Posts Tagged ‘Probate’

Privacy Concerns Loom Large in Probate Court

JANUARY 16, 2017 VOLUME 24 NUMBER 3
Things change. This is our twenty-fourth year of publishing Elder Law Issues, and one thing we frankly didn’t think much about a quarter-century ago was privacy. Today it’s a big concern, and central to a lot of our thinking.

When Fleming & Curti, PLC, first formed in 1994, partners Tom Curti and Robert Fleming each already had nearly twenty years of professional practice. During those early years, we commonly included client’s Social Security numbers in estate planning documents, as did most practitioners. We all routinely provided detailed financial information in court filings — both in probate cases and in guardianship and conservatorship matters.

Yes, “identity theft” was an issue, even in the 1970s and 1980s. But most cases of identity theft in those days involved bad people looking for the names of people who had died in their teens, or even before, and applying for credit and entering into transactions using those names. Even if information was filed in the County courthouse, it was only theoretically vulnerable — few people knew how to get into court files, and one would have to physically travel to the courthouse to look up information. While nominally public, information filed in public records did not seem very vulnerable.

That is simply not the case any longer. Many county courts (not — yet — including the Pima County Superior Court in Tucson) have all of their court files available online. Regional and national aggregators — and even search engines — can list your name, or your parents’ names, for easy retrieval. Identity thieves can look up that information from the comfortable anonymity of their own computers, and from anywhere in the world.

At the same time, public information is generally, well, public. The community has a right to know who has been sued, who has brought suit, and who is involved in court cases. But how to balance that open disclosure with the need for privacy?

That’s the problem faced this month by the Maine Supreme Court — in a request by a single participant in the Maine guardianship/conservatorship system. “Emma” (not her real name — the Supreme Court itself agreed to “de-identify” Emma by giving her a false name) sought to have her financial records removed from the publicly available records. She alleged that the court was involved in disclosing her personal information, and that the practice should change. She also argued that removing the public information would be an appropriate accommodation under the Americans With Disabilities Act, and that failure to do so was discriminatory against individuals whose disabilities resulted in court-ordered guardianships and conservatorships.

The probate judge in Maine recognized that there was a legitimate concern. In an unusual request, he asked the state Supreme Court to tell him: should such records be completely hidden from view, referred to but not made available, summarized but not actually put online, or made completely available online?

The Maine Supreme Court punted. It observed that it might be appropriate to set a statewide rule, but not in an individual case. It ruled that Emma might well have a method of making her case, using her ADA argument. And, it reasoned, it wasn’t particularly good at giving general advice — its job was to decide individual cases, and not so much to review rules and procedures. They declined to answer the judge’s questions. Conservatorship of Emma, 2017 ME 1, January 5, 2017,

This problem faces every court, not just those in Maine. In Arizona, for instance, our Supreme Court has adopted extensive rules attempting to maintain privacy of items like Social Security numbers, bank records and balances, medical diagnoses and information. Today much of the contents of a guardianship or conservatorship file will be sealed, made available only on specific court order and then only to individuals who have some reasonable basis for getting access.

There are several other ironies in the Maine Supreme Court’s review of confidentiality. One involves Emma herself — though the Court changed her name, it left enough detail that it was frankly child’s play to look her up, learn her name and address, and the approximate value of her assets — without setting a foot in Maine. It took about fifteen minutes of online searching; we did not seek to learn anything about Emma, but only to see how easy it might actually be.

We sympathize with the Maine courts’ concern about how to balance information with privacy. We have been wrestling with the same problem in this weekly blog-based newsletter for several years. Regular readers will see that we, like the Court, anonymize names of litigants on a regular basis. We do that despite the reality that their names are usually public records (usually included in the name of the case itself — though not in Emma’s case). Why bother? At least we hope that a search for a grandmother or uncle by name will not list their legal troubles — and our newsletter article about them — at the top of the list. But in order to give readers the ability to follow up on the details of court opinions, we still have to include the name of the case.

It seems likely that the County court handling Emma’s case will continue to work on how to protect privacy issues. The judge who entered orders in her case — and who helped seal much of the public record about her — died in September last year. His elected successor: his wife, who presumably will have similar plans for protecting personal information in probate proceedings.

Common-Law Marriage, Divorce and Probate, All In One Case

DECEMBER 19, 2016 VOLUME 23 NUMBER 47
Here’s a question we hear frequently: how long does a couple have to live together in order to be considered married? The answer in Arizona: until the wedding ceremony.

In other words, Arizona does not recognize “common-law” marriages. That strong, direct statement, however, masks a more complicated answer. Arizona, like every other state, will recognize a marriage that was validly established in another state — so if a couple living in, say, Oklahoma (which does recognize common-law marriages) meets that state’s requirement to be treated as validly married, and they then move to Arizona, they will be married under Arizona law, as well.

No state, however, has a concept of concept of common-law divorce. That is, a divorce must be granted by a court, and can not be established by the couple simply acting as if they were divorced. And no state recognizes bigamous marriages — so if a couple is already married (by common-law or by a formal state-recognized marriage), neither spouse can enter into another marriage, whether by common-law or regular ceremony.

Try telling all that to Rhonda Brown, an Oklahoma woman who seems to have a fairly fluid concept of marriage. She and Bobby Joe Brown were married in 1995, and they had three children together. After a few years of marriage, though, she told her husband that she could not continue to live with him if he did not stop sleeping with other women, and when he did not change, she moved out on her own.

Rhonda moved around Oklahoma and Kansas for several years. She had children by another man (they were removed from her care by the Kansas authorities). According to her testimony, she and Bobby Joe still saw one another occasionally.

