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

Greene v. Borsky, --- So.2d ----, 2007 WL 2119215 (Fla. 4th DCA Jul 25, 2007)

Whether a particular type of order is subject to appeal can have a huge impact on how a case is litigated.  In this case, the issue was whether a trial court's order permitting trustees to pay their legal fees with assets of the trust was subject to appeal.  The 4th DCA said YES.  Thankfully!

Here's how the 4th DCA explained it's ruling:

The orders in this case are appealable non-final orders under Florida Rule of Appellate Procedure 9.130(a)(3)(C)(ii). Rule 9.130(a)(3)(C)(ii) provides that appealable non-final orders include those that determine “the right to immediate possession of property .” This Court has previously held that a sum of money is property to which Rule 9.130(a)(3)(C)(ii) can apply. In Florida Discount Properties, Inc. v. Windermere Condominium, Inc., 763 So.2d 1084 (Fla. 4th DCA 1999), a lessor filed a motion to have disputed rent paid into the registry of the court. Id. at 1084. The trial court denied the motion, and the lessor appealed. Id. On appeal, this Court concluded that the order was an appealable non-final order under Florida Rule of Appellate Procedure 9.130(a)(3)(C)(ii), because it determined “the right to immediate possession of property, i.e., the rent payments.” Id. Likewise, in the present case, the trial court orders determined the right to immediate possession of property, here trust assets to be used by trustees to pay for attorney's fees and witness fees expended in defense of the trust. As such, we conclude that this Court possesses jurisdiction over this appeal under Florida Rule of Appellate Procedure 9.130(a)(3)(C)(ii) and affirm in all respects without further comment.

Careful readers of this blog will recognize the name of one of the attorneys on the winning side of the linked-to case: Amy B. Beller of Miller & O'Neill, P.L.  (see here for prior post).  Well done Amy.

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Kristen D. Drake, JD, CFP, publishes Coast Law, LLC, an excellent Florida-specific blog focusing on estate planning matters.  Her goal is to is to build a "One-Stop Florida Homestead reference page," and she's off to a great start.  For example, in her blog post entitled Homestead Descent Examples she provides a link to homestead-related case studies prepared by Bruce Stone, one of Florida's most well regarded estate planning attorneys.  Here's the post in its entirety:

Sometimes the best way to understand a complicated issue is with examples. Bruce Stone, a prominent estate planning attorney in Florida (more about Mr. Stone here), presented "What Every Georgia Trusts and Estates Practitioner Needs To Know About Florida Law" and included some excellent homestead descent examples in his materials. He was kind enough to let us post them here. Test your knowledge of homestead descent with these great examples.

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Big firms have been shedding their trusts and estates practice groups for decades (see here).  But those that still have them apparently populate them with the most interesting lawyers at the firm.  At least that's what I gather from reading Undue Influence: The Epic Battle for the Johnson & Johnson Fortune, by David Margolick.  Here are two gems from his book:

:"[A]t Shearman & Sterling as at most large firms, the individual-clients group was a loss leader, a service the firm extended to plutocratic executives, but a gilded graveyard for those lawyers -- eccentrics, aristocrats, gays, fops, women -- who traditionally congregated in them."

"[Sullivan & Cromwell's] probate department was small and idiosyncratic, inhabited by the usual collection of oddballs, geniuses, and women.  It was the only place at the firm where one could be an associate in perpetuity and eccentric with impunity."

Well, one of S&C's eccentric, oddball geniuses has decided to go elsewhere.  As reported here in the WSJ Law Blog:

Trusts and estates lawyer Henry “Terry” Christensen III, who formerly represented New York society doyenne Brooke Astor, is leaving Sullivan & Cromwell after more than 37 years to join McDermott Will & Emery. Christensen is the senior partner in Sullivan’s T&E practice and former head of the group.

It is almost unheard of for a partner to leave Sullivan, one of the country’s most prestigious and profitable law firms. Its average profits per partner in 2006 were about $2.8 million, double that of McDermott’s, according to the American Lawyer.

Christensen, as well as a person at the firm, said he was departing because of recent potential conflicts between work for his individual clients and corporate clients of the firm. Here’s the press release from McDermott trumpeting Christensen’s pending arrival.

Among Christensen’s clients are the Tate Gallery and the Starr Foundation. S&C represented Astor, now 105 years old, for more than 40 years, and Christensen handled the Astor relationship for the firm when it ended in 2004. For prior Law Blog coverage of the flap surrounding Astor’s fortune, click here, here and here.

