Florida Probate & Trust Litigation Blog : Florida Probate Litigation, Will Contest Lawyer & Attorney : Juan C. Antúnez : Serving Miami, Jacksonville, Tampa Saint Petersburg, Orlando, Fort Lauderdale

When I wrote here about the brewing probate dispute involving Rosa Park's estate, I mentioned that contested guardianship proceedings are often simply precursors to the real battle: probate litigation. An on-going guardianship dispute that is now receiving national attention, as described in this New York Times article, also highlights a second issue driving many guardianship disputes: forum shopping. In this case, the family is split over whether a court in Texas or one in New Jersey should have jurisdiction over the dispute. The following are a few excerpts from the New York Times article:

Lillian Glasser, by all accounts, never intended to spend her twilight years in Texas. Or her $25 million fortune.

Beyond the personal drama, the case highlights the checkerboard practices of local probate courts, which govern the transfer of property from people who die or are declared incompetent. The courts are not federally regulated, but in response to a growing number of interstate disputes, the National Conference of Commissioners on Uniform State Laws is drafting nationwide probate standards similar to those in the field of child custody.

"These cases are popping up all over the country," said Terry Hammond, executive director of the National Guardianship Association, a nonprofit group of lawyers, social workers and other professionals seeking uniform standards. "The combination of the mobile character of society plus the demographics of an aging population combine to create a potentially volatile situation," said Mr. Hammond, a lawyer in El Paso who briefly represented Mrs. Glasser's son in the Texas dispute.

To Russell Verney, an investigator with Judicial Watch, which has been studying probate courts, the issue boils down to "forum shopping."

"In my opinion," Mr. Verney said, "this is a case about a resident of New Jersey who amassed her fortune in New Jersey and never indicated any interest in subjecting herself or her estate to the probate laws of Texas. If anyone has jurisdiction, it should be the State of New Jersey."

Sharon B. Gardner, a Texas lawyer representing Ms. Glasser's daughter and former guardian, Suzanne Matthews, has responded publicly to the charges being made against her client (and the jurisdiction of the Texas courts) in an e-mail message published here on the Wills, Trusts and Estates Prof Blog.

As reported here, in the latest turn of events the case has wound up in Federal Court, where a judge ruled yesterday. Here are a few excerpt from the linked-to story describing the judge's ruling:

In a sharply worded order that spanks the squabbling children of Lillian Glasser, the 85-year-old New Jersey woman mired in a nasty Texas probate struggle, U.S. District Judge Fred Biery took over a chunk of the complex case Wednesday.

Calling the dispute a "legal fratricide" between sibling rivals that has consumed millions of dollars in attorneys' fees, Biery's order said "the end result ... is the creation of a Glasser chess game in which Mrs. Glasser has become a pawn."

His ruling sends parts of the case back to Bexar County Probate Court where a trial will be held over who should become the guardian of Glasser and her $25 million estate. But because the principal parties come from three states, Biery kept control over other issues.

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Wilson v. Robinson, 2005 WL 3499495 (Fla. 5th DCA Dec 23, 2005)

F.S. § 744.312 lays out the statutory preferences and factors applicable in Florida regarding the appointment of guardians. In this case Robert Wilson appealed an order entered by Seminole County Judge James E.C. Perry denying his petition to be appointed plenary guardian of his wife, Beverly Wilson (who was incapacitated due to Alzheimer's disease), and, instead, appointing their daughter, Bambi Robinson, to serve as Ms. Wilson's guardian.

Although unclear from the opinion, it appears Ms. Wilson expressed a preference for the appointment of her husband as her guardian. On appeal, the Fifth DCA upheld the trial court's appointment of Ms. Wilson's daughter as plenary guardian based on the following:

"[I]n guardianship cases, as in other cases, discretionary acts are subject to the test of reasonableness, i.e., they must be supported by logic and justification for the result and founded on substantial, competent evidence." In re Guardianship of Sapp, 868 So.2d 687, 693 (Fla. 2d DCA 2004) (citing In re Guardianship of Sitter, 779 So.2d 346, 348 (Fla. 2d DCA 2000)); see generally Canova v. Smith ex rel. S.G.S., 854 So.2d 852 (Fla. 5th DCA 2003) (upholding a guardianship decision because it was supported by substantial competent evidence). Discretion is abused when no reasonable person would take the view adopted by the trial court. Canakaris v. Canakaris, 382 So.2d 1197, 1203 (Fla.1980).

