California Appeals Court gives Danny Reed relief. But in Arizona, Marie Long’s not so lucky.

For someone so young, Californian Danny Reed has seen more than his share of pain and trouble. Sixteen years ago, while asleep in his tent at Nevada’s Burning Man festival, a drunk driver drove through his tent and left Danny partially disabled and with permanent brain damage. He was 21 years old.

Danny settled his personal injury suit for $815,000 and a special needs trust was created from the net proceeds with his mother as Special Trustee.

Then three years after that disaster, Danny was visited by more bad luck. A car ran him down in a cross-walk.

The cross-walk case also settled. And the net settlement proceeds from $900,000 were also put into a trust for Danny’s lifetime care.

Six figures for 4.5 months.

Four years ago, after a probate court investigator raised issues about the administration of Danny’s trust, the probate court removed his mother as trustee and temporarily appointed the Public Guardian. There was never a finding his mother had done anything but act properly and in good faith. Indeed, funds and assets were subsequently correctly accounted for to the satisfaction of the court and the parties.

But following several hearings and over Danny’s objections, the probate court nonetheless appointed Thomas Thorpe of Dragomir Fiduciary Services, Inc. to succeed the Public Guardian as temporary trustee of Danny’s special needs trust.

Here’s the rub. The trust specified that a successor trustee was not entitled to compensation. In fact, Danny’s mother received no compensation for her work as his trustee.

Thorpe, however, served for four and one-half months and billed the estate $108,771.07 for trustee and trustee attorney fees. When he petitioned the court for his fees, the trial court awarded him $51,285.63 over objections that the trust instrument prohibited compensation.

So Danny appealed the order. A few days ago, in a published opinion, which consequently makes law in California, the appellate court reversed the trial court and directed it to deny Thorpe’s fee petition.

The appellate court relied on the plain meaning of the trust provision that “a successor trustee . . . is not entitled to compensation.” It also relied on earlier precedents, which hold that a trustor has the right to specify a trustee’s compensation. And more importantly, that “it is not within the power of the court to change, alter or modify such provisions or to substitute its predilection for the expressed instruction of the [trustor].”

And besides the court said, under earlier case authority, if the successor trustee “deemed the amount of compensation specified in the trust to be inadequate, he could have refused to act.”

Thorpe may appeal to the California Supreme Court so Danny may not yet be off the hook.

Loss of trust.

Although California has long been considered a leader in enacting laws protecting its most vulnerable citizens, the system isn’t perfect.

Indeed, earlier this year, the San Jose Mercury News ran a two-part investigative report, “Loss of Trust”: Mercury News series on court-appointed conservators and trustees, “Part 1: Court-appointed personal and estate managers hand out costly and questionable bills” and “Part 2: Santa Clara County lacks rules to rein in fees.”

Danny’s case was highlighted in the report. It was hardly surprising, then, that when the Mercury News filed its story about the appellate court’s findings, it called it “stunning” and “a vindication.” See “Appellate court: Disabled San Jose man owes nothing to trustee and attorneys in bitter probate dispute.”

Back on the Arizona desert.

But back on the Arizona desert, guardianship fees amounting to saving villages by destroying them remained the order of business in the widely-reported case of Marie Long, the 88-year old destitute Phoenix woman who once had $1.3 million in 2005 and sought repayment of money from lawyers and others.

As reported by crusading Arizona Republic Columnist Laurie Roberts, “Marie Long’s story prompted both court and legislative reviews of Arizona’s Probate Court system. As a result, important changes were made, changes designed to ensure that the most vulnerable among us are protected rather than processed into the poorhouse. But all of those vaunted reforms did nothing for Marie, who was left penniless by the system that was supposed to protect her.” Also see “Maricopa County Probate Court – One ward is saved – but a life’s savings is lost.”

No relief for Marie.

On November 13th — just one month before the California Appeals Court did right by Danny Reed — the Arizona Supreme Court took a pass on Marie Long’s appeal of the Arizona Appellate Court’s decision upholding a lower court award of $840,000 in fees to Marie’s lawyers and fiduciaries.

The Arizona Appellate Court found no error or prejudice — even though it did not condone “the highly inappropriate conduct” of the trial judge’s ex-parte contacts with the lawyers seeking approval of their fees.

Contacts are ex parte when only one side of a dispute knows about them because the other side is never told. See “High court concerned — just not enough to help out widow.” Also see “Judge Lindsay Ellis survives immunity challenge in Marie Long case.”