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Last year I wrote here about a case out of the 3d DCA that had me puzzled.  The 2006 case was a will contest involving allegations of "insane delusion".  I couldn't reconcile the 3d DCA's apparent retreat from the extremely tough "lucid interval" standard generally applicable to testamentary capacity cases.

As if on cue, professor Bradley E.S. Fogel of St. Louis University School of Law just published an article in the Spring 2007 edition of the ABA's Real Property, Probate and Trust Journal providing an excellent summary of the law governing insane-delusion will contests.  The article is entitled THE COMPLETELY INSANE LAW OF PARTIAL INSANITY: THE IMPACT OF MONOMANIA ON TESTAMENTARY CAPACITY.  Here's the editor's synopsis of his article:

In this Article, the author discusses the doctrine of monomania, which permits a court to invalidate a will based on the testator’s insane delusion if that insane delusion caused the testator to dispose of his property in a way that he otherwise would not have. The author argues that the monomania doctrine is fatally flawed and that the doctrine should be abandoned in favor of using the general test for capacity to make all testamentary capacity decisions.

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The next meeting of the Probate and Trust Litigation Committee is scheduled for Thursday, August 2 at The Breakers in Palm Beach from 4 p.m. to 6 p.m.  If you have any questions regarding this meeting, you should contact the committee chair directly: William T. Hennessey.

The meeting materials copied here contain white papers addressing the following probate-litigation related issues:

• Fiduciary Lawyer-Client Privilege: Approved by EC [ITEM 3].
• Payment of trustee's fees from trust assets: Approved by EC [ITEM 4]
• Crafting an appellate rule on which Orders are Appealable in a Probate Proceeding? Sean Kelley, Tom Karr, Peter Sachs [ITEM 5]
• Collateral Attack on the Validity of A Marriage after Death Based Upon Undue Influence John Moran, Bill Hennessey, Laura Sundberg, Russ Snyder [ITEM 6]
• Revisions to Rule 1.525 concerning 30 day time limit for filing a motion for attorneys' fees[ITEM 7] Angela Adams, Eric Virgil,Laura Sundberg
• ACTEC Model Arbitration Legislation. [ITEM 8]. Bob Goldman

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I previously wrote here about a case where an ex-spouse was the windfall beneficiary of insurance benefits because her ex had the audacity of dying after their divorce but before getting around to revising his insurance beneficiary designation forms (it's always the little things that get you!).  This outcome probably seemed unfair to many (except the ex), including Stetson Law student Suzanne Soliman, who just published A Fair Presumption: Why Florida Needs a Divorce Revocation Statute for Beneficiary-Designated Nonprobate Assets, in 36 Stetson L. Rev. 397 (2007).  Here's an excerpt:

Like many Americans, Floridians invest significantly in beneficiary-designated nonprobate estate planning tools such as life insurance. These types of assets comprise the bulk of many Floridians' estate plans because they are easy to obtain and, in many instances, affordable compared to other estate planning tools. It is important to effectuate the policyholder's intent, particularly because so many families trust that these assets will provide some degree of security. Enacting a divorce revocation statute to protect nonprobate assets will provide protection and security for many Florida families.

Special thanks to the Wills, Trust & Estates Prof Blog for posting here on this article.

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Taylor v. Maness, 941 So.2d 559 (Fla. 3d DCA Nov 15, 2006)

Property rights vs. homestead rights: which wins out in litigation involving homestead property?  That's a no-brainer: homestead rights trump property rights any day of the week.  The linked-to case underscores this general principal by applying it to a real live set of facts with very real economic consequences riding on how the court ruled.

Does the deed control? NO

In this case husband (but not wife) signed a sales contract for the sale of his homestead property located on Marathon Key, Florida (think VERY EXPENSIVE real estate!).  The house was deeded in husband's name alone.  Wife was not consulted, and refused to sign a deed effectuating the sales contract.  Buyer sued to enforce the sales contract.  But buyer didn't just want damages, he also wanted the court to specifically enforce the contract.  Court said NO WAY, and it didn't matter that wife's name wasn't on the deed.  Why? Because spouse's homestead rights trump all else.  The following excerpts should be enough to make the point:

The undisputed facts, which were before the trial court, are as follows. Mr. and Mrs. Maness were married on June 14, 1986. Sometime in September 1986, Mr. Maness purchased a vacant lot located at 180 Ana Court, Marathon, Monroe County, Florida, which was titled solely in the name of “James G. Maness, as a married man” (“Marathon Property”).     .     .     .     .     On or about September 25, 2002, Mr. Maness, as the seller, and the Taylors, as the purchasers, entered into a contract, whereby Mr. Maness agreed to convey the Marathon Property to the Taylors. Mrs. Maness did not execute the contract, nor was she named in the contract. Closing was to take place on or before December 2, 2002. Mrs. Maness, however, refused to execute the deed transferring the Marathon Property to the Taylors, claiming that she has a homestead interest in the Marathon Property, thereby precluding consummation of the contract.

