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A fiduciary can be found in any number of different roles.  The Surrogate’s Court can appoint a New York Executor or Administrator to handle the affairs of a decedent’s estate.  The New York Supreme Court can appoint an Article 81 Guardian to be responsible for the property management and personal needs of an incapacitated person.  In all of these situations the appointed party is a fiduciary who has obligations and responsibilities.  The actions and performance of all fiduciaries are subject to review by the Court which typically occurs when the fiduciary prepares an accounting reflecting the transactions that have occurred during the tenure of the accounting party.  All persons interested in the matter have a right to review the accounting and to file objections concerning issues they believe constitute a breach of a fiduciary duty. There have been a number of recent court cases which provide interesting examples of the process of reviewing the propriety of fiduciary conduct.

Matter of Flynn was a case involving an accounting by an Article 81 Guardian.  Flynn was decided by Brooklyn Supreme Court Justice Michael L. Pesce on March 20, 2014.  A son of the incapacitated person filed Objections to the Guardian’s account essentially asserting that the use by the Guardian of in trust for accounts (“Totten Trusts”), which named the son as beneficiary, was improper.  After reviewing the evidence, the Court found that the Guardian’s use of these accounts, even without prior Court approval, was appropriate since the funds were needed and used for the interests of the incapacitated person.  The Court also found that the Guardian’s selection of a nursing home to which the funds were paid was also appropriate and did not waste the funds.  The Court dismissed the Objections as being without merit. Continue reading →

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Following the death of a decedent, proceedings in the Surrogate’s Court are often begun for the appointment of an Executor or Administrator.  As discussed in many past posts in the New York Probate Lawyer Blog, an Executor is appointed when a Will is admitted to probate and letters testamentary are issued.  If a person dies without a Will, he is said to have died intestate and the Court then issues letters of administration to the administrator.  The administrator is determined according to statutory priority of kinship pursuant to Surrogate’s Court Procedure Act (SCPA) 1001 entitled “Order of priority for granting letters of administration”.

New York estate lawyers are aware that an estate fiduciary has many responsibilities including locating and collecting estate assets.  Sometimes it may occur that an asset belonging to the estate is being withheld or has been wrongfully taken by a third party.  There are provisions in the SCPA that can be utilized by a fiduciary to discover and recover these assets from the third party. Continue reading →

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Estate Planning attorneys are aware that it is important for a person to prepare a Last Will, Living Will, Health Care Proxy and other appropriate papers regarding advance directives and financial planning.  The New York Probate Lawyer Blog has had many posts regarding these matters.  Among the essentials to develop a good plan, a person should spend time reviewing with his advisors the assets that are owned, the identity of the relatives or other persons that are to receive a beneficial interest, and the amounts and manner in which each beneficiary is to receive his interest.  Numerous considerations also include the impact of taxes and the utilization of trusts and other planning methods.

No matter what kind of estate plan is developed, it is essential that the creator’s intent be clearly and explicitly set out in the various documents that are signed.  Estate litigation in the New York Surrogate’s Court invariably results when the wording in a paper, such as a Last Will, is not clear or complete.  An example of the consequences of missing or unclear language in a Will appeared in a decision on March 19, 2014 by Manhattan Surrogate Rita Mella in Will of Isasi-Diaz Continue reading →

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Planning your estate requires the consideration of many factors.  A primary consideration is preparing and executing a Last Will.  New York Estate Lawyers are familiar with the basic requirements for creating a valid Will.  As set forth in Estates, Powers and Trusts Law Section 3-2.1 a Will should be in writing; signed at the end by the testator and there should be at least two attesting witnesses.

The dispositions that appear in a Will typically are in the form of bequests of specific property or certain sums or percentages of assets as well as a catch all or residuary clause for the balance of an estate.

