Epic Family Dispute Swirls Around a Matter of Trust

A lurid family feud over a $2.7-billion industrial empire is unfolding in a Bermuda courtroom and the gossip sheets of faraway Europe.

It involves a baron, his son, his daughter and his fifth wife, plus a stunning art collection and a complex family trust whose fate could have repercussions for this wealthy Atlantic island and tax haven.

Years ago, Baron Hans Heinrich Thyssen-Bornemisza ceded control of the Thyssen-Bornemisza Group to his eldest son, Georg, in exchange for a pension of $19 million a year.

Now the 80-year-old Swiss industrialist is trying to wrest back his empire, under the influence, some say, of a wife 22 years his junior who would disinherit his children.

Since the company is based in Bermuda, it has fallen to the Supreme Court of this 21-square-mile British island in the Atlantic to judge it. But people here aren’t holding their breath. There are 121,959 pages of documents, and opening remarks have run for 18 months, prompting the trade publication Legal Business to call it potentially “the largest litigation in Anglo-Saxon history.”

There has been speculation the case could run for 10 years. A big delay is threatened by the April resignation of Denis Mitchell, the judge imported from Scotland who claimed the government misled him about his housing allowance--a serious matter on a high-priced island where per capita income averages more than $36,000 a year.

But the tedium in the courtroom is more than made up for by the mudslinging between Carmen “Tita” Cervera, a former Spanish beauty queen who married the baron in 1983, and Francesca, his daughter by his third wife.

“It is the evil stepmother syndrome [that] has destroyed an untold number of families,” the daughter told the Sunday Times of London last year. The current Mrs. Thyssen-Bornemisza, who was formerly married to movie actor Lex “Tarzan” Barker, riposted this year in the glossy Spanish magazine Hola!: “Of all his five wives, I am the one who has looked after him best.”

“All this about the evil stepmother makes me laugh,” she added. “As far as I know, Francesca has been no Cinderella.”

The stakes are huge, possibly even for Bermuda’s economy.

The island is nothing if not business-minded: Bermudians often refer to themselves as “citizens/shareholders” in letters to the editor and in conversation--and wouldn’t mind seeing the baron fail.

Trust management is a growing moneymaker, while tourism revenues are falling, and Bermuda’s reputation could suffer if the multilayered trust is picked apart by the dozen high-priced lawyers on the case.

“It’s a huge trial, so it will have far-reaching consequences,” said Pat Phillip-Bassett, executive director of Bermuda’s International Business Assn. “It’s a very complicated trust, and if it is unraveled, it may make people take another look at how they’re structuring things.”

In Spain there are fears that if the trust is broken it could bring into question the ownership of a collection of mainly old European masters that the Spanish government bought for $350 million from the baron in 1993.

Even this arrangement, with the art collection housed in a Madrid museum named Thyssen-Bornemisza, was acrimonious. The baron’s wife was praised at home for influencing him to house the paintings in Spain, while some family members, including daughter Francesca, favored a higher offer from the Getty Museum in California.

Critics of the baron’s wife say the baron and his family were living comfortably and peacefully until she entered the picture and turned him against the trust arrangement. The baron insists he has been consistently shortchanged by Georg, now 50, whom the baron’s lawyers accuse of being “disreputable and amoral,” according to trial transcripts.

Lawyers of the baron’s son counter that Georg has stuck by the tenets of an arrangement agreed to by all parties and that it is the baron who is trying to undermine the agreement.

None of the parties has testified yet, and the principals have not spoken to reporters for the record since the case began.

The baron’s wife acts as his spokesman and self-described “chief strategist” since he suffered a stroke two years ago that she blames on stress from the legal battle.

It’s not the baron’s first family court battle. He had to fight his siblings in court after he inherited his father’s wealth in 1947.

“I would not advise anyone to do what I did,” the baron told Bermuda’s Royal Gazette newspaper two years ago. “You should never give out legacies before you are dead.”