4 Clients Whose Estates Enriched James D. Gunderson : Merrill A. Miller
The allegations of fraud by Sully’s heirs resemble new accusations filed in court by heirs of the Merrill A. Miller estate who say that Gunderson cheated them to receive his largest bequest yet--$3.5 million.
A petition filed in probate court in October alleges that Gunderson “took a bequest in excess of $3.5 million for himself and his children” in January, 1992, by drafting an amended trust for Miller when the 98-year-old man was “legally blind, was hard of hearing, and was physically and mentally incapable of understanding the nature of these acts.”
Gunderson has acknowledged receiving a gift in the Miller estate, but has declined to discuss any details, saying it would be a breach of his confidential relationship with his client.
Miller, who was a substantial shareholder in the pharmaceutical giant Abbott Laboratories, died in February at the age of 98. The value of his Abbott stock alone was estimated at $17.5 million, court records state.
The relatives say that since 1974 Gunderson was a financial adviser, attorney, counselor and confidant to Miller. Gunderson earned another title--beneficiary--in 1984 when Miller’s trust stated that the lawyer should receive one-fifth of what remained of his Abbott Laboratory stock, after the estate sold what was necessary to settle the state and federal estate taxes for all of the beneficiaries.
After that, the relatives allege, Gunderson attempted to increase his share of the estate. In 1987, Gunderson drafted a provision that gave him one-fifth of the stock “off the top”--with his inheritance taxes effectively deducted from the share due the other beneficiaries.
In 1990, the other heirs contend, Gunderson apparently recognized that his position created a presumption of fraud and attempted to erase such presumption by procuring the services of another lawyer, his former law partner Ellsworth DeWeese, to approve the amended trust.
DeWeese, whose practice is located in Tehachapi near Bakersfield, declined to discuss the Miller case with The Times, except to say, “Mr. Miller wanted me to do what I did.”
When asked if Gunderson introduced him to Miller, and whether the Laguna Hills lawyer actually prepared the amended will and trust presented to Miller in January, 1992, DeWeese replied: “Can I give you a direct answer? I have no comment.”
Gunderson’s daughter, Linda Gunderson, a partner in his law firm, has denied that her father took advantage of Miller. In a letter to the relatives’ attorneys, Linda Gunderson said that Miller had a longstanding wish that her father receive 20% of the Abbott stock “off the top.”
“I don’t think there is any question in anyone’s mind that Merrill was competent and not under undue influence,” Linda Gunderson wrote. “All of the specific bequests were always tax-free.”
Miller’s will and trust included a “no contest” provision that would deprive any other beneficiary of his or her share of the $18-million estate if that person challenged any part of the will, including the bequest to Gunderson. Such a provision is not uncommon and is designed to prevent disgruntled heirs from unnecessarily squabbling over inheritances. Miller’s relatives are seeking to void the provision designating Gunderson as a beneficiary and are asking the court to declare that their challenge is not technically a contest.
