Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Tuesday, June 30, 2015

In Florida, A Lawyer For A Guardian Vicariously Liable To Ward

GavelKarim Saadeh was an elderly immigrant who had accumulated a sizable fortune when, in his old age, he lost control of his estate after making a series of gifts to a younger women.  The court appointed a guardian for Mr. Saadeh and the guardian in turn hired an attorney of their own who assisted in advising Mr. Saadeh to sign a trust instrument that had negative implications for the estate. As a result, the guardians attorney was sued, among others, for malpractice but the case was initially thrown out for a lack of privity between Saadeh and the attorney.

In Saadeh v. Connors, the Florida District Appeals Court held that the attorney was liable to the ward of a guardian that was a client. The duty of care owed by an attorney, in these situations, extends to a third party that was intended to benefit from any advise offered. The third party may sue for malpractice and the claim will not be barred due to a lack of privity.

See Brian Spiro, Florida Attorney for Emergency Temporary Guardian Owes Duty of Care to Temporary Ward, Clark Skatoff, June 26, 2015.

- See more at: http://www.clarkskatoff.com/news-resources/blog/florida-attorney-for-emergency-temporary-guardian-owes-duty-of-care-to-temporary-ward/#sthash.LV6NvW00.dpuf

June 30, 2015 in Guardianship, Malpractice, New Cases | Permalink | Comments (0)

Wednesday, June 17, 2015

New Hampshire Case Illustrates Importance Of Making Sure Client Is Competent

DevilAn ongoing case in New Hampshire involves a large estate, suspect will, dead testator, and beneficiary being asked many questions. At the heart of the matter is the competency to make a will, an issue that is likely to control the fate of a nearly $3 million estate. But in the quest to determine competency one thorny issue arose, the beneficiary had to shopped around to find an attorney for the testator due to the fact many lawyers would not assist due to the competency concerns.

Lawyer shopping can be a problem because not all people go about it with malicious intent; some people just want to find the right representation and are picky in choosing. Whenever faced with an apparent case of shopping, take extra care to make sure the would be client is not being abused or taken advantage of by the people around them. A little observation now can save much hassle for the innocent and stop those with devilish intent.

See Webber Case Shows Importance of Establishing Capacity, Fosters, May 15, 2015.


June 17, 2015 in Current Events, Malpractice, Wills | Permalink | Comments (0)

Tuesday, June 16, 2015

Disbarred New York Attorney Charged With Grand Larceny And Practicing Law Without A License

JusticeA New York man who was disbarred about five years ago has been charged with stealing more than $34,000 from a client couple.  The State alleges that John Giordanella misrepresented himself to the couple by making them believe that he was still a practicing attorney.  The couple, believing that he was a licensed attorney, hired Mr. Girdanella to handle estate matters and gave him six checks totaling $34,247.  If convicted, Mr. Giordanella could face up to seven years in prison. 

See Disbarred attorney charged with stealing $34,000 in funds, Queens Chronicle, April 23, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

June 16, 2015 in Current Affairs, Estate Planning - Generally, Malpractice, Professional Responsibility | Permalink | Comments (0)

Tuesday, June 2, 2015

Malpractice & Ethics Article Available on SSRN

MalpracticeI recently posted on SSRN my article entitled Avoid Being a Defendant: Estate Planning Malpractice and Ethical Concerns, 5 St. Mary's L.J. Mal. & Ethics 224 (2015).

Here is the abstract of the article:

An estate planner may become a defendant in a case involving an estate he or she planned in two main ways. First, the attorney may have performed his or her services in a negligent manner potentially creating exposure to malpractice liability. Second, the attorney’s conduct may have lapsed below ethically acceptable standards.

This Article reviews the exposure an estate planner may have to malpractice liability with emphasis on Texas law and then focuses the reader’s attention on ethical issues that may arise while preparing or executing the plan. The author hopes that by pointing out potentially troublesome areas, the reader will avoid the ramifications of drafting a flawed estate plan or having a lapse of ethical good judgment which may lead to the frustration of the client’s intent, financial loss to the client or the beneficiaries, personal embarrassment, and possible disciplinary action.

June 2, 2015 in Articles, Malpractice, Professional Responsibility | Permalink | Comments (0)

Wednesday, May 27, 2015

North Carolina Lawyer Who Misappropriated $1.6 Million Loses License

PeterCapeceA North Carolina attorney who worked for a prestigious Lincoln County law firm has been disbarred after admitting to misappropriating $1.6 million from an estate that he was executor of.  Peter Capece, who was executor of the estate of Fritz Detmers, used the money that he misappropriated for his own personal gain.  Judge Donald Stephens ruled that the disgraced attorney will lose his license for at least five years.  Capece has also been fired from the Jonas law firm, which released a statement expressing it was “dismayed that a former employee, a person we invited into our firm and treated as one of our own, would betray the trust of a client.”

See Joe Marusak, Lincoln County Lawyer Disbarred For Misappropriating $1.6 Million, The Charlotte Observer, May 20 2015.

 Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

May 27, 2015 in Current Affairs, Estate Planning - Generally, Malpractice, Trusts | Permalink | Comments (0) | TrackBack (0)

Thursday, May 21, 2015

Connecticut Attorney Arrested On Accusations Of Embezzling $1.8 Million

GavelA Connecticut attorney has recently been arrested on accusations that he embezzled $1.8 million from the estate of Miriam S. Strong.  Peter M. Clark was removed from his position as co-executor of Strong’s estate back in March when $1.8 million in money that was bequeathed to the town of Oxford went missing.  Clark is currently facing a Federal mail fraud charge over the incident.   