The trial court's discretion in the selection of a guardian has been described as "limited discretion" in the sense that it must be exercised consistent with the Florida Statutes. See Poteat v. Guardianship of Poteat, 771 So.2d 569, 572 (Fla. 4th DCA 2000) (citing In re Castro, 344 So.2d 270, 271 (Fla. 4th DCA 1977)). (Emphasis added.)

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Fleming v. Demps, 2005 WL 3481367 (Fla. 2d DCA Dec 21, 2005)

In this case there was a dispute regarding whether $317,000 in a certain bank account belonged to the probate estate or the decedent's niece, Ms. Henrietta Fleming, the designated beneficiary of the account. This is the sort of issue probate judges deal with every day. Which may explain in part why Hillsborough Judge Rex Martin Barbas felt it was OK to enter a final judgment ruling in favor of the estate and against Ms. Fleming without conducting an evidentiary hearing.

Ms. Fleming appealed, and the Second DCA reversed the trial judge on the following due-process grounds:

Concerning the lack of an opportunity to be heard prior to entry of the final judgment, "[d]ue process requires that a party be given the opportunity to be heard and to testify and call witnesses on his behalf, and the denial of this right is fundamental error." Pettry v. Pettry, 706 So.2d 107, 108 (Fla. 5th DCA 1998) (citations omitted); see also Pope v. Pope, 901 So.2d 352, 353-54 (Fla. 1st DCA 2005) (same); Hinton v. Gold, 813 So.2d 1057, 1060 (Fla. 4th DCA 2002) (same). Here, the personal representative's motion of March 1, 2004, to determine who is the rightful owner of the funds and whether the funds should be administered as estate assets or otherwise distributed to the proper owner was resolved without giving Ms. Fleming any opportunity to be heard and to present evidence on the issues. (Emphasis added.)

Lesson Learned:

The probate-administration process is often criticized as being too slow and costly. In contested proceedings, this criticism can conflict with basic notions of fairness underlying every Floridian's due process rights. Hopefully the parties (and the trial judge) will realize this without having to incur the extra cost and expense associated with appellate proceedings.

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Demayo v. Chames, 2005 WL 3180187, 30 Fla. L. Weekly D2692 (Fla. 3d DCA Nov 30, 2005)

In December 2002 Henry DeMayo retained Deborah Chames and her law firm, Heller and Chames, P.A., to represent him in a post-dissolution proceeding to modify his child support and alimony obligations. The retainer agreement included the following clause:

It is specifically agreed that Heller & Chames, P.A. shall have and is hereby granted all general, possessory and retaining liens and all equitable, special and attorney's charging liens upon the client's interests in any and all real and personal property within the jurisdiction of the court for any balance due, owing and unpaid as well as a lien in any recovery whether by settlement or trial; and such lien or liens shall be superior to any other lien subsequent to the date hereof and that the client hereby knowingly, voluntarily and intelligently waives his rights to assert his homestead exemption in the event a charging lien is obtained to secure the balance of attorney's fees and costs. (Emphasis added.)

In October 2003 Miami-Dade Judge Robert N. Scola, Jr. granted Heller and Chames' request to withdraw from representing Mr. DeMayo and shortly thereafter entered a final judgment in the sum of $33,207.76 in favor of the law firm. The trial court expressly enforced the waiver provision of the retainer agreement.

On appeal, the Third DCA upheld the trial court's ruling on the following grounds:

[W]e see no reason why an owner of homestead property should not be able to waive [his constitutional right under Article X, Section 4 of the Florida Constitution against divestment of homestead property via a forced sale] if he so desires. As the Florida Supreme Court stated in Caggiano, 605 So.2d at 59,"the homestead exemption *** was intended simply to guarantee that the homestead would be preserved against any involuntary divestiture by the courts****" See also Havoco, 790 So.2d at 1022 ("The homestead guarantee uses broad language protecting the homestead from involuntary divestiture****"). Absent a plain and unambiguous statement in the Florida Constitution to the contrary, we decline to imply a prohibition against a voluntary divestiture of one's constitutional right to homestead protection.

Warning: see this post: on is own motion Third DCA reconsidered this case en banc and then completely reversed itself!

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Although many estate planning attorneys take pride in being trusted family advisors, there are certain boundaries that just shouldn't be crossed. Take secret sex tapes for example. Even if your client happens to be Britney Spears, no self-respecting estate planning attorney would ever allow secret sex tapes to be aired in his or her office.

Which, as reported here, is exactly what Ms. Spears is claiming in a $20 million libel lawsuit she filed against celebrity magazine Us Weekly, charging it published a false story reporting she and her husband, Kevin Federline, made a sex tape, had viewed it with their estate planning lawyers, and were worried about its release.

Here are a few excerpts from the linked-to story:

According to the lawsuit, the article was published Oct. 17 in the magazine's "Hot Stuff" column and claimed that Spears and her husband feared the release of a secret sex tape, which they had viewed with their estate planning lawyers.

The article stated that Spears gave a copy of the tape to the lawyers on Sept. 30 and that she and her husband were "acting goofy the whole time" while watching the video.

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File this particular probate litigation story under the "only in LA" category. As reported here, this gem of a case is on its way to California's Supreme Court. The following are a few excerpts from the linked-to story:

A nasty fight over $1.1 million between a dead man's daughter from a former marriage and his second wife -- allegedly a prostitute whom he was planning to divorce -- has landed in the [California] Supreme Court.

Soon after crane operator Raymond Corder died in a construction accident in May 2001, Shaoping "Sherry" Corder -- his wife of eight months -- and Lisa Corder -- his adult daughter from a first marriage -- filed wrongful death actions that were consolidated.

The two got a $1.1 million settlement, but couldn't agree how to apportion it. At a subsequent trial, Lisa Corder presented evidence that she and her father were very close and that he had been preparing to divorce his new wife because she allegedly was working as a prostitute against his wishes.

Giving the seemingly imminent divorce great weight, Orange County Superior Court Judge Randell Wilkinson allocated 90 percent of the settlement money to Corder's daughter and 10 percent to his second wife.

Probate litigation may be many things, but boring isn't one of them.

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Sheets v. Palmer, 2005 WL 3403620 (Fla. 1st DCA Dec 14, 2005)

In this case the parties settled a will contest by executing a settlement agreement that provided, in part, that the party challenging the will would

"receive a $38,500.00 credit from the Estate as a specific bequest made to him under the terms of the . . . [w]ill."

Apparently when the settlement agreement was signed the parties did not address if this "bequest" would bear any of the taxes and administrative expenses of the estate. Well, they should have. The residuary assets of the estate were insufficient to cover these expenses. As such, the personal representative said the $38,500.00 specific bequest would have to bear a proportionate share of these expenses. The will-challenger said NO, arguing the parties never intended that result. Duval County Judge James L. Harrison agreed.

The First DCA said not so fast, holding as follows:

• In the absence of specific language in the will voiding the statutory apportionment scheme, a probate court does NOT have the discretionary authority to relieve a specific bequest of its obligation to bear a proportionate share of estate taxes and administrative expenses, thus warranting reversal of this portion of the probate court's order. F.S. §§ 733.817(5)(a)1. and 733.805(1)(d).
• A probate court DOES have the discretionary authority to direct from what part of the estate attorneys' fees and costs shall be paid, thus these items could be allocated away from the settlement bequest. F.S. § 733.106(4).
• A probate court DOES have the discretionary authority to direct from what part of the estate interest and penalties on estate taxes shall be paid, thus these items could be allocated away from the settlement bequest. F.S. § 733.817(5)(g).

