A member of the Forbes family has lost his challenge of the way his brother and sisters valued shares in a Sheridan County ranch he gave to his stepsons.
Wyoming Supreme Court Justices on Thursday ruled against Waldo E. “Spike” Forbes in his lawsuit against a brother, two sisters and one other person who are members of the Beckton Ranch Trust, alleging that they undervalued shares in the Beckton Ranch which he had given as a gift to his two stepsons.
Justices agreed with a state district court that because “Spike” Forbes had given away the shares in question, he had no standing to challenge the value the other members of his family put on the shares.
“When Spike gifted his shares … Spike no longer held a tangible interest in the transactions between (his stepsons) and the (ranch) trustees as it related to the shares,” said the opinion, written by state district Judge Bobbi Dean Overfield. “Further, since the shares belonged to the (stepsons), Spike had no tangible interest in any potential damages the (stepsons) may have claimed.”
State district judges are sometimes invited to sit in on the court to fill in for an absent justice.
The Beckton Ranch Trust manages about 6,000 acres of the Beckton Ranch for the benefit of descendants of William Hathaway Forbes, who inherited his father’s J.M. Forbes & Co. investment company in the 1800s. According to the court’s ruling, the trust has 1,188 outstanding shares held by 21 beneficiaries, including Spike Forbes.
Spike Forbes worked as the ranch’s manager and was a member of the trust for 44 years, until 2007, when he stepped down after a dispute with his siblings.
In 2018, Spike gave two shares in the trust to each of his stepsons Geoffrey and Jeremy Scott. He estimated their value at $21,600 per share.
Under terms of the trust, the trustees are allowed an option to buy back, at fair value, any shares that are held by anyone who is not a descendant of William Hathaway Forbes.
Trustees set the fair value through a sealed bidding process that showed what each trustee would be willing to pay for the shares and then offered the Scotts an average of $5,987.50 per share.
Spike Forbes then sued the trustees, alleging they undervalued the shares.
But a state district court ruled that since Spike had given the shares to someone else as a gift, he had no standing to challenge the value set by the trustees.
Justices agreed, despite Spike’s argument that the way the trustees valued the shares will result in the future devaluation of the shares he still holds.