Marie, now 91, remains a ward of the state.

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Photo Credits: “Burning Man 2009,” By Mark Richardson, Kaloozer, at Flickr via Creative Commons-licensed content requiring attribution.

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No pepper-spray either with Free Elder Law Webinars for CLE credit.

Additional year-end CLE possibilities are provided below for the remaining procrastinators still short of year-end continuing legal education credit hours.

I picked up 1.5 credit hours this week and didn’t have to risk pepper spray-by-shopper amongst the holiday crowds. I attended the Webinar, “Guardian Accountability and Monitoring: Where Do We Stand?” presented under the auspices of the National Consumer Law Center’s (NCLC) National Elder Rights Training Project for the National Resource Center.

The program was well done and the presenters knowledgeable, including Jerry W. Hammond & Associates), Sally Hurme (AARP), Naomi Karp (Consumer Financial Protection Bureau – Office of Older Americans), and Erica Wood (ABA Commission on Law and Aging). See Presentations Recording

Additional National Elder Rights Training Project Webinars can be found at the NCLC website at: Webinars | Conferences & Training | NCLC

http://www.nclc.org/conferences-training/national-elder-rights-training-project.html

But also note you’ll need to submit such programs to your jurisdiction for CLE credit approval. For example, for Nevada credit, I used Form 2 available at the following link to the Nevada Board of Continuing Legal Education.

And like a broken record (how is that for a dated reference?), don’t fault me if your state bar kaboshes your approval request or if you don’t like the content or the presenters or if a link gets broken or just otherwise – - – you’re an angry sourpuss because you got up on the wrong side of the bed this morning.

[NCLC also states the following on its website: “Other webinar series also include topics focused on auto fraud and domestic violence survivors.  Webinars that are not part of an on-going series can be found at other webinars.”  http://www.nclc.org/conferences-training/webinars.html

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UC Irvine’s School of Medicine is offering a free online Webinar on Monday, December 12, 2011: “Stopping Elder Financial Abuse: Promising Practices and How to Bring Them to Your Community.” It is supported by the Archstone Foundation. The Presenters are: Julie Schoen, Esq. and Shawna Reeves, MSW. The Webinar is hosted by the Center of Excellence on Elder Abuse & Neglect at UC Irvine.

The registration link is at
http://centeronelderabuse.adobeconnect.com/e7dw0iftmwe/event/registration.html

From their website: “UC Irvine’s Center of Excellence on Elder Abuse and Neglect is committed to eliminating abuse of the elderly. Established with a grant from the Archstone Foundation, the Center of Excellence on Elder Abuse and Neglect is part of the School of Medicine’s Program in Geriatrics.”

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When families squabble over an estate, often only the lawyers win.

Unfortunately, none of the principals are reflected in a very good light in Sunday’s tale by John Leland,“Love and Inheritance: Anatomy of a Family Feud,” at NYTimes.com.

The cast of characters starts with movie star Celeste Holm, now 94-years old, a bit addled, not in a good health, and married to a man almost half her age. Her husband is Frank Basile, age 48.

Who is Celeste Holm? For those unfamiliar, she was a notable screen star of a long-ago era, winning the 1947 Best Supporting Actress Oscar for “Gentleman’s Agreement.” And 3 years later, she was nominated for another supporting actress Oscar for “All About Eve.”

As the Times relates, the other members of the cast of this reality drama are Holm’s two sons, Daniel Dunning and Theodor Holm Nelson. Predictably enough, they were askance when someone much younger than they are took a supposed romantic interest in their elderly unattached parent. Think, for example, of Marshall v. Marshall and the long drawn out case of the late Vickie Lynn Marshall a.k.a. Anna Nicole Smith and her fight with E. Pierce Marshall over the billion-dollar estate of a man 62 years older than she was, her late husband, J. Howard Marshall.

And I can remember another publicized case involving yet another famous personage, the late actor and comedian Groucho Marx. That estate battle involved Groucho’s much junior companion, Erin Fleming, and Groucho’s son, Arthur. See “A Day at the Courthouse.”

But in Celeste Holm’s case, her sons have been at odds with Basile apparently from the start suspecting Basile’s supposed designs on their mother’s wealth.

Basile and Holm have been together 11 years. But after 5 years of litigation to overturn an irrevocable trust set up by Daniel Dunning, Holm’s $2 million liquid assets have mostly evaporated primarily in legal fees and other costs.

