Death and Taxes Blog

I enjoyed Audrey Niffenegger's first novel, The Time Traveler's Wife. Haven't seen the movie -- looks a little too sappy -- but the book was great.

Right now I'm working on Ms. Niffenegger's newest, entitled Her Fearful Symmetry. I've just started it, but the novel appears to be a riff on the old idea of "stay in a haunted house overnight to get an inheritance." Two American twenty-somethings (twins) get the following letter (which I have edited) from the attorney for their English aunt, who has passed away:

Dear Julia and Valentina Poole,

I regret to inform you of the death of your aunt, Elspeth Alice Noblin.... Last September, knowing that her illness would soon result in her death, she made a new will. I am enclosing a copy of this document. You are her residuary legatees; that is, she has bequeathed you her entire estate, with the exception of a few minor bequests to friends and charities. You will receive this inheritance when you reach the age of twenty-one.

The bequest is given to you with the following conditions:

1) Ms. Noblin owned an apartment in London.... She bequeathed this apartment to you on the condition that you both live in it for one year before you may sell it.

2) The entire bequest is given on the condition that no part of it shall be used to benefit Ms. Noblin's [twin] sister, Edwina, or Edwina's husband, Jack (your parents). Also, Edwina and Jack Poole are forbidden to set foot in the flat or inspect its contents.

I reviewed Meryl Gordon's book Mrs. Astor Regrets earlier this year (here) -- it was one of my favorite books I read in 2009.

The trial of Mrs. Astor's son, Anthony Marshall, is coming to a conclusion (barring appeals). Mr. Marshall was found guilty of "looting his mother's fortune" (another lawyer, Francis X. Morrissey Jr., was also found guilty) -- here is the story. I can't understand why the maximum sentence is only 3 years -- why is that? Because Mr. Marshall is rich? Ugh.

I'm also a little troubled by this line in the article:

The judge noted Marshall's World War II service and the possibility that the late Astor herself would have been aghast to see her son imprisoned, but he added that the law left him no choice but to impose a prison term.

1. Would Mrs. Astor REALLY have been aghast, in light of what her son did to her?

2. I realize that many people want to give members of The Greatest Generation a free pass (and unlimited free health care, free prescriptions, etc.) as a result of their actions in World War II, but I can't figure out why Mr. Marshall's heroics 60+ years ago have any bearing on this case.

The headline of this post makes the English major in me very happy. Here's the story -- this morning Roger Ebert posted a link to this 1957 letter (from J. D. Salinger) on Twitter. (BTW, you can find me on Twitter here, although only about 20% of my tweets are estate planning or probate-related. You can find the more entertaining Mr. Ebert here.)

Anywho, the interesting thing (to me as a probate attorney, at least) is this part of the letter:

I toy very seriously with the idea of leaving the unsold rights [to The Catcher in the Rye] to my wife and daughter as a kind of insurance policy. It pleasures me no end, though, I might quickly add, to know that I won't have to see the results of the transaction.

So, Mr. Salinger might leave it up to his family to decide if a play or film will be made from his most famous work. I wonder if his opinion on this has changed over the last 52 years?

Two final notes:

1. The letter is evidently for sale now. Asking price: $54,000!

2. The website on which the letter is featured (Letters of Note) is a real gem.

OK, this will be my last post on Dunn v. Patterson (for a while, at least). Previous discussions: here and here.

I spoke to someone with knowledge of the case, and learned the following:

1. Lawrence Patterson was NOT named as a successor trustee in the documents.

2. One of the perplexing things about the facts laid out in the opinion: why didn't the Dunns at least take a meeting with Patterson? Obviously, doing so would have been cheaper than going to court. Well, according to my source, the Dunns DID attempt to set up a meeting with Patterson. He wound up canceling.

3. Also -- and this is consistent with other complaint I spoke about -- Patterson planned to charge the Dunns at his hourly rate ($350) for this meeting.

The journalist side of me decided that I needed to do a little more digging regarding the Dunn v. Patterson case I discussed yesterday. I'm still trying to find out whether Patterson (the attorney) was named as a fiduciary in the documents, but while I'm waiting for that information, I checked Patterson out at the website for the Illinois Attorney Registration and Disciplinary Commission (ARDC) -- their site is here. These are the folks who handle formal complaints against Illinois attorneys. I did a search for "Lawrence Patterson" and found that a complaint has been filed against him. You can find the complaint as follows:

1. On the ARDC's site, click on "Lawyer Search."

2. Insert Patterson and Lawrence for last and first name and hit "submit."

3. Click on Patterson's name.

4. You'll get a page with his contact information and background, and if you scroll down, you'll see that a complaint has been filed against Patterson (case no. 08CH0074).

I suspected that this complaint was relating to the Dunns, but when I followed the link to the complaint (click on the "R&D" link and then click Patterson's name again), I was both surprised and not surprised.