Lesson Learned:

It can be incredibly frustrating to find yourself in litigation after apparently settling a case in mediation. However, as this case makes clear, carefully drafting the settlement agreement is just as important as negotiating the underlying deal. If the parties had explicitly addressed in the settlement agreement whether or not the $38,500.00 specific bequest would have to bear a proportionate share of the estate's taxes and expenses, the acrimony, expense and delay associated with this post mediation litigation might have been avoided.

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Philip Bernstein's blog, The New York Probate Litigation Blog (catchy title!), reported here on this interesting New York Times article discussing one family's thoughtful approach to planning for the ultimate distribution of family heirlooms from one generation to the next. Here's what Phil had to say about the article:

The significance that family members may attach to relatively insignificant possessions can easily lead to huge disputes in the settling of an estate. An article by Margaret McCaffrey in the December 8th New York Times deals with this subject in humanistic rather than legalistic terms. Nevertheless, Ms McCaffrey's suggestions on how to anticipate and defuse the conflicts that can arise when adult children battle over the same item of jewelry or furniture can have a positive effect not only on the way in which family members treat each other after losing a parent or grandparent but also can reduce the chances that arguments over possessions may lead to more serious and more expensive legal conflicts.

In Florida, under F.S. § 732.515, parents can create "separate written statements" to dispose of family heirlooms. These statements must be referred to in your will, but they can be revised as often as you'd like without the signing formalities required for a will. All in all, a convenient tool that helps families avoid disputes over who gets the family china.

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As I previously reported here, two heirs to the Gannett newspaper sued West Palm Beach, Fla.-based Gunster Yoakley & Stewart alleging that the firm colluded with its client JPMorgan Trust Co., a subsidiary of New York City-based JPMorgan Chase & Co., in running up fees for planning and administering the estate of their father, Charles McAdam Jr., a Wellington resident who was worth more than $57 million when he died in 2003.

Well, as reported in this Palm Beach Post article, the suit has not gone well for Gunster Yoakley. In a move that sent Circuit Judge Jonathan Gerber back to the books to do legal research, the jury awarded the brothers $1.2 million -- $331,496 more than the heirs requested as damages for this portion of the case. The jury found that the firm breached its fiduciary responsibility and committed legal malpractice in its handling of the estate.

And there may be more bad news to come. In a related upcoming trial the Gannett heirs will be claiming another $7 million that they had to pay in taxes and fees because of other oversights made by Gunster Yoakley. "I'm confident that we will be successful," said attorney Steven Katzman, who represented the heirs. Calling the verdict "an aberration," Donald Beuttenmuller, the managing shareholder of Gunster Yoakley, said it will be appealed.

Lesson Learned:

Estate planning and probate administrations can be complex, high-stakes affairs that even the largest and most well respected law firms get burned by on occasion. This is no place for amateurs.

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K.A.S. v. R.E.T., 2005 WL 3179763 (Fla. 2d DCA Nov 30, 2005)

In the latest round in the battle by grandparents to obtain legal visitation rights with their grandchildren, the Second DCA held that guardians do not enjoy the same constitutional privacy rights natural parents enjoy regarding the care and custody of their children. As such, the constitutional privacy rights that have been the undoing of various legislative efforts to establish grandparent visitation rights in Florida simply do not apply. Bottom line, a Florida probate court has the legal authority to mandate grandparent visitations if such family contact is in the best interest of the ward.

