In December I’m scheduled to teach a one-hour segment on probate & trust litigation at an upcoming NBI seminar entitled “Estate Administration Procedures: Why Each Step Is Important.” Click here for more information about the seminar and the other speakers. The dates and locations for the seminar are:

  • Miami, FL – December 6, 2011
  • Fort Lauderdale, FL – December 7, 2011
  • West Palm Beach, FL – December 8, 2011 (I won’t teach this day)

If you’re an attorney looking to expand your practice into probate-administration matters, this introductory-level seminar is probably a good idea for you.

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The Florida Bar ethics rules governing contingent fee agreements are found in Rule 4-1.5(f). Other than in divorce and criminal-defense cases [Rule 4-1.5(f)(3)], contingent fees are acceptable in any form of litigation, including contested probate and trust proceedings.

There’s not a lot of Florida case law out there addressing contingent fees in probate cases. So the Guettler opinion discussed below should be of special interest to any probate litigator taking cases on a contingency fee basis. What the Guettler case makes painfully clear is that Florida law shifts 100% of the risk of NOT getting paid in contingency cases to lawyers who are prematurely discharged by their clients, even if the discharge is without cause and the fee agreement contains a fallback hourly-fee payment clause (a “discharge clause”).

Guy Bennett Rubin, P.A. v. Guettler, — So.3d —-, 2011 WL 4577670 (Fla. 4th DCA Oct 05, 2011):

In the linked-to case above the law firm took this probate case on a contingency fee basis. The firm was then fired without cause and the litigation apparently abandoned by the client before any recovery was obtained. The law firm asked the trial court for an order compelling payment for work done prior to the discharge under the following discharge clause contained in its fee agreement.

[“Discharge Clause”]

In the event I discharge the firm prior to resolution by judgment or settlement, or if I elect to no longer pursue the Anticipated Claims as identified herein-below, I agree to immediately thereafter pay LAW FIRM accrued hourly legal fees based upon the hourly rates as follows:

Services of Guy Bennett Rubin $500/hr., all other attorneys $400/hr., all paralegals $150/hr., all legal assistants $100/hr. listed in paragraph 4 immediately above.

[Nature of Claims]

ANTICIPATED CLAIMS: Dispute and contest the last will and testament of Leo Guettler Jr. and/or revocable trust of Leo Guettler Jr.; defense of claims b y Edna L. Guettler, Inc. and dissolution or liquidation of my interest in Edna L. Guettler, Inc.

Trial court said NO, concluding that the discharge clause constituted a penalty provision in violation of ethics rule 4–1.5, and was thus NOT enforceable as a matter of law. The 4th DCA agreed:

“An attorney shall not enter into an agreement for, charge, or collect an illegal, prohibited, or clearly excessive fee or cost….” Rule 4–1.5(a), Rules Regulating the Florida Bar. A termination-of-services clause in a contingency-fee agreement, which provides for the client to pay the discharged law firm for all services rendered up through the date of termination at the prevailing hourly rate for firm members, if the client abandons or dismisses the claim, violates rule 4–1.5 on its face. The Fla. Bar v. Hollander, 607 So.2d 412, 414 (Fla.1992).

In The Florida Bar v. Doe, 550 So.2d 1111 (Fla.1989), the contingency-fee contract included a “discharge clause” which permitted the client to discharge Doe only after paying him the greater of $350 per hour for all the time spent on the case or forty percent of the greatest gross amount offered in settlement. At the disciplinary hearing, the referee found that while the contingent fee contract violated rule 4–1.5 on its face, there was no testimony offered that Doe’s actions were ever in violation of the rules; consequently, the referee found that Doe was not guilty of any ethical violation warranting disciplinary proceedings. Id. at 1112. However, on review, the supreme court disagreed because “the contract itself shows an ethical violation.” Id. The court found that the discharge provision had the effect of intimidating the client into not exercising her right of discharge and penalized the client for exercising this right. Id. at 1113. The court concluded that “[a]n attorney cannot exact a penalty for a right of discharge. To do so is contrary to our statement of policy in Rosenberg ….” Id. See also The Fla. Bar v. Spann, 682 So.2d 1070, 1072–73 (Fla.1996) (finding that a contingency-fee agreement that provided for payment based on a specified hourly rate upon termination by the client constitutes a penalty clause in violation of rule 4–1.5 because the client would be forced to pay the attorney upon discharge even where the contingency had never been met).