At one point Rhonda even “married” another man — though she said she always thought of the second marriage as a “sham.” How did that happen? According to her, she and Jimmy had been long-time friends and had always agreed they would marry one another if it was necessary for one to help the other out. After Jimmy’s release from prison, his grandparents let him live with them and supported him, but told him he needed to get married. When Rhonda agreed to visit his grandparents and tell them that she and Jimmy were going to get married, his grandparents immediately called a minister and had the ceremony that same day. She never saw Jimmy again, she said.

Meanwhile, Bobby Joe had moved in with another woman, Ami. Although they never had a marriage ceremony, Ami said that they always acted as if they were married, and held themselves out as husband and wife. That’s the very definition of common-law marriage in most states where it is permitted — including Oklahoma. They even had two children together and, according to Ami, they were a married couple in almost every respect. One problem: Bobby Joe was still married to Rhonda.

Then, in 2013, Bobby Joe died in a motorcycle accident. Ami filed a petition with the local probate court, alleging that she was the surviving spouse and asking for appointment as personal representative of his estate. The probate judge approved her appointment as personal representative; Ami did not mention Rhonda or give her notice of the proceedings.

Rhonda ultimately learned about the probate of Bobby Joe’s estate, and sought to remove Ami as personal representative. She pointed out that she had priority for appointment as Bobby Joe’s legal spouse, and that she was one of the heirs of his estate. The probate court heard testimony about the complicated relationship — and then denied Rhonda’s claim to priority for appointment.

The Oklahoma Court of Appeals affirmed the probate court decision, and Rhonda asked the state Supreme Court to review the ruling. The Oklahoma Supreme Court also agreed that Rhonda should not be appointed to administer her husband’s estate.

It is important to note that the state courts did not find that Rhonda and Bobby Joe were divorced, or that Bobby Joe and Ami were validly married. The ruling was ultimately based on concepts of “estoppel” — Rhonda could not make the legal argument that she was married to Bobby Joe because she had participated in another marriage, even though she claimed that her second marriage was a sham. To be more precise, the ban against her asserting her status as surviving spouse might be said to be partly because she admitted to a sham marriage — the courts decided that she should not be permitted to argue two inconsistent things in two different state proceedings. Estate of Brown, November 1, 2016.

The decision in Bobby Joe’s probate appeal was not unanimous, by the way. Six of the nine Justices of the Oklahoma Supreme Court agreed that Rhonda should not be allowed to seek appointment as personal representative, while three argued that there had been no divorce and Rhonda was still entitled to handle Bobby Joe’s estate.

It is also worth noting that the Oklahoma courts did not decide that Rhonda was not Bobby Joe’s surviving spouse. Though she could not insist on her priority for appointment as personal representative, the state Supreme Court decision does not say that she is not entitled to a share of Bobby Joe’s estate. That argument might be made later, back in probate court. We’ll let you know if we hear about it.

Why do we care about common-law (and other fluid concepts of) marriage in Arizona, where only properly recorded marriages are valid? For two reasons: (1) people who move to Arizona from Oklahoma, Kansas, Montana — or one of the handful of other states which recognize common-law marriages — might bring their confused marital statuses with them, and (2) we are constantly both surprised and intrigued by the complicated ways people live their lives.

It has been more than a decade since we last reported on common-law marriages, incidentally. In our 2013 newsletter article on the subject, we reported that fifteen states then recognized some form of common-law marriage. Today that number is down to eleven, with some dispute as to the status in one or two of those.

Public Fiduciary Offices in Arizona

SEPTEMBER 20, 2016 VOLUME 23 NUMBER 35
When an individual living in Arizona becomes incapacitated, or needs financial protection because of diminishing capacity, a family member, friend or private professional fiduciary might be appointed to act as guardian (of the person) or conservator (of the estate). But what if there is no one available to act, or if all the possible candidates are disqualified for some reason?

For over four decades Arizona counties have had a public official who can act as guardian and/or conservator when no one else is available. The Public Fiduciary is designated in each county by the Board of Supervisors, and runs an office (and staff) funded by the county. In addition to guardianship and conservatorship, the office also handles probate of decedent’s estates when no one else can be appointed.

A handful of other states have similar offices, though most handle guardianship only, conservatorship only, or probate only. Many states have similar agencies that can act as guardian or conservator for particular groups of people — typically veterans, or the developmentally disabled. Arizona’s unique experiment was to group all those functions together into one office, and to call it the Public Fiduciary.

Does that mean that Arizona’s Public Fiduciary offices are an inexpensive alternative for poor families who don’t want to incur the costs of initiating guardianship, conservatorship or probate? No. Public Fiduciary offices do not represent families — they file petitions for the office’s own appointment instead of appointment of family members. They also charge fees, meaning that they may or may not be less expensive than private fiduciaries and lawyers representing family members. Most importantly, they will not act when there are suitable family members available.

Arizona’s Public Fiduciary offices have been a very positive success (though there have been individual incidents of abuse by at least two different Public Fiduciaries). Generally speaking, the offices act when estates are small, legal problems are substantial, and/or family members have misbehaved. But there are no formal limitations on the kinds of cases the Public Fiduciary can get involved with, and (though the experience is different in each county) public fiduciaries tend to be the most experienced, most knowledgeable resource for guardianship, conservatorship and probate problems in most counties.

You can read more at the website of the Pima County Public Fiduciary (that’s the county in which all of Tucson is located). There is a separate — but usually similarly-run — office in each Arizona county. Note that, at least in Tucson, the office also handles other, related functions — chief among those is management of the county burial system for indigent decedents or those who die without locatable family.

