Thursday, October 27, 2016

Bernal v. Marin

Bernal v. Marin, 196 So.3d 432 (Fla. 3d DCA 2016)

This decision addresses the validity of a purported trust revocation under F.S. 736.0602.  The Court, interpreting the plain language of F.S. 736.0602 and the legislative history, found that a revocable trust can be revoked without a specific reference to the trust where there is clear and convincing evidence that the settlor intended to revoke the trust.

Here, the decedent executed a trust leaving her estate to charity.  The trust did not provide a method for revocation.  She later executed a will leaving her estate to a friend, which stated that it revoked all other trusts made by her.  The will did not specifically refer to the trust.

F.S. 736.0602 provides that a settlor may amend or revoke a trust:
(a) By substantial compliance with a method provided in the terms of the trust; or
(b) If the terms of the trust do not provide a method, by:
        1. A later will or codicil that expressly refers to the trust or specifically devises property that would otherwise have passed according to the terms of the trust; or
        2. Any other method manifesting clear and convincing evidence of the settlor’s intent.

The trial court held because the will did not specifically refer to the trust or specifically devise the property, the will did not revoke the trust.  The Appellate Court reversed.  It interpreted F.S. 736.0602 as follows:

"Based on the plain language of section 736.0602(3) and sheer logic, a settlor may revoke or amend a trust under subsection (3)(a) by substantially complying with the method provided in the terms of the trust, or under subsection (3)(b)(1), if the terms of the trust do not provide a method, by executing a later will or codicil that expressly refers to the trust or specifically devises the property that would otherwise have passed according to the terms of the trust.  Under these two methods, no further evidence is required.  However, if the settlor revokes or amends his or her trust under the 'any other method' provision under subsection (3)(b)(2), then the settlor's intent must be established by clear and convincing evidence."

The Court found that the will, the testimony of the drafting attorney and an affidavit submitted by a friend and close confidant of the decedent amounted to clear and convincing evidence of the settlor's intent to revoke the trust. 

Tuesday, October 18, 2016

Steele v. Brown

Steele v. Brown, 197 So.3d 106 (Fla. 1st DCA 2016)

This decision, while dealing mostly with the court's ability to provide relief from a judgment pursuant to Florida Rule of Civil Procedure 1.540, also addresses whether a trial court has inherent authority to set aside a homestead order as if it were a non-final order.  The Court held that a homestead order is an appealable, final order, since it determines an interest in property and finally determines a right of interested persons.  The Court noted that leaving appealable, final probate orders open to discretionary review and termination by the courts would upset the probate code's goal of quickly and finally accomplishing the settlement of estates.  

Monday, June 20, 2016

Anderson v. McDonough

Anderson v. McDonough, 189 So3d 266 (Fla. 2d DCA 2016)

In this appeal, the appellant appealed a final order requiring him to pay fees and costs to his mother's estate following an unsuccessful will contest.  The fee award was granted pursuant to F.S. 733.106 (which provides that the court can direct from what part of an estate fees are to be paid) even though the appellant did not receive anything from the estate.  The Court held that this statute does not authorize the imposition of a fee award beyond what may be paid from a person's share of the estate, and does not create personal liability for attorney's fees.  

The estate attempted to argue that the fee award was a sanction for bad faith litigation.  The Court disagreed, finding that neither F.S. 57.105 nor the inequitable conduct doctrine applied here, where the estate failed to properly invoke the procedures of F.S. 57.105, and where even though the appellant lost his will contest, the case was not so clear cut so to render his litigation a matter of bad faith.  As a result, the Court reversed the fee award in its entirety.

Monday, June 13, 2016

Northern Trust Co. v. Shaw

The Northern Trust Co. v. Shaw, --- So.3d --- (Fla. 2d DCA 2016)

This decision deals with an interpretation of a surviving spouse's rights under a prenuptial agreement.  While the spouse argued that she was entitled to both $500,000 under the agreement and other assets left to her by the decedent, the personal representative felt that she was only entitled to the $500,000, and the other assets left to her by the decedent should be taken into account in satisfying that amount. The Court, relying on North Carolina contract law, ultimately felt that the personal representative's interpretation was correct.

The prenuptial agreement at issue stated that the wife would receive from the husband the sum of $500,000 from his estate.  It defined "estate" as his probate estate, any living trust created by him, as well as life insurance, individual retirement accounts, qualified and nonqualified deferred compensation plans and other assets that may pass by beneficiary designation outside of the will or trust documents.  When the decedent died, the wife received a $480,000 IRA distribution as well as tangible personal property valued at $103,996.  

The wife felt that because the agreement also stated that the decedent had a continuing opportunity to make testamentary gifts and IRA distributions to the wife as he desired, the agreement should be interpreted to allow her to receive both the $500,000 distribution and these other gifts from the decedent.  The Court disagreed, and held that the agreement does not provide her with an additional $500,000 payment when she has already received at least $500,000 in assets from the estate.