It’s a story all too familiar. And it’s also all too reminiscent of what happens when families squabble over an estate’s money. Yet another case-in-point is the one in Maricopa County, Arizona Probate Court last year concerning Marie Long, the “Elderly Millionaire Is Destitute After Payment of Fees for Lawyers“ and which I previously blogged about here.

A fight waged against you with your own money.

The irony of such battles, however, is that consistent with the law of trusts, a trustee has a duty to defend a trust against adverse claims. But here’s the rub. The disputatious families don’t always fully grasp that so long as that trustee acts in good faith, the trustee has the lawful right to pay legal fees from trust assets. See, for example, California Probate Code § 15684. Consequently, the fighting too often consumes the legacy, thus transforming the case into truly a fight over nothing.

And so when Basile and Holm commenced their litigation, Holm’s youngest son, as the trustee of the trust mounted a vigorous defense using the very trust assets meant to provide for Holm’s care and support. As the Times article notes, “Hanging over all parties is the question of why the lawsuit lasted so long and cost so much money – - – the very money they were fighting over.” And according to the story, separate from the costs incurred by her trustee son in defending Holm’s estate, Basile claims that he and his wife have litigation costs of their own, which exceed $1.5 million.

But missing from the story, is the answer to the above-asked questions. “Why has the suit dragged on?”  “Why has it cost so much?”

One can only speculate. But besides the litigants, I suspect one has to also examine the role the lawyers have played for each side.

Admittedly, I am not privy to the particulars of Holm’s case other than what I read in the newspaper. Litigation, especially at the higher end Big Law levels, is extraordinarily expensive.

But apart from the Holm case, I do know this much. Whenever there’s protracted, expensive litigation, the parties are often blameworthy but the lawyers also play no small part.

To your last dollar.

A cynical lawyer friend I know who once did a lot of contingency work, which are cases where clients have no ‘skin’ in the game, was fond of admonishing, “Clients are always willing to fight to your last dollar.” But I also think the inverse is often true. Some lawyers are just as willing to fight to a client’s last dollar.

So here’s the moral of any story whenever it comes to family squabbles over an estate. When litigants refuse to consider early settlement offers or disregard prudence over what they term “principle,” far too often, assuming they’re getting paid, only the lawyers win.

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Probate court reform committee issues final report and leaves no [head]stone unturned.

Not to diminish the substantive good work found in the Final Report just issued by the “Committee on Improving Judicial Oversight and Processing of Probate Court Matters” but one recommendation sure to garner notice is the proposal that the Arizona Legislature “could assess $1 for issuance of a death certificate, which could be paid to a fund to use for post-appointment case review, including visitation.”

That the dead may help safeguard the living may strike some as unsettling but we are talking about probate, after all. Moreover, when government budgets are constrained and new revenues are sparse, it’s to the credit of the Committee that they are leaving “no [head]stone unturned” and [don't pardon the additional pun] “thinking outside the box.”

The Committee extrapolates, “In Arizona in 2009, approximately 45,000 people died. Assuming an average of three death certificates per person were issued, the surcharge would generate $135,000 annually. Assuming an average of five death certificates per person were issued, the surcharge would generate approximately $225,000 annually.”

A good report.

All in all, though, it is good work. The Final Report was released to the public earlier this month and now goes to the Arizona Judicial Council for its review of the Committee’s recommendations on substantive reforms of the Arizona Probate Courts. The report can be accessed at Final Report to AJC – Arizona Judicial Branch. Also see The Arizona Republic’s summary at “Maricopa County Probate Court: Reform weighed to protect life savings.”

The Committee’s work was prompted in large part by public criticism of the probate courts that ratched up, most notably through the intrepid, fearless and unceasing reporting via Laurie Roberts’ Columns & Blog as well as some terrific investigative journalism from The Arizona Republic. See http://www.azcentral.com/news/probate/probate-index.php

Bones to pick.

But hallelujahs aside, I do have a few bones to pick. For example, there’s the matter concerning the setting of fees, which I believe the Committee dodged, preferring instead to leave it to “guidelines” and market forces, even though much of the criticism is precisely over fees, particularly in Robert Anglen’s careful analysis at “Lawyers often ratchet up fees” where he writes, “Probate attorneys’ hourly rates have risen faster than inflation over the past decade. In 2004, for example, a court-appointed attorney in one complex case charged $160 an hour. By 2008, typical rates had nearly doubled to more than $300 an hour. From 2004 to 2008, inflation rose nationally a little over 15 percent, according to the U.S. Consumer Price Index.”