***************

Even if the Agreement is unenforceable as a matter of law, Rubin argues that he should have been permitted to proceed on the theory of quantum meruit as pled in Count III of his complaint. “A Florida Bar member who has entered into an improper fee agreement is nonetheless entitled to receive the reasonable value of his or her services on the equitable basis of quantum meruit.” Patterson v. Law Office of Lauri J. Goldstein, P.A., 980 So.2d 1234, 1236, n. 1 (Fla. 4th DCA 2008) (citing Chandris, S.A. v. Yanakakis, 668 So.2d 180, 186, n. 4 (Fla.1995)). However, an action for quantum meruit “arises only upon the successful occurrence of the contingency. If the client fails in his recovery, the discharged attorney will similarly fail and recover nothing.” Rosenberg, 409 So.2d at 1022. Here, the trial court found that there was no evidence that the plaintiffs received anything as a result of the litigation. Instead, the Guettlers dismissed their claims against the estate and recovered nothing. Therefore, because the contingency did not occur, Rubin is not entitled to any quantum meruit recovery.

Lesson learned?

In Florida, if you agree to take a probate case on a contingency fee basis, you assume 100% of the risk of NOT getting paid for your work if your client decides to fire you and/or abandon the claim before the case is over, even if you’ve done nothing wrong. This risk may be worth taking, but Florida probate lawyers (who don’t do contingency cases on a regular basis) need to know it exists. Adding insult to injury, not only might you not get paid, you might end up getting sanctioned by the Florida Bar if you include a discharge clause in your contingency fee agreement. It’s telling that the 4th DCA cited to two such cases in its opinion (see above).

In both F.S. § 733.106(4) and F.S. § 733.6175(2), a probate judge is given the express statutory authority to determine from whose share of the estate attorneys fees incurred in wrongful, frivolous or bad faith litigation will be paid. This type of sanction against wrong doing is akin to a F.S. § 57.105 motion for fees, a comparison I’ve previously written about.

My experience has been that judges usually don’t pull the trigger on this sort of sanction until things get really, really bad. By then, there’s no doubt the wrongdoer is acting way out of bounds, and the court simply enters an order assessing the winning side’s attorneys’ fees against the losing side.

What’s wrong with this picture is that busy trial-court judges may be tempted to NOT include detailed findings of fact in their fee orders. Trial lawyers need to guard against this omission if they want to ensure their hard-fought-for fee orders stand up on appeal. The 3d DCA recently ruled that an attorney’s fee order without supporting detailed findings is per se reversible error.

Levin v. Levin, — So.3d —-, 2011 WL 3477032 (Fla. 4th DCA Aug 10, 2011):

In the linked-to opinion above the trial court’s fee order was reversed NOT because the sanction wasn’t warranted, but simply because the order failed to contain the requisite findings of bad faith, wrongdoing or frivolousness needed to make it stick on appeal.

In this probate case, appellant appeals a judgment assessing attorney’s fees against her share of the estate as well as an order taxing costs against her. The trial court did not make the requisite finding of any bad faith, wrongdoing, or frivolousness before awarding fees against appellant’s share of the estate. See Geary v. Butzel Long, P.C., 13 So.3d 149 (Fla. 4th DCA 2009) (click here); In re Estate of Lane, 562 So.2d 352 (Fla. 4th DCA 1990). Accordingly, we reverse and remand for the trial court to determine, either from the record or after an evidentiary hearing, whether appellant engaged in any bad faith, wrongdoing, or frivolousness in the pursuit of her claim.