*     *     *     *     *
In reaching our conclusion, we wish to address Mrs. Maness' homestead interest in the Marathon Property. The Taylors correctly point out that Mrs. Maness is not the title owner of the Marathon Property. However, the individual claiming the homestead exemption need not hold fee simple title to the property. Callava v. Feinberg, 864 So.2d 429, 431 (Fla. 3d DCA 2003). Article X, section 4 “does not designate how title to the property is to be held and it does not limit the estate that must be owned, i.e., fee simple, life estate, or some lesser interest.” Stilwell, 810 So.2d at 569. Thus, even if Mrs. Maness owns only a beneficial interest in the Marathon Property, she is entitled to claim a homestead exemption to the forced sale of the property. See Callava, 864 So.2d at 431 (holding that even if divorced wife only owned a beneficial interest and not title interest in the residence constituting her homestead, she was nonetheless entitled to claim a homestead exemption from the forced sale of the property).

Lesson learned:

Former U.S. Secretary of Defense Donald Rumsfeld once famously said that it was the "unknown unknowns" that worried him most (see here for the You Tube version).  In litigation involving homestead real property, simply reading the deed tells you very little about the principal issue driving the case.  Knowing this unstated fact in advance may make all the difference in the world.  If your opponent is unaware of this fact, he or she is about to learn why the "unknown unknowns" are the scariest part of practicing law.

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Commercial Capital Resources, LLC v. Giovannetti, 955 So.2d 1151 (Fla. 3d DCA Mar 28, 2007)

So you've been negotiating a settlement of contentious litigation for over 10 hours, it's now late into the night and you've finally got what looks like a deal put together, and then you get handed a "draft" settlement agreement by the mediator (who happens to be a senior judge with a zillion years of experience under his belt).  You don't want to be the guy who mucks up the deal at the last minute, and you don't want to be disrespectful to the judge, but the settlement agreement doesn't seem to get the trustee release language right.  The release language seems to focus on the trustee as an individual, vs. a fiduciary representing a trust estate and its beneficiaries.  Here's what the release language says:

[Trustee], CCR ... and all other named parties and defendants joined in the pending litigation will execute general releases in favor of [Giovannetti].... [Giovannetti] ... will execute general releases in favor of [Trustee], CCR ... and all other named parties and defendants joined in the pending litigation.... [Trustee] agrees that in his capacity as “trustee” of any trust ... without prejudice to his fiduciary obligations or duty to provide proper and necessary notice and disclosures to investors, that he will refrain from taking any action [sic] initiate or to solicit the investors to initiate a law suit against [Giovannetti], and that if any such action is brought against [Giovannetti], [Trustee] will resign as trustee from any trust involved in or bringing the action.

As the linked-to case shows, the professionals who signed off on this deal ended up back in court and eventually before an appellate court . . . all after executing a settlement agreement they probably all assumed was meant to end the litigation once and for all (what their clients were thinking is anyone's guess).

Lesson learned:

In retrospect, one could say that the settlement agreement litigated in the linked-to case was fundamentally flawed because it focused on the trustee as an individual vs. as a fiduciary virtually representing trust beneficiaries.  But that would be a cheap shot.  In reality, what probably happened here is that the lawyers were under pressure to draft a technically demanding settlement agreement late at night, after hours of intensive negotiation.  I've done this myself and lived to regret it.  The true lesson from this case (which I'm still working on) is that you want to draft the key portions of your settlement agreement in advance . . . when you're NOT subject to the pressure and stress of the moment.

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Mike Dillon, General Counsel for Sun Microsystems, Inc., publishes a great blog called The Legal Thing.  In a blog post entitled On Litigation...(Azul), Mr. Dillon shared his "four principals" for evaluating when litigation is appropriate.  I thought his comments were dead on, and applicable to any form of litigation - including probate litigation.  I've reproduced his four principals below with my practice-specific comments:

No. 1 - You only litigate when you have an important interest to protect. Litigation is costly. Incredibly costly. But it is not the expense that is the real issue, it's the diversion of resources. Time employees spend reviewing e-mails and documents, educating lawyers and preparing for depositions is time away from the business. That's the real cost of litigation.

