Estate and Elder Law

David Shulman: Who Gets Paid If an Alleged Incapacitated Person Dies Before the Hearing? Nobody?


By David Shulman

I’m sure there are some independently wealthy attorneys out there who take all of their cases pro bono. Most of us though are hard-working schlubs like everyone else who while we love what we do, need to pay the bills too. When we work there is some hope or expectation of getting paid. Sometimes though, cosmic forces conspire against you to prevent that from happening.

Such is the case in the 2nd DCA case of Guardianship/Estate of Mary W. Klatthaar (is that Klingon?) [enhanced opinion available to subscribers]. Shortly before Ms. Klattharr’s death, her nephew filed a Petition to Determine Incapacity against her. When a person is unable to make decisions for themselves regarding their person or property, the court can determine them to be incapacitated and to appoint a guardian to act on their behalf. The best way to avoid a Guardianship is to have proper estate planning with a durable power of attorney, designation of health care surrogate, and possibly a revocable living trust. With these documents in place, a person can designate someone else to make the decisions for them in the event of their incapacity.

Unfortunately without these documents in place, the alternative is a Guardianship. In Florida the first step to establish a Guardianship of a person is to file a petition to determine incapacity. Because a Guardianship is so drastic, the Court needs to be sure that the Alleged Incapacitated Person (AIP) has their rights protected before a Guardian is appointed. The AIP is appointed their own attorney to represent them in the proceeding. Additionally, the AIP is separately examined by three professionals, generally a psychiatrist, a psychologist and a social worker. The examining committee submits reports to the court as to their opinion of the AIP’s mental status.

Generally, if the AIP is determined to be found incapacitated, then the court appointed attorney and the examining committee are paid from the Ward’s funds. Note the terminology change. Once the AIP is no longer alleged to be incapacitated but has been determined to be incapacitated, they are no longer “the AIP” but are now “the Ward.” Generally the attorney for the party who filed the Petition to Determine Incapacity is also paid from the Ward’s assets. Plus, the Guardian is too.

You see why Guardianships are so expensive and should be the last alternative?

Anyway, if the AIP is determined not to be incapacitated with no Guardian appointed, and the filer of the Petition is found to have filed in in bad faith, then the Petitioner is stuck with the bill for the examining committee and the court appointed attorney.

In this case however, Ms. Klattharr died after the Petition to Determine Incapacity was filed against her but before the Incapacity Hearing. The Examining Committee examined her. The Court appointed attorney did some work on her behalf. But there was never a determination either way with regards to her capacity (or as to whether the petitioner filed in bad faith).

There appears to be a conundrum here. The lower court awarded fees to the petitioner’s attorney, the court appointed attorney, and the examining committee out of the Ward’s estate. The Personal Representative of the Estate objected to these fees. On appeal the Court pointed out that there is a hole in the statute (dear Liza) that only the legislature can fix. The court points out that ”there is a gap in section 744.331(7)  as to the delegation of responsibility for the payment of fees of the court-appointed attorney and the examining committee when a good faith petition is dismissed…said fees cannot be paid by the guardian from the ward’s property if a guardian is never appointed”

When a Petition for Incapacity is filed in good faith, and is dismissed before a Guardian can be appointed (because, for example, the AIP died), the statute does not provide for payment for the court appointed attorney, the petitioner’s attorney, or the examining committee from the AIP/non-Ward’s assets, or from the Petitioner.

David Shulman is a Fort Lauderdale attorney with a law practice focused on estate planning, probate and trust administration, guardianships, and tax. Among other things he is a Mac nerd, BBQ lover, and blogger. Follow him on Google+  or Twitter.View all posts by David Shulman →

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