Lopez v. Flores, — So.3d —-, 2017 WL 1018492 (Fla. 3d DCA March 15, 2017)

client-and-lawyerOur ethics rules evolved in the civil litigation context, which means the rules assume a lawyer has only one client involved in a particular matter, and that lawyer’s never tainted by representing anyone else whose interests are unaligned with his or her one client as it relates to the matter at hand. It’s rarely that simple for trusts and estates lawyers.

For example, it often makes sense for one estate planner to serve as “family” counselor for an entire family, which means several family members are represented jointly by the same lawyer. But no matter how closely knit a family might be, our ethics rules still assume everyone’s entitled to be treated like they’re our one and only client, each with his or her own separate right to our undivided loyalties. Forget that fact and someone else’s family fight could morph into your very own malpractice suit (see here, here).

Another common scenario that comes up in the inheritance-ligation context is for separate family members to confer with the same lawyer or small group of lawyers while everyone’s trying to figure out what to do next. This kind of family-group thinking may seem reasonable, but it comes with its own set of risks for the lawyers involved; namely our ethical duties to “prospective” clients under rule 4-1.18(c), which provides in relevant part as follows:

A lawyer … may not represent a client with interests materially adverse to those of a prospective client in the same … matter if the lawyer received information from the prospective client that could be used to the disadvantage of that person in the matter …. If a lawyer is disqualified from representation under this rule, no lawyer in a firm with which that lawyer is associated may knowingly undertake or continue representation in the matter ….

This rule’s the focus of the 3d DCA’s ruling in the Lopez case linked-to above.

Case Study:

This case involves an elderly father’s marriage to a younger woman, the validity of which was challenged by his children. In my book, this is an inheritance dispute. According to counsel for the children in December 2015 he spoke at length with a friend of his at the Kluger Firm about this case:

[H]e began speaking with his longtime friend, the Kluger Firm attorney, about serving as the Children’s co-counsel in the proceeding. He testified that he revealed to the Kluger Firm attorney “facts, strategy that I was intending to employ, and giving him a road map of where I thought he would fit into the case to help me out as co-counsel.” The Children’s attorney further testified that he disclosed facts to the Kluger Firm attorney that are currently not available to the public.

In February 2016 the children, acting as their father’s plenary co-guardians, filed suit against “Flores”, the new wife. Six months later in August 2016 the Kluger Firm stepped into the fray — as counsel for the other side. Counsel for the children apparently believes this must all be a big mix up; he writes to the Kluger Firm asking them to voluntarily withdraw from the case, and they basically tell him to take a hike in an email the 3d DCA said contained the following invitation: “File your motion. We will seek fees.”

What’s it take for a prospective client to conflict you out of a case? Not much

When, as the 3d DCA put it, the children “accepted” the Kluger Firm’s invitation to file a motion to disqualify them, the firm deployed two defenses, both of which are intuitively appealing, but neither of which ultimately worked.

First, the Kluger Firm argued that because counsel for the children didn’t say exactly what confidential information was shared, the trial court didn’t have enough facts to disqualify them. In other words, general conclusory statements shouldn’t be enough to conflict you out of a case, you need to give specifics.

Sounds reasonable . . . and it worked at the trial court level. Not so on appeal. Why? Because parties don’t have to waive their attorney-client privilege rights to prosecute a disqualification motion. Once a prospective client tells you about his case, it doesn’t matter what the details are, you’re presumed to have confidential information that can — and will — be used against him. So saith the 3d DCA:

While we understand the trial court’s concern that the Children’s attorney’s testimony . . . was bereft of detail and somewhat conclusory, we note that a disqualification standard requiring the movant’s attorney to testify, in open court, as to the specifics of any shared confidential communications would only exacerbate disclosure issues. Thus, we decline Flores’s invitation to recede from those cases holding that there is an “irrefutable presumption that confidences were disclosed” once it is shown that an attorney-client relationship existed. State Farm Mut. Auto. Ins. Co. v. K.A.W., 575 So.2d 630, 633 (Fla. 1991); Metcalf v. Metcalf, 785 So.2d 747, 749 (Fla. 5th DCA 2001); Garner v. Somberg, 672 So.2d 852, 854 (Fla. 3d DCA 1996). We further decline to recede from those cases employing that irrefutable presumption even though the attorney with whom presumed confidences were disclosed is not subsequently employed. Metcalf, 785 So.2d at 749–50; Garner, 672 So.2d at 854; Dean v. Dean, 607 So.2d 494, 497 (Fla. 4th DCA 1992).

Can a Chinese Wall cure the conflict? NO

The Kluger Firm’s second line of defense comes up indirectly in the 3d DCA’s opinion. When the children initially lost their disqualification motion, they asked the trial court judge to stay the case pending their appeal. Trial court judge said no, but he did try to split the baby, ordering the specific attorney at the Kluger Firm who had previously conferred with counsel for the children to wall himself off from the rest of the firm when it came to this case.

In denying the Children’s stay request . . . the trial court ordered the Kluger Firm attorney—with whom the allegedly confidential information had been shared—not to participate in the case in any way and not to discuss the case with anyone at the Kluger Firm.

As law firms get bigger, it’s natural to assume just because you share confidential information with one lawyer doesn’t mean everyone else at the firm knows your business. But then again, we can’t be sure. Under 4-1.18(c) there’s no guess work, if one lawyer’s conflicted out, the entire firm’s out: “If a lawyer is disqualified from representation under this rule, no lawyer in a firm with which that lawyer is associated may knowingly undertake or continue representation in the matter.”

In other words, under 4-1.18(c) it’s all or nothing. The Chinese wall approach doesn’t work — either no one’s conflicted out or everyone’s conflicted out, but there’s no in between; at least not with the 3d DCA:

The trial court’s sequestration of the Kluger Firm attorney from other Kluger Firm members is simply irreconcilable with the trial court’s conclusion that no confidential information had been shared with the Kluger Firm attorney. Sequestration would not be necessary had no confidential information been disclosed. . . . In this case, the record plainly and irrefutably demonstrates that confidential information was shared with an attorney of the Kluger Firm. Because that attorney of the Kluger Firm was disqualified from representing Flores, no attorney of the Kluger Firm can represent Flores in this case.

Lesson learned?

As a practicing lawyer, one of the best risk-management tools available to you are the ethics rules. Not because you need someone to tell you it’s a bad idea to lie, steal or cheat; but because you need someone to point out the pitfalls that are NOT self evident. And to get the best thinking on how to apply our generally applicable ethics rules to the specifics of a trusts and estates practice, you’ll want to read the ACTEC Commentaries on the Model Rules of Professional Conduct.