We last wrote specifically about the Pima County Public Fiduciary in (and this amazes even us) 1994. To put that in context: the office is now more than twice as old as when we last highlighted them. A considerable amount has changed since that time: for one thing, the current Pima County Public Fiduciary (well, the Interim Public Fiduciary, anyway) is the first non-lawyer to hold the office in its 42-year history. Peter Santini has been a core staff member for two decades, and is a logical choice to handle that role. His predecessor retired recently, and the County is in the process of making a permanent selection.

One thing hasn’t really changed in over twenty years. You can still make a referral to the Pima County Public Fiduciary by calling their office and talking with an intake person on staff. Their phone number: 520-724-5454.  Remember, though, that they only handle Pima County cases; there’s no point in contacting them about Public Fiduciary matters in any of Arizona’s other 13 counties, or for similar cases in other jurisdictions.

If you thought about it a minute, you’d probably guess that the availability of an office like the Public Fiduciary would mean that there are fewer private-industry alternatives for similar work in Arizona. In fact, though, the experience is exactly the opposite. Despite a robust and effective Public Fiduciary system in Arizona, the private fiduciary industry is much more extensive, better-regulated and more professional than in many other states. That may be partly a result of good training — a large portion of the private fiduciary industry learned how to handle guardianships, conservatorships and probates while working in their local Public Fiduciary offices.

Court Invalidates Will and Trust Naming Lawyer as Beneficiary

JULY 11, 2016 VOLUME 23 NUMBER 26
One principle governing lawyers is obviously and intuitively correct: A lawyer may not prepare a will or trust (or, for that matter, any other document or arrangement) by which a client makes any substantial gift to the lawyer. Similarly, lawyers are precluded from preparing documents giving or leaving anything of value to the lawyer’s close family members, either.

The American Bar Association, in its “Model Rules of Professional Conduct,” codified the principle. Rule 1.8(c) of the Model Rules says:

“A lawyer shall not solicit any substantial gift from a client, including a testamentary gift, or prepare on behalf of a client an instrument giving the lawyer or a person related to the lawyer any substantial gift unless the lawyer or other recipient of the gift is related to the client. For purposes of this paragraph, related persons include a spouse, child, grandchild, parent, grandparent or other relative or individual with whom the lawyer or the client maintains a close, familial relationship.”

That rule has been adopted in 49 states, the District of Columbia and the U.S. Virgin Islands. Some of those jurisdictions may have modified the rule slightly, but the basic principle is pretty nearly universal. It also is clearly appropriate.

But lawyer ethics rules are not the same as laws, and it is not that hard to imagine that an ethically-challenged lawyer might be willing to violate the rule — if he or she could still inherit a substantial estate, it might not matter whether the license to practice law is revoked. Most court decisions dealing with lawyers who write themselves into wills (they are blessedly rare) recognize that the document itself should also be found to be invalid, at least to the extent of any gifts to the lawyer or his/her family.

You may have noticed that there is just one U.S. state which has not adopted the ABA’s Rule 1.8. In fact, California has not adopted any of the ABA’s Model Rules. What California has done, though, is to adopt an even stronger law. Under its law governing wills and trusts, any document prepared by anyone in a fiduciary relationship with the signer is presumed to be invalid — and the law is clear that lawyers are fiduciaries. In other words, California’s go-it-alone approach to this issue results in a stronger proscription than in most states.

That provision was put to the test last month in a case involving 74-year-old California lawyer John F. LeBouef, who was accused of having prepared (and possibly forged) a will and trust naming himself as principal beneficiary of a client’s $5 million estate.

LeBouef’s client, himself 73 years old at the time of his death, had been in poor health since the death (seven years before) of his life partner. The client was reported to have serious problems with alcohol, to the point that neighbors reported that he frequently would fall down in his home, howl like a dog, and occasionally soil himself.

The client had two nieces who were probably named as his principal beneficiaries in a will and trust he signed in 2006. “Probably” because, as it turns out, the original documents were lost — in a burglary of the client’s home after his death, in which his prior estate planning documents (and LeBouef’s laptop computer) were among the only items stolen. At trial, the probate court judge found LeBouef’s testimony about the burglary, the preparation of the new documents, and the client’s intentions all unbelievable.

Some part of the judge’s incredulity was related to LeBouef’s prior behavior. It developed that, after he helped an 86-year-old caretaker claim a $2.5 million inheritance from the estate of the man she had cared for, LeBouef’ marred his client (he would have been about 60 at the time) and, ultimately, inherited the bulk of her estate. Meanwhile, another, 90-year-old, client of LeBouef’s had left most of her $1.3 million estate to LeBouef’s life partner (and business partner), Mark Krajewski. LeBouef had prepared the four amendments to that client’s trust, of course.

After the California probate judge invalidated the will and trust naming LeBouef, she also ordered him to pay the client’s nieces over $1.2 million legal fees — those fees and costs were incurred in their successful challenge of the documents prepared by LeBouef. Perhaps the most impressive act of bravado, though, was LeBouef’s final request of the probate court: he asked the court to approve payment of a fee to him for acting as trustee during the litigation, including a separate fee for managing the trust’s real estate (including the decedent’s home, in which LeBouef lived for three years rent-free). The probate judge declined the request.

The California Court of Appeals reviewed the case and, in a strongly-worded decision, approved the probate court’s rulings on every score. In fact, the Court of Appeals directed that a copy of its decision should be sent to the State Bar of California and to the local prosecutor’s office. “We express no opinion on discipline and/or the decision to initiate criminal prosecution,” wrote the Court. Butler v. LeBouef, June 20, 2016.

Disappointed Heirs Not Permitted to Make Claim Against Dad’s Lawyers

JANUARY 25, 2016 VOLUME 23 NUMBER 4

Like a lot of Americans, Fred Brown (though that’s not his real name) had a complicated family life. He had been married twice, and had two daughters — Martha and Sally — from his first marriage. He was still married to Barbara, and she had two children from her first marriage (Patty and Richard). Fred needed to do estate planning, and he did — he hired a Colorado law firm to prepare his will.