The second concern has to do with the Committee also dodging the matter of probate attorneys who also serve as judge pro tems, saying, “The Committee does not discern a need for new rules to guard against inappropriate contact between part-time pro tem judges and full-time judicial officers.” And if that’s not clear, further adding that, “The Committee was not charged with responsibility to investigate the use of pro tem judges in any particular case, was not equipped to do so, and has not done so.”

                                                                                                                                                                          But at least the Committee’s Final Report acknowledged the concerns over inherent possible conflicts that may arise, e.g., “that an attorney in a contested probate matter may feel constrained to vigorously argue against opposing counsel who also serves as a pro tem judge for fear it may affect the outcome of a future case decided by that person in a pro tem capacity.

“It was also suggested that attorneys who also serve as part-time pro tem judges may develop closer relationships with judicial officers, thereby leading to potentially improper communications.”

But not to worry.

But because judge pro tems are used infrequently and “sporadically,” the Committee seems to sing,“Don’t Worry Be Happy.”

And as for ex parte contacts, “The Committee does not discern a need for new rules to guard against inappropriate contact between part-time pro tem judges and full-time judicial officers. Ethical rules in place for attorneys and judicial officers prohibit ex parte communications between the two while court matters are pending that involve both parties.”

But for another take on how well that sometimes works in practice, see “Judge Lindsay Ellis survives immunity challenge in Marie Long case.”

The positives.

So to sum up, the direction is positive. The prospects for the future of probate reform are guardedly optimistic.

Kudos to calls for improved training not only of judicial officers, lawyers and investigators but for unlicensed fiduciaries.

‘Atta-boys’ go to the recommendations for “good faith” budget estimating; for estate sustainability analyses (although I think the Report needlessly convolutes that); for enhanced alternative dispute resolution options; for electronically streamlining of court forms and for better, less expensive court access; and especially, for calls for improved post-appointment visitation of wards.

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Probate court rejects Last Will where undisclosed lawyer’s girlfriend was named decedent’s pet caretaker.

A Maltese but not Trouble.

Doesn’t matter if you’re Leona Helmsley’s dog, the Maltese Trouble, or one of the lesser known dogs and cats of Kay Elaine Johnston discussed below. Seems you just can’t leave big bucks to your pets – - – not unless you do everything strictly by the book and especially, without monkey business. 

Last summer, there was the tail (sic) of Conchita the Chihuahua. She was left $3 million bucks by the late Gail Posner who died of cancer and left her posh Miami Beach digs to her dog to live in the comfort and style she’d grown accustomed to. And of course, there was a relative that objected to the bowwow benevolent bequest.

World’s oldest dog?

And who can forget the oft-told but likely apocryphal story about the caretaker with the world’s oldest living dog. The caretaker had been appointed in the decedent’s will to take care of a much beloved black labrador retriever. But after the dog died, the ‘creative’ caretaker kept replacing the black lab with a similar looking dog so she could keep receiving payments under the pet trust.

But in the case of the late Kay Elaine Johnston, Probate Court Judge Susan Tate said there was dissimulation of a different kind. Judge Tate ruled there was “deception” when the decedent’s lawyer, Robert Johnson, named Kyria Wilhite as caretaker for the 50 cats and 6 dogs that had been cared for by Kay Elaine Johnston. To care for her beloved animals, Wilhite was to receive $50,000 a year plus expenses and “reasonable compensation” for her services.

The problem was that lawyer Robert Johnson failed to tell anyone that caretaker Wilhite was also his girlfriend when he prepared Kay Johnston’s will. Yah think there was anything ethically wrong with that? (Surprisingly, even though Carol Phillips, the decedent’s cousin, complained about this to the Georgia State Bar, her complaint was dismissed. Go figure). See “New turn in dispute of estate“ and “Georgia judge overturns will for pet care.”

After Johnston’s December 2007 death, in addition for caring for the pets, Wilhite got the house and 7 acres of Johnston’s property. Wilhite and Johnston, however, had only known each other a couple of months. But then the elderly do make especially fast friends and confidants.  Yah think? A video news link to the story is at http://www.11alive.com/video/default.aspx?bctid=919963163001

Good pay for picking up milk.