For example, if, as in the Lopez case, you get a call from another lawyer in town who wants to talk to you about a possible case, ACTEC’s got some advice on how you might take that call without conflicting your firm out of ever representing the other side in that same case. By the way, I’m not sure ACTEC’s proposed solution would actually work in a Florida court room, but it’s worth considering.

ACTEC COMMENTARY ON MRPC 1.18

. . .

Lawyers Contacted by Other Lawyers as a Consultant. Another lawyer (the “consulting lawyer”) will occasionally contact the lawyer for advice concerning one of the consulting lawyer’s cases. When the consulting lawyer seeks advice concerning estate planning issues, given the non-adversarial nature of estate planning services, there is little risk of MRPC 1.18 precluding the lawyer from later representing a party adverse to the consulting lawyer’s client under the circumstances proscribed in MRPC 1.18. See Estate Litigation Lawyers and Prospective Clients above. When the consulting lawyer seeks advice concerning estate disputes, litigation or administration matters, whether the consulting lawyer’s client is a prospective client of the lawyer will depend on the facts and circumstances. Generally, if the consulting lawyer uses hypothetical questions and makes no promise to compensate the lawyer, the lawyer should not be precluded from representing a client adverse to the consulting lawyer’s client. Under those circumstances, the consulting lawyer’s client and the consulting lawyer do not have a reasonable expectation that the lawyer will consider that he or she is being asked to be a lawyer for the consulting lawyer’s client. However, if the consulting lawyer discloses the name of the client and other relevant facts or offers to pay for the advice obtained, depending on the facts and circumstances, the consulting lawyer’s client may be considered a prospective client of the lawyer. Thus, the lawyer may decide to limit the amount of confidential information disclosed by the consulting lawyer to prevent the disclosure of confidential information “significantly harmful” to the consulting lawyer’s client. This would protect the lawyer’s ability to represent a client adverse to the consulting lawyer’s client in the same or a substantially related matter.

Spradley v. Spradley, — So.3d —-, 2017 WL 913632 (Fla. 2d DCA March 08, 2017)

probate_court_doorYou’ll often hear lawyers speak in terms of suing “the estate,” or transferring property to “the estate,” or collecting a bill that’s payable by “the estate.” This kind of loose talk usually doesn’t matter, but sometimes it does. To be clear, under Florida law there’s no such thing as a separate legal entity known as an “estate.”

If you want to sue, get paid from, or transfer property to, an “estate,” all of that needs to happen via the estate’s court-appointed personal representative (PR).

Skip the PR and you could end up getting your lawsuit dismissed, which is exactly what happened in the linked-to case above. Lucky for the plaintiff the 2d DCA said that was a bit harsh, he should have been given a chance to amend his complaint and sue the right party. So saith the 2d DCA:

[T]o the extent that Mr. Spradley attempted to sue his mother’s estate, we find that the trial court erred in failing to grant Mr. Spradley leave to amend his complaint to substitute the proper party. Although there does not seem to be a Florida case directly on point, it is well-settled that “an ‘Estate’ is not an entity that can be a party to litigation. It is the personal representative of the estate, in a representative capacity, that is the proper party.” Ganske v. Spence, 129 S.W.3d 701, 704 n.1 (Tex. App. 2004) (citations omitted); see also § 733.608, Fla. Stat. (2016) (describing the general power of the personal representative); Reopelle v. Reopelle, 587 So.2d 508, 512 (Fla. 5th DCA 1991) (highlighting that only the personal representative of a decedent’s estate would have the right to intervene in litigation for the benefit of all the beneficiaries of the decedent’s estate); 31 Am. Jur. 2d Executors and Administrators § 1141 (2016) (“Since estates are not natural or artificial persons, and they lack legal capacity to sue or be sued, an action against an estate must be brought against an administrator or executor as the representative of the estate.”); 18 Fla. Jur. 2d Decedents’ Property § 721 (2016) (same). Here, Mr. Spradley not only failed to sue the proper party, but he also failed to allege that the estate had been opened and a personal representative appointed. Despite these deficiencies, the trial court should have granted Mr. Spradley leave to amend his complaint before dismissing his action. See Coby v. Food World, Inc., 746 So.2d 570, 572 (Fla. 1st DCA 1999); Reed v. Mims, 711 So.2d 169, 172 (Fla. 3d DCA 1998) (“[W]here it appears that a pleading’s deficiencies can be cured by an amendment, a reasonable opportunity for amendment should be allowed.”).

This should be basic stuff, but you’d be surprised how often lawyers (and judges) get this wrong. The next time that happens you’ll want to have this case handy.

Depriest v. Greeson, — So.3d —-, 2017 WL 672155 (Fla. 1st DCA February 21, 2017)

Safe driving strategy, woman properly grips car steering wheel, selective focus

One of the first things any beginning probate lawyer learns is to make sure no one’s driving the decedent’s car. Why? Because the estate can get sued if the car’s involved in an accident. The source of this liability is Florida’s “dangerous instrumentality doctrine,” which the 1st DCA defined as follows:

Florida’s dangerous instrumentality doctrine is a creature of common law that “imposes … vicarious liability upon the owner of a motor vehicle who voluntarily entrusts that motor vehicle to an individual whose negligent operation causes damage to another.” Aurbach v. Gallina, 753 So.2d 60, 62 (Fla. 2000) (citing S. Cotton Oil Co. v. Anderson, 80 Fla. 441, 86 So. 629, 638 (1920) (On Petition for Rehearing)). An owner voluntarily entrusts a vehicle to another when it gives that person authority to operate the vehicle by “either express or implied consent.” Id. (citing Hertz Corp. v. Jackson, 617 So.2d 1051, 1053 (Fla. 1993)).

In the probate context you usually don’t have to worry about actual consent (if someone asks, the answer’s easy: NO!), if your estate’s going to get sued it’s probably because your personal representative (PR) didn’t make sure no one could do something stupid with the decedent’s car while the PR wasn’t looking, which in legal parlance translates into implied consent. According to the 1st DCA, in implied-consent cases courts will focus on the following factors:

Most vehicle cases involving implied consent examine factors such as what a car owner knows about the driver’s prior use of the vehicle, the location and accessibility of the keys, the nature of any familial relationship between owner and driver, and the conduct of the parties after an accident occurs. Ming v. Interamerican Car Rental, Inc., 913 So.2d 650, 656 (Fla. 5th DCA 2005).

