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

This was too good to pass up during tax season. You know the apocalypse will soon be upon us when someone actually figured out how to make taxes . . . funny?! Stop everything and go to Taxalicious this moment to judge for yourself. This post, which I've reprinted below, gives you a sense of the blog's take on taxes.

Letterman's: Top Ten Dumb Accountant Tax Tips

10. Don't file a W-2 form unless your name begins with "W"

9. Answer every question "Wouldn't you like to know?"

8. Hide all money in mattress, on return write "No money hidden in mattress"

7. If you've just eaten, don't do taxes for at least half an hour

6. Hire yourself as an employee, fire yourself, sue yourself for discrimination, deduct court costs

5. Report $1 billion income so IRS will think you're some sort of big shot

4. For "charitable contributions," list $9 you spent on last Kevin Costner movie

3. Request bonus deduction because "easy" misspelled on 1040-EZ form

2. To distract the auditor, enclose a photo of yourself naked

1. Remember, you can't spell "taxes" without "CPA"

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The on-line version of the Minneapolis/St. Paul Business Journal reported on this phenomenon here, providing national statistics that should be of interest to Florida probate attorneys. The following are portions of the article I found most interesting:

The perfect storm

The reasons for the flurry of trust-and estate-related legal battles are many.

According to an article in the Dispute Resolution Journal, an estimated $41 trillion of wealth will be transferred in the United States from the "Greatest Generation" to their kids, the baby boomers, between 1998 and 2052.

The massive transfer in wealth alone is enough to spur more family feuds, Godfrey said.

Increasingly complex family compositions makes disagreement even more likely. Disputes often arise between children and second spouses as well as between children of different marriages, said Jim Clay, a partner in the Trusts and Estates Department at Rider Bennett in Minneapolis.

That's what's happening in the Anna Nicole Smith case being heard by the U.S. Supreme Court. In that case, Smith is trying to claim part of the inheritance of her late husband, Howard Marshall, a Texas oil tycoon. Smith alleges that Marshall's son, Pierce, destroyed documents, thus interfering with her expected inheritance. Pierce denied the allegations and said Marshall left Smith nothing in his will.

Some lawyers say baby boomers seem much more willing to air their family problems in court than their parents were.

Well-publicized trials also contribute to the rise in demand for estate litigation.

In the Binger case, the family disputed the former Honeywell chairman's decision to amend his will two months before he died in November 2004 to give about $40 million to $50 million of his $200 million estate to Jane K. Mauer after his death. Mauer was his family's wealth manager with whom he also had a close personal relationship. The family objected to that gift, arguing that Mauer manipulated Binger into giving it to her. Mauer says that's not true. Dorsey & Whitney attorney Greg Weyandt, a member of the firm's trust-and-estate litigation practice, represented the Binger family.

"I've gotten calls from people who said they read about some other case in the newspaper and it made them think they may have a claim," said Alan Silver, a litigator with Minneapolis-based Bassford Remele.

Lack of trust in the trustee

Disputes among family members -- or families vs. other beneficiaries -- aren't the only conflicts spilling over into the courtroom.

Battles between beneficiaries and trustees are becoming increasingly common.

The economic downturn of 2001 seems to have had something to do with the popularity of this kind of case.

"We had a significant decrease in the market and if trustees didn't have a diversified portfolio or weren't doing everything they should have been doing as trustees, there's always the potential of being sued by beneficiaries," Clay said.

A classic example of this kind of dispute is the clash between the heirs to the Minneapolis Creamette fortune and Lowry Hill, the trustee to the 48-year-old family trust. In that case, the family of Creamette founder James T. Williams, represented by Silver, alleged that Lowry Hill failed to properly manage the trust's stock portfolio and caused a $13.3 million decline in the value of the trust. Lowry Hill officials maintained they handled the trust prudently. The trial court awarded the Williams family $5.4 million plus attorneys fees and return of trustees fees. The Minnesota Court of Appeals set aside the award and sent the case back to the trial court for further proceedings. The parties ultimately resolved the case out of court on a confidential basis.

Beneficiaries also may sue a trustee for failing to properly execute the orders of a trust.

Silver litigated one such case that was decided by the Minnesota Court of Appeals in 2004. In that case, Ruben Divine left his assets to his son, Perry, and to his wife and left strict instructions as to how that money was to be distributed. Perry Divine argued that the trustees abused their discretion in allowing the distribution and took them to court, but a Ramsey County District Court judge disagreed with Divine. Divine tried to get that decision reversed by the Court of Appeals, but failed.

