Two Minneapolis women are wondering if they are the victims of misuse of funds by an estate sale company. In particular, the women question whether they will ever see more than $21,000 in sale proceeds which they had hoped to apply toward the care of an elderly family member.
]]> Until recently, the estate sale company, which has been in business for 25 years, boasted a favorable rating with the Better Business Bureau. The Minneapolis women likely had no reason to be concerned about fraud when they signed a sale contract, but with complaints now on file from disgruntled customers ranging from St. Paul to San Francisco, the company's rating has been downgraded to 'F'.Concerns about the lack of regulation over estate sale companies prompted one Minnesota legislator to sponsor a bill requiring companies to post a cash bond prior to holding an estate sale. However, the bill was denied a hearing.
Even though estate sales are a longstanding practice in estate administration, and most sale companies conduct honest business, the risk of being fleeced by deceptive practices highlights the importance of legal assistance and oversight.
Prior to signing any contracts for third-party services, Minnesotans charged with the difficult task of disposing of a loved one's assets will want to be aware of the steps they can take to minimize risk and preserve estate assets.
Source: Star Tribune, "Estate sale checks never came," Kelly Smith, May 8, 2012
]]>The petition for conservatorship represents only the most recent dispute between the daughter and the actress' husband of 25 years. Each party has accused the other of financial transgressions in the past, and the current litigation conjures up the same themes.
]]> The daughter claims that a conservator is necessary due to the husband's misuse of funds and failure to share information. For his part, the husband blames the estate's looming financial difficulties on the high costs of medical care and the depreciated value of the actress' home.The daughter's petition requests that she be granted authority to manage her mother's finances and medical care, but as the case heads to mediation, the daughter has indicated a willingness to consider an independent conservator. The husband insists that he has succeeded in providing the best care possible under the circumstances, and that he should be his wife's conservator if the court deems a conservatorship necessary.
As complex family situations become increasingly common in American society, family disputes over the care of a loved one are increasing in stride. Minnesotans dealing with similar disagreements over the well-being of a family member will want to have a solid understanding of the legal options for ensuring that a loved one's wishes are respected and that estate assets are managed properly.
Source: CBS News, "Zsa Zsa Gabor's daughter and husband to appear in court," May 2, 2012
]]>The guardian claims that the charity exercised undue influence to coerce the elderly woman into making the donation commitment and changing her will for the charity's benefit.
]]> The litigation centers around two letters the woman signed in 2002 and 2010 pledging the disputed contribution to the charity. The guardian asserts that the letters are not legally binding contracts.The guardian also claims that the charity insinuated itself into the woman's life and attempted to estrange her from family members and her personal care provider. Pointing to a $5,000 charge against the woman's credit card and efforts to convince her to dissolve the legal guardianship, the guardian has accused the charity of using bully tactics to get at the woman's financial assets.
The charity has sought legal standing as a beneficiary in the woman's guardianship proceedings, asserting that invalidating her gift commitment would defeat her charitable intent. Because the charity currently finds itself in the middle of a foreclosure action, its continued existence may turn on the probate court's decision about the validity of the woman's pledge commitment.
While the desire to make a legacy gift to charity is not uncommon, the case of the millionaire widow highlights the importance of making sure that the wishes of an elder loved one are clearly understood.
Minnesotans may want to make a point of discussing the philanthropic plans of elder family members. Anyone who suspects that a family member's gifts to charity may not have been entirely voluntary will want to have an understanding of the legal options available for setting matters right.
Source: Orlando Sentinel, "Widow's guardian sues Holocaust center over $1-million 'pledge'," Tonya Alanez, April 17, 2012
]]>The lawsuit involved a trustee and the heirs and beneficiaries of Hill's great-grandson. The plaintiffs claimed that a local storeowner had exercised undue influence to take advantage of the great-grandson's incapacity. In addition to a will contest, the probate litigation challenged the validity of trust amendments made by the great-grandson near the end of his life.
]]> The great-grandson's original will had divided his estate among heirs and friends, and made allowances to several different charities. The new will, executed in 2011, cut out all the previous beneficiaries and named the store owner as sole heir. Around the same time, the great-grandson made changes to his trust that gave complete control of trust assets to the store owner.The plaintiffs asked the court to invalidate the 2011 will and trust amendments, claiming that the great-grandson was in poor health and lacked the capacity to make a new will and amend the trust.
The details of the recent agreement are confidential, but it is estimated the estate was valued at roughly $62 million.
Even though most inheritances are not as grand as the James Hill estate, the case of the railroad fortune emphasizes the importance of staying aware of the influence others may have upon elder loved ones. Minnesotans who suspect that a loved one may be subject to coercion or undue influence will want to be aware of all their legal options for protecting a family member's assets.