Case Study:

The decedent in this case and his wife lived with his adult daughter. His car and its keys were kept at his daughter’s house and she occasionally drove her father’s car with his permission. About a month after her father’s death daughter was driving his car and got into an accident. The decedent’s nominated PR was a step-son who lived in South Carolina. He hadn’t been appointed PR at the time of the accident.

Because a PR has no legal duties prior to his appointment, the nominated PR in this case had no duty to prevent his step sister from driving her father’s car. That fact determined the outcome of this case, so saith the 1st DCA:

We conclude that because Decedent’s stepson had no legal duty to prevent Decedent’s daughter from using Decedent’s car, Appellants cannot demonstrate implied consent, which is an essential element of their claim under the dangerous instrumentality doctrine.

But what about Florida’s relation-back doctrine, which allows nominated PRs to act on behalf of estates even before they’re actually appointed by court order (see here). If a nominated PR has the option to act, does that mean he can get sued if he didn’t jump into action the moment dad dies? NO:

To say that implied consent arises from a nominated personal representative’s failure to act . . . is to create a duty to act prior to appointment, directly contrary to the Probate Code’s distinction between authority and duty. § 733.601, Fla. Stat.; Richard, 193 So.3d at 968–69 [see here]. Appellants’ argument could subject nominated personal representatives to liability from which the Legislature intended to shield them in the period after a death and before issuance of letters of administration formally appointing them as personal representatives. The law does not impose such a duty on facts such as those presented here.

Lesson learned?

This was an unusual case; the accident happened in the gap period between the decedent’s death and the date his estate was opened and a PR was appointed. Once a PR’s appointed, everything changes. At that point you can’t sit on your hands and hope for the best, if anyone’s going to drive the decedent’s car you better make sure the PR and all the beneficiaries (i.e., the people who can sue him) are aware of the risks and are willing to accept them. Sometimes that makes sense; usually it doesn’t. In most cases you’ll want to make sure your PR takes control of the decedent’s car and actually prevents anyone from using it. If the PR doesn’t take steps to prevent anyone from driving the decedent’s car, consent could be implied. You’ve been warned.

In re Estate of Arroyo v. Infinity Indemnity Insurance Company, — So.3d —-, 2017 WL 192019 (Fla. 3d DCA January 18, 2017)

stop-goFlorida’s survival statute (F.S. 46.021) tells us that “[n]o cause of action dies with the person. All causes of action survive and may be commenced, prosecuted, and defended [against the decedent’s estate].” However, how you go about prosecuting a case changes dramatically after someone dies.

Before someone dies you usually only have to sue them in one courtroom. After they’ve died you’ll usually have to sue them in two separate court proceedings, often before two separate judges:

  1. First, you’ll need to litigate the merits of your case in the court in which you file your lawsuit (in post-death litigation this is where you establish the decedent’s liability; this case is considered an “independent action” and in larger circuits (like Miami) that have separate court divisions this part of your case usually plays out in the Civil Division, see here).
  2. Second, you’ll need to litigate your collection rights in the probate proceeding administering the defendant’s estate (in larger circuits having separate divisions this part of your case happens in the Probate Division). This is where you stake your claim to a piece of the probate “pot”.

Trap for the unwary:

The two-pronged process for litigating claims post death is a huge trap for the unwary. Why? Because you can spend years (and a fortune) litigating the merits of your independent action in the Civil Division and never be the wiser to the fact that you’ve forfeited your ability to collect on your judgment in the Probate Division because you’ve blown past F.S. 733.702‘s statute of limitations for probate claims and/or F.S. 733.710‘s 2-year “statute of repose” for probate claims; which means no matter how spectacular your win might be at trial, you’ll never see a dime because you can’t enforce your judgment in probate. Does this nightmare scenario ever actually happen? YES! see here, here.

One way to get around the ultra-short probate claims periods is to target non-probate assets. A life insurance policy, annuity contract or individual retirement account that is payable to a specific beneficiary is NOT a probate asset (the transfer’s self-effectuating, there’s nothing for a probate judge to do). The probate-avoidance strategy is most commonly used in cases where the plaintiff is going after the decedent’s insurance policy (a non-probate asset) instead of the assets of the decedent’s probate estate. Sounds good in theory, but does it work in real life? That’s the question answered by the 3d DCA in this case.

Case Study:

The backstory to this case involves a “Coblentz agreement, which is a type of settlement deal that lets you settle someone’s lawsuit against you while simultaneously throwing your own insurance company under the bus for refusing coverage and leaving you to fend for yourself. Here’s how this part of the story was summarized by the 3d DCA:

On February 11, 2011, Reyes filed a personal injury negligence lawsuit (“the negligence lawsuit”) in the circuit court against the Estate, but never filed a written claim in the probate court. Although the Estate tendered the defense of the negligence claim to Infinity, Infinity declined to defend the claim. In January 2013, the Estate settled the negligence lawsuit by entering into a Coblentz agreement with Reyes, in which Reyes and the Estate agreed to the entry of a consent judgment, Reyes agreed not to execute the judgment against the Estate, and the Estate assigned any rights it had against Infinity to Reyes. After Reyes and the Estate entered into the Coblentz agreement and obtained the consent judgment, Reyes sued Infinity in circuit court pursuant to the assignment of rights provision in the Coblentz agreement, alleging in part that Infinity had demonstrated bad faith by failing to defend the Estate in the negligence lawsuit (“the bad-faith lawsuit”).

Can I sue a decedent’s insurance company if my probate creditor claims are time barred? YES

The decedent died in 2009. The negligence lawsuit against his estate wasn’t filed until 2011, and the plaintiff never filed a creditor claim with the probate court. In short, the plaintiff’s claim against the estate was time barred. So does this mean the claim is dead? NO. Why? Because the plaintiff’s going after the decedent’s insurance coverage — which is a non-probate asset — which means the probate creditor-claim deadlines don’t apply. Bottom line, the lawsuit against the insurance company (Infinity) survives, so saith the 3d DCA:

We conclude that although . . . Reyes did not file a claim against the Estate in the probate court within the two-year limitations period, [his judgment] is enforceable against Infinity if coverage is established and there was no fraud or collusion. Our conclusion is fully supported by not only footnote 12 in May, but also by the Fourth District Court of Appeal’s decision in Pezzi v. Brown, 697 So.2d 883 (Fla. 4th DCA 1997).

In Pezzi, the Fourth District held that the plaintiff’s failure to comply with sections 733.702 and 733.710 did not place limitations on the plaintiff’s ability to recover against the decedent’s insurer. Id. at 886. Specifically, the Fourth District held that the jurisdictional limitation under section 733.710 “is specific to the decedent’s estate, the personal representative, and the beneficiaries; the limitation does not extend to the decedent’s insurance policy.” Id. at 885 (emphasis added).

