Michael Hutchence, the lead singer of the band INXS, was found dead in a Hotel room in Sydney on November 22, 1997. His death was ruled a suicide.
Hutchence had made a Will the year before he died, in which Amnesty International and Greenpeace were each to receive $US250, 000, his daughter Heavenly Hiraani Tiger Lily, was to receive 50 per cent of his estate, with the rest split equally between his partner, Paula Yates, his mother, father, brother and sister.
Eight years after his death, and despite having a fortune estimated at between $10 and $20 Million, the executor’s report on the late singer’s estate claimed that after the sale of artworks, real estate, guitars, a Harley-Davidson, a jeep and other items, and the outgoings of the estate, including $670,000 in legal fees, there was nothing for the beneficiaries.
It was reported that the assets of Hutchence estate did not include three Gold Coast properties worth more than $10 million, a villa in France, a house in London, a development in Indonesia, a string of luxury cars, or ongoing royalties from INXS.
In the years before he died Hutchence structured his financial affairs to minimise tax and to reportedly secure himself against
“(a) his ‘thieving relatives’, (b) his ‘girlfriends’, and (c) in the event he married, his wife/ies (sic).”
It would appear that Hutchence hid assets in a complex array of companies and trusts that were ultimately controlled by the “Vocals Trust” of which Hutchence was not the beneficiary.
A trust occurs where a person or company (trustee) agrees to hold and manage assets or property in a way that will benefit someone else (beneficiary), under this relationship the trustee has a ‘fiduciary duty’ to the beneficiary. It is the existence of this relationship that forms a trust. A deceased estate is a trust, and the executor is the trustee who manages the property and assets of the deceased prior to distributing them to the beneficiaries named in the Will.
However trusts are usually governed by a written trust deed, stipulating the rules for its maintenance, the rights and obligations of all parties, and how income from the trust’s assets is ‘distributed’.
In establishing a trust Hutchence could legally minimise tax and protect his assets from creditors as property and assets moved into a trust become trust property. What seems unusual is that Hutchence transferred his assets into a trust where ultimately he was not the beneficiary. Hutchence had to trust that those who he effectively transferred his assets to would act in his interests.
We have included information about trusts, as they are another way that you can plan for your future. It should be noted that Trust law is complex and expert advice from an accountant, lawyer or both should be sought if you are considering setting one up.