John D. MacArthur Dies 1897-1978 (PBP) 1-6-780
By MARLENE PASSELL,
Times Staff writer
John Donald MacArthur, one of
America's last billionaires, who said
he wanted to live to be 80, died at
Good Samaritan Hospital at 2:12
a.m. today without emerging from
the coma into which he lapsed
Thursday. He was 80.
The insurance magnate and land
developer whose fortune was
estimated at $3 billion, died two
months to the day before his 81st
birthday and three days after his
physician revealed MacArthur had
cancer of the pancreas.
In announcing the tycoon's death,
Ron Kairalla, one of his aides, said
in an emotional statement at 3 a.m.
today, "The community has lost a
great person."
In a second press conference late
this morning, Kairalla said funeral
services will be private and at a
time of the family's convenience.
Asked if MacArthur had been kept
alive by artificial means, Kairalla
said no, "he did not want to be kept
alive using oxygen that another pa-
tient could use to recover. After the
operation he died a very natural
death -pain free and with dignity,"
he said.
"Mr. MacArthur was a very me-
thodical man. No one was more fu-
turistic and realistic than he. He
knew that no one ever lived forever.
He was very fortunate in the good
Ford giving him 80 years."
"Anyone who really knew the
man, loved the man,"Kairalla said.
"I will remember him in a thousand
different ways. He was strong, com-
More about MacArthur, D6
kind
tC. 'n
y
passionate, brilliant in business, a
man's man, a businessman's dream,
a man with a heart as big as this
room."
"He was a man who had a lot of
friends in key places," Kairalla
said. "He shook hands meaningfully
with the most powerful people in the
world. . . And, contrastingly, he
was best friends with people who
couldn't pay their utility bills as
well as with people who owned utili-
ty companies.
The aide said MacArthur's family
has asked that those who wish to
send flowers send them to the chari-
ty of their choice. He said flowers
already sent while MacArthur was
hospitalized were sent to the pediat-
rics ward of Good Samaritan Hospi-
tal.
"I don't want anyone to feel sorry
for me," MacArthur had said in the
past. "I've lived a good life and
been reasonably happy all my life."
MacArthur had said after a bout
with unrelated stomach cancer se-
ven years ago that he wanted to live
to be 80. "After that, you are au-
thorized to write my official obitu-
ary," he told a reporter.
MacArthur is survived by his wife,
Catherine; son, Roderick; daughter,
Virginia Cordova de MacArthur, and
six grandchildren.
His son said earlier this week af-
ter the announcement that his father
had two weeks to live, that MacAr-
thur's wish to be cremated will be
honored.
MacArthur suffered a stroke on
Nov. 23, 1976, at his Colonnades
Beach Hotel.
The usually accessible tycoon re-
mained in isolation for more than
seven months following the stroke.
The isolation ended in July 1977
when MacArthur "went public" to
accept a Horatio Alger award, sym-
bolic of his accomplishments as a
self-made man.
His public appearances were
many, though the speeches were
few. Twice weekly trips to Miami,
for speech therapy, after the stroke
was but another indication of Mac -
Arthur's determination never to ad-
mit defeat.
The stroke made him a mellower
and more philosophical individual. In
his first formal interview following
the illness, he spoke of his disbelief
in the "indispensable man."
"I think 'if I should drop dead
tomorrow, all of this would go right
Continued on Wage A2 Col. 3
Times photo by Max Kaufmann
i
r>
John D. MacArthur dies at 84
. Continued from Page Al
on, " he said, waving his expansive
arm.
About a month after that inter-
view, the billionaire was among 18
defendants named in a civil suit
filed by the federal government
claiming land fraud in the Holley -by -
the -Sea development in Pensacola.
Filed 'by the Department of Hous-
ing and Urban Development, the suit
claimed MacArthur and other cor-
porate officers made false 'state-
ments to induce the buying of land
at the development.
Characteristically, a call to the
Colonnades Beach Hotel for com-
ments on the lawsuit by the tycoon
resulted in the switchboard call be-.
ing answered by MacArthur.