And shades of Maricopa County, Arizona and its well-documented probate abuses, which are supposedly all better now thanks to recently signed probate reform legislation, lawyer Johnson billed the estate for every nickel-dime visit to Kay Johnston’s home. (Also see If anyone’s listening, here’s a way to cut through the competing probate reform noise at the AZ legislature.”)

Maybe, he thought, like some lawyers and professional fiduciaries apparently do, that since his fee was such a ‘bargain’ at $150.00 per hour, he could charge for every picayune visit and task whether it involved professional services work or not.

Carol Phillips, though, didn’t buy that malarkey, saying of her late cousin and her ‘helpful’ lawyer, “If she said, ‘I want a gallon of milk,’ he’d go to the grocery store and charge his lawyer fee to get it, plus the milk. Everything he did, he charged for.” But then, isn’t what they always do? Read more at Jacksonville.com: http://jacksonville.com/news/georgia/2011-04-26/story/georgia-judge-overturns-will-pet-care#ixzz1LEHqpcVa

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If anyone’s listening, here’s a way to cut through the competing probate reform noise at the AZ Legislature.

For anyone not already tone deaf with a case of earsplitting self-interest, a court-appointed attorney in Maricopa County, Arizona’s Probate Court offers his own cogent solution to what’s become a contest of the dueling probate reformers at the state capitol. The attorney’s name is Jon D. Kitchel and he’s in private practice.

Currently, two bills, one from the state senate and the other from the state house, are vying to conjure up ‘the better prescription’ to cure what’s been ailing the local probate court. See “Competing Arizona bills target probate courts,” – azcentral.com

I’ve previously and repeatedly added my own tuneless sounds to the celestial chorus of plaintive voices crying for reforms in the desert wilderness. Indeed, I have a separate blog category on the topic at Elder financial abuse.

I won’t get into the nuances of both bills for now. Instead, the links to both are provided here for SB1499 and HB2424.

Senate Bill 1499 is supported by the courts, probate lawyers, the fiduciaries and other interested stakeholders. The other is House Bill 2424, which is promoted by activists and family members of wards who’ve run up against the buzz saw and are still licking wounds from the experience.

Attorney Kitchel gave me express written permission this morning to post his Open Letter hoping his ideas gain some kind of traction between the competing interests.

Jon Kitchel’s “Open Letter” is as follows:

“A 2011 Committee Report from the Maricopa County Superior Court Probate Court Department reports, “the vast majority of guardianship and conservatorship cases receive proper oversight and monitoring.” The Arizona Republic has published many stories over the last two years documenting cases where the probate system has failed to protect wards and their estates. Wards and their families caught in a probate quagmire take little comfort when advised their case makes up a small minority of probate cases.

“Guardians, conservators and trustees (“fiduciaries”) serve as decision makers for the legally impaired and vulnerable among us. Legally impaired and vulnerable persons run the gamut from minor heirs, victims of birth defects, child beatings, and car accidents to mental illness and old age.

“Guardians take care of the person. That means seeing to medical, food,  clothing, shelter and other physical needs of a person. It also means which friendships are permitted and whether a ward gets eyeglasses or hearing aids. Conservators and trustees manage the ward’s money, prepare the budgets and pay the bills.

“Grouped together we call them “fiduciaries” and the probate court has exclusive jurisdiction to appoint, supervise and remove them. Fiduciaries perform an essential service for our wards. Under the supervision of the probate court, fiduciaries step in to make decisions when wards are unable to do so for themselves.

“The Legislature is currently considering alternatives that might improve the system. Here are three substantive changes the Legislature could make to improve our system:

“First, require fiduciaries to provide regular financial reports to wards or their counsel if they choose to receive them. Current statutes require a conservator to file an annual accounting listing income and expenses a year after the money is gone. It’s not possible for anyone to monitor an estate without regular financial reports.

“Second, reduce (or eliminate) the barrier to fiduciary substitution. Sometimes a relationship between a fiduciary and ward is unproductive. It may be too expensive or it may simply be a personality conflict. Under our current system, only the court may determine if that relationship should be ended. That determination is made after expensive litigation in which both sides of the conflict are paid from the ward’s estate.

“A better system would allow a ward (as often as once a year) to ask the court to appoint a successor fiduciary for any reason. Fiduciaries, like anyone else, should have to compete for business based on price and performance. If another qualified fiduciary is available and willing to serve (consistent with the ward’s best interests) the court should be required to appoint a successor. The ward might be able to participate in choosing a successor, but that would be up to the probate court.

