Over the past several years, the budget axe has fallen upon our Surrogate’s courts. The loss of personnel has resulted in huge backlogs in clerks’ offices. A simple application for  Letters of Administration may  literally  take months during which time it may be impossible to insure property of the estate. An application to sell the decedent’s  real property may languish for months during which time the costs of maintenance, taxes, and insurance, need to be covered, rents may have to be collected and mortgages paid. During this elapse of time, contracts  of sale may  fail. Vacant property may be vandalized.

Contrast this with the revocable trust which provides for a seamless administration of the decedent’s estate without the delay and expense of a probate or administration proceeding. The trustee appointed by the creator of the trust has the power to take all of the steps needed to either continue the business of the estate or to wind it up without costly and time consuming delays. The Surrogate’s Court remains available in the event that a person interested in the trust seeks an accounting from a trustee or seeks redress for a breach of fiduciary duty but all in all, the revocable trust has come to be a far more reliable vehicle than a probate or administration proceeding.

When it comes to elder law and guardianships, the Sunshine State is more like the wild west.  Nursing homes and hospitals are a fertile hunting ground for unscrupulous attorneys who may convince residents to sign documents authorizing them to commence guardianship proceedings on their behalf. In many Florida counties, this may lead to a friendly judge appointing a total stranger to handle the finances of an unsuspecting senior citizen with the result being a loss of control over that person’s assets under the color of law.

While there are efforts underway to institute reforms over Florida guardianships, elder care attorneys have a powerful lobby in the legislature and the passage of legislation to control guardianship abuses is by no means certain. There are numerous instances of adult children learning that their parents have given up the keys to their assets –homes, bank accounts, everything– to a court-appointed guardian who may systematically have drained the assets of their loved one to a point of poverty.

A revocable living trust can not only provide for avoiding the cost and delays of the probate process in Florida but, equally important, it will protect the assets and lifestyle of a senior citizen from attack not only by unscrupulous lawyers and judges but also from greedy and disloyal relatives. Your lawblogger notes that virtually every family has one or two of those. I have made a good living over the years fighting to undo the damage they have done to my clients but it is far easier to avoid the expense and aggravation of dealing with a rogue family member by putting proper protection in place before the problems arise.  A revocable living trust can easily be drawn by an experienced Florida lawyer at a reasonable cost, often well under a thousand dollars.

Those of us from New York are well protected by New York’s  guardianship laws and procedures. Strict guidelines are in place to prevent the embezzlement of assets. Florida law offers far less protection and those who move down unaware of the differences in the legal climate risk a rude awakening when least equipped to deal with it.

New York has approved an amendment to SCPA 1301 which raises the limits for small estates from thirty thousand dollars to fifty thousand dollars. A small estate is a simplified proceeding in the Surrogate’s Court where it is possible to qualify as a Voluntary Administrator by downloading and filing a basic affidavit  of Voluntary Administration

This proceeding enables the administration of an estate without having to engage an attorney and by paying a filing fee of $1. This is truly the greatest bargain in New York’s judicial system. An administration should be filed by the person closest distributee  to the decedent. The requirements of the small estate program are laid out in NY Courts. Gov and will guide you through the steps you will need to take to qualify as an administrator or executor.

Today’s New York Daily News reports the tale of a brawl with potentially  wide-reaching implications for the Administrator of a New York County Estate. The administrator of the 3.1 million dollar estate was arrested for a brawl outside of a New Jersey strip club in which he has  been accused of assaulting a police officer. Tow truck operatorJohn Mattarazo was also accused by a cousin of illegally taking thousands of dollars from the estate of  the very successful hair care business built up by his aunt Maria Matarazzo.

While a felony would normally automatically exclude one from eligibility as a fiduciary, Mattarazo was given deferred prosecution and was not convicted of a crime. Nevertheless he was appointed the administrator of the estate. Now a cousin, citing his numerous alleged misdeeds has moved to have him removed as administrator.

Were this a case of an executor under a will, a court might  be willing to give more credence to the nomination of a fiduciary since we would go to great lengths to follow the dictates of a decedent choosing his own executor. That direction simply is not present where a court is asked to remove a fiduciary who has  not adhered to basic standards of fiduciary behavior. Continue to watch this space for more news from the court’s ruling on this attempt to remove the fiduciary.

In the Matter of Reuben Hoppenstein, No. 2015-2918/A (N.Y. Sur. Mar. 31, 2017) the New York County Surrogate ruled as appropriate the distribution of a life insurance policy to a new trust which eliminated certain beneficiaries of the distributing trust. This distribution was made by a trustee vested with absolute discretionary power  by the terms of the trust. The beneficiaries who were excluded brought suit against the trustee . The Surrogate deferred to the trust instrument even though it was not in strict compliance with the Estate Powers and Trusts Law.

The law always seeks to determine the intent of the creator of an instrument. Here the creator of the trust wished that his trustee have absolute discretion to make certain distributions. That provision inherently has the potential to disappoint some beneficiaries who were expecting to receive distributions from the trust but “absolute discretion” means just that.

The New York Law Journal has reported that newly appointed Kings County Surrogate John Ingram has barred the testimony of a widow in an action about whether or not she may exercise her spousal right of election in the matter of her late husband’s estate. Irving Berk, who died in 2006, left a five million dollar estate to his children and his grandchildren.