Bonus material:

  1. Answer Brief of Appellee
  2. Appellant’s Reply Brief

If, when and how Civ. Pro. Rule 1.525, the rule setting a 30-day post-judgment deadline for filing attorney’s fee motions in civil litigation, applies to contested probate, guardianship and trust proceedings, is an important question. The last thing any lawyer wants to do is blow a deadline for claiming fees on behalf of his client. Here’s what the rule says:

Any party seeking a judgment taxing costs, attorneys’ fees, or both shall serve a motion no later than 30 days after filing of the judgment, including a judgment of dismissal, or the service of a notice of voluntary dismissal.

Florida appellate courts have upheld application of Rule 1.525’s 30-day deadline to all adversary probate and guardianship proceedings (there’s never been any question that Rule 1.525 does NOT apply to NON-adversary probate/ guardianship proceedings), and arguably to all trust proceedings. See Price v. Austin, 43 So.3d 789 (Fla. 1st DCA 2010) (adversary guardianship proceeding, click here); Hays v. Lawrence, 1 So.3d 1176 (Fla. 5th DCA 2009) (adversary probate proceeding, click here); Donkersloot v. Donkersloot, 993 So.2d 126 (Fla. 2d DCA 2008) (trust litigation, click here).

However, a rule designed to apply in the general commercial litigation context didn’t really work in the probate, guardianship and trust context, where fee petitions are appropriately filed all the time, not just after a final judgment is entered. To fix this glitch in 2011 legislative and rule changes were adopted completely eliminating Rule 1.525’s 30-day deadline in the adversary probate and guardianship context, and limiting Rule 1.525’s 30-day deadline to fee petitions filed in trust proceedings by anyone other than the trustee (e.g., a beneficiary suing the trustee for malfeasance).

[1]  Rule 1.525 NOT Applicable to ANY Probate or Guardianship Proceeding:

In In re Amendments to Florida Probate Rules, — So.3d —-, 2011 WL 4467595 (Fla. Sep 28, 2011), the Florida Supreme Court amended subdivision (d)(2) of Probate Rule 5.025 (the rule governing adversary probate and guardianship proceedings), completely eliminating Rule 1.525’s application in the adversary probate and guardianship context as follows:

(2) After service of formal notice, the proceedings, as nearly as practicable, must be conducted similar to suits of a civil nature, including entry of defaults. The Florida Rules of Civil Procedure govern, except for rule 1.525.

[2]  Rule 1.525 Applicable to ONLY Certain Contested Trust Proceedings:

In 2011 the Florida legislature adopted new subsection (6) to Fla. Stat. § 736.0201 specifically limiting Rule 1.525’s application to anyone other than the trustee (e.g., a beneficiary suing the trustee for malfeasance) as follows:

Fla. Stat. § 736.0201(6): 

Rule 1.525, Florida Rules of Civil Procedure, shall apply to judicial proceedings concerning trusts, except that the following do not constitute taxation of costs or attorney’s fees even if the payment is for services rendered or costs incurred in a judicial proceeding:

(a) A trustee’s payment of compensation or reimbursement of costs to persons employed by the trustee from assets of the trust.

(b) A determination by the court directing from what part of the trust fees or costs shall be paid, unless the determination is made under s. 736.1004 in an action for breach of fiduciary duty or challenging the exercise of, or failure to exercise, a trustee’s powers.

For more on the analysis that went into the new trust-code provision limiting Rule 1.525’s 30-day deadline to only certain trust proceedings, you’ll want to read Florida House of Representative’s Staff Analysis of CS/HB 325.

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This I believe: “Always go to the funeral.” This philosophy took me to Caracas, Venezuela where I witnessed first hand thousands of ordinary Venezuelans, jubilantly taking to the streets, welcoming home the remains of their ex-president, Carlos Andrés Pérez, seen by many as a symbol of opposition to the Chavez regime. My clients, President Pérez’s widow, Blanca de Pérez, and her children, beamed with pride and satisfaction as he was finally laid to rest in his native soil after months of heated litigation in Miami.

This was the final chapter in a case that had started for me with a phone call in Miami in late December 2010, and ended ten months later in October 2011, with President Pérez’s burial in Venezuela. The litigation was over President Pérez’s place of burial: Miami vs. Venezuela. The legal issues at play were similar to those in the burial dispute involving Ana Nicole Smith’s remains. I made my first public appearance in this case in early January 2011, when we obtained an emergency order halting President Pérez’s burial in Miami over the objections of his wife and children in Venezuela.