The will his lawyer wrote for him followed his wishes: it left the condominium he and Barbara lived in to Barbara, and a $10,000 bequest to each of the four children (both his and Barbara’s). Everything left over after that would go into two trusts for Barbara’s benefit; on her death, the trusts would be equally divided among the four children.

Fred died in 2003, and Barbara hired her husband’s lawyers to handle the probate. Fred’s daughters Martha and Sally asked about their inheritances, and the law firm told them that they would each receive their $10,000 and that they would share the money in the trusts on Barbara’s death. The lawyers also told Martha and Sally that they represented Barbara, not the whole family, and that if Martha and Sally had any questions about the probate they should get their own legal advice.

Barbara properly established the trusts called for in Fred’s will; they totaled just under $1 million in value. She also hired the same lawyers to prepare her will, which left her condo to her daughter Patty and the rest of her estate to Patty, Martha and Sally.

When Barbara died in 2009, Martha and Sally were upset that they did not receive an equal share of the condominium once owned by their father. They complained that Patty had ended up with about 70% of Barbara’s assets, while they each received only about 15% (it apparently did not bother them that Richard did not receive anything from his mother’s estate). They acknowledged that they would still share the remainder in the trust established under Fred’s will, but objected that Patty would get about $3.2 million in total inheritances from Fred and Barbara, while they would only receive a little under $1 million each.

Martha and Sally sued the law firm that had prepared Fred’s estate plan, alleging that the lawyers had committed malpractice by not ensuring that Fred’s wishes were carried out. They also complained that the lawyers had failed to disclose all the information about the property ownership they had needed to protect their alleged right to receive a share of Barbara’s inheritance on her death.

After a series of motions, the trial court dismissed Martha and Sally’s lawsuit. The judge ruled that even if they could prove that a mistake had been made, Fred’s lawyer did not owe Martha and Sally any duty giving rise to a claim. The Colorado Court of Appeals affirmed the dismissal, and the state Supreme Court agreed to review the entire matter.

The Colorado Supreme Court upheld the dismissal of Martha and Sally’s claim. Colorado strictly applies the doctrine of “privity” to prevent lawsuits against lawyers by non-clients in most circumstances, and these facts did not persuade the state’s high court to modify its rules. Besides, as the Supreme Court Justices noted, it looks like Fred got exactly what he wanted: his home went to his wife, $10,000 went to each child on his death, and the rest of his estate stayed in trusts that got divided into four equal shares on his widow’s later death. Baker v. Wood, Ris & Hames, Professional Corporation, January 19, 2016.

Would a similar case be dismissed in Arizona, as it was in Colorado? The answer is uncertain. Arizona does not have cases expressly upholding, modifying or rejecting the “privity” doctrine. A growing body of law across the country indicates a general move toward higher liability for attorneys, but it is not clear whether that trend will likely come to Arizona.

Should Fred’s lawyers have been liable to Martha and Sally? Not if they followed Fred’s wishes, regardless of how unhappy his daughters might have been. The difficulty in such a case would be to establish with clarity what Fred wanted. Did he clearly contemplate what might happen between his own death and the death of Barbara six years later — and of course Fred did not know with certainty that he would die first, much less how long Barbara might survive him.

This is one of the challenges we face when counseling clients about estate planning. Married couples may be able to imagine what might happen after the death of the first spouse to die, but neither spouse is likely to have contemplated what their survivor’s life might look like six, or ten, or twenty years after the death of the first spouse. It’s impressive, actually, that Fred and Barbara got as much right as they did — many widows in Barbara’s situation might begin to modify the disposition of their assets more quickly than the six years Barbara left things (more or less) as they were.

Woman’s Holographic Will Effective Despite State Law

JANUARY 18, 2016 VOLUME 23 NUMBER 3

It might seem odd that interstate problems in probate proceedings arise. After all, we have had 50 states and a handful of other jurisdictions gathered together in the United States for a half-century, and nearly that many for most of the two centuries before that. Shouldn’t differences in probate interpretations been ironed out by now?

Not necessarily. Perhaps it is a result of the fact that Americans are much more mobile today than they were even a few decades ago. Perhaps it is partly because of improvements in communication, letting interstate issues rise to the surface more readily. For whatever reason, a recent case involving Pennsylvania and Connecticut demonstrates that there can still be uncertainty about application of probate principles.

Rose and Mae (we’ll leave their last names out of this explanation), sisters, lived together in a house in Philadelphia for many years. They jointly owned their home, and they also were two of five joint owners of a farm in Connecticut. The farm was an inheritance, still held in the names of Rose, Mae, their brother Stephen, their sister Alyce, and a nephew (John) who had inherited his father’s share.

At Christmas time in 2000, while Rose was recovering from a stroke, Stephen sent a card to his sisters. He urged them to do some estate planning, since if they failed to do so “the lawyers would have a field day” and there estate taxes would be very high. He was wrong about that last assertion, incidentally, but that is not the point of our story.

In any event, Rose responded to her brother’s suggestion by dictating the language of a will to Mae’s son, who lived nearby. He wrote out her will, she made a few changes (adding her middle initial, for instance) and signed the document. She did not have it witnessed, and did not talk to an attorney about improving the quality of her will — she lived another six years, but did not update the document.

After Rose’s death (and after Mae entered a nursing home), Mae’s son initiated a probate proceeding in Pennsylvania, where Rose had lived and died. He sought admission of the handwritten document as a “holographic” will; Pennsylvania law recognizes such documents even if they are not signed by two witnesses. Initially John, Stephen and Alyce (Rose’s nephew and two siblings) objected to the Pennsylvania probate, but then they withdrew their objections. The will was admitted to probate in Pennsylvania.