In reaching this conclusion, the Fourth District was “guided by the principle that statutes restricting access to the courts must be narrowly construed in a manner favoring access.” Id. at 886 (citations omitted). Thus, the court held that while:

Section 733.10 represents a decision by the legislature that 2 years from the date of death is the outside limit to which a decedent’s estate in Florida should be exposed by claims on the decedent’s assets … [t]here is no indication that section 733.10 represented a legislative decision to undermine the rights of plaintiffs to recover under tortfeasors’ insurance policies.

Id. at 886 (quotations, citations, and emphasis omitted). . . .

In conclusion, the Fourth District in Pezzi held that, because the plaintiff was not seeking recovery from the estate’s assets, the personal representative individually, or the beneficiaries, “[n]either section 733.702 nor section 733.710 precludes plaintiffs from bringing this cause of action and recovering to the extent that [the deceased tortfeasor] was covered by liability insurance.” Pezzi, 697 So.2d at 886.

MEAC Opinion 2016-004 (Date Issued: November 6, 2016)

Handshake - Hand holding on black background

The vast majority of cases settle, and many of those deals get hammered out with the help of a Florida Supreme Court certified mediator (like yours truly).

What may come as a surprise to some is that certified mediator’s have their own set of mandatory ethics rules, which means we need to do things a certain way. And when we’re not sure what to do, the Florida Supreme Court’s Mediator Ethics Advisory Committee (MEAC) will issue advisory opinions upon request.

Case in point: What do the mediator ethics rules tell us to do when all sides agree they have a verbal handshake deal, but can’t get it all drafted and signed up before going home for the night? That’s the question dealt with in this MEAC opinion.

The ground rules:

We all know that a settlement agreement’s not binding unless it’s in writing and signed by the parties (and their counsel). So saith Fla. Civ. Pro. R. 1.730(b):

If . . . agreement is reached, it shall be reduced to writing and signed by the parties and their counsel, if any. . . . A report of the agreement shall be submitted to the court or a stipulation of dismissal shall be filed. . . . The mediator shall report the existence of the signed or transcribed agreement to the court without comment within 10 days thereof. No agreement under this rule shall be reported to the court except as provided herein.

And if you’re a certified mediator, Fla. R. Med. 10.420(c) says part of your job is making sure this all gets done right. Here’s the actual text of that rule:

The mediator shall cause the terms of any agreement reached to be memorialized appropriately and discuss with the parties and counsel the process for formalization and implementation of the agreement.

The dreaded “handshake” deal:

So what’s a mediator to do if you’re in that grey zone between a verbal understanding and a written contract? That’s not an uncommon occurrence. Larger, more complex cases often take all day to negotiate, it might be the middle of the night before all sides agree they have a handshake deal. By then everyone’s too tired and bleary-eyed to start drafting a written settlement agreement, but all sides are confident they do in fact have a deal. In this scenario should a mediator file a report saying the parties reached agreement (and hope the deal doesn’t fall apart during the drafting stage)? Or do you report NO agreement?

In MEAC Opinion 2016-004 we’re told the ethical thing to do is none of the above. Instead, as a mediator your job is to give all sides a fair chance to write up their contract and, to the extent your assistance is asked for, do what you can to help. Once the deal’s signed up, then you file your report with the court in accordance with Fla. Civ. Pro. R. 1.730(b). If after a while the lawyers report the deal’s fallen apart, then you report NO agreement. In the meantime, stand fast.

The way MEAC opinions work is that mediators submit specific questions and the committee responds with an answer to each question. Here are the specific questions and answers published in this opinion:

Question 1:

If Rule 10.420(c) states that a “mediator shall cause the terms of any agreement to be memorialized appropriately,” how does the mediator comply with Rule 10.420 without confirming that the verbal agreement is actually reduced to writing and signed?

MEAC Answer:

When mediating cases subject to the Florida Rules of Civil Procedure, a mediator cannot comply with rule 1.730(b) without confirming that the verbal agreement has been reduced to writing and signed by all parties and their attorneys, if any. The method by which the mediator complies with rules 10.420(c) and 1.730(b) together is determined by the mediator.

Question 2:

If Rule 1.730 requires an agreement to be reduced to writing and a mediator cannot file a report until that agreement is reduced to writing and signed, how does achieving a verbal agreement at mediation satisfy the mediator’s obligation to cause the agreement to be “memorialized appropriately?”

MEAC Answer:

Rule 1.730(b) cannot be satisfied by a verbal mediation agreement. In MEAC 2015-005, the Committee noted that rule 10.420(c) does not require the mediator to write something regarding the terms of the agreement prior to the close of the mediation session if the parties have agreed who will memorialize the agreement and the process for its formalization.

Question 3:

If a mediator has “an obligation” to comply with Rule 1.730, does the mediator have a responsibility under Rule 10.420(c) to follow up with the parties and their counsel to make sure the verbal agreement is actually reduced to writing and signed consistent with the requirements of Rule 1.730(b), Rule 10.520, and the Committee Notes for Rule 10.420?

MEAC Answer:

When mediating cases subject to the Florida Rules of Civil Procedure, the mediator has an obligation to follow up with the parties and their counsels to make sure the verbal mediation agreement is reduced to writing and signed by all parties and their attorneys, if any, prior to making a report to the court.

. . .

Question 5:

Rule 1.730(b) states: “No agreement under this rule shall be reported to the court except as provided herein.” If MEAC believes the mediator has “memorialized appropriately” the terms of the agreement by merely achieving a verbal agreement between the parties, what can the mediator report to the court pursuant to Rule 1.730(b) if the parties have not reduced their agreement to writing and secured the necessary signatures? Which rule or statute permits a mediator to report to the court the existence of a verbal agreement?

MEAC Answer:

In the example presented, the mediator would report “no agreement” under rule 1.730(b). There is no provision in Chapter 44, Mediation Alternatives to Judicial Action, or any Florida trial or appellate court procedural rule that authorizes a mediator to report a verbal mediation agreement to the court.

 

Allen v. Montalvan, — So.3d —-, 2016 WL 4547993 (Fla. 4th DCA Aug. 31, 2016)

children-court-systemTwo points to keep in mind when thinking about this case. First, most disputes — even those that end up in court — ultimately settle. Second, if you’re a trusts and estates lawyer sooner or later you’re going to have to deal with a dispute involving minors.

