The
weekly saga of the Bari Family is presented to you as a light hearted tale of
estate planning gone awry. Through the
lives of this particularly unusual family, you may learn some fundamentals of
estate planning but mostly have some fun. As you will see, however, estate planning is
an oxymoron.
Episode 5
How Did We Get
Into This Fix?
Danny’s first call on discovering the loss was to his long time bookkeeper, Juanita, who had been on her annual vacation.
“May I speak to Juanita please?" he asked the person who answered.
“She ain’t in”, was the reply. “Who’s calling?”
“This is her boss Danny at the restaurant.”
“Well, I haven’t heard from her since she left on vacation, but figured she was just off having a good time. I mean who wouldn’t like Brazil. She said she was going to enjoy the big bonus you gave her before she left.”
Danny was too embarrassed to call his folks or confide in Bernie, whom he knew would tell his Mom. The restaurant operations had been given over to him 5 years ago and he had done a great job of modernizing the place and the menu. Revenues were up and a new reputation was being built. Now it looked like the whole house of cards was going to fall. Even though it didn’t make sense from a tax standpoint, Augie had always insisted that the corporation own all of the investment property of the family. Now all of that property, over $15 million worth was in jeopardy of being lost- all because Danny had not been watching the ship. He had simply been too busy running things to pay attention to what was happening in the back office aside from the daily income tallies, which were so positive.
So now the entire house of Bari, everything his folks had worked for- even their home, was going to be lost. Even the fidelity bond had expired! Each layer of the onion just made things look worse.
So he made a call. Many years before, Danny was contacted by some members of Augie’s family in New Jersey who at that time were interested in having a piece of the restaurant for the purpose of laundering money from their west coast drug operations. Danny had said no then but now it seemed that his only salvation lay in accepting their offer: All the operating capital you need for a good return secured by your interest in the restaurant.
Danny didn’t have any interest in the restaurant other than what his parents would leave to him. Neither one of them believed in giving anything to their kids (except annual gifts in very small amounts) so the corporation was still entirely owned by both of them. Danny would inherit, without a will, 25% of the restaurant. In reality, however, his sisters and brother would never have anything to do with it and would easily be bought out, or take other property, if there were any.
Somehow the relatives in Jersey took this collateral and kept the restaurant afloat for the past year. Six weeks ago however, Danny received a visitor who was definitely going to mess up the rest of his life.
“So Danny. It’s good to see you. My name is Pollo. I am a representative of the benefactors who saved your bacon- hey I like that: ‘Saved your bacon’. You know, like this is a restaurant, know what I mean?
“What’s this about- I’m paying the interest.” Said Danny.
“Well, you see Danny, you’re a good boy, but this isn’t about interest. This is about ownership. The boys just figure that if you could do so well honestly, they could do even better under the table. So I am here to collect the principal that bookkeeper took from you. You have a week to pay or we will arrange some incidents that will insure that you are the only legal owner of the restaurant- with your sons as collateral.
That was six weeks ago and other than some slime ball named
Vinnie coming around the restaurant asking for his Dad’s location, Danny had
not been hassled. He knew, however, that
his family’s days might be numbered- and that it was his fault! He had to find a way out!
[So Danny has upset the perfect applecart of the Bari family. The family fortune is all tied to the restaurant and the properties it owns (as well as its income) and it looks like the mob is going to start collecting on its debt. Stay tuned to the further sagas of this intriguing family that could be just like your neighbors. In time we (or possibly just death) will solve some of their estate planning problems. Right now, they have more important issues to deal with!]
Very entertaining Dewey. I found your blog on my facebook and decided to give it a read! Keep 'em coming.
Posted by: James Campbell | 02/18/2010 at 11:01 AM