It is an increasingly common scenario in Arizona and across the country: one child accuses another of having financially exploited a parent. Often the allegations are made shortly after the parent’s death, and in a probate proceeding. Sometimes the allegations are accurate, sometimes it turns out that they are not despite the appearance of possible misbehavior, and sometimes the allegations are unfounded, mean-spirited or even abusive themselves. When there is no basis for the allegations, who should pay the cost of the investigation that proves there was no exploitation?

Victor Friedman, a widower, lived in Phoenix. He had two children: a son, Dennis Friedman, and a daughter, Jo Ann Friedman Burgess. During the last few years of his life his daughter was more involved in his affairs. She held his power of attorney, was named as trustee of his revocable living trust, and was slated to receive the bulk of his estate on his death. Mr. Friedman’s will and trust left a small amount to his son, and a small bequest to his sister Libby Friedman.

After Mr. Friedman died, his son and sister started a probate proceeding. Their avowed purpose was to have Jo Ann removed as trustee, and to try to show that she took financial advantage of her father as his health and capacity had declined. A preliminary court struggle led to an agreement by the warring family members that they would all agree to appointment of an independent person as “special administrator,” that they would let that person conduct an investigation, and that they would agree in advance to be bound by the special administrator’s findings.

The probate judge appointed prominent Phoenix attorney Marlene Appel as special administrator, and she prepared a report of her investigation. Her essential finding: not only did Jo Ann Burgess act properly, but she acted as “we would like all such fiduciaries to act.” In other words, Dennis and Libby Friedman’s claims were unsupportable.

The probate judge dismissed the charges against Ms. Burgess, and then ordered that Dennis and Libby Friedman’s shares of the trust should be charged the $27,500 paid to Ms. Appel for her investigation. The judge specifically found that the allegations were not completely without merit, but that they were ultimately unfounded.

The Arizona Court of Appeals returned the case to the probate judge for more hearings. While the appellate court agreed that it might be appropriate to charge Dennis and Libby Friedman for the cost of the proceedings, the test should be whether they acted with malice in making their claims. It was not enough that they were not successful. In Re Estate of Friedman, February 12, 2008.

Would you like to subscribe to Elder Law Issues? Simply provide your e-mail address and name below, and click "Subscribe". At the same time, you may choose to also subscribe to The Voice, the newsletter of the Special Needs Alliance.

Privacy note: We do not ever use your e-mail address or name for any purpose other than to send out our subscription-based newsletter. You can rest assured that we will not sell, trade or share this information with any other person or entity. We have no ancillary or associated companies or entities to which we could provide your e-mail address, either.

© 1993-2008 Fleming & Curti, P.L.C.
520-622-0400 /  FAX: 520-203-0240