The Second DCA explained the rationale underpinning its decision as follows:

The probate court's reliance on Sullivan and similar cases that have invalidated grandparent visitation statutes assumed that the appointment of the Ward's maternal grandparents as the guardians of his person transferred to them the parents' fundamental liberty interest to raise their children free from state interference in the absence of a compelling state interest. But the appointment of the Ward's maternal grandparents as the guardians of his person did not bestow upon them the constitutional privacy interest that natural parents enjoy regarding the care and custody of their children. See M.G. v. R.V., 58 P.3d 1145, 1147 (Colo.Ct.App.2002); In re Joshua S., 260 Conn. 182, 796 A.2d 1141, 1155-57 (Conn.2002); Casper v. Bushman (In re Guardianship of Wemark), 525 N.W.2d 7, 9 (Iowa Ct.App.1994); Luby v. Da Silva (In re Brown), 153 Wash.2d 646, 105 P.3d 991, 994 (Wash.2005). Therefore, Sullivan and the other cases that address grandparent visitation statutes are not controlling here. Likewise, a stepparent, custodian, guardian, or other person standing in loco parentis to a child does not acquire all of the rights or assume all of the obligations of a natural parent. It follows that a guardian of the person of a minor does not have the exclusive right that a natural parent would have to determine what persons may visit the child. See Reynolds, 141 P.2d at 503; Casper, 525 N.W.2d at 9; Luby, 105 P.3d at 994. In this case, the Guardians of the Person enjoy the care and custody of the Ward not because of the natural bond between parent and child but, rather, by virtue of their appointment by the probate court. Because the Guardians of the Person function as an arm of the probate court, they are subject to its supervision and control in the best interests of the Ward concerning what persons may visit him. (Emphasis added)

As this 2003 AARP article makes clear, grandparent visitation rights have been hotly contested in various states. This opinion is sure to draw much attention from advocates on both sides of this debate.

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Zoldan v. Zohlman, 2005 WL 3180190 (Fla. 3d DCA Nov 30, 2005)

The decedent was 90 years old when his 78 year old wife threatened to divorce him unless he signed an irrevocable contract requiring him to treat his step-daughter as an heir equal to his three sons under his will. Afraid he might be abandoned/divorced if he didn't comply, the decedent signed the contract. That was enough for Dade County Judge Herbert Stettin to invalidate the whole deal on undue influence grounds. The Third DCA said not so fast, reversing on the grounds that wanting to keep your wife happy does not undue influence make. Well, OK, that's not what they said exactly, but it's what they meant. The Third DCA's more judicious way of making the point was as follows:

The Florida Probate Code provides that a will is void, either wholly or in part, if its execution is procured by fraud, duress, mistake, or undue influence. § 732.5165, Fla. Stat. (2003). The undue influence required for invalidation of a testamentary document is conduct amounting to duress, force, or coercion to such a degree that the free agency and willpower of the testator is destroyed. Mere affection and attachment or a desire to gratify the wishes of one who is esteemed or trusted may not alone be sufficient to amount to undue influence. E.g., In re Peters' Estate, 155 Fla. 453, 20 So.2d 487, 492 (Fla.1945); Derovanesian v. Derovanesian, 857 So.2d 240 (Fla. 3d DCA 2003), rev. denied,868 So.2d 522 (Fla.2004); Raimi v. Furlong, 702 So.2d 1273, 1287 (Fla. 3d DCA 1997); Coppock v. Carlson, 547 So.2d 946 (Fla. 3d DCA 1989); and cases cited therein. (Emphasis added)

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Snell v. Guardianship of Snell, 2005 WL 3159591 (Fla. 1st DCA Nov 29, 2005)

In the rush to "do the right thing" in guardianship proceedings, sometimes little niceties such as "due process" get overlooked. In this case Duval County Judge Jean M. Johnson ruled on a fee petition filed pursuant to F.S. § 744.108(1) by counsel for a former guardian. The former guardian did not attend the fee-petition hearing (although he received notice of the hearing, there was no indication that he might be surcharged), and during the course of the hearing there was absolutely no discussion regarding possibly surcharging the former guardian for overpayments.

The trial judge subsequently ruled that because the amount of fees and costs being awarded was less than the amount already paid to counsel, the overage could be recovered directly from the former guardian. The First DCA reversed noting that under Florida Probate Rule 5.025 proceedings to surcharge a guardian are treated as adversary proceedings requiring formal notice and an opportunity to be heard.