He said he was discouraged by the
government attitude and unfamiliar
with the government's allegations
but promised to reply to the charges
in more detail later.
MacArthur was admitted to Good
Samaritan Hospital Dec. 18, 1977, in
a weakened condition after several
weeks of not eating well.
His problem was first diagnosed
as gall bladder difficulties, but after
spending the Christmas holidays at
home with his wife, he returned to
the hospital where "inoperable and
incurable" cancer of the pancreas
was diagnosed after exploratory sur-
gery.
Tuesday, MacArthur's physician of
many years, Dr. Donald warren an-
nounced that MacArthur would be
dead within two weeks.
MacArthur was born March 6, 1897
in Pittston, Pa., the seventh and last
child of Rev. and Mrs. William T.
MacArthur.
He was one of four sons of a Pres-
byterian minister, each of whom
eventually made a mark.
The eldest, Alfred, became a re-
spected insurance company presi-
dent. Next was Telfer, who ran a
chain of suburban newspapers
around Chicago. Third was Charles,
Pulitzer Prize-winning playwright
and husband of actress Helen Hayes.
All preceded insurance magnate
John in death.
Their father had a church in
Nyack, N.Y., and the two oldest
sons went into business in Chicago.
Young John was apprenticed to
brother Alfred in the insurance busi-
ness, took time out for World War. I
where he served with the Canadians
as a pilot. He shot down two planes
and spent six months in a Toronto
hospital recovering from a back in-
jury sustained when his plane was
shot down.
A r1
ing within the law, he reportedly
was often on the fringes, and certain
of his tax practices were eventually
banned by the Internal Revenue Ser-
vice — for example, artificially
maintaining statutory life reserves
by selling life policies to employees
on credit in order to avoid paying
maximum corporation tax.
In addition, mail-order policy mer-
chandising was eventually banned by
the Illinois Insurance Commission
after his successful methods were
copied and flagrantly abused . by
many fly-by-nighters.
Despite his legal struggles, the
MacArthur Insurance Group (Bank-
ers Life and several smaller firms
acquired for cash) prospered and as
of January, 1975, had assets of over
$100 million with more than $4 bil-
lion worth of policies in force.
Coincident with the rise of MacAr-
thur's insurance business was the
growth of his bank holdings. Starting
in 1936 with the purchase of Citizens
Bank and Trust of Park Ridge, Ill.,
(January 1975 assets: $265 million),
he acquired United Bank and Trust
of Brooklyn, N.Y., in 1968.
Although the bank had assets of
only $1.7 million, he soon consumat-
ed a merger with. New York's Royal
National Bank which had assets of
$285 million.
The bank had no legal connection
with. any of MacArthur's other hold-
ings. He financed the move on his
own, taking a 45 percent position in
the stock and emerging as chairman
of the board. As of January 1.975,
Royal National had increased its as-
sets to $310 million.
MacArthur also had other diverse
holdings. Starting with isolated
small acquisitions, such as oil pro-
perties, a printing company and an
airport service firm, he picked up a
chain of 50 hotels (but later sold
many of them) through a mortgage
default.
"I spent a lifetime building up a
conapany and it was great satisfac-
tion to have a piece of paper laid on
my desk and see a few more zeroes
than there -were the year before," he
once said.
Another default led to his big
move into Florida real estate in the
mid -1950's when he acquired 2,000
acres in Palm Beach County.
The land ' included most of what is
now Lake Park, North Palm Beach
Palm Beach Gardens and some of
Palm Beach Shores'on Singer Island.