“Fiduciaries to no surprise, are united in opposition to this proposition. They assert that difficult decisions made for a ward would make the ward unhappy, and that a ward may be subject to the inappropriate influences of third parties leading to the termination of a fiduciary.

“Instead of viewing these challenges as an opportunity to distinguish themselves in a sea of competitors, fiduciaries seem to perceive these challenges as threats to their job security. While the best fiduciaries obviously work very hard to achieve a good working relationship with their clients, a ward may too easily be stuck with one who does not. Arizona is proud of its right-to-work status and new fiduciaries should be encouraged to enter the field and compete for business. A court appointment should not be a gift of job security.

“Third, if a ward is paying the bill, the person being paid should have a primary duty to the ward. That includes both the fiduciary and the lawyer hired by the fiduciary with the ward’s money. A fiduciary and his attorney should not be keeping secrets from the ward while charging the ward for doing so.

“Some reformers believe the solution to our probate troubles is more judicial oversight. Current statutes and court rules already require the court’s active and prudent management of its cases. In reality, more judicial oversight in these days of lean budgets and limited staff is probably just wishful thinking. From the Committee Report, “In times of serious budgetary constraints it is an increasing challenge to ensure all 30,000 probate cases receive the desired level of supervision.” Moreover, wards have a reasonable belief that the only one putting their interests first might be themselves, not an impersonal administrator.

“Arizona’s legislature could take a large step forward to real probate reform by stepping on a few bureaucratic toes and granting Arizona’s wards three basic rights: the right to receive regular financial reports, the right to elect substitution of a fiduciary for any reason, and the right to expect all professionals paid by the ward to put the ward’s interests first.”

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Jon D. Kitchel is an attorney in private practice and who has served as a court-appointed attorney in the probate court since 1993. [Reproduced with permission from the author]

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Sun Valley Group goes ‘bye-bye’ as postscript to case of Marie Long.

The Sun Valley Group, Inc., a licensed professional fiduciary service and the former guardians of Marie Long, has announced they are ceasing their fiduciary business in Arizona and are closing up shop. See “Major fiduciary firm is going out of business.”

I blogged several times about this infuriating topic last year at “To track financial exploitation, follow the money” and “Probate judge’s ‘ex-parte’ contacts with opposing counsel?” and at “Judge Lindsay Ellis survives immunity challenge in Marie Long case.”

Marie Long’s sad tale has been widely reported both locally and around the country, see for example “Is Valley guardian group taking care of your loved one, or taking advantage?” and “National Association to Stop Guardian Abuse: Guardian Balked at aiding Marie Long while draining her Trust.”

A CBS News report in December added to the bad press. If you missed the CBS report, see below.

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The staggering obviousness of preventing Pyrrhic probate fees.

Pyrrhus won the battle but lost the war.

Pyrrhus of Epirus won a battle but was so depleted by it, he lost the war. The lessons of Pyrrhus are easily forgotten when it comes to money, especially when the money being depleted is not your own.

As Francois de La Rochefoucauld once said,“We all have strength enough to endure the misfortunes of others.”

And as has become increasingly evident, paraphrasing La Rochefoucauld, some lawyers in the probate courts also find themselves mustering“strength enough to spend the fortunes of others.”

Last September, I wrote Of guardianship fees and saving villages by destroying them. So it’s good news that an appellate court this week vacated an attorney’s fee award of $260,080.00 in the noteworthy contested guardianship case of “IN RE MATTER OF GUARDIANSHIP OF SLEETH.” See the Opinion at 1 CA-CV 10-0093.

Staggering obviousness.

But while some colleagues and the press praised the decision, it’s hardly cause for hoopla. It merely calls belated attention to what the probate courts should already be doing, which is as the Sleeth court wrote, exercising “independent judgment to determine what portion of the attorney’s fees were reasonably incurred. Otherwise, there is no motivation for attorneys to judiciously weigh the cost of their actions against the risks and potential harm to the protected person’s estate.”

But court oversight being what it is, the staggering obviousness of merely requiring a probate court to exercise its statutory discretion to evaluate the reasonableness of attorney’s fees is now cause for celebration. Indeed, referring to a supreme court committee recommending probate reforms, the front page story in this morning’s local paper, “Court of Appeals targets high fees,” quotes a local expert who says the decision is a “roadmap” and that the Court of Appeals has “accomplished (in one) ruling what the probate committee has been trying to do for months.”

