Monday, April 07, 2008

The Money by James R. Phelan and Lewis Chester

Howard Hughes fascinates me. Not the brash, young aviator portrayed by Leonardo DiCrappio, but the codeine-addicted, neurotic, obsessive-compulsive, germ-fearing recluse whose business empire was nearly in shambles by the time he died. Then he weighed a skeletal 93 pounds despite being six feet and four inches tall. For all we hear about the mentally ill suffering in poverty, Hughes demonstrates the other extreme -- a person so wealthy that he built a surreal world for himself where no one dared intervene. One can't help feeling a bit sorry for Hughes as all his secrets, so closely guarded during his lifetime, were revealed for all to see in the aftermath of his death.

The Money isn't a biography. Rather, it is a study of virtually every complication that can arise in estate court. Although he was widely known as the wealthiest man on Earth, Hughes never signed a will and had no obvious heirs such as wives or children. The book details the search for legitimate heirs as well as several pretenders, most famously Terry Moore, who claimed to have married Hughes in two questionable ceremonies. Several alleged wills laid claim to the money, but the book explains how each was determined to be fake. The legal battles were expensive; they would have bankrupted a lesser estate. For starters, three states claimed Hughes' residency. While Nevada authorities didn't put up a fight (there was no state inheritance tax there, so why bother?), California and Texas had much to gain or lose. Hughes' hideous physical condition at death also spawned numerous legal actions against his doctors and handlers.

Along with the endless court battles fought in several states, The Money tells how one of Hughes' heirs, lawyer Will Lummis, struggled to repair the billionaire's financial empire known as Summa Corporation. First he wrested control from the men who had been running it into the ground during Hughes' later years. Then he set about straightening out myriad problems, taking the company from the brink of insolvency to a secure position that at least guaranteed that the heirs would get something of value.

Perhaps the most ironic part of this tale is the Howard Hughes Medical Institute (HHMI). During the man's life, this organization was little more than a tax shelter. All of Hughes' stock in the Hughes Aircraft Company (a huge defense contractor that was successful largely because the U.S. government forced Hughes to install good management and leave it alone) was transferred to the HHMI to avoid paying taxes. During his lifetime, the HHMI spent very little on medical research. After the Hughes estate was sorted out, however, the organization began disbursing millions for important medical research worldwide. So this cynical tax dodge evolved into the lasting legacy of the peculiar billionaire.

If I taught a class in estate law, I would make this book required reading because it examines so many issues. Yet for all the complications in this story, The Money is quite readable for the layperson; the narrative never devolves into arcane legalese. It isn't an ideal introductory book about Hughes, but the authors (who have written other books about him) provide enough background that prior knowledge isn't necessary. I would recommend this book to anyone fascinated with Hughes and his wealth or curious about the many facets of estate law.

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