Which means you owe it to yourself to at least have a passing familiarity with the mechanics for settling disputes involving minors. Why? Because if you don’t get that process right the settlement deal you spent months hammering out may come back to bite you when you least expect it, as the parties in this case can attest to.

Case Study:

This case involves two minors injured in an automobile accident. Their parents/natural guardians entered into a pre-suit settlement agreement with the insurance company of the driver responsible for the accident. Under this deal the insurance company tendered $50,000 to settle all claims arising from the accident — including the minors’ claims — in exchange for releases from all concerned — including releases signed by the minors’ parents/natural guardians.

After finalizing the settlement deal on behalf of their minor children the parents apparently had a change of heart. They hired new attorneys who proceeded to sue on the claims they had just settled. Insurance company cried foul (surprise!), and the trial court agreed, tossing the new lawsuit on the grounds that these claims had just been settled on behalf of the minor plaintiffs by their parents/natural guardians. Not so said the 4th DCA.

Because the original pre-suit settlement hadn’t been blessed by a court in a proceeding in which the minors had been independently represented by a guardian ad litem (GAL), it was invalid — and non-binding — as a matter of law. The parents, as natural guardians, simply did not have the legal authority to bind their children in a settlement deal involving a total sum of $50,000 or more (even if most of the money is NOT going to the minors). Bottom line, the parents get a second bite at the apple; so saith the 4th DCA:

Section 744.3025(1)(b), Florida Statutes (2009), states that unless a guardian with no potential adverse interest to the minor has already been appointed, “the court shall appoint a guardian ad litem to represent the minor’s interest before approving a settlement of the minor’s claim in a case in which the gross settlement involving a minor equals or exceeds $50,000″ (emphasis added). . . .

Because the pre-suit settlement in this case involved minors and totaled $50,000 or more, the trial court was required to appoint a guardian ad litem to represent the children’s interests before approving a settlement that disposed of the children’s claims. See generally Sullivan v. Dep’t. of Transp., 595 So.2d 219 (Fla. 2d DCA 1992) (referencing other chapter 744 statutory provisions to arrive at the conclusion that, when the monetary threshold amount is met in a pre-suit settlement, the minor’s guardian (natural or appointed) must obtain the circuit court’s approval of the settlement). . . .

Because the proposed settlement did not comply with the requirements of section 744.3025, it was invalid as to the claims of the children. As such, the trial court erred by dismissing the children’s complaint based upon that agreement.

When are GALs mandatory?

But wait, argued insurance company, the minors’ claims alone didn’t settle for $50,000, that sum was part of a larger global deal that involved an adult killed in the accident, so the statutory threshold wasn’t triggered. Not so says the 4th DCA. Even if the minors’ portion of the deal didn’t add up to $50,000, if the total sum of the deal did, you still need a court-appointed GAL to validly settle their claims.

Further support for considering the full $50,000 as a single settlement “involving a minor” comes from the Florida Probate Rules. Rule 5.636(d), which was intended to mirror the requirements of section 744.3025, states:

The court shall appoint a guardian ad litem on behalf of a minor, without bond or notice, with respect to any proposed settlement that exceeds $50,000 and affects the interests of the minor, if:

(1) there is no court-appointed guardian of the minor;
(2) the court-appointed guardian may have an interest adverse to the minor; or
(3) the court determines that representation of the minor’s interest is otherwise inadequate.

Fla. Prob. R. 5.636(d). The committee notes for this provision provide a useful illustration.

The total settlement to be considered under subdivisions (d) and (e) is not limited to the amounts received only by the minor, but includes all settlement payments or proceeds received by all parties to the claim or action. For example, the proposed settlement may have a gross value of $60,000, with $30,000 payable to the minor and $30,000 payable to another party. In that instance the total proposed settlement exceeds $50,000.

So what’s the takeaway?

Most of us assume that parents who don’t have a conflict of interest with their minor children and are acting in good faith can settle their claims without going through the costs and delays inherent to getting court approval and appointing GALs for all the minors. That assumption, while intuitively appealing, is probably wrong once the sums at issue reach $15,000, and definitely wrong once a lawsuit’s actually filed and/or you’re talking about a settlement deal involving payments of at least $50,000 — even if most of the money is NOT going to the minors.

A good resource for figuring out the specifics of how this is all supposed to work in real life is Miami-Dade’s local rule for settling claims involving minors. See 2008 1-08-18 Standards and Procedures for Minor Settlement.

And for a general discussion of the ins and outs of settling claims involving minors, you’ll want to read Settlements Involving Minors by Miami probate attorney Elizabeth M. Hughes. Ms. Hughes does an excellent job of explaining Florida’s statutory thicket for settlement agreements involving minors, as well as providing a big picture explanation to put it all in context. Here’s an excerpt from Ms. Hughes’ article (which I highly recommend):

Minors are considered to be wards of the court and the courts are thus charged with responsibility for their welfare in many situations. As a result, . . . even though parents are jointly the natural guardians of their minor children, the status as natural guardian typically confers only custody of the person and not of the property. As natural guardians, parents typically have all the rights, duties, and powers that a guardian of the person would have but without most of the rights, duties, and powers of a guardian of the property. . . . [T]his lack of authority over the minor’s property rights means that parents, generally, do not have the legal authority to settle or compromise a child’s claim or to waive substantive rights without court approval.

By the way, the “price” for getting this all wrong may be more than just professional embarrassment, you might find yourself on the receiving end of your own lawsuit, which is apparently what happened in a scary 3d DCA case cited and summarized as follows by Ms. Hughes in footnote 31 of her article:

Auerbach v. McKinney, 549 So. 2d 1022 (Fla. 3d DCA 1989) (The acceptance of funds offered in settlement of a minor’s claim using an arrangement that circumvents the proper legal procedures may result in personal liability of the plaintiff’s counsel, restoration of funds improperly paid to the attorney, and legal malpractice liability. Attorneys had to return money meant for brain damaged minor client, where attorneys accepted payments from defendant’s insurers made out to attorneys rather than to the minor client without seeking court approval.).

Nelson v. Nelson, — So.3d —-, 2016 WL 7322546 (Fla. 2d DCA December 16, 2016)

header_28Multi-generational irrevocable trusts (often referred to as “dynasty” trusts) have always been around, but changes to federal estate tax laws in the mid-1980s sparked a huge surge in their popularity (see here). Ever since they’ve been the darlings of the estate planning world. And for good reason; these trusts allow families to transfer wealth over multiple generations free from the grip of creditors, the IRS, state and local tax authorities, litigators, and — perhaps most importantly — ex-spouses (see here, here).