There are many aspects involved in preparing a Will which include mapping out the appropriate dispositions and including clauses that might create testamentary trusts, the appointment of executors and trustees and tax provisions to lessen the burden of estate taxes.  All of these items should be carefully reviewed by the testator with a professional estate planning advisor so that a person’s intentions for the transfer of his estate are properly formulated and effectuated. Continue reading →

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The New York Probate Lawyer Blog has had previous posts concerning the issue of elder abuse.  A recent survey released by the National Association of Professional Geriatric Care Managers reported that the financial exploitation of the elderly is a growing and ongoing problem.  The survey found that the top areas of abuse included theft of money and property by family, friends, neighbors and care-givers.  Also, using deception to obtain the signature of the senior on a deed, a Will or power of attorney was a top form of abuse.

A New York Guardianship Lawyer is familiar with the provisions of Article 81 of the Mental Hygiene Law (MHL) that can help to protect an older person from being taken advantage of.  MHL Section 81.29 allows a Court to void a deed, a power of attorney, a trust or health care proxy if the Court finds that a person did not have the required capacity to sign these papers.  Additionally, a Guardian of a person’s property has the authority to recover assets that were wrongfully taken from an incapacitated person by commencing a Court action against the wrongdoer.  The Guardianship proceeding allows the Court to make a full review as to whether the alleged incapacitated person is able to adequately protect his rights and whether the individuals who are interacting with the AIP are doing so in a fair and proper manner. Continue reading →

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There are numerous and diverse matters that are presented to the Surrogate’s Court for resolution.  In the Manhattan Surrogate’s Court, the Queens Surrogate’s Court and the Brooklyn Surrogate’s Court, just to name a few, cases are presented regarding a variety of estate administration and estate settlement controversies.  A review of some recent Court decisions provides insight into these disputes.  Will of Ida Seals was decided by Erie County Surrogate Barbara Howe on March 10, 2014.  This case involved a petition by the niece of a decedent to have the Court declare that a son of the decedent who was a named beneficiary in her Will was deceased since the son had been “absent” or not heard from since in or about 1980.  New York Estates, Powers and Trusts Law (EPTL) Section 2-1.7 entitled “Presumption of death from absence; effect of exposure to specific peril”, allows the Court to presume that a person is deceased under certain circumstances.  The Surrogate refused to invoke the presumption and to find that the son was deceased.  Instead, the Court found that the petitioner failed to sufficiently demonstrate that a diligent search was performed to provide a substantive basis for presuming the son’s death.  The petition was dismissed without prejudice for a later determination during the proceeding settling the fiduciary’s account.

Testament of Raffe is another recent case which was decided by Nassau Surrogate Edward McCarty III on March 7, 2014.  In Raffe the objectants to an accounting filed by a testamentary trustee asked the Court for an Order restraining the trustee from providing or using any additional trust funds to operate a home heating oil business that was owned by the trust.  The objectants asserted that the business was a failure and that the trust funds were being wasted.  After considering the various factors involved to support a preliminary injunction, the Surrogate refused to allow the restraint.  The Court found that any monetary harm could be rectified by a surcharge against the trustee and that economic loss that could be recognized in terms of money damages would not constitute the irreparable harm needed for an injunction.  Continue reading →

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Real estate is typically one of the most valuable assets comprising a decedent’s estate. Typically, a person’s residential house is a major asset. Many individuals also own commercial properties that may be used as a part of a business or may contain tenants. In view of the large worth of real estate assets it is common that the property is at the center of many estate battles.

A common occurrence appears to involve a pre-death transfer of the real estate interest to one person to the exclusion of others who would otherwise receive the property pursuant to a Last Will or through their rights of intestacy as a distributee of a decedent. Moreover, these lifetime transfers often occur when the decedent is elderly and suffers from physical or psychological conditions. Also, the deeds may be executed by persons acting as an attorney-in-fact under a power of attorney. Since these changes in property ownership appear to be improper and deprive potential beneficiaries of valuable inheritance rights, lawsuits in the Surrogate’s Court and Supreme Court frequently occur concerning ownership rights and the validity of the deeds reflecting the transfers.