From the start, every court appearance in this case drew multiple reporters and camera crews, reporting the story both domestically and internationally, in English and Spanish, including by the NYTs and WSJ.

Here’s an excerpt from a piece in the Miami Herald, Venezuelans mourn former president Perez, reporting on President Pérez’s final burial in Venezuela:

CARACAS, Venezuela — Thousands of Venezuelans attended a wake for former President Carlos Andres Perez on Wednesday amid tears and speeches a day after his remains arrived in his homeland and ended a a bitter family feud over his final resting place.

Politicians, relatives and supporters of Perez crowded around his closed casket at the headquarters of the Democratic Action party in downtown Caracas and sang the party’s anthem.

“Rest in peace, president,” said Caracas Mayor Antonio Ledezma, once a confidant of Perez.

The remains of Perez arrived in Venezuela nine months after his death in Miami at age 88 set off a feud between his wife, who wanted to bring the body home, and his mistress in the United States, who said Perez had vowed repeatedly never to return as long as political arch-nemesis Hugo Chavez was president.

The two sides finally reached a confidential settlement sending his body back to his homeland.

Given this level of media attention, the Chavez regime’s decade-long grip on power in Venezuela and embrace of poisonous anti-democratic rhetoric, plus Miami’s large exile community, the litigation inevitably took on troubling political overtones. Fortunately, in the end, justice prevailed and President Pérez was buried in Venezuela.

There’s gotta be a better way

The way burial disputes are currently adjudicated in Florida needs to change. As things stand now, in burial dispute cases Florida courts are permitted to accept unwritten, hearsay opinion testimony from anyone who shows up and says he’s got something to say about what the decedent “would have wanted,” if he’d gotten around to writing down his wishes. This approach opens the door to drawn out litigation over the decedent’s burial “intent,” invites abuse and inflames family discord in cases where there really are no winners.

There is a better way

Florida needs new legislation governing burial disputes adopting the same approach already applied to living will/end-of-life cases: if the decedent didn’t leave written instructions as to his burial wishes, his next of kin, in the same order of priority applicable to living will/end-of-life cases (see F.S. 765.401), has sole authority to decide his place of burial. Period, end of story, no hearsay testimony, no opinion testimony, no exceptions, no drawn out trials. If that type of statute had been in place in 2010, all sides of the President Pérez burial case would have been spared the stress, grief and expense of months of heated litigation.

For an excellent article tackling the need for better burial statutes nationwide, you’ll want to read Uniform Acts-Can the Dead Hand Control the Dead Body? The Case for a Uniform Bodily Remains Law. What I find particularly helpful about this article is that it provides a detailed, well-researched and thoughtful proposed statute from beginning to end. For those of you finding yourself involved in one of these cases, you’ll want to read this article. It highlights issues you’ll have never thought of on your own.

Basile v. Aldrich, — So.3d —-, 2011 WL 3696309 (Fla. 1st DCA August 23, 2011)

At one time—under the Florida statute of wills of 1828, in force until the Revised Statutes took effect on June 13, 1892—a will was ineffective to devise Florida real estate that the testator had no interest in at the time the will was executed. Since June 13, 1892, however, a will containing a residuary clause has been effective to transfer after-acquired property. This rule is currently codified in F.S. 732.6005(2). Here’s what the statute says; I’ve italicized the crucial text at the heart of the linked-to case above.

732.6005 Rules of construction and intention.—

(1) The intention of the testator as expressed in the will controls the legal effect of the testator’s dispositions. The rules of construction expressed in this part shall apply unless a contrary intention is indicated by the will.

(2) Subject to the foregoing, a will is construed to pass all property which the testator owns at death, including property acquired after the execution of the will.

Based on this statute the trial court in the linked-to case above ruled that a will devising certain specifically identified property to certain specifically named beneficiaries — but containing no residuary clause — resulted in the specific devisees taking everything. Wrong answer, says the 1st DCA.