What divorce attorneys need to know about irrevocable trusts:

Irrevocable trusts are so ubiquitous you need to assume they’re going to factor into most divorces involving high net worth individuals. And if an irrevocable trust is going to get dragged into divorce-related litigation it’s probably going to be for one of two reasons: alimony claims or property-division claims (i.e., equitable distribution).

In the Berlinger case the 2d DCA told us how irrevocable trusts can be pierced to collect unpaid alimony (see here). This time around the 2d DCA addresses the nuclear option: equitable distribution.

For irrevocable trusts equitable distribution is basically a death sentence. The court isn’t just exposing the trust’s assets to pay a certain debt (i.e., alimony); if a trust is subject to equitable distribution it gets terminated and its assets split up. Is this a viable threat in a Florida divorce proceeding? According to the trial judge in the Nelson case linked-to above the answer is YES. That result would shock most trust and estate lawyers.

Can a divorce court force you to terminate your irrevocable trust and split the assets with your ex’? 2d DCA says NO

In this case a husband and wife residing in Florida bought a second home in California and put this home into an irrevocable trust for the benefit of wife and her daughter from a prior marriage. During the divorce husband argued that because the trust was funded with marital assets it was subject to equitable distribution, wife said no way. Who won? Trial court said YES (big win for husband), 2d DCA said NO (bigger win for wife).

What’s seductive (and dangerous) about husband’s argument in this case is that it’s only half wrong. YES, under F.S. 61.075 assets acquired during a marriage are presumed to be marital assets. But NO, they don’t retain their marital-asset status once they’ve been gifted away, which is what happens when a marital asset is transferred to an irrevocable trust. So saith the 2d DCA:

Although the California home became a marital asset pursuant to section 61.075(6)(a)(1)(a) at the time the Former Husband purchased the home and jointly titled it in the parties’ names, the California home ceased in character to be a marital asset upon its transfer into the Trust. At that point, the California home became part of the assets of the Trust, an entity distinct from the Former Husband and the Former Wife. See Juliano v. Juliano, 991 So.2d 394, 396 (Fla. 4th DCA 2008) (treating a trust as a distinct entity from husband settlor); 2 Brett R. Turner, Equitable Distribution of Property § 6:94 (3d ed. 2005) (providing that an irrevocable trust is a distinct entity capable of holding title to property). Transferring the home into the Trust placed the home beyond the trial court’s reach for purposes of equitable distribution. See Juliano, 991 So.2d at 396; In re Chamberlin, 155 N.H. 13,918 A.2d 1, 17 (2007) (holding that assets used to fund an irrevocable trust were not marital assets because they ceased being property belonging to either spouse once the assets were placed in the trust and beyond the reach of the parties).

. . .

Akin to assets owned by a corporation, limited liability company, or partnership “[t]he individual assets owned by an irrevocable trust are … ordinarily third-party property which cannot be divided upon divorce.” Turner, supra, § 6:94 (citing, inter alia, Seggelke v. Seggelke, 319 S.W.3d 461, 467 (Mo. Ct. App. 2010) (holding that a bank account owned by an irrevocable trust was not marital property); Wilburn v. Wilburn, 403 S.C. 372, 743 S.E.2d 734, 742 (2013) (noting that where spouses created an irrevocable trust, “the trust corpus is not the property of either spouse and thus cannot be marital property”)).

So what’s the take away?

Irrevocable trusts do shelter assets in the context of a divorce, but this shield isn’t foolproof (alimony claims remain viable) and these trusts remain subject to the same vagaries plaguing all litigants in our underfunded and overworked state court system (remember the trust failed at the trial court level in this case). So what’s the take away?

If you’re an estate planner, the message to your clients needs to be that while irrevocable trusts are crucial estate planning tools, they can’t do it all. If you want to be sure your trust doesn’t get sucked into a divorce there’s no substitute for a well drafted prenuptial agreement.

And if you’re a litigator, the lesson to be drawn from this case is that parties will continue to target trust assets in divorce proceedings for one simple reason — that’s where the money is! Vast sums of wealth are held in family trusts, and the size of these trusts is only getting bigger (see here).

In this case husband’s divorce counsel constructed an equitably compelling and technically creative argument for why the trust assets should have been split up in the divorce. And it almost worked. So don’t think for a moment this is the last we’ll see of this kind of attack on trust assets in divorce proceedings. When the next trust/divorce dispute comes along the 2d DCA’s opinion in this case will be required reading for all concerned.

Florida's-broken-sentencing-system
The Herald-Tribune analyzed millions of criminal cases from the past 12 years to build a first-of-its-kind database of Florida judges (see here), comparing sentencing patterns on everything from their age and previous work experience to their race and gender.

If you make your living in and around our courts — no matter what kind of law you practice — you’ll want to read the investigative reporting recently-published by the Sarasota Herald-Tribune. Their reporters documented clear patterns of racial bias in the way Florida state-court judges sentence black and white criminal defendants.

The Herald-Tribune analyzed millions of criminal cases from the past 12 years to build a first-of-its-kind database of Florida judges (see here), comparing sentencing patterns on everything from their age and previous work experience to their race and gender. What this kind of impressive data journalism does best is take the focus off of anecdotal sideshows (which make for good TV but accomplish little); shining a light instead on systemic patterns of behavior that only become apparent when you sift through millions of data points (yay! for newspapers).

The aspect of these stories I found most interesting is the reporting on how unconscious biases likely account for most of the discrepancies we see between how black and white defendants are treated by our judges. Here’s an excerpt from the lead story entitled Florida’s broken sentencing system:

“Every human has biases,” said Scott Bernstein, a judge for the 11th Circuit Court in Miami who teaches diversity to judges. “The goal is not to rid yourself of biases, but to be conscious of them. As judges, we know to set biases aside. But when you’re not aware that this is going on in your brain, that’s where trouble comes.”

As observed by state Sen. Audrey Gibson, “Nobody is going to say they have personal biases, but if you see it in black and white, you may think differently.” For example, consider the counter-intuitive findings reported in Race and politics influence judicial decisions:

The Herald-Tribune analyzed millions of criminal cases from the past 12 years [documenting] . . . that race, politics and gender steer most biases on the bench — but like all humans, judges are full of contradictions.

Black judges, for example, don’t always show empathy toward their own race. In fact, no group has a wider gap when it comes to sentencing black and white defendants than black Republicans.

They sentence criminals of their own color to nearly 70 percent more confinement than white defendants for third-degree felonies.

Judges also defy political stereotypes.

