Knotts quietly settle over spending of estate

Relatives had argued that millions should have gone to the family's foundation

October 02, 2004|By Ivan Penn | Ivan Penn,SUN STAFF

Members of the prominent Knott family reached an undisclosed settlement late Thursday night over the spending of $17 million of their parents' assets that some relatives say should have gone into a foundation that bears the family name, a foundation official said.

The settlement ends a dispute between two Knott siblings, who were responsible for the spending of the $17 million, and their relatives on the foundation's board of trustees. The trustees - there are 34, all of whom are Knott family members - threatened to sue the siblings if a settlement was not reached by the end of this week.

In last-minute negotiations, the parties hammered out an agreement that ended the dispute but the details were kept confidential, said Gregory Cantori, executive director of the Marion I. and Henry J. Knott Foundation.

Multimillionaire developer and philanthropist Henry J. Knott Sr. created the 27-year-old foundation - ranked in the top quarter of the 100 largest foundations in the Baltimore area with $43 million in assets - to help local charities.

In his and his wife's wills, the elder Knotts stated that after obligations and bills were paid they wanted the remaining money to go to the foundation. They appointed two of their children, Patricia K. Smyth and Henry J. Knott Jr., as representatives of their estates to carry out their wishes. A third heir, Francis X. Knott, replaced Henry Knott Jr. at his death.

Smyth and her two brothers gave away almost $17 million to charities that had long been beneficiaries of the elder Knotts' philanthropy but without the foundation's knowledge, angering family members and touching off the dispute.

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