The problem – a Will with NO residuary clause.

A residuary estate, in the law of wills, is any portion of the testator’s estate that is not specifically devised to someone in the will, or any property that is part of such a specific devise that fails. It is also known as a residual estate or simply residue. The will may identify the taker of the residuary estate through a residuary clause or residuary bequest. The person identified in such a clause is called the residuary taker, residuary beneficiary, or residuary legatee. If no such clause is present, however, the residuary estate will pass to the testator’s heirs by intestacy. That’s what happened in this case.

Here’s how the 1st DCA described the will at issue in this case:

On April 5, 2004, Ms. Aldrich wrote her will on an “E–Z Legal Form.” In Article III, entitled “Bequests,” just after the form’s pre-printed language “direct[ing] that after payment of all my just debts, my property be bequeathed in the manner following,” she hand wrote instructions directing that all of the following “possessions listed” go to her sister, Mary Jane Eaton:

—House, contents, lot at 150 SW Garden Street, Keystone Heights FL 32656

—Fidelity Rollover IRA 162–583405 (800–544–6565)

—United Defense Life Insurance (800–247–2196)

—Automobile Chevy Tracker, 2CNBE 13c916952909

—All bank accounts at M & S Bank 2226448, 264679, 0900020314 (352–473–7275).

Ann also wrote: “If Mary Jane Eaton dies before I do, I leave all listed to James Michael Aldrich, 2250 S. Palmetto 114 S Daytona FL 32119.” Containing no other distributive provisions, the will was duly signed and witnessed.

Three years later, Ms. Eaton did die before Ann, becoming her benefactor instead of her beneficiary. Ms. Eaton left cash and land in Putnam County to Ms. Aldrich, who deposited the cash she inherited from Ms. Eaton in an account she opened for the purpose with Fidelity Investments. On October 9, 2009, Ann Dunn Aldrich herself passed away, never having revised her will to dispose of the inheritance she had received from her sister.

NO residuary clause = intestacy.

Whenever possible, courts will construe wills in a way that disposes of all of the testator’s estate and avoids intestacy. The Florida Probate Code section that’s supposed to make this all happen is F.S. 732.6005. When in doubt, this statute authorizes a court to interpret or “construe” an ambiguous will in a way that avoids intestacy. But if the will simply doesn’t say what to do with the testator’s residuary estate, the result is partial intestacy; F.S. 732.6005 does NOT authorize a court to fill a blank slate with its best guess as to what the decedent would have wanted. The trial court in this case failed to grasp that distinction. Wrong answer, says the 1st DCA. Here’s why:

We hold that, where a will fails to dispose of all of a decedent’s property (Ann’s will has no residuary clause), “partial intestacy” results; and that property Ann owned at the time of her death not disposed of by her will passes to her heirs, in the manner prescribed by sections 732.101–.111, Florida Statutes (2009). Accordingly, we reverse and remand.

*****

Only subsection (1) of section 732.6005 applies to the dispute here: If discernible from the will, the testator’s intent must be given effect, unless doing so would be illegal or otherwise contrary to public policy. . . . Subsection (2) of section 732.6005 does not apply because it is expressly “[s]ubject to” subsection (1), which provides: “The intention of the testator as expressed in the will controls the legal effect of the testator’s dispositions.” § 732.6005(1), Fla. Stat. (2009). The language of Ann’s will is unambiguous and its intent is clear.

Ms. Aldrich devised her house and lot in Keystone Heights, and bequeathed its contents, together with other personal property that the will identifies with painstaking specificity. Her will plainly evinces an intent to dispose of each particular item of property the will names. Equally plainly, the will manifests no intent to dispose of [her residuary estate], property the will does not allude to in any way.

*****

Synecdoche is a rhetorical device, not a judicial doctrine. “[I]f a will disposes of only one small specific item out of a large and valuable estate, it would be absurd to hold that the devisee of that one small item is entitled to the remainder of the estate.” Matter of Estate of Allen, 150 Mich.App. 413, 388 N.W.2d 705, 707 (1986). The same logic applies in the present case.