Source: The Maui News, "'Fair' resolution a 'final chapter' in Dorcy estate," Brian Perry, April 19, 2012
]]>The executors of the woman's estate initiated a will contest after discovering that the woman had significantly changed her end-of-life documents just eight months after signing a will naming her heirs. The executors of her estate showed that the deceased woman had written letters expressing her fear of the police officer, and she indicated that she was bothered by the officer's efforts to coerce her into loaning him money.
]]> The probate court invalidated the woman's second will after finding that the police officer cashed several of her retirement checks before her death and forged the woman's name to continue cashing checks after her death.Court documents indicated that the man drained nearly $66,000 from the woman's personal checking account in the seven months following her death.
Fortunately for the executors, the offending police officer owned property that may serve as a source of restitution to the estate. The court ordered the police officer to reimburse $81,000 to the woman's estate and placed a $70,000 lien against the officer's house.
Although the executors in this case succeeded in obtaining a judgment for the amount of money the police officer swindled out of the woman, financial exploitation often leaves heirs and beneficiaries with no recourse for recovering estate assets.
Minnesotans with elder loved ones should consider paying close attention when a family member mentions an unlikely friend asking for money. Early intervention may be the only way to head off financial exploitation and preserve estate assets.
Source: Eagle-Tribune, "Hale ordered to pay 'Aunt Betty' estate $81K," Jill Harmacinski, April 8, 2012
]]>The promoter's sons accused the estate executor of self-dealing during probate administration. The sons say the executor failed to share information about the sale of rock memorabilia, including a trove of original concert posters, to a company managed by the executor. The sons claimed that the executor fraudulently hid the estate assets from the probate court and that the sons only learned about the sale when looking through old company documents in 2009.
]]> Although the probate court recently ruled that the sons' claims had no merit and ordered them to pay more than $500,000 in legal fees, the sons have expressed their desire to appeal and extend the litigation. In addition to a finding of no merit, the probate court also concluded that the sons waited too long to file their lawsuit and that their claims were barred by the statute of limitations.Minnesotans may know that an estate administrator owes a fiduciary duty to beneficiaries to make a full inventory and disclosure of estate assets, but tracking estate assets can become especially complex when administration involves business interests. Even under the watch of a well-intentioned executor, confusion or miscommunication can lead to probate disputes.
Because claims against an estate administrator may be restricted by statutory time limits, beneficiaries of complex estates will want to file any such claims with care and in a timely manner.
Source: sfgate.com, "Bill Graham's sons ordered to pay legal fees," Bob Egelko, April 3, 2012
]]>The woman's sentence requires her to serve 60 days in jail followed by five years of probation. She is also subject to a $300 fine and will have to pay restitution to the swindled clients. However, victims of financial exploitation risk permanent loss when abusers lack the financial resources to pay compensation. It is unclear from the report whether the woman will ever be able to pay the full amount of restitution, but any violation of the terms of her probation could land her in jail for 33 months.
]]> Warnings about financial abuse of elder adults have gained increasing visibility in recent years, but this sordid affair in South St. Paul serves as a reminder of the risk of exploitation faced by all vulnerable adults. Even when a loved one receives care from licensed professionals in a licensed facility, the attention of family members and legal guardians remains essential to ensuring that the assets of the vulnerable adult are appropriately applied to his or her care and needs.Minnesotans with family members at risk of financial exploitation will want to stay aware of signs indicating potential fraud and the legal options available for protecting critical assets.
Source: Inver Grove Heights Patch, "Woman sentenced to 60 days in jail for South St. Paul nursing home heist," Jeff Roberts, March 30, 2012
]]>Seniors who own real estate may be particularly vulnerable to fraud, which in turn threatens to deprive heirs of a future inheritance. In one case, a son convinced his elderly mother to take out a reverse mortgage totaling $100,000, only for the son to gamble away the entire payout. The son faced criminal prosecution, but only after depriving his mother's estate of much of the value of her property.
]]> Similar stories abound. For example, the daughter of one woman diagnosed with Alzheimer's disease misused funds from a reverse mortgage to pay off credit cards and buy herself gifts. In another particularly disturbing case, a man used the threat of suicide to coerce his grandparents into giving him money from their reverse mortgage arrangement.Minnesotans with seniors in the family would do well to stay alert for signs of elder financial abuse. Even with a guardianship or conservatorship in place, seniors may still be susceptible to fraud in the absence of oversight by concerned family members. In some cases, the damage caused by fraud against seniors cannot be undone unless acted upon quickly, which is why anyone who suspects a vulnerable adult is being exploited will want to be aware of all the legal options for protecting their loved one and his or her assets.