Then Mae’s son filed an action in Connecticut to have the Pennsylvania probate proceeding recognized there. Such a proceeding is called an “ancillary” probate, meaning that it relies on the validity and rulings of the court in another state (the “domiciliary” state). John, Stephen and Alyce objected, arguing that Connecticut law does not permit holographic wills. They also argued that evidence showed that Rose was unduly influenced, and that Connecticut public policy did not favor wills such as Rose’s.

The Connecticut trial court ruled that the question was not whether Rose’s will would satisfy Connecticut law, but whether it had been found to be valid in Pennsylvania. Since it had, said the judge, the only issue was whether there was sufficient reason to challenge that ruling — finding none, the will was admitted and effectively transferred Rose’s interest in the inherited family farm to Mae’s family.

The Appellate Court of Connecticut agreed with the trial judge, and upheld his ruling (interestingly, only nephew John had appealed, not that it actually matters). The result: Rose’s holographic will, not itself valid in Connecticut, was effective to pass Connecticut property because it was valid in Pennsylvania and admitted to probate there.

The appellate judges noted that the common law rule had been different. Until the 1850s, when Connecticut had expressly adopted a statute recognizing the validity of wills which were valid when and where they were executed, a will would not be effective to pass Connecticut real property unless it met that state’s tests for validity. For the past 150 years, though, Connecticut had expressly approved out-of-state wills that met their local requirements for execution. Goodwin v. Colchester Probate Court, January 19, 2016.

Would Arizona courts reach the same conclusion? From the description, for instance, it appears that Rose’s holographic will would not meet Arizona’s requirements for admission to probate (Arizona is one of the states that, like Pennsylvania, recognizes holographic wills — but they have to meet Arizona’s requirements). If Rose had held real estate in Arizona, would her will have been effective? Although the precise question has not been addressed in Arizona, the result should be the same — though there is one 70-year-old Arizona case that might support an opposing argument.

Another point needs to be made: we are constantly surprised that people might leave their estates in such disorder as to trust handwritten notes which might be subject to dispute. In the six years after her brother suggested she ought to plan her estate, could Rose not find an hour to visit a lawyer to get good advice? For that matter, couldn’t she have undertaken that project sometime in the decades before her brother’s suggestion?

It is perhaps not too surprising that Rose might want to leave the bulk of her estate to her sister (with whom she lived) and her sister’s family. It is only surprising that she left her affairs in a condition that enhanced the likelihood that “the lawyers would have a field day,” and that she would create legal disputes among her family members. It would have been so easy to avoid that result.

Handling Your Own Legal Work — Without a Lawyer

OCTOBER 12, 2015 VOLUME 22 NUMBER 37

Last week we wrote about when you might reasonably represent yourself — that is, when you might not need a lawyer for your legal work. We suggested that what lawyers do is not precisely brain surgery, and that reasonably intelligent, informed and diligent non-lawyers might well be able to handle a number of legal tasks on their own. But which tasks, particularly?

You know you’re not going to get a lawyer to answer that question without a number of disclaimers and qualifications. Let’s be clear about what we have to say here: this advice will not apply to every individual, or in every state, or in circumstances that seem similar to what we describe. Treat this advice like the dangerous information it is: we’re not giving you blanket permission to represent yourself in a range of legal issues, and if things go wrong we don’t want you complaining that we told you it would be fine. We mean no such thing.

The default choice you should make in every legal issue is to talk to one of the people who know legal matters best. There is a name for those people: they are called lawyers.

Are you worried about cost? Start the conversation with the lawyer you consult by insisting on knowing how charges will be calculated and how you can stop the cost if it begins to overwhelm. Are you worried about getting information you don’t want to hear? Then you really, really need to talk with a lawyer. Are you worried about people finding out just how much trouble you’re in? Your conversations with the lawyer are almost always completely privileged — no one is going to hear about the fact that you consulted the lawyer, much less what you talked about.

All that said, we know how people are. You want to do it yourself. You want to save money. You want to figure it out, just like you did when you built your house without a contractor, or fixed your car without a mechanic. OK — are there some legal tasks that are safer for you to tackle than others? Yes, there are.

Wills

Can you write your own will? Yes. There are lots of forms out there, and you can use software to do much of the work. As between those two choices, by the way, we prefer software; it will take you down a branching decision tree, and will reduce the likelihood that you will make a mistake. But not eliminate it.

We are fond of recalling the client who brought us his father’s will. Dad had found a form for a will for a single person, and had just scribbled out the provisions about being single and written in mom’s name. Then he had adjusted the other provisions for the fact of mom being in his life. Problem was, the whole thing no longer made sense. Property did not pass the way dad almost certainly intended. Yes, he saved a couple bucks on legal fees — but the cost to his family was much, much higher.

That story being told, the reality is that most people will do just fine if they write their own wills. The key word in that sentence is “most” — some will foul up their estates, and fantastically (and expensively). That won’t be you, though — right?

By the way, if you use software or a form you are giving up on the opportunity to have a conversation with someone who knows what they are doing. Maybe you don’t need to make provisions for your home, if you take advantage of Arizona’s “beneficiary deed” provision. Or maybe that isn’t the right choice for you. Will the computer chat with you about that, or about your wishes for end-of-life care, or — stuff you can’t even think of?

Trusts

Just talk with a lawyer, please. The forms and books you read will oversell trusts, and the number of steps you need to take will complicate things beyond most people’s ability to figure it out on their own.

If you insist on preparing a trust without a lawyer, once again we prefer software to books and forms. But don’t think you can prepare the trust using software and save a couple bucks by taking the completed form to the lawyer to review — it takes us just a little bit longer to review your document than it does to interview you, figure out what you need, and then prepare the right document in a format we’re familiar with. In other words, it actually costs more.