Much of the property was swamp-
land and MacArthur, years later, ex-
pressed his feelings about his
Florida land. "When ,you come to
Florida, see a swamp, wade up to
your belly in water and go back a
year later and see houses and bicy-
cles and schools spring out of the
ground, it's a special kind of satis-
faction.
atis-
faction. "
Most of the property was once
owned by Sir Harry Oakes, a British
land speculator, who was mysteri-
ously murdered in the Bahamas in
the early 1940s. Oakes had main-
tained a large Spanish -style mansion
w -;, h later was used by the North
Palm Beach Country 'Club and now
serves as a village recreation cen-
ter.
helped develop, however, and he
soon buying again instead of selling
Among his purchases were
Biltmore Hotel, which he
planned to renovate until he
slowed by a long illness in the 1
He, had several offers to sell it
he was determined that the st
building which has stood sen
over Lake Worth, would be r
bished, not razed in favor of mo
.condominiums. It is now being r
vated by Stanley J. Harte to w
he sold it in October, 1977.
In June 1976 he bought the R
da Inn on the Green in West
Beach, saying "I had a little
change in my piggy bank
thought I would buy it."
His biggest run-in with his n
bors came in 1974 when he
forced by a court to change
name of his PGA Country Clu
the JDM Country Club.
MacArthur had built the club
Palm Beach Gardens in 1963
was officially sanctioned the
National Golf Club.
In 1973 he evicted the associ
charging it had violated its s
heart lease. agreement and w
"very hostile tenant."
The association then filed
against its former landlord all
that his continued use of the
PGA created unfair competition
confusion since the two were no
ger affiliated.
MacArthur's love was his C
nades Beach Hotel on Singer Is
was It provided him with an endless sup-
ply of new people to meet. Friends
the said he made time for everyone and
had everything from worrying about
was lates for. a banquet booked in the
Os. g
96 Kotel to deciding when to close a
but multi-million dollar deal.
ately The hotel has grown like the em-
tinel pine, a hodge-podge with an unbe-
efur- lievable mix of architectural styles
dere and gimmicky additions. It was two-
no- storied when he purchased it but
horn MacArthur plopped four more
stories and a penthouse (named for
ama- Bob Hope) on top of it despite warn -
Palm ings from builders that "the whole
extra damn thing would collapse."
so I The hotel is a reflection of its ca-
sual owner who was known to skimp
eigh- on maintenance. With two swim -
was ming pools, one olympic size, and
the not heated, the Colonnades has been
b to a favorite watering place for Cana-
dians and they arrive each season in
in planeloads.
and it Children have had the run of the
PGA, place, playing with the elevators and
around the owner's exotic ducks, or-
ation namental gardens, pools, the beach
weet- cabanas and acres of lawn.
as a Although occasionally angered by
attempts of some of his neighbors to
suit thwart his business activities, Mac -
ging Arthur usually took criticism from
name them cheerfully.
and The closest he ever came to
lon- revealing the secret to his money-
making success was "be sure you
olon- know when the breaks are coming
land. your way — and then work like hell . "
IVIacArthur
rated as "one of a kind'
Continued from Page Al
over his dredge and f ill plans, but
fortunately they worked out in favor
of the Village of North Palm
Beach," Privett said.
Current North Palm Mayor M.C.
Love Jr. said, "We've had conflicts
with Mr. MacArthur, but all in all
he did a good job in the north end
and was instrumental in developing
it into what it is today.'
Palm Beach Gardens Mayor Rich-
ard Feeney called MacArthur,
founder of the tcwn, "A tremendous
individual. No one has affected the
people of Florida as I much as he
has."
Lake Park Mayor J. Clifton Cook
said, "He's done a great deal for the
area in spite of the fact that many
of us have criticized him for his con-
trol of the area.
Palm Beach Shores Mayor Paul J.
Klang said, "We're really very sorry
to hear the passing of Mr. MacAr-
thur. He was the 'most prominent
resident of our community and he'll
be missed."
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Riviera Beach Mayor Bobbie
Brooks described MacArthur as a
shrewd businessman but added that
their relationship had been a good
one and that he would be missed.
`Conservationist'
Finer the war he held various jobs,
including a stint as a police reporter
for the Chicago Herald Examiner
before starting his own company,
Marquette Life Insurance Co., in
1928, with $7,500 capital.
