The Lund family war that is now playing out in the courts is a sad and costly affair. It could end a Minnesota grocery tradition of nearly 80 years.
Russell Lund converted a Hove’s Grocery to the first Lund’s store on Lake Street in Minneapolis in 1939. Russell and his family grew the single store into a retail empire. Lund’s later bought out the Byerly’s stores to become the second largest grocery chain in Minnesota with 26 stores.
The Lund/Byerly’s food giant is now owned by four of Russell’s grandchildren.
Recently one of the four heirs insisted she wanted to get cash for her one-quarter share. The Lund family estate plan did not provide for a buy-out of shares of the company. The family board of directors refused her request saying that the amount of her buy-out claim would damage the financial standing of the chain. She then sued the company and her siblings for payment of her claim. The district court judge has since ruled she is entitled to get paid for her share. After the trial, the court will determine what the dissenting heir’s share is worth.
The glare of publicity on the lawsuit is obviously painful for the family. What’s worse is that the siblings are no longer talking to their sister or sharing birthdays or holidays.
The lesson that we can learn from this is that a family war can be avoided or at least lessened by a well-designed estate plan. The estate plan should have provided for an exit mechanism for the heirs and an agreed-upon system for determining the value.