Probate comment: Ask your lawyer to assume the worst case scenario and then estimate how long you should expect the process to last (1 to 2 years is the norm) and how much it will all cost (it will always be higher than you expected).  Then ask yourself, "is it really worth it?"  If the answer is yes, then proceed to point no. 2, otherwise stop immediately and move on with your life.

No. 2 - A non-judicial resolution is almost always preferable. When you file a complaint, you are turning over resolution of an issue to a third party - be it a judge, arbitrator or jury. To a great degree you lose control of the outcome.

Probate comment: In the probate-litigation context, every penny spent on legal fees siphons off a piece of the family inheritance to a third party: the lawyers.  The quickest way to stop the bleeding is to settle the case.  Mediation should be a no-brainer in this type of litigation.

No. 3 - You litigate when you have a high degree of confidence that you will prevail. Bluffing is for weekend games of Texas Hold'em . When you file suit, you need to have fully evaluated all aspects of the case to ensure that the outcome will be favorable.

Probate comment:  Pick your battles carefully.  This is where lateral thinking pays off.  In the probate-litigation context there are often multiple approaches to achieve a desired result.  Some approaches usually favor the defendant, some usually favor the plaintiff.  Depending on what side you're on, play to your strengths.  How you address this point no. 3 will inform points 1 and 2 above.

No. 4 - You litigate to win. This means that your employees, board and management team fully understand and support the commitment (both financial and time) required to prevail. It also means having seasoned litigation counsel who understand your business and objectives.

Probate comment: Litigation is not a negotiation strategy.  Once you've decided a lawsuit is your last best option, you need to be willing to see the process through to the end.

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In re Amendments to the Florida Evidence Code, --- So.2d ----, 2007 WL 2002629 (Fla. Jul 12, 2007)

Florida's version of the "Dead Man's Statute" has been a trap for unwary litigants for over a century.  Widely criticized by commentators, practitioners, and even courts, in 2005 the rule was finally abolished when the Florida legislature repealed section 90.602, Florida Statutes.  For those interested in learning more about this evidentiary rule and why reform was needed, the 2005 legislative staff analysis is an excellent starting point.

In lieu of the Dead Man's Statute, the Florida legislature created section 90.804(2)(e), Florida Statutes (2005), which added an exception to the hearsay rule to permit relevant communications of deceased or incompetent persons to be heard by the trier of fact.  Due to a quirk of Florida's constitution, the Florida Supreme Court is required to approve this new evidentiary statute to the extent the new statute is deemed "procedural" in nature.  That's what the linked-to opinion is meant to do.

Understanding this rule of evidence is fundamental in the probate litigation context, which is why I've reproduced it below in its entirety:

90.804 Hearsay exceptions; declarant unavailable

(1) [No Change]

(2) HEARSAY EXCEPTIONS.-The following are not excluded under s. 90.802, provided that the declarant is unavailable as a witness:

(a)-(d) [No Change]

(e) Statement by deceased or ill declarant similar to one previously admitted.-In an action or proceeding brought against the personal representative, heir at law, assignee, legatee, devisee, or survivor of a deceased person, or against a trustee of a trust created by a deceased person, or against the assignee, committee, or guardian of a mentally incompetent person, when a declarant is unavailable as provided in paragraph (1)(d), a written or oral statement made regarding the same subject matter as another statement made by the declarant that has previously been offered by an adverse party and admitted in evidence.

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A blog dedicated to probate litigation usually doesn't go for laughs, but I couldn't pass this one up from San Francisco blog Crooked Street Press:

Estate Attorney With Tourettes Learning to Adjust

San Francisco- Estate Planner George Henry came down with a severe case of tourette syndrome about 9 months ago strangely enough while he was in front of a judge in a court room. Henry says that the last nine months has been hard on himself and loved ones around him “especially the people that make me mad F&#@ SH** B*^%#!” Where it has been especially tough is on the job as an estate planner to families that have lost members of their family and Henry starts to blurt out rants of swear words. Many times the swearing goes on for several minutes especially around the time the fees for his service are debated by the grieving family.

“When he swore in my court room after I over ruled against him on an objection, I about threw the book at him.” Judge Thurgood Thompson said. “Then he told me that he had tourettes. But I had never heard him swear before. From that point forward until the end of the case he would put on a swearing clinic. In my gut…I think most of it was directed at me.”

“Don’t get me started on F&#@ SH** B*^%# Judge Thurgood Thompson.” Henry said.

Henry and his family have been living with his condition for about 9 months now and his family has adjusted to this sudden problem. “I think the kids like it because it gives them new ideas.” Margaret Henry said. “Usually the episodes happen when I ask George to wash the dishes. He’ll rant for about twenty minutes or so but then he eventually does them.”