So what’s the answer provided by this ‘new’ prophylactic roadmap? Well, as “anciently and well established,” it’s simply “that at all times, the court must be guided by what is in the best interest of the ward,” quoting In re Farson’s Estate, 77 Ariz. 196, 201 (1954).

And so the appellate court argues for greater use of cost-benefit analyses; for prioritizing the best interest of the ward; for more scrutiny of the fee reasonableness factors; and for determining whether there was even a benefit provided to the protected person.

And in a nod to Pyrrhus, the court writes, “Obviously, fiduciaries and their attorneys must avoid the pursuit of pyrrhic victories that accomplish little but to bankrupt the protected person.”

Or as the court also says, “When “winning” a dispute results in lost financial security for the protected person, those seeking an award of attorney’s fees must defend the appropriateness of their decision to pursue such an expensive dispute.”

Hallelujah and amen.

Local gadfly Laurie Roberts, who’s been covering the local probate court problems for some time writes in her column this morning of the Sleeth decision,“Court of Appeals strikes down probate fee ruling,” and asks for both “a hallelujah” and “an amen.”

But is it time for a revival meeting? No, not when the answers to our prayers have been there all along.

Sure, there’s always room for redemption. But as George Bernard Shaw once said,“No question is so difficult to answer as that to which the answer is obvious.” Can I get a“heal!”?

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Re. Probate Court Matters: Judicial Oversight Court Improvement Committee issues interim report.

Hell for Sisyphus was to ceaselessly push a boulder up a hill, only to have it roll back down to push back up again. A similar unavailing ceaselessness redounds in seeking the elusive solutions to reforming guardianship of the vulnerable elderly.

But it’s not a boulder that comes to mind. Instead, it’s a wheel that’s endlessly and constantly being reinvented.

First come the scandals and financial abuses of vulnerable wards reported in the press. And then come the cries for reform. Oversight is retooled. Legislation is passed. New court rules are promulgated. Better training is promised. And then the boulder is pushed once more up the hill.

Some might argue that defrauding the elderly has a long antecedental record. For instance, there’s the biblical story of Genesis 27:1–40 where Jacob disguises himself as his brother Esau to deceive his father, the blind and aged Isaac for the purpose of stealing Esau’s birthright blessing reserved for the eldest son.

The call for reform is repetitive.

In the 1980′s, following a spate of bad press, serious reform legislation followed. 8 years ago, Professor Lawrence Frolik advocated for judicial use of limited guardianship in a law review article entitled, PROMOTING JUDICIAL ACCEPTANCE AND USE OF LIMITED GUARDIANSHIP. He wrote that “There must be specific plans for monitoring guardians, both limited and plenary, with realistic cost estimates. It is pointless to claim that the guardianship system is “reformed” unless judges institute formal systems to fulfill their oversight function.”

The professor went on, “If the courts fail in this critical role, then guardianship reform will be little more than a charade. Guardianship will be a world of court orders without compliance, paper reforms without reality, and a smug, self-satisfied system that turns a blind eye to the needs of the mentally incapacitated. Yet, it need not be so. Courts can and must monitor guardians and aggressively seek the resources necessary to support the effective oversight of guardians and the protection of persons adjudicated mentally incapacitated.” See Stetson Law Review, Vol. 31, p. 735, 2002

Still the calls for reform go out. The music’s identified. But still we tune and strum the same guitar.

Reasons for hope, again.

But that said, the Arizona Supreme Court’s Committee on Improving Judicial Oversight and Processing of Probate Court Matters has published its draft 64 page Interim Report with preliminary recommendations on judicial oversight of guardianship and conservator cases.

The Committee on Improving Judicial Oversight and Processing of Probate Court Matters has done a good job so far at re-identifying those important albeit familiar issues impacting judicial oversight:

“(a) Judicial officers are not required to participate in training specific to deciding probate cases before presiding over such cases. Because most judicial officers did not practice as attorneys in probate cases, the learning curve can be sharp.

(b) Non-licensed family members or friends who petition to become guardians often lack critical information about what the position entails. Thus, post-appointment, they may realize belatedly they are ill-equipped for the position and/or fail to adequately perform their duties.

(c) Court-appointed attorneys, guardians ad litem, and court investigators are not required to participate in training specific to their roles in guardianship and conservatorship cases.