MacArthur began during the Great
Depression although at one point his
company's assets dwindled to $16.
It was then that he began to make
his mark on the business world by
selling low-cost life insurance.
"It was a natural market,," he re-
called years later. "The Depression
was on, the 'banks were closed and
you didn't have any money."
"You had kids, you were sorry you
lost your old policy . So, I said,
`Well, give me two bucks.' and you
reached into your pocket and were
insured for, say, $1,600.
"At that time, no big insurance
company would take a monthly pay-
ment unless it was $10 or more. The
other companies were saying to me:
`It costs us $630 for handling an item
through our books. You want to take
a dollar premium. You've lost your
mind.'
"I was. able to do it. because I
didn't have all this overhead, ead, like a
big salary for a company president.
Then when times got prosperous,
we'd collect five dollar premiums.
And now we're collecting $20 and so
forth. ' f
In 1935, MacArthur -acquired Bank-
ers Life & Casualty for $2,500. By
19409 it had assets of $1 million.
While other insurance companies
relied mostly on their salesmen in
the field, MacArthur turned during
the war years to heavy mail-order
policy promotion and the assets of
Bankers Life shot up almost verti-
nil
L, Y -
was title h e sought In his early days, as throughout
1A
= career, MacArthur was spe, vill
far from controversy.
He was the subject of many legal
charges brought about because of his
unorthodox business practices, such
as carrying his suburban Chicago
home as an investment of Bankers
Life.
While always found to be operat-
Continued from Page Al
the pond like scarecrows in a corn-
field.
"Those are such cute little
ducks," he told me, "and you know
I'm always for the underdog."
"John," I said, "you amaze me.
With all the problems you've got to
contend with, and here you're wor-
rying about a few little ducks."
"Don't be fooled," he told me in
one of his serious moments. "Under
this old crust, there's a heart."
0
1 knew the first time I saw Mac-
Arthur referred to as a "billionaire"
in print that it was an important
milestone in his life. I didn't want to
pass up the opportunity to get his
reaction.
He was pleased but he didn't want
to acknowledge it when I confronted
him.
"How does anybody really know
what he's worth," MacArthur said.
"The way things are today you
never know from one day to anoth-
er."
"But you must have a good idea,
John," I said. "Are you or aren't
you a millionaire?"
"Well, let's put it this way," he
said, enjoying every moment of the
conversation.
"I come when I'm called."
Jensen man drowns
JENSEN BEACH — A 70 -year-old
man drowned Thursday morning in a
canal behind his house.
Eugene Edward Bryant, 1005 Ter-
race Way, was found floating face
down at the end of a dock. He was
fully clothed.
His wife, Marthe Bryant, told a
deputy she missed him at midnight
and looked for him outside. At 6:30
a.m. she saw something floating in
the water and discovered the body.
.,,it owy town in the area was
Kelsey City, which later became
,Lake Park.
After MacArthur took over the
property, he financed the develop-
ment of North Palm Beach and
founded Palm Beach Gardens.
. He continued buying up land, part-
ly in his own name and partly
through Bankers Life andtwo real
estate and holding companies, Royal
American Industries and Southern
Realty & Utilities.
While - Royal American continued
to maintain a. large inventory of un-
de�veloped land, as well as ownership
of WEAT. television and radio sta-
tions (he sold both in 1975) Southern
Realty eliminated all its land hold-
ings to concentrate on other invest-
ments such as utilities.
. MacArthur reputedly was the larg-
est single land owner in Florida but
lie would never confirm the specula-
tion. He once admitted to owning
100,000 acres in the state.
"I've no idea what anyone else
owns and I've no idea what the hell I
own," he said.
In 1974, miffed by efforts of envi-
ronmentalists to block development
of some of his property, MacArthur
announced he was going to liquidate
his Florida holdings and move to
some place, where he would feel
more welcome.
He got as far as selling radio and
television stations WEAT.
It was as though he could not re-
lease his loving grip on the area he
Times Photo by John Lopinot
R®n Kairalla announces MacArthur's death