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Somogyi v. Nevai, __ So.2d __ (Fla. 4th DCA Feb 22, 2006)

In the probate context it is not unusual to have multiple orders entered prior to completion of the estate administration that are subject to appeal under Florida Probate Rule 5.100 and Florida Rule of Appellate Procedure 9.110(a)(2). The Committee Note for the 1996 amendment to Florida Rule of Appellate Procedure 9.110(a)(2) recognizes this reality, and addresses it head on, stating in part as follows:

The addition of new subdivision (a)(2) is a restatement of former Florida Rule of Probate Procedure 5.100, and is not intended to change the definition of final order for appellate purposes. It recognizes that in probate and guardianship proceedings it is not unusual to have several final orders entered during the course of the proceeding that address many different issues and involve many different persons. An order of the circuit court that determines a right, an obligation, or the standing of an interested person as defined in the Florida Probate Code may be appealed before the administration of the probate or guardianship is complete and the fiduciary is discharged.

So every time the probate court issues an order, the attorney needs to immediately ask him or herself whether that order is subject to appeal under the special rule applicable to probate proceedings. The answer is not always clear (when in doubt, the prudent approach is to file the appeal and let the appeallate court determine the issue). In this case the question was whether an order denying a motion to dismiss was subject to appeal. The Fourth DCA said NO in the following one-paragraph opinion:

PER CURIAM.

We grant appellee's motion to dismiss this appeal for lack of jurisdiction. The "Order Denying Motion to Dismiss Petition for Revocation of Portions of Will and Related Relief" does not finally determine a right or obligation of an interested person under Fla. R.App. P. 9.110(a)(2), where it merely denies a motion to dismiss and does not revoke the probate of the will. See Sanchez v. Masterhan, 837 So.2d 1161 (Fla. 1st DCA 2003).
Dismissed.

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Benedetto v. Columbia Park Healthcare Systems, __ So.2d __ (Fla. 5th DCA Mar 10, 2006)

The question of whether a person should be required to hire a lawyer if he or she wants to petition a court to probate a will has been the subject of a good amount of blogosphere commentary lately. Texas law professor Gerry W. Beyer has covered the issue on his blog Wills, Trusts & Estates Prof Blog (see here, here, and here) and Chicago-area probate attorney Joel A. Schoenmeyer has done the same on his blog Death and Taxes - The Blog (see here and here).

In Florida, the answer is simple: with limited exceptions, every guardian and personal representative MUST hire a lawyer. That's the lesson to be drawn from the Fifth DCA opinion cited above. In this case the Fifth DCA was unable to tell from the record on appeal whether the personal representative was the "sole interested person" in the estate (thus qualifying for the exception to the general rule requiring representation) or not. If the personal representative was not the "sole interested person" in the estate, then his appeal was subject to dismissal. Here's how the Fifth DCA explained the law in Florida on this point:

Florida Rule of Probate Procedure 5.030(a) provides in relevant part as follows:

(a) Required; Exception. Every guardian and every personal representative, unless the personal representative remains the sole interested person, shall be represented by an attorney admitted to practice in Florida. A guardian or personal representative who is an attorney admitted to practice in Florida may represent himself or herself as guardian or personal representative.

Because an independent action on behalf of an estate is ancillary to the estate administration, this rule governs both the estate administration itself and any independent proceedings prosecuted or defended by the estate. Thus, unless Appellant is the "sole interested person," as defined by law, he is precluded from maintaining this appeal without counsel. See, Dimitroff v. Taylor, 651 So.2d 131 (Fla. 2d DCA 1995). See also § 731.201(21), Fla. Stat. (2005) (defining "interested person").

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Simpson v. Estate of Simpson, __ So.2d __ (Fla. 5th DCA Feb 17, 2006)

In this case the personal representative of the estate knew that her nephew was claiming he was entitled to an ownership stake in a citrus business owned by the decedent. Nephew never received the notice-to-creditors mandated by F.S. § 733.701. Nephew filed a petition under F.S. § 733.702(3) seeking an extension of time to file his claim against the estate based on the estate's failure to provide the statutorily required creditors' notice.