“I hope someday my F&#@ SH** B*^%# condition will subside.” Henry said. “But until then people had better leave me the F&#@ SH** B*^%# alone.”

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Marlowe v. Brown, 944 So.2d 1036 (Fla. 4th DCA Aug 02, 2006)

Being an effective probate litigator often requires lateral thinking -- the generation of novel solutions to problems using other than straightforward, step-by-step logic. The point of lateral thinking is that many problems require a different perspective to solve successfully.

The linked-to case is a perfect example. In this case a couple was in the midst of a very contentious divorce proceeding.  After they signed a non-final mediation agreement, but before a final judgment of divorce was entered, husband died. Shortly thereafter, wife died.  Presto! . . . we're in probate litigation land.

Why fight over a 50% divorce mediation agreement when you can get 100% in probate?

Before husband died, the parties had been contesting the meaning of their divorce mediation agreement, which contemplated a 50/50 split of the couple's assets.  Rather than continue this litigation in a linear fashion within the probate context, wife's PR came at the problem from a completely different perspective: why argue over 50/50 when wife, as a surviving spouse, gets 100% of all jointly titled assets?

In September, 2003, the wife moved the probate court to declare certain assets to be hers. Among these assets were the Greenbrier Farm, the Naked Lady Ranch, and “Hatteras Lots;” the dissolution judge's January 21 order had found that the husband and wife owned these properties as tenants by the entirety. The wife argued that these lots passed to her by operation of law when her husband died. The wife made similar arguments as to other properties based on the way the properties were titled at the time of the husband's death. For example, the wife argued that 103,114.299 troy ounces of silver passed to her under the provisions of a storage contract which declared that the account was a joint tenancy with right of survivorship.

Wife lost this argument at the trial court level . . . but won where it counts: on appeal.  The 4th DCA ruled that first, in the absence of a final judgment, there was no divorce; and second, as surviving spouse she gets 100% of the joint property.  Here's how the 4th DCA summed up its thinking:

The dissolution of marriage action terminated with the death of the husband and the . . . judge should have dismissed the case upon the wife's motion.

.     .     .     .     .

In Price v. Price, 114 Fla. 233, 153 So. 904, 905 (1934), the supreme court described the effect of an appellate reversal of a divorce decree, where one spouse dies after the issuance of the decree, but while the appeal is pending:

[O]n such reversal, the parties will be placed in the position they occupied before the decree was entered, and if one of them has died between the date of the decree of divorce and its reversal, the survivor procuring the reversal will be entitled to all rights of succession or the like, in the estate of the other, the same as if no divorce has ever been had.

Similarly, the husband's death in this case left the wife in the legal position of one whose marriage was terminated by death, and not by a final judgment.

Yes, lateral thinking wins the day again. 

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Dowling v. Davis, Slip Copy, 2007 WL 1839555 (M.D.Fla. Jun 26, 2007)

Does Florida's homestead exemption from creditor claims extend to cases where all parties concede that the judgment debtor purchased a home in Florida with the intent to hinder creditors?  As explained in this federal court decision, the Florida Supreme Court says YES it does:

Crooks Welcomed:

[T]he Florida Supreme Court has expressly held that “[t]he transfer of nonexempt assets into an exempt homestead with the intent to hinder, delay, or defraud creditors is not one of the three exceptions to the homestead exemption provided for in article X, section 4.” Havoco of Am., Ltd. v. Hill, 790 So.2d 1018, 1028 (Fla.2001) ( “Havoco I” ) (emphasis added); Havoco of Am., Ltd. v. Hill, 255 F.3d 1321, 1322 (11th Cir.2001) ( “Havoco II” ) (affirming that judgment debtor's purchase of home with intent to hinder creditors did not overcome homestead exemption, based on answer to certified question in Havoco I ). This is precisely what Plaintiff is alleging Defendants sought to accomplish by purchasing the Florida residence. For this reason, Plaintiff's claim fails.

