Flegal v. Guardianship of Swistock

Flegal v. Guardianship of Swistock, 169 So.3d 278 (Fla. 4th DCA 2015), 2015 WL 4269079

This case centered around the ownership of stock shares and due process within a guardianship proceeding.  The dispute arose over the ownership of stock shares which were initially purchased by a father and his daughters as joint tenants with right of survivorship.

Prior to his incapacity, the father sued his daughters in Pennsylvania over ownership of these shares.  He claimed even though he had transferred the shares to his daughters as joint tenants with rights of survivorship, he did not actually intend to gift the stock to them.  As evidence of this intent, he established that he had paid for the stock, kept possession of the certificates, retained all dividends and paid income taxes on the dividends.  He asked the daughters to sign the stock back to him, but they refused, so he sought a declaration that he was the sole owner of the stock.

While this litigation was pending, the daughters filed a petition to determine their father's capacity and appoint them as plenary guardians.  The father moved to dismiss, arguing that they had only brought the guardianship to avoid the outcome of the Pennsylvania action about the ownership of the stock.  The examining committee concluded he was not incapacitated, so the daughters dismissed their petition.

About a year later, the father suffered a stroke.  A daughter not involved in the stock ownership litigation filed for guardianship and sought to be appointed as emergency temporary guardian (ETG).  She listed the stock as property subject to the guardianship.  The trial court entered an order setting a hearing on that daughter's petition, and mailed the order to the other daughters who received it just four days before that hearing. 

At the first guardianship hearing, the trial court appointed the daughter as ETG.  Once she was appointed as ETG, the daughter and the ward's counsel submitted a proposed order requiring the shares to be transferred to her as guardian.  Without notice to the other daughters or a hearing, the court signed the order.  The father died the next day.

The daughter later sought to be discharged as ETG and filed her final report.  She also transferred the shares from herself as guardian to herself as personal representative of the father's estate.

The Pennsylvania court ultimately found in favor of the daughters and held that the stock was held as joint tenants with rights of survivorship.  Five months after the ETG filed her final report, the other daughters filed an untimely objection about the ownership of the shares.  They argued they lacked notice and an opportunity to be heard, and asked the court to disapprove of the ETG's final report.

The guardianship court ultimately entered an order approving the final report and noted that the other daughters had objected but that their objection was untimely.  The court also approved the distribution of the shares to the estate.  The daughters moved to vacate the discharge order and argued that they were deprived of their stock without due process.  

The Court noted that Rule 5.648(b) only requires notice of the petition for appointment of an ETG be served on the alleged incapacitated person and his attorney, not the daughters.  The daughters argued that since Rule 5.401 provides that "every petition or motion for an order determining rights of an interested person...shall be served on interested persons," they should have received notice before the stock transfer occurred as interested persons.  The Court agreed, since their interests were affected by the court's order.  The Court also found, however, that their objection to the ETG's report was untimely, so they therefore abandoned or waived any objection to that report.

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