The evidentiary hearing on Nephew's petition for extension of time did not end well for him. Unfortunately Lake County Probate Judge Mark J. Hill failed to distinguish between (1) a proceeding to determine Nephew's entitlement to an extension of time vs. (2) a proceeding to determine the validity of his claims. According to the Fifth DCA, the undisputed evidence presented at the hearing established that Nephew was a "reasonably ascertainable" creditor who was not given notice, and thus entitled to an extension of time to file his claim against the estate.

The undisputed evidence establishes that Mark's claim was not only reasonably ascertainable, it was known to Anita. Robert testified that shortly after Jim died, Anita said to him, "We've got to make sure Mark gets his stock." However, after Mark turned 21 on September 17, Anita changed her position, stating, "I can't do anything to get the stock to Mark for his 21st birthday because it's all tied up in the probate court, and we can't touch it." Then, on October 2, 2001, Robert wrote a letter to Anita asking her to give Mark the 10.5 shares of stock. Clearly, Anita had actual knowledge of Mark's potential claim.

Once the evidence established that Nephew was entitled to file his claim, the probate court should have stopped there and let the parties fully litigate Nephew's claim in a separate independent action. That's not what the probate court did. Which was reversible error according to the Fifth DCA:

Instead of ending its inquiry there, the probate court proceeded to determine the validity of Mark's claim. Under the applicable probate statutes, the merits of Mark's claim should have been determined in an independent action. In disputes over the validity of timely filed claims, section 733.705(4) requires the claimant to "bring an independent action upon the claim" if an objection to the claim is served. Section 733.705(5) contemplates the use of an independent action after the probate court permits the filing of an untimely claim. It states, "A claimant may bring an independent action or declaratory action upon a claim which was not timely filed pursuant to s. 733.702(1) only if the claimant has been granted an extension of time to file the claim pursuant to s. 733.702(3)." The term "independent action" requires the filing of a separate action upon a claim against the estate. In re Pridgeon's Estate, 349 So.2d 741 (Fla. 1st DCA 1977). This requirement allows pleadings and responses sufficient to set the issues before the court prior to hearing. In re Fornash's Estate, 372 So.2d 128, 129 (Fla. 2d DCA 1979).

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British Aristocrat Turns to "Apprentice"-style Reality TV Program in Hunt for American Heir

Proving once again that tacky U.S. pop culture ideas never die, they just morph into new versions of themselves around the globe, Sir Benjamin Slade, British aristocrat and heir to a $13 million estate, doesn't just want to give his estate away to any old Yank, he wants a group of hardy souls to trek to his 13th-century manor house in North Newton, England, and allow themselves to be "ejected," apparently while being filmed for TV, from contention with his own variation on "The Donald's" now-famous you're fired line: "You're disinherited!"

Sir Slade's line doesn't seem to have quite the same "humph" to it that Donald's catchphrase does, but it certainly is off the charts on the "eccentricity" scale (maybe that's the problem?). This story was reported here in the New York Times. The following are excerpts from the linked-to story (note the litigation angle):

NORTH NEWTON, England, March 2 -- WANTED: Heir for $13 million estate, including 13th-century manor house, in bucolic Somerset. Must be able to pay $140,000 annual upkeep and meet incidental costs of, for example, repairing the driveway ($70,000) and fixing the stables ($1 million).

Also, "He can't be a drug addict," said Sir Benjamin Slade, the current owner of the estate and its manor, Maunsel House, which has been in the family since 1772. "He can't be a Communist. It's politically incorrect to say so, but he can't be gay, because he may not produce any children."

The problem, said Sir Benjamin, who is 59 and childless himself, is that none of his army of relatives is willing to take on the property when he dies. So he is searching for an heir in America, where some Slades settled in the 18th century.

"Americans have more energy and a better work ethic," he said, sipping tea in his sumptuous library. ("There are no bookcases, because my family was illiterate," he said.) Paintings of ancestors plastered the walls; a fire roared in the hearth; a leak dripped steadily from the ceiling.

Sir Benjamin has a ready store of scandalous stories about his ancestors, to whom he refers in the first-person plural. Many of his tales have to do with the Slade habit of losing money in inheritance-related disputes. The hardest fought of these, perhaps, was between a set of male Slade twins in the 19th century, only one of whom could be the heir.

"The problem was that no one knew who popped out first," Sir Benjamin said. The ensuing suit -- Slade v. Slade -- cost a fortune in legal fees, adding to the family's financial woes. "We were absolutely stuffed," Sir Benjamin said.

He got the idea for the heir hunt when an American television company, researching a program about Britons' American relatives, got in touch.