But what about an equitable lien? Don't count on it:

Plaintiff argues that the fraud occurred when Defendants, knowing a judgment was imminent, purchased a house with proceeds that could have been used to satisfy Plaintiff s judgment against Davis. Again, however, the homestead exemption does not contain an express exception for real property that is acquired in Florida for the sole purpose of defeating the claims of out-of-state creditors. Havoco II, 255 F.3d at 1322; Havoco I, 790 So.2d at 1028; Bank Leumi Trust Co. v. Lang, 898 F.Supp. 883, 887 (S.D.Fla.1995); In re Adell, 321 B.R. 562, 569-70 (Bankr.M.D.Fla.2005). Indeed, in one of the primary cases relied upon by Plaintiff, the court specifically distinguished those cases in which a debtor owned the funds-where an equitable lien is not proper-from those cases in which a debtor purchased a residence with fraudulently-obtained funds. In re Fin. Federated Title & Trust, Inc., 273 B.R. 706, 716 (Bankr.S.D.Fla.2001) aff'd 347 F.3d 880 (11th Cir.2003) (affirming imposition of equitable lien where funds were undisputedly obtained through fraudulent Ponzi scheme).FN5

FN5. Although not cited by Plaintiff, one court has imposed an equitable lien where a judgment debtor transferred funds to his daughter and son-in-law to satisfy a mortgage on their residence. Babbit Elecs., Inc. v. Dynascan Corp., 915 F.Supp. 335, 337 (S.D.Fla.1995). The court held that the transfer was made to delay, hinder, and defraud the defendant's judgment creditor in collection of its judgment and that imposition of an equitable lien would not change the position of the daughter and son-in-law. Id. at 338. However, this pre- Havoco I decision appears to be in conflict with the Eleventh Circuit's ultimate holding in Havoco II that the homestead exemption shields a debtor's purchase of a residence with non-exempt funds, even when the purchase is made with the intent to hinder a judgment creditor. Havoco II, 255 F.3d at 1322.

Lesson Learned:

As this case proves -- again -- Florida's homestead laws are almost impenetrable creditor protection shields.  And as I've written about before (see here), getting around this protective wall via an "equitable lien" theory almost never works.  Bottom line: people who admittedly move to Florida for the express purpose of evading their just debts can get away with it.

I have to believe this result is an unintended consequence of Florida's outdated homestead laws.  Until someone decides this is a crisis, I assume we'll be stuck with the status quo.  So if you're looking to defraud your creditors, sunny Florida says "welcome home!"

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Kranias v. Tsiogas, 941 So.2d 1173 (Fla. 2d DCA Oct 13, 2006)

Attorneys witness their clients' signatures on documents all the time. In the estate planning context, attorneys regularly witness their clients signatures on wills and trusts.  Is the attorney-client privilege waived every time you witness a signature?  The 2d DCA says NO.

The specific exception to the attorney-client privilege at issue here is found in Florida Statutes section 90.502(4)(d), which provides as follows:

(4) There is no lawyer-client privilege under this section when: . . . . . (d) A communication is relevant to an issue concerning the intention or competence of a client executing an attested document to which the lawyer is an attesting witness, or concerning the execution or attestation of the document.

In the linked-to case the petitioners were suing the trustee of a land trust for somehow defrauding them in connection with a deed.  The petitioners' own attorney had written to them about the deed, and also witnessed their signatures on the deed.  The trial court said that was enough to require disclosure of attorney's letter.  Wrong answer.  As explained by the 2d DCA, just because counsel witnesses his clients' signatures, doesn't mean the attorney-client privilege is lost:

We conclude that the circuit court erred in ordering the production of this letter based on section 90.502(4)(d), because this exception to the attorney-client privilege does not apply here. There has been no argument that the Petitioners either did not intend to sign or were not competent to sign the quitclaim deeds that conveyed property from a land trust to the Petitioners. The attorney-client privilege is not waived as to communications between an attorney and a client when such communications pertain to the preparation of a document merely because the attorney later acts as a witness to the parties' signatures on that document.

Lesson learned: anticipate privilege waiver issues

A significant cultural difference between planning/transactional attorneys and litigators is their respective sensitivity to circumstances that may result in a waiver of the attorney-client privilege.  Sensitivity to this issue is second nature to litigators (it's part of their every-day practice), non-litigators need to make a conscious effort to keep it in mind.  As I've written before (see here), sometimes it's OK to purposely step into the attorney-as-trial-witness role, you just don't want to end up there inadvertently.