(d) The judiciary’s auditing procedures are not sufficient to oversee all guardianships and conservatorships.

(e) The process for obtaining guardianships and conservatorships can be daunting to parties involved in such proceedings, which either deters use of the system or causes confusion.

(f) Confusion exists regarding the respective roles of court-appointed attorneys, guardians ad litem, and fiduciaries.

(g) Alternative dispute resolution is not always available or used when disputes arise.

(h) Only guardians are required to visit wards post-appointment, and no mechanism exists for periodic visits and reports by others to ensure the guardian or conservator is performing his or her duties appropriately.

(i) The courts often lack sufficient resources to provide needed oversight and protection of Arizona’s vulnerable adults.”

The Committee’s recommendations also encompass improved monitoring, dispute-resolution, data automation, paperwork processing and of course, the ever-present, never fully realized better training.

But the thornier area awaiting further deliberations remains the matter of fees paid to fiduciaries and attorneys. The Committee did adopt a recommendation that “The supreme court should adopt statewide fee guidelines for attorneys and fiduciaries paid from an estate.”

However, what’s left pending for further attorney and fiduciary teeth-gnashing is summarized below:

“Should all fee requests be first approved by the court before payment by the estate?

Should the Supreme Court adopt a rule requiring a case management plan/budget be filed at the start of a conservatorship/guardianship case?

Should quarterly accountings be required in the first year of a guardianship or conservatorship?

Should the court be authorized to order alternative dispute resolution to resolve disputes?

Should standard, hourly rates be set for fiduciaries, their attorneys, court-appointed attorneys, guardians ad litem, and their non-clerical assistants?

Should attorneys and fiduciaries be required to disclose their fee schedules and hourly rates prior to commencing an appointment?”

Some of this dovetails with a June 14th blogpost, On “exorbitant fees” and “shocking the conscience of the court.

But for anyone else wanting to weigh in, the Committee’s website continues asking for public input regarding problems encountered or observed in guardianship or conservatorship cases and for any suggested solutions. Questions and comments may be directed to probatecourtcommittee@courts.az.gov

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“It’s deja vu all over again,” as local paper investigates Maricopa County’s Probate Court.

A multi-part journalistic investigative series, Maricopa County Probate Court – Life savings, freedom taken away, kicked off in this morning’s Arizona Republic. Written by reporters Robert Anglen and Pat Kossan, it’s worthwhile reading.

Yet the inquiry and its conclusion has that pinch-me Yogi Berra feeling of, “it’s deja vu all over again.” The report talks again about how lax court oversight “allows the assets of some vulnerable adults to become a cash machine for attorneys and for fiduciary companies, which manage their affairs.”

The ground has been traveled before not only here in Arizona but elsewhere. Most recently, for instance, this blog discussed problems emanating from the Lone Star State of Texas, at Of guardianship fees and saving villages by destroying them as well as previously with several posts including, Equal opportunity defalcators and a Maricopa County Probate judge’s ‘ex-parte’ contacts.

So it really is deja vu because the problems are decades old and they go on and on. Indeed, underscoring the unremitting depth and breadth of a national problem have been longstanding advocacy organizations like the National Center on Elder Abuse (NCEA) and more grassroots groups such as the National Association to Stop Guardian Abuse and blogs like Estate of Denial.

The new Arizona Republic investigation covers the same ground previously traipsed by its noted columnist Laurie Roberts who since late 2008 has been calling needed attention into the Maricopa County Probate Court system and its oversight of the vulnerable wards under its jurisdiction. The paper’s report breaks its examination into the following 5 areas, which it terms issues:“I. Disputes trigger the problems; II. Fees mount quickly; III. Cozy relationships raise questions; IV. Objectors take the blame; and V. Oversight is lax.”

But even if the latest journalistic broadside at Maricopa County’s Probate Court has that feel of ‘we’ve been here before,’ I still think it’s a good thing the local press is giving the topic another public push. After all, the work of the Committee on Improving Judicial Oversight and Processing of Probate Court Matters is not yet completed.

Eric Sevareid

And while some local probate lawyers I know are unhappy with the Republic and Columnist Roberts, the status quo is untenable. Moreover, the aspirational ideal of famed journalist Eric Sevareid still resonates, “It’s the job of  journalists to afflict the comfortable and comfort the afflicted.”

Over the years, I’ve often thought that it’s a job we lawyers should also harken to.

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