Whatsleft Plantation enjoyed a special place in the hearts of Ben Reach and Sam Nixon MD. It lay on the edge of Thomasville. It had been in the family of its owner Frank Atkinson since 1880 when his great-grandfather discovered it while escaping Cleveland’s ice and snow and lodging at a fashionable Thomasville resort hotel, that day’s equivalent of The Breakers in Palm Beach.
It was then a collection of small cotton farms and long leaf pine turpentine parcels. Frank’s ancestor paid an average of $6 an acre for the assemblage of 10,000, which he called Paradise Acres, a name which stuck until Frank’s father began to sell off pieces to satisfy his over-indulgence in high living and alcohol, a taste for which he inherited and passed genetically down to Frank.
By the time Frank’s father died the place had shrunk at the edges to 5000 acres, the rest acquired as additions to adjoining Yankee plantations, as local crackers and blacks called the sporting estates of snowbirds such as Frank and his forebears. Today it contained just 1000 acres, reduced the same way during Frank’s lifetime, but still managed for quail and containing a cypress swamp-bordered 50-acre spring fed lake Ben and Sam loved to fly fish for bream in the spring.
Frank was Sam’s patient and Ben’s client and both curmudgeons’ dear friend. He was Ben’s age, in fact they shared a birthday, June 29.
Frank had been a widower three years, living now alone in the Big House on Whatsleft, his breakfast and lunch prepared and served by Maud Eanes, wife of his manager Buck Eanes, employee of Frank since a teen. They lived in the Manager’s House, just fifty yards from the Big House. Buck or Maud looked in on Frank at bedtime each night to be sure all was well. Maud left his light supper prepared for warming by Frank in the microwave each afternoon.
Maud called Sam and asked for a meeting with him and Ben. She and Buck arrived at Ben’s office together. They bore expressions “serious as a heart attack,” as Sam described them. Seated at Ben’s conference table with the curmudgeons with cups of coffee poured by Joanne, they poured out their souls.
“Dr. Sam, Mr. Ben, Mr. Frank needs to go live in a nice place where he can be looked after real close. We are afraid he is going to fall and break something. His sons want to move him to a second- rate nursing home, sell Whatsleft to a developer and take the money. They have had Pete-Bob Dix out at Whatsleft a dozen times, measuring everything and taking pictures.”
“Thank you, Maud, Buck, we are on the case,” Sam said. The couple rose and thanked the curmudgeons, who in unison replied, “No…thank you.”
Next morning Ben and Sam drove to Whatsleft without prior notice. Maud answered the door and led them to the screened porch overlooking the fishing lake where Frank sat finishing his breakfast.
“Frank, we want to talk to you about a plan.”
With that, Sam laid out this plan.
“You need to move to Ironleaf Manor. You will have your own apartment, big and tall windows, lots of light. You can get your meals brought to you or eat in the dining room, food as good as The Greenbrier or the Homestead (Frank and his wife Anne had spent Christmas at one of these for years). If you need or want anything it’s a phone call away.”
“I cannot afford that,” Frank said.
“Yes you can,” Ben said.
“You can grant Bill Kellam (billionaire owner of the quail plantation adjoining Whatsleft) an option to buy Whasleft at your death for its then appraised fair market value, but not less than its current value. Bill will pay you now for the option say 25% of Whatsleft’s current value, to be applied to the purchase price if he exercises the option . He will rent Whatsleft from you the rest of your life for enough to cover your living expenses at Ironleaf. He will also be obligated to put a conservation easement on Whatsleft after he buys it, preventing its further division or development.
You can provide that the proceeds of Whatsleft be held in trusts for your sons. They will get 4% of the value of the trust each year for life. The trusts cannot be attached by their creditors or wives. (The sons had each suffered divorce twice and bankruptcy once). When they die what’s left in the trusts can go to your grands or in trust for them.”
“What about the capital gains taxes?” Frank asked.
“There won’t be any,” Ben said. “The option creates what is called an open transaction, not currently taxable. Whatsleft will get a stepped-up cost basis at your death to then fair market value, and that eliminates the capital gain, at least under current law.”
“And estate taxes?” Frank asked.
“Depends on what the estate tax exemption is when you die, but you inherited over eleven million dollars of exemption from Ann at her death, so there won’t likely be any estate tax to pay, and we can eliminate generation-skipping tax when your sons die,” Ben said.
Frank smiled. “Let’s get ‘er done,” Frank said.
Ben and Sam had already arranged for Maud and Buck to get employment offers from Bill Kellam for managing Whatsleft after Frank’s move to Ironleaf Manor.