See Attorney Accused of Embezzling $1.8 Million From Woman’s Estate, NBC Connecticut, May 21, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

May 21, 2015 in Current Affairs, Estate Planning - Generally, Malpractice, Professional Responsibility, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Friday, May 8, 2015

Lawyer Charged With Stealing From Wards

Paul KormanikHaving served as a court appointed guardian, Columbus lawyer Paul Kormanik is now charged with stealing funds from his wards and is relinquishing his law license.  Kormanik has pleaded not guilty to 11 felony charges involving engaging in a pattern of corrupt activity, theft from an elderly person, and tampering with records for illegally controlling his wards’ bank accounts and stealing their funds.  In addition to these charges, the Columbus Bar Association brought 15 charges of professional misconduct against Kormanik.  His attorneys are requesting the probate judge to postpone his trial, which is scheduled to begin June 22.

See Randy Ludlow, Lawyer Accused of Stealing From Wards Gives Up Law License, The Columbus Dispatch, May 7, 2015.

May 8, 2015 in Elder Law, Estate Planning - Generally, Guardianship, Malpractice, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Thursday, April 30, 2015

Article on Bad Tax Shelters

Jacob TodresJacob L. Todres (St. John’s University School of Law) recently published an article entitled, Bad Tax Shelters—Accountability or the Lack Thereof: Ten Years of Tax Malpractice, St. Johns Legal Studies Research Paper No. 14-005 (2014).  Provided below is the abstract from SSRN:

In the 1990’s and early 2000’s the tax landscape in the United States was overrun by an epidemic of tax shelters that was unprecedented. The shelters were designed and sold by seemingly reputable large accounting and law firms. The same shelters were sold to many taxpayers. They became generic, off-the-shelf, products. However, the tax shelters had no business substance. The shelters were eventually found to be invalid by the courts. In light of the invalidity of the shelters, the large fees paid for the shelters and the large damages caused by participating in the invalid shelters, there were predictions that many malpractice suits against the sellers of the shelters would ensue.

For this article I attempted to determine whether the predicted wave of tax malpractice suits occurred and what impact, if any, resulted in the area of tax malpractice litigation.

Much to my surprise, there ended up being very few cases focusing on substance. There were several class actions that were settled but, in light of the settlements, offered no useful insights. Most of the other reported cases dealt with procedural issues such as whether the action must be arbitrated, federal versus state venue, statute of limitations, etc. In the end, there were only a few cases that addressed any issue of substance. The only exception was a huge case in Kentucky, Yung v. Grant Thornton LLP , that was decided in late November, 2013. The case was huge because of its length (over 200 pages) and because it awarded $20 million in compensatory damages and $80 million in punitive damages. 

In the article I analyze the few existing generic tax shelter cases and try to fit them into the general principles governing tax malpractice. I then also review the other developments in the tax malpractice area during approximately the last decade.

April 30, 2015 in Articles, Estate Planning - Generally, Malpractice | Permalink | Comments (0) | TrackBack (0)

Monday, April 27, 2015

State Bar Judge Rules To Disbar Lawyer for Misappropriation

Gavel 3When Michael Scott Keck removed $55,000 from the trust fund of a client who was in prison in order to repay a debt to another client, the bar suspended him from practice.  Now, a State Bar Court judge has recommended that a San Francisco attorney be disbarred.  Keck has practiced law since 1986 and had no prior record of misconduct. 

At the disciplinary trial, Keck testified that the fund’s previous financial advisor authorized him to borrow the money in the trust.  However, that testimony lacked credibility since an attorney should know that the adviser would not have the authority to allow a loan from trust assets.  Keck was “dishonest, concealed material facts from [his client] and others, and acted in bad faith,” the judge said in regards to Keck’s case.  Despite Keck’s good record in his practice of law, the judge said misappropriating a client’s funds is grounds four disbarment.

See Bob Egelko, State Bar Court Judge Rules to Disbar S.F. Lawyer for Taking Funds, SF Gate, Apr. 24, 2015.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

April 27, 2015 in Estate Planning - Generally, Malpractice, Professional Responsibility, Trusts | Permalink | Comments (0) | TrackBack (0)

Wednesday, April 22, 2015

Attorney Sentenced for Probate Theft

Gavel 3Seventy-year-old Arizona attorney Rodney Matheson was found guilty on charges of theft and fraud for stealing money from his deceased clients’ probate accounts.  Maricopa County Superior Court Judge Bruce R. Cohen sentenced Matheson to 2 ½ years in prison and also ordered Matheson repay more than $1 million to an attorney representing the Mayo Clinic.  Cohen placed Matheson on probation on a fraudulent schemes conviction for seven years, which will begin once he is released from prison. 

According to court documents, Matheson orchestrated an elaborate “shell game” by stealing money from several estates in order to satisfy a court order for payment of $800,000 to the Mayo Clinic, the major beneficiary of a third estate.  The fraud was uncovered when the Mayo Clinic filed a civil suit to collect $1.2 million left to the hospital as a beneficiary by the Mary Jane Schalow Trust.

See Disbarred East Valley Attorney Sentenced to Prison in Probate Theft Case, AZ Central, Apr. 21, 2015. 

April 22, 2015 in Estate Planning - Generally, Malpractice, Professional Responsibility, Trusts | Permalink | Comments (0) | TrackBack (0)