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DeMello v. Buckman, 2005 WL 2990487 (Fla. 4th DCA Nov 09, 2005)

When advising parties involved in trust litigation there are two fronts I like to focus on: (i) the legal substance of the case and (ii) what I refer to as "capturing the moral high ground." Being right on the law is crucial, although not always sufficient. When in doubt, the litigant occupying the moral high ground is much more likely to get the nod from the trial judge (and the other side is just as likely to get hammered).

This case deals with the suit by one sister against another sister as trustee of their deceased parents' inter vivos trust. I'll leave it up to you to decide who captured (or lost) the moral high ground here before Broward County Judge Mark A. Speiser. Fortunately for the losing side, however, the Fourth DCA reversed most of the trial judge's final judgment on appeal (lesson learned: sometimes it pays to appeal). The most interesting issues addressed by the Fourth DCA were the following:

• Courts have a limited role in supervising the exercise of a trustee's discretion, thus warranting reversal of the trial judge's award of damages for selling a residence owned by the trust for less than the contesting trust beneficiary thought the house should have been sold for.

The court has a limited role in supervising the exercise of the trustee's discretion. As stated in Scott on Trusts: [T]he court will not control [a trustee's] exercise of [discretion] as long as he does not exceed the limits of the discretion conferred upon him. The court will not substitute its own judgment for his. Even where the trustee has discretion, however, the court will not permit him to abuse the discretion. This ordinarily means that so long as he acts not only in good faith and from proper motives, but also within the bounds of a reasonable judgment, the court will not interfere; but the court will interfere when he acts outside the bounds of a reasonable judgment. In other words, although there is a field, often a wide field, within which the trustee may determine whether to act or not and when and how to act, beyond that field the court will control him. How wide that field is depends upon the terms of the trust, the nature of the power, and all the circumstances. (Footnote omitted). 3 Austin Wakeman Scott & William Franklin Fratcher, The Law of Trusts § 187 (4th ed. 1988).

A recent Florida Bar Journal article I wrote about here provided a comprehensive survey of current Florida law on this subject.

• Under Florida Civil Procedure Rule 1.120(g), "special damages" must be specially plead in the complaint. It is not uncommon to seek compensation for lost income arising from trustee mismanagement. Here's what the Fourth DCA had to say about special damages in this case:

The court awarded three items of damage to Buckman: (1) mortgage payments not received in the amount of $33,832.89; (2) foregone investment income on mortgage down payment not received in the amount of $3,928.50; and (3) foregone investment income on other mortgage payments not received in the amount of $821.88. Even if we were to decide that these were compensable items of damage, which we do not decide, none of these items of damage were specially pleaded in the complaint, and all of them constitute items of special damage. Therefore, Buckman is not entitled to recover these items of damage.

• In the absence of contrary evidence, it was improper to award as damages the trust's payment of legal fees incurred by the trustee in the administration of the trust prior to litigation, especially if the amount is within that deemed presumptively reasonable by F.S. § 737.2041.
• In the absence of contrary evidence, it was improper to award as damages the trust's payment of the CPA who prepared the tax return for the trust. The Fourth DCA specifically noted that trustees are obligated under F.S. § 737.402(u) to file tax returns and pay taxes on the trust, as well as authorized under F.S. § 737.402(2)(y) to hire accountants.

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I've been consumed by work on an appellate brief, which kept me away from the blog. During my absence Florida's appellate courts have been busy publishing probate-related opinions. I've listed the four newly published opinions below and intend to have write ups for all four of them soon. Stay tuned!

• DeMello v. Buckman, 2005 WL 2990487 (Fla. 4th DCA Nov 09, 2005)
• Snell v. Guardianship of Snell, 2005 WL 3159591 (Fla. 1st DCA Nov 29, 2005)
• Zoldan v. Zohlman, 2005 WL 3180190 (Fla. 3d DCA Nov 30, 2005)
• K.A.S. v. R.E.T., 2005 WL 3179763 (Fla. 2d DCA Nov 30, 2005)

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