Arizona Republic Columnist Laurie Roberts has another installment this morning in her continuing saga involving the evisceration of vulnerable wards’ assets by lawyers and private fiduciaries who are ostensibly supposed to protect and conserve assets not treat them like a bottom-less billing bounty.
Today’s column talks about millionaire 49 year-old Edward Abbott Ravenscroft, forcibly made a ward because of his loss of sobriety, drug possession, and the fear he’d be taken of advantage of by the alleged unsavory types he was consorting with. Well, too bad that fear didn’t broaden to also include the supposed professionals guarding his interests.
Roberts writes: And so Ravenscroft was handed over to the care and protection of probate court, a cozy group of lawyers and fiduciaries who are appointed to help vulnerable people but also do a pretty good job of helping themselves to a nice pile of cash. In January 2009, attorney Paul Theut was named Ravenscroft’s guardian-ad-litem and within a month Theut asked that Sun Valley Group be brought in to oversee the millionaire’s estate. Ravenscroft, he wrote, cannot manage his affairs due to drug and mental-health issues and “has property that will be wasted or dissipated unless proper management is provided.”
So they proceeded to manage it for him.
According to court records, Theut collected $62,000 of Ravenscroft’s money in his first 3½ months as GAL. Larry Scaringelli was appointed his attorney after Commissioner Michael Hintze rejected Ravenscroft’s own choice of a lawyer. (Being the one to foot the bill, Ravenscroft thought he ought to have some say in the matter.) Scaringelli collected nearly $33,000 in his first five months. Sun Valley and the Maricopa County public fiduciary, which is Ravenscroft’s guardian, haven’t disclosed their take. See azcentral.com blogs – Laurie Roberts’ Columns & Blog …
Ravenscroft’s case is part of a broader federal racketeering suit recently filed and which includes another victimized ward, Marie Long. Laurie Roberts reported on that suit several days ago. See Old Lady Goes to Federal Court – And Now She Has Company.
Regrettably, as has already been previously reported, such situations remain unsatisfactorily remedied. Indeed, one writer refers to the current system as “legalized elder abuse.” See Laurence Harmon’s insights at http://assistedlivingseniorhousing.com/2009/12/29/legalized-elder-abuse-guardianships-and-conservatorships.html
Fees feeding frenzy.
An ordinary attorney-client relationship is an arms-length transaction. Clients give informed consent about what their lawyers will charge them. This is done up-front. It is almost always via a signed writing spelling out the scope of work undertaken and the amount of fees to be charged.
But when a lawyer’s client is a vulnerable person, unable to give such informed consent, it is up to a court to hold up the other end of the arms-length transaction. Courts are supposed to monitor and approve the disbursals of fees and expenses related to a lawyer’s work and the guardianship of vulnerable wards.
But what seems reasonable to a lawyer or private fiduciary may not be reasonable to the proverbial ‘man on the street.’ To an objective, disinterested outsider, the fees charged and paid too often look like a free-for-all feeding frenzy.
Shocking the conscience of a lawyer.
I remember a law professor who criticized a California Supreme Court opinion setting out the basic rule concerning the reasonability of a lawyer’s fees. “The standard,” he explained, “is unconscionability.” Then sotto voce, he joked it wasn’t good news that the unconscionability test was based on what shocked a lawyer’s conscience.
In a now oft-repeated citation, the California Supremes said, “The test is whether the fee is ‘so exorbitant and wholly disproportionate to the services performed as to shock the conscience.'” See Herrscher v. State Bar (1935) 4 Cal.2d 399-401-402, 49 P.2d 832, 833, quoting from Goldstone v. State Bar (1931) 214 Cal.499, 498, 6 P.2d 513 and also California Rules of Professional Conduct, Rule 4-200.
According to Roberts’ column today, Ravenscroft’s lawyer charged and the court approved $260 for the lawyer to travel a distance of less than 10 miles from his office to the courthouse. But then Arizona doesn’t have a comparable “shock the conscience” rule. (1)
(1) Arizona ER 1.5 FEES
(a) A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses. The factors to be considered in determining th reasonableness of a fee include the following: