“When life gives you limes, make margaritas,” said Jimmy Buffet, rephrasing the old adage. Right now, the co-trustees of Buffet’s estate plan have limes. Lots of them. And it’s going to take more than a pitcher of margaritas to fix things.
Buffet, famous for the tropical rock anthem Margaritaville, died from cancer in June 2023 at age 76. He left behind his wife of 46 years, Jane, and three adult children. Buffet was not just a wildly popular musician; he was also a successful businessman. Capitalizing on his brand, he launched a line of clothing; a cruise line; was part owner of minor league baseball teams; and founded a hospitality company, aptly named Margaritaville, that operates restaurants, resorts, bars and casinos.
Buffet’s Trust
The cornerstone of Buffet’s estate plan was a trust for Jane’s benefit. He named her as co-trustee, and to serve alongside her as an independent co-trustee, named his friend, accountant and financial advisor, Richard Mozenter. Despite his careful planning, the strategy has imploded. There is no love lost between Jane and Mozenter. They have sued one another, each one accusing the other of mismanaging the trust.
Disputes of this type are not uncommon, but the enormous stakes in this case are. The trust has $275 million in assets.
In this post we give an overview of the dispute, discuss what to look for when selecting a trustee, and what to do if you believe the trustee is not fulfilling his/her duties.
Jane v. Mozenter
Jane was unhappy with Mozenter almost from the beginning. On May 30 she asked him to resign as co-trustee, but he refused. On June 3 she filed a petition in Los Angeles Civil Court requesting his removal. Her petition claims that despite Mozenter earning close to $2 million in fees in 2024, he has been “unprofessional and combative” and has failed to give her updates on the trust. It took Mozenter nearly 16 months to answer her questions about her finances and the trust, and, according to Jane, the numbers he ultimately provided to her just don’t add up. She is to get $2 million annually, amounting to less than a 1% return on the assets. She reports that Mozenter advised her to cut back on her spending or sell property in order to make ends meet.
Mozenter’s calculations, she claims, omit revenue from the Margaritaville company, although it comprises 20% of trust assets and which, Variety reports, generated $14 million in the last 18 months.
A hearing on her petition is scheduled for Aug. 14.
Mozenter v. Jane
Mozenter is equally disgruntled with Jane. He has filed a lawsuit in Palm Beach County, where the estate is in probate, seeking to remove Jane as co-trustee. His petition claims that Jane “has only acted on behalf of herself as a beneficiary and not as a co-trustee.” He alleges that she has not cooperated with him on necessary tasks, including filing tax returns and managing her late husband’s business interests. On the other hand, her interference in other matters, such as the severance package he was negotiating with Buffet’s boat captain, has resulted in unnecessary expenses for the trust. His lawsuit also claims that Jane pressed him to remove the Buffets’ eldest daughter as remainder beneficiary, a request in direct conflict with Buffet’s written wishes.
Mozenter has an explanation for Jane’s anymosity toward him. He says she is angry and upset because with her husband gone, someone else is calling the shots and controlling her financial life. But this is precisely the arrangement Buffet wanted, he says, noting that Buffet told him Jane lacked the skiils necessary to manage the trust on her own.
What state these dueling lawsuits will be heard in, is yet to be determined.
What Can You Expect From Your Trustee?
The most important quality to look for in a trustee is honesty and good character. A trustee is a fiduciary, legally obligated to put the interests of the beneficiaries before his/her own. A trustee must keep beneficiaries informed of all actions taken with respect to the trust; provide beneficiaries with timely accountings; keep detailed records of all trust-related transactions; avoid all conflicts of interest or even the appearance of conflict of interest; and never co-mingle trust assets with his/her personal assets.
How Do You Remove A Trustee?
Our attorneys are no strangers to complaints from beneficiaries about trustees’ actions, or lack of action. As the Buffet case illustrates, you cannot just summarily remove a trustee or co-trustee if you think they are not carrying out their responsibilities properly. If you are dissatisfied with a trustee, the first thing to do is to communicate your issues to the trustee and try to work it out. You can also hire a mediator to facilitate the discussion and help resolve the issue.
Legal action should always be a last resort. This type of lawsuit is not inexpensive. You will have to hire a lawyer. You will have to show that the trustee violated his/her fiduciary duty and/or has been incapable of getting along with the co-trustee and/or beneficiaries. You will likely need to hire professionals, such as accountants, to support your allegations.
Advantages and Risks of Naming Co-Trustees
There is nothing inherently wrong with naming co-trustees. The arrangement can be advantageous, allowing each co-trustee to handle duties at which he/she is most proficient. The arrangement could even expedite the administration of the estate. That said, requiring two people to work together can open the door to discord when you are gone. You must weigh the potential benefits and risks, taking these factors into consideration:
- Do each of the proposed co-trustees have the temperament to work amicably with the other?
- What about your co-trustees’ job schedules and family responsibilities? To use an extreme theoretical example, suppose one is a single parent caring for minor children who lives in Seattle, and the other is a Florida local who travels extensively and has a spouse and children. These are the kinds of realities you must consider that could prevent your co-trustees’ from collaborating well to get the job done.
- If one of the possible co-trustees is your spouse who has been a participant in managing finances, think about how he/she may feel in the future if you name an independent co-trustee. Some spouses may be relieved that someone else is handling financial matters. But some, like Jane Buffet, may resent the outside control.
- You should always meet with each potential co-trustee alone, and then with both together, to discuss your proposed plan and get their feedback. You will then need to decide if you will allow each co-trustee to make decisions independent of the other; if only one can; or if both must agree before any action is taken. The option you choose will shape the dynamic between your trustees. Whatever you decide must be reflected in precise language in your trust.
You can rely on the estate planning attorneys at our law firm for good advice when you are evaluating who to name as trustee(s). We have seen situations where co-trusteeship has been successful, and others that have not. Contact us and we will help you consider your options and determine the best plan for your specific circumstances.