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In In re Amendments To Florida Probate Rules, --- So.2d ----, 2007 WL 1932256 (Fla. Jul 05, 2007), the Florida Supreme Court adopted several amendments to our probate rules, all of which were proposed by the Florida Probate Rules Committee.  The following is the explanatory preamble to the rule changes, all of which will become effective on January 1, 2008:

BACKGROUND

On January 29, 2007, the Florida Probate Rules Committee (Committee) filed a regular-cycle report recommending amendments to several of the Florida Probate Rules, as well as the adoption of two new rules. The Committee proposes amendments to existing rules 5.040 (Notice); 5.041 (Service of Pleadings and Papers); 5.200 (Petition for Administration); 5.210 (Probate of Wills Without Administration); 5.241 (Notice to Creditors); 5.490 (Form and Manner of Presenting Claims); 5.496 (Form and Manner of Objecting to Claim); 5.498 (Personal Representative's Proof of Claim); 5.499 (Form and Manner of Objecting to Personal Representative's Proof of Claim); 5.530 (Summary Administration); 5.650 (Resignation or Disqualification of Guardian; Appointment of Successor); 5.670 (Termination of Guardianship on Change of Domicile of Resident Ward); 5.697 (Magistrate's Review of Guardianship Accountings and Plans); and 5.710 (Reports of Public Guardian). It further proposes the adoption of two new rules: rules 5.095 (General and Special Magistrates) and 5.645 (Management of Property of Nonresident Ward by Foreign Guardian).

DISCUSSION

After the Committee filed its report with the Court, the Court published the proposed amendments in The Florida Bar News. Sean O. Cadigan and Keela Roberts Samis, both members of The Florida Bar, filed a joint comment, the only one filed. Cadigan and Samis, both of whom have served as magistrates in probate cases, suggested the addition of a sentence to the end of subdivision (e) in rule 5.697 to read: “The magistrate shall be required to file a report only if a hearing is held pursuant to subdivision (d) of this rule or if specifically directed to do so by the court.” They believed the additional sentence would make it clear that a magistrate would not need to prepare and file a magistrate's report or adhere to the exception period when the magistrate assists the court in the review of guardianship reports, but does not conduct a hearing to review the report.

In its response to the comment, the Committee agreed that the addition of the sentence proposed by Cadigan and Samis would avoid a possible misinterpretation of the rules and asked the Court to incorporate the sentence proposed by Cadigan and Samis into its proposal.

CONCLUSION

Having taken the proposed amendments, the comment, and the Committee's response into consideration, we hereby adopt the amendments to the Florida Probate Rules as set forth in the appendix to this opinion, including the additional sentence at the end of subdivision (e) in rule 5.697, suggested by Cadigan and Samis. New language is indicated by underscoring; deletions are indicated by struck-through type. The committee notes are offered for explanation only and are not adopted as an official part of the rules. The amendments will become effective on January 1, 2008, at 12:01 a.m.

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Many predicted that Anna Nicole Smith's 2006 Supreme Court victory involving her late husband's estate would lead to increased numbers of trust-and-estate cases being litigated in federal court (see here and here).

A recent example of the "federalizing" of trust-and-estates litigation is reported on in 2nd Circuit Re-Examines Standard for Probate Exception.  As the following excerpts make clear, it will now be much easier for litigants in the North East (i.e., litigants within the 2nd Circuit's jurisdictional boundaries) to adjudicate trusts-and-estates disputes in federal court:

 A retired attorney's long-running fight with the Bank of New York and a White Plains, N.Y., law firm over her parents' estate gave a federal appeals court the chance to explore the new standard on the probate exception to federal diversity jurisdiction.

The 2nd U.S. Circuit Court of Appeals said a 2006 U.S. Supreme Court decision changed the scope of the exception and the circuit's own case law, with the result that some of the claims brought by Adrienne Marsh Lefkowitz against the bank and McCarthy, Fingar, Donovan, Drazen & Smith can stay in federal court.

Second Circuit Judges John Walker and Peter Hall, with Southern District of New York Judge Denise Cote, sitting by designation, decided Lefkowitz v. The Bank of New York, 04-0435-cv. Hall wrote for the panel.

.     .     .     .     .

[I]n 2006, the U.S. Supreme Court decided Marshall v. Marshall, 126 S.Ct. 1735. In that case, former Playboy playmate and TV reality show star Anna Nicole Smith won a procedural victory in her attempt to collect a bequest from her late 90-year-old husband, Texas oil magnate J. Howard Marshall.

Hall, in writing the 2nd Circuit's opinion, said Marshall "reigned in the boundaries of the probate exception."

"The court explained that in Marshall the probate exception did not apply because plaintiff sought neither to (1) 'administ[er] an estate, ... probate ... a will, or [do] any other purely probate matter,' nor (2) 'to reach a res in the custody of a state court,'" Hall said. "From these statements, we discern that under the clarified probate exception a federal court should decline subject-matter jurisdiction only if a plaintiff seeks to achieve either of these in federal court."

Hall said that, therefore, "insofar as our Court's decision in Moser purported to direct courts to exercise subject-matter jurisdiction over in personam and other claims that might 'interfere' with probate proceedings only ... that holding was overly broad and has now been superseded by Marshall's limitation of the exception."