Some Democrats in liberal South Florida are harder on blacks than many Republican judges across the state. In Republican strongholds, like Pensacola, there are GOP judges who sentence more like Democrats.

And last but not least, as reported in Lawmakers call for more judicial oversight, this data-driven project may lead to the kind of important legislative reforms you simply can’t get by focusing on individual bad actors. Sounds good to me.

Smith v. Smith, — So.3d —-, 2016 WL 803625 (Fla. 4th DCA March 2, 2016)

Smith-guardianship-case
Glenda Martinez-Smith smiles as her husband Alan Smith opens his eyes while waiting for a doctor’s appointment at Holy Cross Hospital in Fort Lauderdale on April 1, 2015. As reported by the Palm Beach Post, the decision to annul their marriage is heading to the Florida Supreme Court. (Richard Graulich / The Palm Beach Post)

As Bette Davis once said, getting old ain’t for sissies. But it’s a whole lot easier if you’re married.

And while there’s all sorts of good research proving that loneliness kills (see here), the evidence is just as clear that a happy marriage — especially for the elderly — can save your life. As reported in How marriage can save your life:

In a vast array of scientific studies, over and over again, a happy union has been shown to benefit virtually every system of the body. It reduces the risk of heart attack and stroke. It triples a patient’s survival after bypass surgery. It lowers production of stress hormones, and boosts immune response. Married people are also less likely to drink and smoke. It’s accepted wisdom that one spouse will often die soon after the another; studies have confirmed this “widowhood effect.” . . .

Quite simply, if we could package it in a pill, marriage would qualify as a wonder drug. Finding a way to mimic the benefits of marriage could well be the most critical health challenge of our time.

Aside from all the health benefits of being married, whom we marry and when we marry them are decisions that are at the very core of our sense of autonomy and identity as adults. As noted by Judge Warner’s strong dissent in the linked-to case above:

The right to marry is a fundamental right, protected by the United States Constitution. See Obergefell v. Hodges, ––– U.S. ––––, ––––, 135 S.Ct. 2584, 2598, 192 L.Ed.2d 609 (2015):

Choices about marriage shape an individual’s destiny. As the Supreme Judicial Court of Massachusetts has explained, because “it fulfils yearnings for security, safe haven, and connection that express our common humanity, civil marriage is an esteemed institution, and the decision whether and whom to marry is among life’s momentous acts of self-definition.”

Id. at 2599 (quoting Goodridge v. Dep’t of Pub. Health, 440 Mass. 309, 798 N.E.2d 941, 955 (2003)).

It’s against this backdrop that the hotly contested Smith Guardianship has played out for years. At the center of this story is a couple that met late in life, fell in love, and married. What they didn’t expect were the often heart-wrenching complications that can come up when our private lives become the subject of public decision making in a contest guardianship proceeding.

Case Study:

Martinez and Smith first met each other in 2008, while Smith was still married to his first wife. Martinez and Smith vacationed together and eventually moved in together. The couple became engaged in 2009. Smith wrote letters to Martinez declaring his love and affection. He also executed a designation of health care surrogate and living will declaration, designating Martinez as his health care surrogate, as well as giving her power of attorney. He commenced divorce proceedings against his first wife.

In January 2010 Smith was involved in an automobile accident in which he suffered head trauma. As a result, his daughter filed a petition to appoint a guardian of the person and property for Smith. After the hearing on incompetency, the court found that Smith had “lessening of some cognitive functions possibly due to dementia that make him incapacitated, the nature and scope being that he is unable to manage his property and to contract.” The court also specifically found that “there is no incapacity on the part of J. Alan Smith that would warrant a guardian of a person.” Thus, the only rights which the court removed from Smith were the right to contract and to manage his finances.

For a bit of color commentary on the backstory to this case, you’ll want to read the reporting done by the Palm Beach Post (yay for newspapers!) in How professional guardian got marriage annulled:

Glenda Martinez-Smith found the love of her life as a senior citizen.

Martinez-Smith, 68, said she felt like she hit the lottery when she met retired Army Col. J. Alan Smith of Boynton Beach through a senior dating website. “It was like a fairy tale,” she recalls.

But the retired school teacher said their bliss was destroyed when a judge found her husband incapacitated after a car crash and appointed a professional guardian.

With the blessing of two Palm Beach County circuit court judges, the guardian put Smith, who had suffered a traumatic brain injury, in a nursing home, got Martinez-Smith banned from ever seeing him again and annulled the couple’s marriage.

“That was the most horrible day of my life, the day my marriage was annulled,” she said.

Besides annulling her marriage, one judge threatned her with arrest and another kicked her out of court. Still, Martinez-Smith persevered, winning appeal after appeal and wresting control back from the professional guardian.

While Martinez may have ultimately prevailed in wresting control of the guardianship, the 4th DCA delivered a crushing setback on the issue that probably meant most to Martinez personally: her marriage to Smith. According to the 4th DCA, it simply never happened.

No right to contract = no right to marry:

The trial judge never said anything about taking away Smith’s right to marry. But that’s what happened when he took away Smith’s right to contract. Under F.S. 744.3215(2)(a), once you lose your right to contract — your right to marry is automatically stripped away as well. Here’s the key text of the statute:

(2) Rights that may be removed from a person by an order determining incapacity but not delegated to a guardian include the right:
(a) To marry. If the right to enter into a contract has been removed, the right to marry is subject to court approval.

It’s this statutory “if-then” causal link that’s at the heart of this appeal. It was clearly an unintended consequence of the trial judge’s limited guardianship ruling. As the trial judge himself stated, he certainly thought Smith retained the right to marry after his guardianship ruling. Which is what Smith and Martinez did in 2011. Here’s what the trial judge had to say about Smith’s post-guardianship marriage to Martinez:

Mr. Smith is married, apparently to Ms. Martinez, . . . that right was not removed, and . . . she is able to provide companionship and companion care . . . Now for someone like Mr. Smith, it’s great that he has good doctors, good nurses, and people like that from a medical point of view, but that is not substitute [sic] for the type of personal ability that a spouse has to provide companion care to their spouse. Like it or not . . . she is his spouse, she certainly is hands-on and it is often when a spouse is in an impaired condition like that one of the real benefits, even to someone in Mr. Smith’s condition, is to still see his spouse, be able to know she’s there and benefit from that . . .

Practice tip: even if you and your trial judge are in agreement, if you’re wrong on the law you don’t get a pass if a new judge takes over or your case gets challenged on appeal. Which is exactly what happened in this case.