*****

A testator may choose to dispose of only a portion of his or her estate by will, allowing the balance to descend under the laws of intestate succession. . . . While the will does not dispose of all the property Ann Dunn Aldrich owned at her death, this circumstance is hardly unique to her or her estate and does not contravene any rule of law or public policy. Nor does the will reflect any mistake on her part.

*****

Section 732.6005(2) is, after all, a rule of construction. Rules of construction are to be resorted to only if the testator’s intent cannot be ascertained from the will itself.  . . . The presumption against partial intestacy is designed to resolve ambiguities where they exist. The presumption should not be applied to create ambiguities in a will where none would otherwise exist.

Irrevocable life insurance trusts or “ILIT’s” are a mainstay of high end estate planning for all sorts of reasons, mostly having to do with saving taxes. For tax reasons, the client usually can’t serve as trustee of his own ILIT. So often family friends (selected for their loyalty to the grantor, knowledge of family dynamics, and willingness to serve without compensation) do the job. What these unsuspecting family-friend trustees never realize is the liability minefield they’re waltzing into [click here].

What to do? Well, you could try to draft around the problem, which isn’t easy and there are no guarantees whatever fix you come up with will survive a court challenge years later before an overworked and understaffed probate judge. Or you could do things the easy way and get the law changed. That’s what Florida did.

Risk Management for ILIT Trustees: Legislative Fix: F.S. 736.0902

As explained in the Legislative Staff Analysis of CS/SB 926, effective July 1, 2010, Florida enacted F.S. 736.0902, statutorily eliminating ILIT trustee liability with respect to (1) insurable interest issues related to the ownership of life insurance and (2) investing in life insurance policies.

The “insurable interest” issues addressed by the ILIT statute are codified in F.S. 627.404. I previously wrote here about how blowing this issue in an ILIT can get you sued. The investment duties waived by the statue for ILIT trustees opting into its protections are found in Florida’s Prudent Investor Rule (F.S. 518.11) and Florida’s Trust Code (F.S. 736.0804).

How Florida’s ILIT Trustee Protection Statute Works:

Under F.S. 736.0902, an ILIT trustee will have NO duty to ensure that there exists an insurable interest in a life insurance policy if:

  1. the trust owns insurance on the life a “qualified person” which is a new statutory concept defined as the “insured or a proposed insured, or the spouse of that person, who has provided the trustee with funds used to acquire or pay premiums with respect to a policy of insurance” on the life of any of those individuals;
  2. the trust agreement does not opt out of the application of statute;
  3. the insurance policy is not purchased from a trustee affiliate nor will the trustee or any trustee affiliate receive commissions related to the policy purchase unless trustee investment duties were delegated to another person;
  4. the trustees did not know that the beneficiaries lacked an insurable interest when the policy was purchased; and
  5. the trustee did not have knowledge of a STOLI (stranger-owned life insurance) arrangement.

Moreover, under F.S. 736.0902 an ILIT trustee has NO duty to determine whether the life insurance policy is a proper investment, to diversify with respect to any policy, to investigate the financial strength of the issuing company, to decide whether to exercise any policy options nor to examine the financial and physical health of the insured if [a] the first three criteria above apply and [b] either:

  1. the trust agreement affirmatively opts in to the application of the statute, or
  2. the trustee gives notice to the trust beneficiaries of the trustee’s intention to opt in to the statute, and no beneficiary objects within 30 days of receipt of that notice or any written objections are withdrawn.

Practice Pointer: ILIT Trustee Statutory Protections are NOT Automatic: Must “Opt In”

The new ILIT statute isn’t self effectuating. In other words, if you want its protections you have to affirmatively opt into its application. You can do this in one of two ways. First, you can include a clause in the trust agreement affirmatively opting into F.S. 736.0902. This is the only way to guarantee the statue will apply to your ILIT. Why? Because the second way to opt into F.S. 736.0902 is by giving all of the ILIT’s beneficiaries notice and an opportunity to object. If even one person objects, the statute’s investment-duty protections will NOT apply. This is an important point. Here’s how the notice/objection regime is laid out in subsection (5)(b) of F.S. 736.0902:

  1. The notice of the application of this section shall be given to the qualified beneficiaries and shall contain a copy or restatement of this section.
  2. Notice given pursuant to any of the provisions of part III of this chapter to a person who represents the interests of any of the persons set forth in subparagraph 1. shall be treated as notice to the person so represented.
  3. Notice shall be given in the manner provided in s. 736.0109.
  4. If any person notified pursuant to this paragraph delivers a written objection to the application of this section to the trustee within 30 days after the date on which the objector received such notice, paragraphs (1)(b)-(f) shall not apply until the objection is withdrawn.
  5. There shall exist a rebuttable presumption that any notice sent by United States mail is received 3 days after depositing the notice in the United States mail system with proper postage prepaid.

 

Common sense, and hard earned experience, tell us that clients can sign perfectly clear and unambiguous wills . . .  that are disasters waiting to happen. Why? Because even the simplest one-page will is governed by a complex body of law that appears nowhere within the four corners of the document, but can have devastating unintended consequences on even the simplest estate plan.

This body of law, known as [1] “rules of construction” (i.e., rules that apply when the will is silent, but which can be varied by the terms of the will; see Part VI of chapter 732 of Florida’s Probate Code for the rules of construction governing Florida wills) and the [2] “rules of law” (i.e., rules that cannot be modified by the terms of the will, such as Florida’s strict homestead laws [see here]), is found in Florida’s common law, Probate Code, Principal and Income Act and related accounting law, and “read into” every will signed in Florida . . .  even the $5-special you bought at Home Depot.

What can a family do when confronted by one of these time bombs? Until recently, not much. Courts had their hands tied; even if there was clear and convincing evidence that the unambiguous text of the will resulted in an outcome directly contrary to the testator’s intent, Florida common law prohibited reformation of the will to fix the mistake.

Legislative Fix:

As explained in Florida House of Representative’s Staff Analysis of CS/HB 325, Effective July 1, 2011, new F.S. § 732.615 became law. This is Florida’s version of Uniform Probate Code § 2-805, dramatically expanding the scope of judicial Will reformation actions to correct drafting mistakes.

The bill creates s. 732.615, F.S., to provide that a court may reform a will even if it is unambiguous. A person challenging the will would have to prove by clear and convincing evidence that both the testator’s intent and the terms of the will were affected by a mistake of fact or law. A court may look to extrinsic evidence in these circumstances even if the evidence contradicts the plain meaning of the will.

In the example of [Azcunce v. Estate of Azcunce, 586 So.2d 1216 (Fla. 3d DCA 1991)], the changes provided in the bill may have allowed the court to look at the extrinsic evidence regarding the deceased’s intent to not disinherit his daughter even though the will was unambiguous and the extrinsic evidence contradicted the plain meaning of the will.

The bill creates s. 732.616, F.S., to provide that any interested person may petition to modify a testator’s will in order to achieve the testator’s tax objectives, provided such modification is not contrary to the testator’s probable intent. This change would allow a party to seek modification of the will in order to achieve a tax advantage intended by the testator so long as the modification is not contrary to the testator’s probable intent.

The bill creates s. 733.1061, F.S., to provide that in the newly created actions under s. 732.615 and s. 732.616, F.S., “the court shall award taxable costs as in chancery actions, including attorneys fees and guardian ad litem fees.” A chancery action for attorneys fees and costs is an action in equity that is similar to a prevailing party provision for attorneys fees and costs, but equity does give the court discretion if the circumstances demand. The new section would give the court the ability to charge attorneys fees and costs directly to a party. The bill also gives the court the discretion to tax the fees and costs against a party’s interest in the estate or other property of the party that is not part of the estate.

For an excellent discussion of Florida’s prior common law governing will-reformation actions and how this new legislation brings us into line with modern national trends, you’ll want to read WILL REFORMATION LEGISLATION by Brian Felcoski (prepared with the assistance of Elisa F. Lucchi and Jon Scuderi). Here’s an excerpt:

Restatement Third Property §§ 12.1 and 12.2: Many states have adopted the approach in the Restatement Third which allows: (1) construction of wills where appropriate, and (2) reformation of wills for unilateral mistake by the testator (or the scrivener as the testator’s agent).