Tuesday, June 7, 2016

Howard v. Howard

Howard v. Howard, --- So.3d --- (Fla. 4th DCA 2016)

While most practitioners are familiar with the rules and procedures surrounding the guardianship process, many are less familiar with the procedural requirements for the appointment of a guardian advocate on behalf of someone with a developmental disability.  This decision deals with two such procedural requirements: (1) what constitutes a finding of "good cause" to proceed with the guardianship proceeding without the potential ward present and (2) the requirements for a written order appointing guardian advocates.  

Good Cause to Proceed Without Potential Ward:

Here, the potential ward did not attend the hearing on her family's petition for the appointment of guardian advocates.  The ward's attorney did not waive his client's presence, but did state on the record that he had communicated with her and she did not want to attend.  The ward's father testified about the ward's physical and mental limitations, and the court also received doctors' reports regarding her condition.  Based on the facts presented at the hearing, the trial court entered an order appointing the ward's family as her guardian advocates.

The ward argued that the court failed to make a finding of good cause when it proceeded with the hearing without her being present, as required by F.S. 393.12(6)(c).  The Court held that F.S. 393.12 required the court to make a finding that the ward's waiver of her right to appear was made knowingly and voluntarily.  This can be done by examining the ward on the record or by examining third parties who know the ward.  Here, since the trial court had heard from the ward's attorney who stated that the ward did not want to attend, the Court held that the trial court had implicitly considered the ward's decision not to appear as good cause to hold the hearing in her absence.

Requirements for an Order Appointing Guardian Advocate:

The Court also considered whether the trial court's order appointing the ward's family as her guardian advocates satisfied the requirements of F.S. 393.12(8).  The Court found that because the trial court failed to make findings as to the nature and scope of the ward's lack of decision-making ability, and failed to make a finding as to the specific legal disabilities to which the ward was subject, the order did not comply with F.S. 393.12.

Friday, May 13, 2016

Richard v. Richard

Richard v. Richard, ---So.3d --- (Fla. 3d DCA 2016)

This decision deals with the application of the relation back doctrine found in F.S. 733.601, and whether it would apply to validate a notice to creditors that was published one day prior to the appointment of the PR.  The Court interpreted the meaning and history behind F.S. 733.601 and ultimately found that the doctrine does apply to validate the earlier filed notice to creditors.

The probate court had held that the notice to creditors published the day before the order was entered appointing the personal representatives was a nullity, and that the relation back doctrine did not apply to validate the act of publication.  In doing so, it found that a statement of claim filed more than three months after the first publication date was a timely filed the claim.

The Court disagreed with the probate court regarding the application of the relation back doctrine.  F.S. 733.601, which codifies Florida common law on this issue, states as follows:

"The duties and powers of a personal representative commence upon appointment.  The powers of a personal representative relate back in time to give acts by the person appointed, occurring before the appointment and beneficial to the estate, the same effect as those occurring after appointment.  A personal representative may ratify and accept acts on behalf of the estate by others when the acts would have been proper for a personal representative."

The claimant argued that because F.S. 733.601 only says that the powers of a personal representative relate back, the duties of a personal representative, such as the duty to publish a notice to creditors, do not.  The Court disagreed.  It held that it is the acts of the person who is later appointed as personal representative of the estate which are ratified by the statute.  It found that if the statute read that the "powers and duties" related back, it would create unintended consequences for personal representatives who now had a duty to act on behalf of an estate without even being appointed as personal representative yet.  It further found that the publication of a notice to creditors can be viewed as both a duty and a power of the personal representative, such that it falls within the purview of F.S. 733.601.  As a result, it held that the relation back doctrine applied to the personal representative's act of publishing the early notice to creditors.

Tuesday, May 10, 2016

Woodward v. Woodward

Woodward v. Woodward, 192 So.3d 528 (Fla. 4th DCA 2016)

This decision deals with whether res judicata and laches barred a beneficiary's claim against a trustee.  The Court held that neither applied, since the beneficiary's two claims against the trustee did not contain identity of the causes of action, and because the beneficiary did not know about the trustee's actions until he was served with an accounting.

In 1996, the beneficiary of the Trust at issue filed suit against the trustee for breach of fiduciary duty, alleging that the trustee failed to account, improperly mortgaged real property and improperly paid expenses of the trust.  During the pendency of the action, the trustee transferred the Trust's assets to two new trusts and terminated the Trust at issue.  The trial court eventually dismissed this complaint.

In 2011, the trustee served an accounting for the Trust, and the two new trusts, on the beneficiary.  The accounting showed the termination of the Trust and the distribution to the two new trusts.  The beneficiary filed a new suit within 6 months of receipt of the accounting.  In this complaint, he sought removal of the trustee, an accounting, restoration of the assets, and other relief.  

The trial court held that the second lawsuit was barred by res judicata and laches.  The Court disagreed.  It held that the second lawsuit was not barred by res judicata, since res judicata requires that the original claim and the subsequent claim have identity of the causes of action.  Identity of the cause of action depends on whether the facts or evidence necessary to maintain the suit are the same in both actions.  Because the facts and events giving rise to the 1996 suit were different than those giving rise to the later suit, the Court held that res judicata does not apply.

The Court also found that laches did not bar the second action.  It held that the statute of limitations did not begin to run until the beneficiary received the trust accounting, even though the Trustee argued that the beneficiary knew that he had terminated the trust more than four years (the statute of limitations period) before he filed his second action.