When a new judge took over the case and ruled — oops! — Smith’s 2011 marriage to Martinez was void, the 4th DCA agreed. And because the marriage was void, it can’t be ratified (i.e., made legal) by an after-the-fact court ruling. As far as the law’s concerned the 2011 “marriage” never happened. Here’s how the 4th DCA summed up its ruling:

A marriage entered into by a person with no right to marry is void. See Kuehmsted v. Turnwall, 103 Fla. 1180, 138 So. 775, 777–78 (1932) (marriage entered into by person lacking mental capacity to consent is void); Dandy v. Dandy, 234 So.2d 728, 730 (Fla. 1st DCA 1970) (marriage between parties was void because one of the parties was still legally married to another and thus lacked the right to marry again). Thus, it follows that in order to enter into a valid marriage, an incapacitated person who has had his or her right to contract removed must first ask the court to approve his or her right to marry.

Based on the foregoing, the court’s interpretation of section 744.3215(2)(a) was correct: at the time the Ward and Appellant married, the Ward had no right to marry as he had not obtained court approval. Therefore, the trial court correctly determined that the marriage was void.[FN1]

[FN1] As the marriage was void from the inception, Appellant’s argument that the court “ratified” the marriage by acknowledging it at the December 18, 2012 hearing is without merit. A void marriage, in legal contemplation, has never existed and, therefore, cannot be ratified. See, e.g., Arnelle v. Fisher, 647 So.2d 1047 (Fla. 5th DCA 1994) (discussing distinction between a void and voidable marriage).

So is this the end of the story? Maybe not. The 4th DCA’s certified this case for review by the Florida Supreme Court (see here).

Lesson learned?

There’s a good reason why estate planners do everything possible to make sure their clients can  privately manage their own affairs as they age. Our courts are overworked and underfunded (see here), which means they always need to be your choice of last resort. And even under the best of circumstances, the moment any of us steps into a courtroom, no matter how well meaning and professional everyone involved in that system might be, our private lives become matters of public adjudication. Which means that even though the judge and court-appointed guardians or court-appointed attorneys may all be “neutral” in the legal sense of that word, those same individuals can’t help but project their own — often unconscious (see here value judgments and biases on the people before them when deciding what’s in the “best interest” of an elderly ward.

Bottom line, when in doubt, stay out of court. Once you step into a courtroom, the law of unintended consequences looms large over everything. In this case Smith had executed two key documents: a power of attorney and a health-care surrogate designation; both identifying Martinez as the one person Smith wanted to be in charge of all of his finances and health-care decisions in the event of his disability. These estate-planning documents are specifically designed to keep people like Smith out of our guardianship courts. If these documents had been implemented as intended, Smith’s marriage to Martinez would likely have never become a matter of public adjudication. This case is a prime example of what can go wrong when good estate planning gets ignored in the often naive rush to get into court.

United Bank v. Estate of Frazee, — So.3d —-,  2016 WL 3745512 (Fla. 4th DCA July 13, 2016)

save on taxes word on laptop keyboard key business concept
Florida implemented mandatory e-filing on April 1, 2013. For everything you’ve ever wanted to know about e-filing in Florida, see here.

Sometimes you blow a deadline and the courts cut you a break (see here). Sometimes you’re not so lucky. This case is an example of the latter.

Florida implemented mandatory e-filing on April 1, 2013. Which means that if a document’s not e-filed, it doesn’t count (even if you made your filing the old fashioned way on paper). If you blow a deadline because you made some kind of e-filing mistake, you can throw yourself on the mercy of the court and ask for an excuse under Rule 2.525(d)’s as “justice” may require exception.

An appellate court’s going to reverse a trial judge’s call on your plea for mercy only if you overcome the almost impossibly deferential “abuse of discretion” standard of review. Which means if you’re a probate lawyer, you should assume you’re probably stuck with whatever your probate judge rules. And that’s exactly what happened in this case.

Case Study:

United Bank hired counsel to file two probate creditor claims on its behalf shortly after e-filing became mandatory in Florida. The bank’s filing deadline was May 15, 2013. The claims were first filed only in paper form on May 14th, but didn’t get properly e-filed until May 23rd. So which “filing” counted? Paper or electronic? According to both the probate judge and the 4th DCA, the only filing that counted was the electronic filing on May 23rd (which meant the creditor claims were filed late):

[A] statement of claim (which qualifies as a “document”), even if submitted in paper, is not filed unless it is electronically submitted or falls within one of the exceptions to electronic filing. When a clerk must accept a paper document under one of the exceptions to electronic filing set forth in Rule 2.525(d), the clerk must “immediately thereafter convert any filed paper document to an electronic document.” Fla. R. Jud. Admin. 2.525(c)(4) (emphasis added). Since “filing” is only accomplished through electronic submission (in the absence of a Rule 2.525 exception), a document is not actually “filed” when improperly submitted to the clerk in paper, and the clerk’s obligation to convert paper filings would not kick in.

. . .

Based on [a May 23rd] filing date, the claims were untimely. There were no circumstances meriting an extension “upon grounds of fraud, estoppel, or insufficient notice of the claims period.” § 733.702(3), Fla. Stat. Unless the court considered the Bank’s claims as having been filed when the Clerk received the paper filing on May 14th, the claims would be barred under the Probate Code.

Does lack of knowledge = justifiable excuse? NO:

OK, so maybe bank’s counsel mucked up the e-filings, but the paper filings were filed timely on May 14th. Did bank counsel get any credit for that? NO. Just because you make an honest mistake figuring out our e-filing rules doesn’t mean you’re going to get a do-over:

The court . . . noted that one of the exceptions in Rule 2.525(d) would allow it to accept the document as timely filed [on May 14th] where “justice so requires.” Fla. R. Jud. Admin. 2.525(d)(8). However, the court concluded that the failure to file was a result of the negligence and lack of knowledge of the attorney . . . and those excuses did not amount to justice requiring the court to allow the late filing of the claims.

Lesson learned?

There are two big risks probate lawyers need to worry about when it comes to Florida’s mandatory e-filing system: missing deadlines and confidentiality issues. This case is a prime example of what can go wrong if you blow a creditor deadline because you didn’t get the e-filing done right. We’ve yet to see someone get slammed for improperly filing confidential documents in a probate proceeding, but probate lawyers file confidential documents all the time, so it’s probably only a matter of time (don’t be the test case!).

For more on how not to run afoul of our e-filing confidentiality requirements, you’ll want to read Laird Lile’s excellent presentation entitled The e-Thics of e-Things, and for more on how e-filing in general shouldn’t be taken for granted by litigators, you’ll want to read E-Filing or E-Failure: New Risks Every Litigator Should Know.