Probate

Can you handle the probate of your mother’s estate without a lawyer? Probably. Do you and your sister get along well? Is your mother’s estate all in Arizona? Is the will clearly valid (or are the heirs easy to figure out)? If so, the probate may not be that complicated.

Don’t expect to just drop by the courthouse and talk with the judge, or the probate clerk. You can talk with someone in the clerk’s office, but they won’t give you forms or any legal advice. They will tell you to go to the local bar office (or someplace similar) to pick up the forms (you’ll likely pay a few dollars for that) and fill them out.

The process won’t be any faster without a lawyer — in fact, it’ll probably take longer. It will be frustrating and you’ll feel like you’re having to do things that you shouldn’t have to do. But you’ll likely get through it just fine.

Planning on fighting with your brother, or your stepfather? Talk to a lawyer before filing a single thing.

Guardianship

The share of guardianships filed without a lawyer increases every year. That’s mostly OK — the process is complicated, but at least there are a couple of lawyers involved in most guardianship proceedings even if you don’t hire one. The judge, for one, is a lawyer. The subject of the guardianship will have a lawyer appointed to represent them. You’ll get feedback from those lawyers, and from the clerks and others in the system, that will keep you from going horribly wrong. Probably.

One piece of advice: if the court clerk stops, look at you quizzically and suggests you might want to talk with a lawyer — go talk with a lawyer. That is a clear indication that something about your case is out of the ordinary. While the court staff can’t give you legal advice, they are pretty good at body language.

Guardianships of minor children are even easier for most people to take care of on their own. In fact, lawyers are involved (in Arizona — very different answers might apply in other jurisdictions) in a minority of minor guardianship proceedings. But if things get peculiar, or you get anxious about whether you’ve done things right, talk with a lawyer. You might not need to turn the guardianship petition over to them, but make sure you’re in the clear.

Conservatorships

When handling someone else’s money is involved, you need legal advice. We’ve watched people actually go to jail for things that they thought were just fine — the court’s view of the conservatorship is much more restrictive than the view of many family members. Don’t risk it.

Remember that a conservatorship necessarily means that there is money to manage, and that your legal fees can likely be paid from that money. It’s just a good investment.

[Did we mention that we only mean this to apply in Arizona? Let us repeat that — and observe that even the words “guardianship” and “conservatorship” can mean something else in other states.]

We hope this helps. We really do favor people handling their own affairs when they can, and most lawyers agree: we will help you figure out whether you can do this yourself.

Attorney’s Fees in Probate Proceeding Challenged, Approved

SEPTEMBER 7, 2015 VOLUME 22 NUMBER 32

How much can an attorney charge in a probate proceeding? In Arizona, at least, the principal rule is one that is difficult to determine: attorney’s fees must be “reasonable”. But what does that actually mean?

A recent Arizona Court of Appeals decision approving the fees charged by the attorney for an estate’s personal representative may give the answer for that case, but may leave lawyers (and heirs) scratching their heads. It involved a relatively small estate, and what looks at first glance like an unremarkable set of legal issues.

Angela Teran (not her real name) died in 2010. Her will was easily admitted to the probate process in Maricopa County (Phoenix) courts. A personal representative was appointed, and she hired Phoenix-area attorney Robert Kelly Gorman to represent her.

Angela’s will directed that $2,000 should be given to her church, and the rest of her estate divided among four named individuals. It was not clear from the will whether the division of the remainder should be in equal shares or by some other arrangement. Her estate consisted of a single $35,000 bank account and another $3,000 in trust.

Once the probate was filed, the attorney began communicating with the four beneficiaries to figure out how to make the distribution. He proposed that the remaining estate balance should be divided equally, and he prepared an agreement to that effect for all the beneficiaries to sign.

Two beneficiaries quickly signed, but the other two did not. For two years nothing developed, though there were apparently numerous contacts among the attorney, the personal representative and one of the beneficiaries about how to treat all four beneficiaries fairly. Finally, the beneficiary who disagreed with the proposed distribution filed a request with the court to remove the personal representative.

At a hearing in 2012, the court directed attorney Gorman to prepare a proposed plan for distribution of the estate and a petition for approval of his fees incurred in representing the personal representative. He did just that, proposing to give the church its $2,000 and just $1,000 to each of the four other beneficiaries. He claimed fees and costs totaling $33,620.90, of which $22,650 had already been paid.

At about this time, the personal representative herself died, and the contesting beneficiary was next in line to administer the estate. Upon her appointment she objected to the proposed (and already collected) attorney’s fees, alleging that they were unreasonable. After a hearing, the probate court denied approval for Gorman to collect any additional fees, but did not order him to return any of the $22,650 he had already received. The new personal representative appealed, urging the court to order him to return some or all of his fees.

The Court of Appeals, in a split opinion, approved the probate court’s determination on the reasonableness of Gorman’s fees. While the two judges voting to uphold the fee award found it “concerning that the amount of fees awarded is very large given the size of the Estate,” they did not find any basis on which to reverse the probate judge’s determination. Of particular note to the majority judges was the fact that the contesting heir did not point to particular items on Gorman’s bills that should be disallowed, but instead relied on her assertions that he treated her unfairly and that his fees deprived the beneficiaries of their inheritances. That, said the judges, was not enough of a challenge to force reduction of his fees. Kurowski v. Gorman, August 25, 2015.

The one dissenting judge wrote a strongly-worded opinion. He noted that the approved fees ended up being 59% of the entire estate — an amount he called “strikingly unreasonable.” While the lawyer’s early actions were unobjectionable, wrote the dissenting judge, he should have moved the dispute to the court for resolution much more quickly; had he done so, far less time (and money) would have been spent to “field communications that were completely unproductive.”

