Monday, January 1, 2018

Lawyer Guardian's Self-Dealing Draws Disbarment

The New York Appellate Division for the Second Judicial Department imposed disbarment of an attorney for self-serving elder abuse

By order dated July 23, 2004, the Supreme Court, Queens County, appointed the respondent the successor guardian of the person and property of Albert K., who was then a 76-year-old incapacitated person. In and around early 2007, the respondent, in his capacity as guardian, appointed his wife, Ann Marie D’Angelo (hereinafter Ann Marie), as the nurse geriatric care manager for Albert K. Ann Marie provided geriatric care management services to Albert K. through her solely-owned entity named Family Care Connections, LLC (hereinafter Family Care), which she formed in and around January 2007. Family Care operated from the same office suite as the respondent’s law firm. The respondent paid to Family Care out of Albert K.’s estate the aggregate sum of $111,881.98 for services to Albert K.

The Queen's County Supreme Court held a hearing

In a decision dated December 8, 2010, the Supreme Court determined that the respondent’s final account should be approved; however, it determined that the sum of $108,881.59 constituted excessive fees paid to Family Care and Ann Marie. It approved the sum of only $3,000 paid to Family Care for the period May 2007 through September 2007, when Albert K. was at home. The Supreme Court further determined that: (1) the respondent should be denied commissions and an attorney’s fee, “as his actions were in the best interests of him and his family rather than his ward”; (2) the respondent was personally liable to pay the court examiner’s legal fees in the amount of $14,625 for identifying and asserting objections to the account; and (3) the respondent should be surcharged the amount of the foregoing items in the aggregate sum of $123,506.59, without interest. The Supreme Court issued an order dated December 28, 2010, consistent with its decision dated December 8, 2010, judicially settling the account. In an order dated May 11, 2011, the Supreme Court denied the respondent’s motion for reargument.

There was also serious misconduct in the sale of Albert K.'s real property and preparation of his will.

The respondent deposited the [sale proceeds] check into the corporate account for Castleworks. The proceeds were later disbursed by the respondent for various purposes, including to his law firm and his and Ann Marie’s personal accounts. Castleworks performed no brokerage services in the marketing and sale of the Bridgehampton property, and there was no co-brokerage agreement between Castleworks and Elleira Realty for the Bridgehampton property.

The respondent did not disclose to the Supreme Court, which had approved the sale of the Bridgehampton property, that he had received, deposited, and disbursed one-half of the commission Elleira Realty received in connection with the sale of the Bridgehampton property...

In this case the circumstantial evidence that Albert K. did not understand the contents of the May 8, 2009, or July 8, 2009, wills was overwhelming. Twelve years earlier, on June 9, 1997, Dr. James J. Johnson, Jr., conducted a mental status and competency evaluation of Albert K. in connection with the petition to appoint a guardian for him pursuant to article 81 of the Mental Hygiene Law. Dr. Johnson concluded that Albert K. suffered “from a severe and probably progressive neurologic disease known as multi-infarct dementia,” and that he had “severe impairment of his language and comprehension of his surroundings.” The respondent testified at the hearing that he had been given a copy of Dr. Johnson’s report when he was appointed successor guardian to Albert K., and that during the time that he was Albert K.’s guardian, Albert K. had exhibited mental confusion and could not understand complex sentences. The respondent further testified that, at the time that the May 8, 2009, will was executed, Albert K. would not have understood what an “executor” or a “trustee” was. Ann Marie testified at the hearing that by 2009, Albert K. was showing progressively worsening symptoms of aphasia. This evidence supported the Special Referee’s conclusion that the respondent’s contention that Albert K. understood the contents of the May 8, 2009, and July 8, 2009, wills was deceitful

The special referee

“Respondent demonstrated little remorse for his conduct. He did suggest, in some instances, that it might have been prudent to have involved the court either for consent or advice, in some of the matters before us. For the most part, he seemed to suggest that it was all really all right and that his conduct should not be subject to discipline.

“Much of the conduct complained of demonstrated that respondent was eager to increase his income and that he could do so by donning the ‘two hats’ referred to by his wife in another context. Their incomes were intertwined. He paid her an extravagant sum for her services as geriatric care manager. Her realty firm was his ‘cover’ for the receipt of funds as commission for which he had done no work or made no legal agreement.

The court

 In mitigation, the respondent asks the Court to bear in mind that this is not a case of an attorney stealing escrow funds or absconding with settlement proceeds; that he did not engage in deliberate or intentional conduct; that he has never retained Ann Marie as a geriatric care manager on any other guardianship; that he has since withdrawn himself from the list of attorneys eligible to be appointed as guardians; and that he will never in the future accept any matter in which he is not proficient or which poses a risk of a conflict of interest. Citing no authority, the respondent asks that the Court impose a public censure in view of the fact that he has handled dozens of guardianships and all his accountings have been approved, with the exception of Albert K.; a suspension or disbarment would severely impact not only himself, but also all his employees; the individuals who benefit from his pro bono activities would be deprived of a resource; and he is a person of good character as evidenced by newly-submitted character affidavits.

Notwithstanding the aforementioned mitigation, including the facts that the respondent paid in full the surcharged amounts, that the incident appears to be an isolated occurrence in an otherwise unblemished 30-year career, and that the respondent actively contributes to the Bar and his community and church, we find that the severest of sanctions is warranted (see Matter of Taylor, 113 AD3d 56; Matter of Aversa, 88 AD3d 339). This case involves a course of covert self dealing by the respondent, who abused his position as guardian of Albert K., an incapacitated person. Albert K., who was elderly, incapacitated, and later terminally ill, was unusually vulnerable. In three separate instances, the respondent acted against the interests of his ward. He exploited his ward’s deteriorating mental and medical condition to generate different incomes streams for himself, using his wife as cover, in at least two instances. Of note, the Special Referee found that the respondent demonstrated little remorse for his conduct. Furthermore, the respondent, having been appointed in dozens of guardianship cases, cannot claim inexperience. There were no allegations that the respondent’s judgment was clouded by personal circumstances or financial difficulties during the relevant time period.

Disbarment is effective immediately. (Mike Frisch)

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