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Robinson v. Weiland, 936 So.2d 777 (Fla. 5th DCA Sep 01, 2006)

In the linked-to case two annuities were at issue.  At the center of the dispute were two change-of-beneficiary forms allegedly signed by the decedent right before he died.  Relying on these change-of-beneficiary forms, the decedent's girlfriend claimed a 60% interest in the annuities (surviving son got the other 40%).  Decedent's sister claimed these change-of-beneficiary forms were invalid because they either weren't signed by the decedent or were the product of undue influence.

The "Smoking Gun" Witness

After trial but before judgment was entered, counsel for decedent's sister hit the jack pot when he managed to track down girlfriend's former roommate who signed an affidavit completely undermining girlfriend's trial testimony.  Roommate's affidavit ended with this bombshell:

After the forms were at the house for a number of weeks, I personally was present when she completed the annuity beneficiary change forms. She told me she was including herself as a 40% beneficiary because she did not want to appear to be too greedy.... The forms were definitely not completed in the presence of John S. Cetrano [the decedent] and were not placed in their envelopes for mailing by John S. Cetrano; Michael Weiland filled them out at 1711 Joshua Drive, NE, Palm Bay, Florida and mailed them many weeks after she first had possession of the forms.

But what if the trial court says "who cares"?

Assume you've found the smoking gun witness, and that the only reason you didn't have this witness at trail was because an opposing party (girlfriend) defrauded you and the court during the discovery phase of the case.  No matter how un-enthusiastic the trial court may be when you seek to have this new evidence admitted, once you allege "fraud", the trial court MUST conduct an evidentiary hearing to address your claims, and failure to do so is reversable error. 

In this case counsel for sister filed motions under Civ. Pro. Rules 1.530 and 1.540(b)(3) trying to get a new trial or to set aside the judgment.  The trial judge summarily denied both motions and was reversed on appeal.  Here's how the 5th DCA summarized its rationale:

The courts consistently agree that the trial court has discretion to grant a motion to reopen a case for presentation of additional evidence after the parties have rested and even after granting a motion for directed verdict for a party. .  .  .  Factors the trial court should consider in determining whether to reopen the case to allow presentation of additional evidence include whether the opposing party will be unfairly prejudiced and whether it will serve the best interests of justice.

Because the trial court summarily denied Robinson's motion, we are unable to determine why the trial court made that decision or what factors, if any, the trial court considered. Moreover, given the allegations of fraud made by Robinson to support her motion, we think an evidentiary hearing was essential for the trial court to properly determine whether to grant the request to present the testimony of Adams.

After the final judgment was entered, Robinson filed her Motion for Rehearing, New Trial, or Evidentiary Hearing, pursuant to rule 1.530, Florida Rules of Civil Procedure, once again alleging fraud as a basis for relief. Cetrano and Weiland argue that Robinson failed to demonstrate the trial court abused its discretion in denying the motion, primarily arguing cases discussing motions for relief from judgment made pursuant to rule 1.540, Florida Rules of Civil Procedure. This court and others have held that if a party files a motion pursuant to rule 1.540(b)(3), pleads fraud or misrepresentation with particularity, and shows how that fraud or misrepresentation affected the judgment, the trial court is required to conduct an evidentiary hearing to determine whether the motion should be granted.  .  .  .  Moreover, the courts have held that the hearing requirement applies when fraud is asserted as a grounds for relief under either rule 1.530 or 1.540, Florida Rules of Civil Procedure.  .  .  .  The motion filed by Robinson sufficiently alleges fraud and demonstrates how it affected the judgment, thereby satisfying the requirement for an evidentiary hearing under either rule 1.530 or 1.540. Therefore, we reject the arguments advanced by Cetrano and Weiland.

We conclude that Robinson was entitled to an evidentiary hearing based on the motion she filed prior to entry of final judgment and the motion she filed thereafter. We, therefore, reverse the order summarily denying Robinson's Motion to Reopen Trial For Newly Discovered Evidence and her Motion for Rehearing, New Trial, or Evidentiary Hearing and remand for an evidentiary hearing. Should the trial court determine that fraud occurred as Robinson alleged, we believe that a new trial would be warranted.

Key word: EVIDENCE

Your client doesn't have a right to a favorable ruling, but he or she is entitled to a fair day in court.  Which means that if the other side cheats, lies or otherwise defrauds you and the court to keep you from finding your smoking gun witness, you have a right to an evidentiary hearing to establish this fraud and a new trial if evidence of fraud is in fact established.

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