Source: Chicago Tribune, "When senior mortgage fraud hits home," Lew Sichelman, March 16, 2012
Source: Spotlight on Elder Abuse, "New Effort Targets Elder Fraud, Financial Abuse (MN. USA)," Feb. 14, 2012
]]>Today's advances in health care are helping people to live longer. Unfortunately, many of these people are living longer with debilitating diseases, such as Alzheimer's, and one result is that savings are sometimes diminished by the cost of health care. In fact, half of individuals over the age of 85 are living with Alzheimer's disease. These statistics may be a wake-up call for Minnesotans who haven't yet decided on powers of attorney and health care directives, since the lack of these documents too often leads to probate disputes.
]]> The existence of second families is another common issue in modern probate litigation. When multiple families are involved, there may be numerous parties looking for an inheritance. In fact, over half of first marriages end in divorce, and 75 percent of divorced individuals will get married again. Over 40 percent of Americans have at least one step-relative. In these situations, spouses, ex-spouses, children, step-children and half-siblings may all seek to benefit from a will. Of course, such a wide distribution of assets is not always possible.Recent troubles in the national economy have led to increased job loss, forcing estate owners to live on their existing savings and assets. Often, the result is that the estate dwindles, leaving less and less for heirs and beneficiaries.
Each of these situations has made drafting wills and determining inheritances considerably more complicated for many Minnesotans. That is why estate planners and heirs alike will want to look carefully at the legal options for preserving an estate and achieving a fair and equitable distribution of assets.
Source: USA Today, "With more blended families, estate planning gets ugly," Haya El Nasser, March 14, 2012
]]>According to the filings in pending probate litigation, the half-sister of the influential poet and musician allegedly conspired with her mother and grandmother to siphon over $250,000 dollars out of Scott-Heron's personal bank account shortly after his death.
]]> The musician's son, acting on behalf of the estate, filed suit seeking the return of the missing money along with an additional $2 million in punitive damages. The son claims that the women took advantage of a limited power of attorney to misappropriate funds in a case of apparent self-dealing. According to the lawsuit, the women forged the musician's name in order to transfer money from an account set up to receive royalty payments into an account linked to the women's address.The turmoil surrounding Scott-Heron's estate illustrates how basic estate planning tools can be abused by the very people entrusted to preserve an estate for heirs and beneficiaries. In the wrong hands, even the devices intended to protect an inheritance may become a liability to the wishes of a loved one.
Minnesotans who find themselves faced with a probate dispute will want to do everything legally in their power to preserve or recover estate assets and make certain those assets pass to the rightful beneficiaries.
Source: nydailynews.com, "Bitter fight over Grammy winner Gil Scott-Heron's estate," Barbara Ross, Feb. 28, 2012
]]>The will left a 35-acre parcel of oceanfront real estate to be held in trust for the benefit of the local grammar school. Some area residents now claim that a recent probate settlement is an injustice against the wishes of the long gone benefactor.
]]> Probate litigation appears likely to continue as opponents of the settlement raise concerns over fiduciary issues, including mismanagement of trust property. The property has long been under the administration of a private board of trustees, who have generated income by renting out cottages on the trust land.The claims of mismanagement include accusations that some of the trustees rented cottages for their own use at a discount rate that lowered rental values for all the other cottages.
Under the new probate settlement, the cottages would be divided into condominium units and sold to current tenants. The original trustees would be replaced by a public board tasked with managing sale proceeds to enhance school funding.
Opponents of the settlement say its terms undervalue the land and subvert Payne's dying wish that the land itself be used to benefit the town's public schools. Supporters claim that the new public board of trustees will enhance local oversight and increase revenues for the schools.
Whatever the benefits may be from the new trust established by the probate court, the settlement order raises concerns about the ability of individuals to have confidence that their wishes will be carried out in accordance with the conditions of a trust. The ultimate fate of William Payne's venerable trust may well influence the shape of tomorrow's probate litigation.
Source: Pioneer Press, "351-year-old will sparks bitter dispute in Mass.," Rodrique Ngowi, Feb. 24, 2012
]]>Earlier this month, a woman pled guilty to credit card fraud after spending over $30,000 of her aunt's money. The woman sought and obtained guardianship over her elderly relative in January 2011, which gave the younger woman access to her aunt's bank accounts. The niece promptly moved over $170,000 dollars into her own accounts, eventually purchasing sunglasses and new tires for her vehicle.