The Dunn matter is only part of the complaint. There is also another count to the complaint, relating to a client named LaVerne Drovitz. According to the complaint, Patterson represented Drovitz in connection with a statutory custodial claim against the estate of her late husband. Here's the shocking part (Patterson is the "Respondent" here):

12. During the February 3, 2007 meeting, Drovitz instructed Respondent to accept the settlement offer.

13. During the February 3, 2007 meeting, Respondent told Drovitz that he would not accept the settlement offer as instructed by Drovitz. At that time, Drovitz attempted to terminate Respondent's services. Respondent told Drovitz that she was not competent enough to fire him and that he planned to initiate guardianship proceedings against her.

14. On March 6, 2007, Respondent filed "755 ILCS 5/11a-8 Petition for Appointment of a Temporary & Plenary Guardian of the Person & Estate Guardian ad Litem & Adjudication of Disability" (hereinafter "petition") in the Circuit Court of Will County Probate Division. The case was captioned as Estate of Laverne Drovitz, as an alleged disabled person, case number 07 P 162.

18. On March 16, 2007, Respondent met with Maloney [the guardian ad litem appointed to protect Drovitz's interests] regarding Drovitz's guardianship proceeding. At that time, Respondent informed Maloney that he planned to have himself appointed Drovitz's guardian and use Drovitz's assets to continue with the legal action referred to paragraph 4, above and pay Respondent's legal fees.

24. On April 25, 2007, Judge Goodman entered an order denying the petition, citing the physician's report that indicated that Drovitz did not have a disability.

I want to stress that the allegations in the complaint are just that: allegations. But if they are at all accurate, they certainly paint a picture of an attorney who intimidates his clients, and threatens to use the power of the law to have them declared disabled if they don't do as he says.

I can't remember a recent judicial opinion I've disagreed with more than the Illinois 3rd District's opinion in Dunn v. Patterson.

The facts of the case are fairly simple:

Charles and Charlotte Dunn had Lawrence Patterson, an attorney, prepare estate planning documents for them. Those documents (trust and powers of attorney) state in relevant part that the Dunns may not amend or revoke their documents unless Lawrence Patterson consents (or they get a court order allowing the amendment or revocation).

The Dunns apparently then went to another attorney, and asked that second attorney to write Patterson a letter, stating that they wanted to remove the above "consent" language. Patterson replied, "You have to come and see me if you want me to do that."

At some point, the Dunns took Patterson to court, arguing that the above provisions should be void because of public policy. The trial court ruled for the Dunns, but the 3rd District reversed.

One of the 3rd District's points is that, in Illinois, you can sign documents with so-called "third-party consent" provisions. I understand that, but it seems clear to me (as a practicing estate planning attorney) that Patterson put the consent provision in the documents for one main reason: he wanted to intimidate the Dunns into continuing to use him as their attorney. In this respect, Patterson's conduct is a mere extension of the shady practice (used by some estate planners) of maintaining possession of the original estate planning documents of their clients. (This is done in the hope that more business -- either future estate planning or probate work -- will come the attorney's way because the clients are too embarrassed to switch attorneys, or don't know any better.)

And yet the 3rd District essentially takes Patterson's rationale for the provision ("to prevent elder abuse") at face value. Is Patterson a doctor? If not, then how would Patterson know whether the Dunns are competent to amend or revoke their documents? The 3rd District doesn't tell us. The Court states that "[o]ut here in the cornfields of Illinois and, we suspect, sometimes in the large metropolitan areas of Illinois, one's lawyer is often his or her most trusted friend and advisor with respect to major life decisions." But was that the case? In the facts section, the Court tells us only that the Dunns hired Patterson to do his estate plan. There's no evidence that he was a trusted friend or advisor.

The 3rd District also doesn't address another (to my mind) key issue: was Patterson named as a fiduciary in the documents? If so, then Patterson had everything to gain by preventing the Dunns from changing their documents (and, potentially, forcing him out). (Some attorneys routinely name themselves as fiduciaries in their clients' documents. And, of course, they bill their clients' estates and trusts for all of their work.) The Court instead seems to take pity on Patterson, and state that his actions are "admirable and consistent with the highest ideals of the bar." I don't know what's worse: Patterson's actions, or the fact that the entire Court seems to have ignored what's really going on here. Hopefully this case will go to the Illinois Supreme Court and be reversed.

Let's say that you've followed tips 1-4, and the claimant still won't go away. What choices do you have? There are two, really:

1. Settle; or

2. Go to trial.

Tip #5 is to try and settle the claim.

When real life people have debt, it can be a big pain. You are, in many ways, at the mercy of bill collectors. If you fail to make a payment, they can ruin your credit rating, making it difficult for you to rent or purchase a home (or, perhaps, get a job). They can also be an incredible nuisance, calling at all hours of the day.

By contrast, dead people (or their representatives) have a number of advantages over creditors:

a. They don't care about their credit rating -- it's irrelevant.

b. