Running afoul of the founder at W.P. Carey …

July 7, 2010

Here at footnoted, we work for our founding editor, Michelle Leder. And as a tiny outpost of Morningstar Inc., of course, we all ultimately work for founding Chairman and Chief Executive Joe Mansueto. It’s safe to say that we’re happy working for a couple of enterprising visionaries like Joe and Michelle. (Hi, guys!)

But a new filing from commercial property company W.P. Carey & Co. (WPC) on Tuesday reminds us that other founders may not be quite so easy to work for — and that family relationships come in all kinds of shapes and patterns.

Gordon DuGan, who has been CEO of W.P. Carey for about five years and an executive there for 11 years, gave notice on June 30. The 43-year-old observed in a formal resignation letter, dated yesterday, that “[t]his is not how I expected my long tenure with the Company would end.” He continued, citing

“irreconcilable differences of opinion concerning the degree of authority and control that should be exercised by the Chairman over day-to-day operations, as well as a difference of opinion with the Chairman regarding the strategic direction of the Company…”

The Chairman, of course, is 79-year-old Wm. Polk Carey (as his name appears throughout company documents), founder of the company and owner of about 30% of its shares. And the friction may help explain why the company’s total return trailed the property management sector by nearly 13 points in 2009, though it outperformed handily in 2008 and it’s doing better so far this year.

In any case, the W.P. Carey board didn’t miss a beat, to judge from the 8-K filed on Tuesday. It accepted DuGan’s resignation and named one of its own, Trevor P. Bond, as interim CEO — all of which took effect yesterday, just six days after DuGan gave notice. (The company also made Mark J. DeCesaris chief financial officer — after nearly five years as acting CFO.)

Bond is a longtime financial manager and has been on the board for three years — he made $217,482 in the position last year, and served on its audit and compensation committees until being named interim CEO.

And it turns out that Bond also has a somewhat closer relationship to Chairman Carey — a fact not found in the company’s press release, but mentioned in the 8-K. (Another director, Francis J. Carey, is Wm. P.’s brother.)

Specifically, the company’s 8-K tells us,

“Mr. Bond is the son of the second husband of the daughter of the half sister of Wm. Polk Carey, the Company’s Chairman.”

That wasn’t enough to keep Bond from being classified as an independent director in the company’s most recent proxy. For shareholders’ sakes, we hope it’s enough to pave the way for a better working relationship with the Chairman.

Image source: Kristal Kraft ~ DenverDwellings via Flickr

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