]]> While this is a criminal case, it highlights the need for those involved in the lives of the elderly to keep watch on affairs. Unfortunately, many older people lack the capacity to deal with all of the aspects of daily life, making the elderly reliant on those directly caring for them.In Minnesota, someone can obtain authority over another person's affairs as either a guardian or conservator. A guardian is granted powers only over those things necessary to ensure proper care, while a conservator has power over the person's estate and financial affairs. Both positions are appointed by the court and can require court oversight to ensure there is no abuse. Either way, the guardian or conservator owes the person he or she is serving a fiduciary duty -- guardians and conservators cannot make certain decisions purely for self-gain.
Source: TriCities.com, "Gray woman pleads guilty to stealing more than $30K from elderly woman," Feb. 9, 2012
]]>The unconventional adoption is now being challenged by an attorney appointed to serve as guardian ad litem for the entrepreneur's children. The guardian for the children will represent their interests in the trust assets, and is now seeking to gain access to the irrevocable trust as a source of claim payment.
]]> The guardian, who is an attorney, argues that the entrepreneur's adopting his girlfriend is unfair to the biological children, since the trust is now divided among three beneficiaries, dramatically cutting each child's share of the trust assets.As a general rule, only a person with an interest in a trust can bring legal action against a trustee. Because a trustee owes a legal duty to act in the best interests of trust beneficiaries, many lawsuits against trustees are founded upon a claim for breach of fiduciary duty. Often, these lawsuits seek to either remove the trustee or demand an order directing the trustee to perform in a particular way.
In the case of beneficiaries who are minors, any legal action must be brought through a parent or legal guardian. In any event, the entrepreneur's unusual circumstances highlight the importance of carefully choosing an experienced probate attorney to help with the complex issues posed by estate planning.
Source: nbcmiami.com, "Children's guardian disputes Polo founder's adoption of girlfriend," Karen Franklin, Feb. 10, 2012
]]>Some attorneys and judges say that probate litigation is on the rise. Therefore, it is important for Minnesotans to carefully plan their estates to ensure that when they are gone, their assets and property are dispensed according to their wishes.
]]> The most common issue that attorneys see is with people who are in their second or third marriage. In these cases, the estate plan often does not provide for the second or third spouse while also providing for the children from a previous marriage. Two celebrities whose beneficiaries famously found themselves in this situation are Anna Nicole Smith and Jerry Garcia.Another common situation occurs when one of the parties involved with the estate owner commits fraud. This often happens when a parent or family member is fatally ill and another family member becomes the primary caretaker. The caretaker may then feel an entitlement to a larger share of the estate and therefore take measures to be added to financial accounts because, upon the death of the estate owner, the names on the accounts take precedence over the terms of a will. This was the case in the death of philanthropist Brooke Astor.
Even successfully drafted, ironclad wills may not hold up in certain circumstances, such as those listed above. It is important to note that these are not just issues for families with multi-million dollar estates. These are issues that can affect all families and estates no matter how large or small the value.
If individuals do not properly plan what will happen to their estates when they pass, the likelihood of probate litigation for their beneficiaries and heirs will be much higher. However, consulting with an experienced estate administration attorney can help make the estate planning process much easier.
Source: Reuters, "The big lessons from celebrity estate wars," Amy Feldman, Jan. 26, 2012
]]>Careful estate planning prior to one's death will help ensure that there isn't too much ambiguity in this regard. However, when estate planning is put off, those who eventually handle the estate may be left with some questions.
]]> Minnesotans should know that state law governs probate and estate administration, so residency is a very important factor since the laws in each state can vary. The easiest way to start thinking about determining residency is to ask where the estate owners spent most of their time. If they spent February and March in a warmer state and the rest of the year in Minnesota, then they are likely Minnesota residents. If their time was basically split down the middle between Minnesota and somewhere else, then the state in which the decedents filed state income taxes is probably the best indicator of where estate administration should take place.If the estate includes two homes in two different states, then the decedent might have filed for a homestead exemption for one of the residences. In that case, wherever the exemption was filed is probably where the estate should be administered.
When a person owns real estate in a place that is not the home state, then sometimes establishing an ancillary estate is necessary. Because ancillary estates are essentially probate estates outside of the decedent's home state, ancillary estates are often time-consuming and expensive. Dealing with an ancillary estate involves conducting estate administration in separate two courts.
One way for estate planners to anticipate this somewhat complicated situation is to create a trust that will hold the title to both homes. That way the trust can be dealt with in one court instead of two.
Source: nwi.com, "ESTATE PLANNING: Questions of residency," Christopher Yugo, Jan. 22, 2012
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