and proceeded to create . . . art.
He signed it Pablo Picasso.
Paul finished with, “Does this affect what we’ve been doing? I am sorry I forgot all about my Picasso.”
“That’s okay,” I answered, “I forget about mine all the time . . . ”
He had the grace to laugh, “But does it? Alter what you’ve done?”
“Depends on the valuation.”
“Oh, I’ve never had it appraised . . . but XYZ Corp owns it.”
I started to put the pile of documents back in my briefcase, “Well, let’s get it to Sotheby’s and see what happens, maybe we’ll get lucky and you just ran into a Picasso imitator and all you got out of the day was a nice drawing.”
He laughed, I called a friend at Sotheby’s, went back to my office, and waited. Two weeks later I ended up shredding the documents. The drawing was worth more than one of his Manhattan brownstones. His biggest.
Moral of the story: all the planning in the world crashes down when it's done without all the facts.