A recent case decided by Kings County Justice Francois A. Rivera on February 20, 2014 provides a good example of a controversy created by real estate owned by a decedent. In Juliano v. Juliano, the decedent (“Beatrice”) had owned a home in Brooklyn where she lived with some of her adult children. Beatrice had made a Last Will in which she left her entire estate, which included the house, to her four children in equal shares. Approximately 6 years prior to her death it appears that Beatrice signed a deed transferring her entire interest in the house to her son to the exclusion of the other 3 children. However, it seems that the son receiving the property (“Frank”) did not accept or record the deed at the time it was signed by Beatrice but waited about 6 years to record it.

Interestingly, the Court voided the deed because it found that the gift was not effective due to the lack of proper acceptance by Frank at the time the deed was made. Additionally, although the Court found that there was a confidential relationship between Beatrice and Frank that would have provided a basis for a finding of undue influence, the Court declined to void the transaction on that ground since it had determined the deed was invalid due to the lack of acceptance.

As an estate litigation attorney, I have represented numerous individuals in situations where issues have arisen concerning the alleged improper transfer of real estate and other assets from a decedent to a family member or to a third party. These cases are typically presented in Surrogate’s Court proceedings and Supreme Court proceedings. Sometimes the issue is raised before a person dies and is litigated in a Guardianship case. The Guardianship Court has the power to void deeds and other transactions it finds to be improper due to the abuse of a power of attorney or the incapacity of persons making the transfer.

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A New York Guardianship proceeding involves the determination of the capacity of an individual. In order for a Court to appoint a property management Guardian or a personal needs Guardian there must be a finding of incapacity.

Article 81 of the Mental Hygiene Law (“MHL”) provides the statutory provisions for these proceedings. As discussed in previous posts in the New York Probate Lawyer Blog, the case is commenced by the filing of a petition with the Court along with a paper known as an Order to Show Cause. After the Court reviews the petition and finds it to be sufficient to start the case, the Order is then signed. The signed Order contains the date and place for the hearing and the names of persons appointed by the Court as Court Evaluator or attorney for the alleged incapacitated person.

There are a number of fees that are generally associated with Guardianship matters. After a Guardian is appointed, he may be entitled to receive a fee or commissions for carrying out his guardianship obligations. The judgment appointing the Guardian typically sets forth the manner by which such fees are to be computed. The judgment usually provides for fees that are to be paid to other individuals such as the attorney who represented the petitioner and the Court Evaluator or the attorney who represented the incapacitated person. It is common for the Court to direct that these fees be paid out of the assets owned by the incapacitated person.

There are some occasions when the petition for guardianship is denied by the Court or the matter may be discontinued by the agreement of the parties. In these situations the Court has the authority under MHL Section 81.09(f) to direct that the petitioner pay for these fees in addition to the alleged incapacitated person. In a recent Brooklyn Guardianship case entitled “Matter of Brice v. Wilks“, decided by Judge Kathy J. King on February 4, 2014, the Court directed that the petitioner pay the Court Evaluator’s fees after the petition was denied.

It is important for a person considering starting a Guardianship case to consult with a knowledgeable Guardianship attorney who can review the issues that are involved and explain the various fees and costs that may be incurred. Sometimes the facts of a matter may involve a risk that the petitioner could be held responsible for fees that are not otherwise expected.

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New York Will Attorneys are aware that there are many aspects of a decedent’s estate that can result in controversy and estate litigation. A recent case decided by Queens Surrogate Peter J. Kelly on January 22, 2014 entitled “The Matter of Hill” and reported in the New York Law Journal, contains many issues that are common to estate disputes. In Hill, the decedent had executed a Last Will that provided for a residuary clause leaving the balance of the estate equally to the decedent’s two daughters, Brenda and Marcia. The Will also contained a pre-residuary provision which specifically devised real property equally to the two daughters subject to a life estate in favor of Brenda.