Mr. Berk’s caregiver, Hua Wang, has attempted to exercise the spousal right of election after having married the him secretly. Finding that the widow would be testifying about her relationship with  her deceased husband while having a pecuniary interest in the outcome of her testimony, the court barred her from giving what would be a one-sided narrative. The issue as to whether the widow has forfeited her ability to exercise her right of election will be decided absent her testimony.

A recent article in New York’s Daily News reports on the Queens County political machine and  its incredible control over proceedings in that county’s Surrogate’s  Court. It is a primer  on  the perils  of what can happen where there is no Will and no decent estate plan. Your lawblogger has often commented on the way in which a Public Administrator can affect the outcome of an estate. While the Public Administrator generally has the job of handling the estates of folks who die without a will and who have no relatives to step up and administer their estates, there is also a significant number of estates where executors and  administrators do not qualify to serve and they are replaced by the Public Administrator.

The Public Administrator is a business unto itself, collecting all of the assets due the estate, paying the bills and  disbursing to the distributees of the deceased. Along the way, they hire the brokers who are needed to sell parcels of real estate,  contractors to clean up  and repair assets and auctioneers to  sell items such as art,  coin  collections, cars and boats. The Public Administrator employs a law firm to handle all of the legal  work  involved and the fees generated and paid  can  be huge!

It’s good to be a friend or political crony of the Public Administrator and it can be really costly to an estate! Although some of the estates handled are small and unprofitable, estates valued  in excess of one million dollars are not  uncommon. The Public Administrator earns a commission on every  dollar brought into and estate –and on every dollar  paid out. While many of my clients  will  serve as  executors or administrators for the estate of a family member without taking the commission provided for by law, the Public Administrator always takes the commission.

So many of the problems that involve the Public Administrator can be avoided with a little bit of planning. One of the obvious answers, of course, is simply to have a well-drawn will appointing executors and trustees who are up to the task. Using self-directed assets such as an ITF bank account, retirement account or  a trust can basically eliminate the need for the Public Administrator to step into the breach. Failing to do this can cost many thousands of dollars and incredible aggravation.

Over the past holiday I treated my 15 year old grandson to a movie. Rogue One was not my choice but he enjoyed it immensely. At the close of the movie, a computer generated image of Carrie Fisher as Princess Leia  appeared on the screen. One day later, Carrie Fisher passed away after suffering a heart attack on a flight about to land at Los Angeles.

Reuters Entertainment News reports that there is now a growing concern among actors over how best to protect the rights of their estates should they be posthumously depicted in some  future movie. California currently requires that the heirs may control the way in which their images may be used posthumously — if at all. It is now clear that this subject involves substantial  intellectual  property rights which need to  be addressed while the performer is  still alive. As computer generated technology continues to improve and expand, protection of these intellectual property rights will be of greater importance and provisions for this will become common features of contracts in the entertainment industry.

Michael Petro’s article in the Buffalo Law Journal  is an interesting  piece about  a relatively new provision of the law which permits us to end an “irrevocable” trust. It’s easy to decant a fine wine but not always so with an irrevocable trust.

Before the law was changed in 2011, ” irrevocable” meant just that. We were required to adhere to the wishes and directions of the trust’s creator even though changing times might have resulted in circumstances that the he or she would have believed warranted a change in the trust. Now it is possible to decant a trust which otherwise would have been irrevocable years after its long-deceased creator conceived of its rules. For example, changes in tax laws over the years can make it extremely desirable to change the trust —or simply end it without the blessing of the trust’s creator who is no longer here to give it although it might be hard to envision him or her not doing so.

However, as Shakespeare  would say, “Here’s the rub”. It may sound logical that everyone affected by the trust needs to consent to changing of revoking the instrument. Sometimes, however, it is impossible to gain the consents of all of the siblings who stand to benefit (or lose) by the proposed change. More important is the fact that where minors are beneficiaries or where they have a contingent interest triggered by the death of a parent – beneficiary, their consent is also necessary and may be obtained by the appointment of a guardian ad litem. This may be an expensive and time consuming proceeding so the instrument needs to be reviewed in light of the facts surrounding the beneficiaries and to see whether or not it is cost-effective and whether time will simply make the decanting unnecessary.

Walter Scott’s epic words quoted above are a good guide for all of us; especially for attorneys. In what would appear to be a perfectly ridiculous way to lose a law license, New York City attorney James A. Robbins has been disbarred after losing a will entrusted to his safekeeping and then making up a series of completely phony excuses as to why the estate was being delayed without ever disclosing that the will was lost. He evidently compounded his mistake by forging documents filed with the Surrogate’s Court in an elaborate cover up to try to probate the will.

The  completely dumb thing about this is that (as your lawblogger has reported at length in earlier posts) a lost will may be admitted to probate in a situation such as this where the loss and disappearance of the document can be explained by the attorney who was its last custodian. The facts and circumstances reported in the New York Law Journal would indicate that this was a situation where instead of a series of lies and fabrications, counsel could have succeeded in having a copy of the will admitted to probate by simply falling on his sword and admitting to his mistake and explaining that  the will had disappeared in his custody. We all make mistakes and , especially where the results are not fatal, an explanation coupled with an apology and cleaning up the mess is usually sufficient to placate most clients. However, even if the client’s reaction is to fire counsel, the loss of the business and the client is a far acceptable outcome to the loss of a professional license, a felony conviction and 500 hours of community service.