Under earlier Arizona appellate decisions, lawyers involved in probate, guardianship, conservatorship and trust disputes are required to make an analysis of the cost and benefit of legal actions, and to balance those considerations when determining fees. The probate court, argued the dissenting judge, should have undertaken that same analysis when reviewing the fees — including those already collected.

What does the Kurowski opinion mean for attorney’s fees in other cases? Not much, actually. The opinion is a “memorandum” decision, which means it is not supposed to be used as precedent in other cases. The fact that it is a divided decision also calls into question its value for other cases. But it does demonstrate that one probate judge, and two appellate judges, were persuaded that, at least in a single case with difficult beneficiaries and its own peculiar facts, a fee of almost two-thirds of the estate could be justified.

Is Dispute Inevitable When Two Children are Named as Co-Trustees?

MAY 18, 2015 VOLUME 22 NUMBER 19

So often our clients assure us that their children are different from other children. Our clients know that their children will fundamentally get along. They are sure that there will be no big problems when they die, and that the children will communicate and cooperate. Fortunately, that turns out to be the case for our clients. But other lawyers’ clients seem to be very different.

Betty Lundquist (not her real name) must have thought her two daughters could work well together, because she named them as successor co-trustees of the revocable living trust she set up. She directed that the daughters (Peggy and Lisa) were to split her estate equally. She also signed a “pour-over” will, directing transfer to her trust of any assets not already properly titled at her death. For whatever reason, she named Lisa as the sole personal representative of her probate estate.

Betty had actually transferred pretty much everything to her trust, and so probably envisioned that there wouldn’t be much need for a probate at all. As she approached death, however, things were already getting tense between Peggy and Lisa. The day before Betty’s death, Peggy and her husband tried to transfer some of her trust accounts into their own name. They got the original will and trust documents from Betty’s accountant, and declined to share them with Lisa. Peggy was living in Betty’s home, and wouldn’t let Lisa even into the home to look at — and inventory — their mother’s belongings.

When Betty died in 2011, Lisa filed an emergency petition with the probate court seeking release of the original will and other documentation. She ultimately was appointed personal representative, and Betty’s will was admitted to probate. Peggy thereafter refused to co-sign trust checks to pay Betty’s bills, or motor vehicle affidavits to transfer car titles.

Eventually the probate proceedings were wrapped up, though the sisters were still not getting along. Finally, Lisa filed a request for payment of her mother’s estate’s expenses — including her attorneys fees for the probate proceedings themselves. Peggy responded by arguing that Lisa should have been disinherited because she filed the probate proceedings at all. Her logic: Betty’s will and trust provided for automatic disinheritance for anyone challenging her estate plan, and Lisa’s filing of a probate proceeding amounted to a challenge of their mother’s plan to avoid probate altogether.

The probate court approved payment of attorneys fees of $8,081.20, and a little more than $7,000 of other costs incurred in administration of the estate. Since the bulk of Betty’s estate was actually in her trust, the probate judge also ordered that the payments would come from the trust to the extent necessary. Peggy appealed both the approval of attorneys fees and the order that the trust should pay the fees.

The Arizona Court of Appeals ruled that the attorneys fees were appropriate and reasonable, and upheld the order. Furthermore, it agreed that the probate court had the authority to order payment from the trust — even though the trust had not been submitted to the court for oversight. According to the appellate court, both the trust’s language and Arizona law provide for payment of the decedent’s expenses — including probate and administrative expenses — from trust assets. Johnson v. Walton, May 14, 2015.

Peggy’s argument (that no probate proceedings were even needed) might have carried more weight if the Court had not been convinced that she actively interfered with the orderly administration of her mother’s estate. In fact, with even a modicum of cooperation Betty’s daughters might well have had a smooth, easy and inexpensive trust administration, and no need for any probate proceedings. That is a common result in similar circumstances — especially when one of the children is put in charge and they behave responsibly and honestly. (Of course, the person in charge need not be one of the children — but that is the choice we see most often.)

Was Betty’s mistake putting her two daughters in joint charge, and assuming they would work together? It’s always hard to figure out exactly what else might be going on when reading a Court of Appeals opinion, but if the joint authority didn’t cause the problem, it certainly did not help prevent the later dispute.

Our usual advice: rather than appointing two (or more) children with equal authority, we suggest you default to a choice of the one person who is most responsible, most widely respected among your beneficiaries, most available and most trustworthy. For clients who tell us that each of those terms applies best to a different child, we suggest that they use some method to make a single selection (coin flips work in extreme cases). Fortunately, though, our clients’ children all get along, all work beautifully together and never have disputes. Just like our own children.

Lessons From a Day in Probate Court

JULY 7, 2014 VOLUME 21 NUMBER 24

One day last week I found myself sitting in probate court, watching other cases get resolved while waiting for the Judge to get to my own cases. The matters I was listening to seemed to me to be instructive, and give me a chance to share some observations from the perspective of a veteran probate court participant.

In the almost forty years I’ve been practicing in probate court, some things have changed quite a bit. Others have not. One that has changed dramatically is the now-common practice of probate court litigants doing things themselves, without hiring a lawyer. That was almost unheard of in the 1970s, but is now commonplace. More than half of the cases I watched did not have a lawyer involved.

On top of that trend, Arizona has engaged in a decade-long experiment in certifying non-lawyers to prepare legal documents. The Arizona Certified Legal Document Preparer Program has been run by the Supreme Court since 2003, and there are more than 500 Certified Legal Document Preparers across the state. They have undergone a background check and passed a test — and they can prepare pleadings for probate, divorce and other actions, as well as wills (and even trusts). The key is that they are not supposed to practice law — they can help you fill out forms, but not be your lawyer. Other states (notably Washington) are following or considering a similar path.