Brenda lived at the real property premises with the decedent and became her attorney- in-fact in a power of attorney. Shortly before the decedent’s death Brenda used the power of attorney to transfer the real property from the decedent into Brenda’s sole name.

The transfer of the deed by Brenda as attorney-in-fact to herself is not an uncommon occurrence. Litigation by New York estate attorneys as well as Queens Guardianship Lawyers concerning such circumstances is often commenced to void the deeds in these transfers. Under both the estate laws and the New York Guardianship laws improper transfers of a person’s assets can be invalidated and the property or the proceeds thereof recovered. Moreover, an attorney-in-fact under a power of attorney has an obligation to account for his actions especially where there appears to be self-dealing by having transfers made for one’s own account. The Courts are more likely to find impropriety where a person abuses a confidential relationship by benefiting from his position of trust or authority.

In Hill the Court had previously found that the deed transfer by Marcia was voidable and the estate was able to recover title to the property. However, the dispute in Hill did not end. Since the real property had been transferred before the decedent’s death it was not part of the decedent’s estate when she died. As a result Marcia claimed that the property was subject to the rules of Ademption which effectively provide that when property that is specifically given under a Will does not exist when the decedent dies, the gift is essentially ignored. If the Court in Hill had applied the Ademption rule, then the real estate, once recovered, would have been disposed of under the residuary clause to the two daughters and not by the specific pre-residuary provision. This result would have eliminated Brenda’s life estate.

Notwithstanding Brenda’s improper and voidable transfer of the deed, the Court held that the recovery of the title to the property by the estate although occurring after the decedent’s death, prevented the application of the Ademption rule. The Court also stated that Maria had a fiduciary obligation to the estate to recover the deed and that she should not personally profit by not following the terms of the Will.

I have represented many clients in New York Guardianship cases and estates where it was necessary to recover property that was improperly transferred. As can be learned from Hill, the Courts are receptive to proceedings to rectify a breach of fiduciary duty by a fiduciary and to enforce the disposition of assets in the manner a decedent expresses in his Last Will.

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Fiduciaries such as Executors, Administrators and Trustees are frequently required to participate in proceedings in the Surrogate’s Court. There are many different types of cases in the Court such as probate and administration proceedings and accountings. For example a Brooklyn Estate Lawyer might be retained by an Executor to represent the executor in a discovery proceeding to recover assets that are claimed to have belonged to the decedent. Similarly, a Bronx Estate Attorney may be hired by a fiduciary to assist with the interpretation or construction of a Last Will or Trust Agreement that is ambiguous.

There are occasions when the Executor or other fiduciary may find hiring an attorney to be difficult because the estate or the trust either does not have any assets or the assets are not liquid or available to pay counsel fees. A question would then arise as to whether the fiduciary could represent himself pro se in his capacity as a fiduciary. This issue was recently presented to Manhattan Surrogate Nora Anderson in “Matter of Van Patten” which was decided on February 10, 2014 and reported in the New York Law Journal. In Van Patten the non-attorney Executor of the estate of a trust income beneficiary sought to represent herself pro-se in the trustee’s accounting proceeding. The Court found that the Executor, as a fiduciary, had obligations to potential estate beneficiaries and creditors and the pro-se representation by a non-attorney fiduciary would constitute an unlawful practice of law. The Executor was directed to retain an attorney or risk having the estate’s objections to the trust accounting dismissed.

As can be seen from this case, representation of a fiduciary in Surrogate’s Court proceedings can be quite complex. A fiduciary has numerous obligations and must protect the interests of estate beneficiaries as well as other parties such as creditors. As a New York estate attorney, I am familiar with the various duties that estate representatives must attend to as well as the laws and procedures involved with estate settlement. I assist my clients regarding these issues and work with them concerning all matters to finalize an estate.

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