One of our best known vigilante crime fighters, Batman, was orphaned at the age of 8 when his parents were murdered. He swore to dedicate his life to fighting crimes like that which killed his parents, and by the time we see him in adulthood he has spent millions of his billion dollar fortune designing and building crime fighting gadgets galore and an elaborate secret cave for operations headquarters. Let’s see how that might have come about.
What issues do the Waynes have?
They own businesses, so they need succession planning to make sure the company can continue running.
They have a minor son, so they need to plan for his care until he grows up and for how and when they will give him the money he will inherit.
What did they own?
We don’t actually know if the elder Waynes left a will or any other estate planning, but I would guess it was incomplete, at best, as I’ll explain below. We know that they had enormous wealth in the form of a number of profitable companies falling under the umbrella of Wayne Industries. There was money and potentially company ownership from Mrs. Wayne in addition to Wayne Industries, but it is less clear how that was owned and managed. This means that in addition to planning for the distribution of their personal wealth, Bruce’s parents also had to prepare succession planning for their businesses and business interests.
And of course, the most important piece of their planning, and where I suspect they failed, was in the management and distribution of their wealth and businesses to their son.
The Waynes appear to have had at least some succession planning in place for their businesses, as we know that the companies weathered the immediate period after their death and that they were thriving many years later when Bruce was flying about the town on his bat wings. This meant that the companies must have had either a corporate structure or a well written set of bylaws or partnership agreement for an LLC or partnership structure. In a corporation, the company itself has the ability to replace leadership, adjust to circumstances and operate independently of whether their officers or any of their shareholders died unexpectedly. The passing of shares is generally controlled by specifically created and adopted company policies, or controlled by state law.
In the case of an LLC or partnership, where there are typically fewer people involved in the running of the company, a plan setting out who owns shares versus who has the ability to run the company is important to prevent infighting or take over by inexperienced leaders. The Waynes do appear to have prevented the demise of their companies through advance planning of some sort. While Bruce, as their only heir (if they did not have a will), would have inherited their interests in the companies, as an 8 year old he would have been unable to run them, requiring the parents to prepare for the possibility of their early death by having other adults ready to step into company leadership roles. Written plans, along with properly adopted bylaws and policies within the company, would have allowed for this.
We know that Bruce inherited all or the majority of his parents’ estates due to the seemingly bottomless pit of money he has access to in later life. Most people do leave all or most of their estate to any children they have before considering gifts to other relatives or friends, and the Waynes seem to have followed this pattern. If they had no will at all, then in most states everything they owned would go to their child. But as an 8 year old, Bruce would not have been able to exercise control of any money or property at that time. The best way to provide for minor children is through the creation of a trust that will hold their inheritance until they are older and allow an appropriate person or trust company to manage the inheritance until the child can take over. If the Waynes did not have a will that created a trust for Bruce, a court would have created one for him. In that situation, when Bruce reached the age of majority, which today is usually age 18 but may have been 21 if we are talking about the Golden Age Batman, he would have been give all the fortune outright, having complete control over management and spending of the money as soon as he turned either 18 or 21.
If the Waynes had created a trust in advance, they would have been able to delay Bruce’s access to the entire sum of money, and they would have been able to allow time for him to learn how to handle such a large sum responsibly. Some parents direct the trustee to pay for higher education or down payment on a home or even a sum toward starting a business, but access to full control by the child is delayed until an older age or a life milestone, such as obtaining a college degree. If the amount of the inheritance is very large, it may be released to the child in stages, so that some money comes under their control while the rest stays in trust and protected from the missteps of youth.
Basically, you can set the trust up to do what you expect you would do for your child if you’d been alive and they asked for money.
I suspect that Bruce’s parents did not have a trust set up for him because it is hard to imagine that the ways in which he used his money would have been green lighted for loans or gifts by his parents. “Hey Mom and Dad, I want to spend a big chunk of your hard earned money to dig a giant hole under our tower (I’ll pay an engineer to make sure it doesn’t fall down) and then try to invent super high tech comic book toys so I can confront highly dangerous and violent criminals all alone. Is that ok?”
I like to think Mom and Dad would, at the very least, have required Bruce to provide a proof of concept and marketability study before backing this particular hobby. Which is why I’m pretty sure young Bruce had sole control over his money at about the same age many young men buy their first car and then roll it into a ditch.
If you want to keep your young super heroes safe and solvent and protected from their own passions, a trust for minor’s is definitely the way to go.