. . .

Rationale of Rest. 3d Prop. §12.1: The rationale is that admitting evidence outside the four corners of a will is inherently suspect but, possibly correct. Rest. 3d Prop. – WDT, §12.1, comment b. However, the law deals with evidence that is inherently suspect but possibly correct on one of two ways, namely: (1) to exclude evidence; or (2) to consider extrinsic evidence with safeguards to prevent against mistaken evidence through a strict burden of proof. Id.

. . .

Overview of the Uniform Probate Code §§ 2-805 and 2-806: The language in these sections of the UPC was patterned after the language in Sections 415 and 416 of the Uniform Trust code, which in turn was based on the Restatement Third of Property. As such, the rationale of the drafters of the UPC was the same as the drafters of the Restatement Third.

 LoCascio v. Estate of LoCascio, — So.3d —-, 2011 WL 2555644 (Fla. 3d DCA June 29, 2011)

Silvia Locascio’s brutally beaten corpse was found in her home on October 30, 2001. Eventually her husband and brother-in-law were found guilty of her murder – based in large part on the testimony of the couple’s only son. Click here, here for more on the back story to this tragic case.

In this latest — and hopefully final — chapter of this very sad case, the 3d DCA reversed a probate order summarily removing the decedent’s son as PR of her estate. This court order was just as summarily reversed by the 3d DCA in the following one-paragraph opinion:

Edward J. LoCascio appeals from an order removing him as successor personal representative of his deceased mother’s estate. See LoCascio v. Sharpe, 23 So.3d 1209 (Fla. 3d DCA 2009); see also Golden & Cowan, P.A. v. In re Estate of Locascio, 41 So.3d 1113 (Fla. 3d DCA 2010). Because the “hearing” which preceded the ruling did not meet even the most rudimentary requirements of due process, including without limitation the presentation of evidence, it is reversed and the cause remanded with directions to reinstate the appellant as personal representative and for the prompt final resolution of this already over-protracted proceeding.FN1

FN1. We consider that this ruling obviates any reason for a curator or any other extraneous entity to administer the estate.

In order to understand this opinion I think you need to keep two points in mind.

First, the family tragedy at the heart of this case has been the subject of multiple criminal and probate trials plus 9 appeals as far as I can tell. By now — 10 years after Mrs. Locascio’s murder — the 3d DCA is tired of this case and wants it to go away (note the court’s gratuitous reference to “prompt final resolution of this already over-protracted proceeding” and its parting shot in FN1).

Second, the 3d DCA’s emphasis on due process underscores the importance Florida law gives to the office of personal representative/PR. Probate judges do not have unfettered discretion to simply remove a PR because someone shows up in court and starts complaining. There needs to be evidence of wrongdoing, and that evidence needs to be presented at an evidentiary hearing affording all concerned with all of the due process protections Florida law affords to such litigants.

Lituchy v. Estate of Lituchy, — So.3d —-, 2011 WL 2135597 (Fla. 4th DCA Jun 01, 2011)

I previously wrote here about whether a person should be required to hire a lawyer if he or she wants to petition a court to probate a will. In Florida the question is governed by Florida Probate Rule 5.030(a), which provides 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. A guardian advocate is not required to be represented by an attorney unless otherwise required by law or the court.

In this case the probate court denied the pro se petition for formal administration filed by the estate’s sole beneficiary because he wasn’t represented by an attorney. Wrong answer says Rule 5.030 (did no one point this simple rule out to the court?), and now the 4th DCA:

The trial court denied the pro se petition for formal administration of the estate of the appellant’s wife, because the appellant was not represented by an attorney. We reverse, because the petition states that the appellant is his wife’s sole beneficiary. Thus, he is entitled to file the petition without the necessity of an attorney. See Fla. Prob. R. 5.030(a) (“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.”) (emphasis added); Benedetto v. Columbia Park Healthcare Sys., 922 So.2d 416 (Fla. 5th DCA 2006).

Reversed and remanded with directions to reinstate the petition for administration.