The television company -- which Sir Benjamin said has asked him not to discuss too many details -- is now hoping to turn the search into an "Apprentice"-style reality program, in which potential heirs would live at Maunsel House and undergo a series of challenges, with Sir Benjamin eliminating them one by one.

Sir Benjamin is looking forward to ejecting the losers with his own aristocratic catchphrase: "You're disinherited."

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Roberts v. Sarros, __ So.2d __ (Fla. 2d DCA Feb 15, 2006)

Probate appellate decisions come in all flavors. Some sparkle with creative lawyering by one of the advocates (see here), some can make you dizzy following the appellate court's complex but ultimately convincing line of reasoning (see here), and some just get the job done. This is one of those cases that just get's the job done. No fireworks, just good lawyering and solid guidance for us practitioners.

In this case the Second DCA walks us through an exercise probate lawyers encounter every day: how to read or "construe" a trust agreement.

Step 1: Zero in on the problematic language. I say problematic because no matter how ambiguous a provision may be, it doesn't really matter if it has no impact on any of the interested parties. In this case the problematic language revolved around whether a surviving widow had the authority to revise a trust agreement after her husband had passed away. Surviving widow signed a trust amendment disinheriting one set of her grandchildren. Grandchildren understandably didn't think this was a good idea, and the case ended up in court. Here's the "problematic" language, as described by the Second DCA:

Article XV of the Trust provides, "AMENDMENT AND REVOCATION: This Trust is subject to revocation, change or amendment, in writing, by the Grantors from time to time." Article XII contains rules of construction for the Trust instrument, including the following provision that is pertinent to this appeal: "Unless the context required [sic] otherwise, masculine personal pronouns include the feminine, and the singular and plural may be construed interchangeably."

Step 2: Identify the applicable law. Here's what the Second DCA had to say about the law in Florida applicable to trust-construction disputes:

This court has recognized that "[t]he polestar of trust interpretation is the settlors' intent." L'Argent v. Barnett Bank, N.A., 730 So.2d 395, 397 (Fla. 2d DCA 1999). If the trust language is unambiguous, the settlors' intent as expressed in the trust controls and the court cannot resort to extrinsic evidence. Id.; Ludwig v. AmSouth Bank of Fla., 686 So.2d 1373, 1376 (Fla. 2d DCA 1997). In determining the settlors' intent, the court should not "resort to isolated words and phrases"; instead, the court should construe "the instrument as a whole," taking into account the general dispositional scheme. Pounds v. Pounds, 703 So.2d 487, 488 (Fla. 5th DCA 1997); see also L'Argent, 730 So.2d at 397.

Step 3: Apply law to the facts. At the trial court level the judge ruled that surviving widow lacked the authority to amend the trust agreement. The trial court agreed with the disinherited-grandchildren when they argued that use of the plural form "Grantors" in the trust-amendment section meant widow lacked authority to unilaterally amend the document. The Second DCA reversed, based on the following line of reasoning:

[I]n considering the trust instrument as a whole, it is clear that if the singular/plural clause were not applied, it would produce absurd results. Every reference in Article I is to the plural form "Grantors." Article I deals with the disposition of principal and income of the Trust to the Grantors during their lifetime. If the references to the "Grantors" were construed to mean only the plural form, then after the death of the first Grantor the surviving Grantor could no longer receive income from the Trust. Such a result is contrary to the stated purpose of the Trust, which is to provide for the McNeills "for so long as they may live." Article I also provides that "the Trustees shall make payments from the principal of the Trust Fund to or for the benefit of the Grantors in such sums and at such times as the Grantors may request from time to time." Again, if construed to mean only the plural "Grantors," then the surviving Grantor would have no access to the principal of the Trust even though the trust was established to provide proper care for the McNeills and to allow them to maintain "a style of living to which they have been accustomed."

Like Article I, Article XV must be construed in accordance with the singular/plural clause. This is consistent, as in Article I, with the overall plan that the Grantors retain control over their assets as long as either of them lived. Nothing in the context of Article XV requires that "Grantors" be construed to mean only the plural form. When construed to include the singular "Grantor," Louise M. McNeill, as the surviving Grantor, could amend the Trust pursuant to the power to revoke or amend contained in Article XV. Thus, we reverse the trial court's order granting summary judgment as to count I and determining that the Amendment by Louise M. McNeill was invalid and remand for further proceedings on the Appellees' complaint.

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