Everyone knows that lawyers are expensive, that we complicate matters unnecessarily, that we are slow and unresponsive. Legal document preparers should alleviate those problems, right? That’s not exactly what I saw in my day in probate court. In two cases I think document preparers failed to serve their clients well. In a third, with no lawyer or document preparer involved, a little help would have made the litigants’ lives easier, I’m pretty sure.

Exhibit One: a simple probate (I’ve learned that “simple” is a dangerous word in this context, but let’s keep using it). It involved a decedent who left five children, a will and a house — and not much else. One son and a son-in-law were named as personal representatives in his will, and his son-in-law (as he explained to the court while I listened) took responsibility for getting the probate proceedings going. He contacted a document preparer to get him started.

The document preparer required a $1,200 fee up front, and promised to have the paperwork ready shortly. After months of trying to get back in touch with the document preparer, though, the son-in-law finally figured out that he was out of business — he had been charged with a felony (apparently unrelated to his business) and wasn’t going to be doing any more quasi-legal work for others. The new problem: the original will was somewhere in the document preparer’s files, and he was in prison.

Son-in-law explained that he had gone to a new document preparer, who had prepared a petition for probate of a copy of the now-missing will. That had cost another $650 up front, and required that the son and son-in-law attend a probate court hearing to explain why the original will was missing. The result: about $2,000 in initial costs (it wasn’t clear if more fees will be incurred), a wait of more than six months to get a simple probate started, and a confusing and frightening hour before a friendly but stern probate judge.

What would have happened if the son-in-law had visited a lawyer instead? It’s hard to say with certainty, but a best guess from the information revealed in court: the total cost would probably have been about $2,500-3,000 plus filing fees, the son and son-in-law would have had authority to sell the house in no more than five days, the lawyer probably would have waited to be paid from proceeds from sale of the house (so no one would have to write up-front checks), and the whole thing would almost certainly have been over in about four months. And that doesn’t consider the possibility that there might have been a summary proceeding available under Arizona law which would have saved a few dollars and several months of time. Oh, and no one would ever have had to appear in court, nervously or otherwise. Oh, and the son and son-in-law would have had the correct forms filled out, and wouldn’t have had to visit the County Bar Association office to get one more form the document preparer missed, consuming another hour of their day and causing more confusion and consternation.

You might think the problem was really just bad luck, that this hapless fellow chose his document preparer badly. After all, few document preparers end up in prison, and there’s nothing that keeps a given lawyer from going bad, either. True enough, though (a) most lawyers practice in groups, so if one lawyer in a firm drops out of sight there’s likely to be someone else to take responsibility, and (b) the document preparers do seem to have a high rate of discipline, with about 50 having their licenses suspended or revoked in the decade since creation of the listing. That looks like about a 10% rate of attrition, which seems higher than for lawyers.

Exhibit Two: In another case involving a document preparer but no lawyer, two women were involved in the life of a 14-year-old girl. The girl’s mother had gone to prison some years ago, and a family friend had adopted the 14-year-old and her four brothers and sisters. Now the 14-year-old had decided she wanted to live with her maternal grandmother, and so had just moved in. Grandmother had consulted a document preparer, and filed an emergency guardianship petition without giving notice to the adoptive mother. Last week’s hearing was the permanent guardianship proceeding, seeking to turn that emergency guardianship into a full guardianship.

The document preparer helpfully came to court with the grandmother, though of course he could not speak for her or even be acknowledged in the probate proceeding. He helped her get her documents together and prompted her about what to tell the Judge. The adoptive mother was also there, telling the Judge that she had no objection to the change in guardianship — she just wanted to make sure that everyone realized that she would no longer be responsible for the girl’s medical bills. The problem with that position: she is still responsible for her daughter’s medical bills — and there was no one available to explain that nuance to her (and the Judge, in his eagerness to get through a complicated and mildly contentious proceeding, didn’t help by reassuring her she was completely off the hook).

Would a lawyer have been more expensive? Almost certainly. Would the 14-year-old have been better served by having someone able to actually give legal advice in this complicated family situation? I’m pretty sure. Would the proceeding have been less stressful, less contentious and more suitable for the 14-year-old (who sat through the court proceeding, watching the tension and drama)? Darn straight.

Exhibit Three: a grandmother was seeking guardianship over her infant grandson. Her daughter lived with her, but had no job and no insurance; grandmother was just trying to get the baby on her own insurance plan. She did the paperwork herself, with no lawyer or document preparer. When she gave notice to the baby’s father, he showed up at the hearing and started talking about his pending petition to get custody, his desire to develop a relationship with the baby, and his lingering uncertainty about paternity. Grandmother got temporary guardianship, but the whole proceeding took a stressful hour and involved plenty of assertions and suspicion.

If grandmother had gotten the advice of a competent lawyer, she might have learned that it’s actually not that hard to get medical insurance for an infant, that she could have worked something out in writing with the putative father (and accelerated the process of figuring out whether he really is the father), and that her guardianship would be of little value (at least in Arizona) if the father’s status is confirmed. Maybe she would not have thought the lawyer’s advice was worth the money.

It was an interesting day. I came away with heart-felt sympathy for litigants who are frightened and confused by a, well, frightening and confusing system. I also appreciate the work of judges who have to explain legal principles to unrepresented litigants (without practicing law, of course) and try to help them navigate the system — all under the watchful eyes of other litigants and (sometimes) their lawyers, waiting for their own cases to be called. Finally, I remain convinced that lawyers have an important place in the legal system, and that even when we are under-appreciated we help people far more than they may be willing to concede.

©2017 Fleming & Curti, PLC
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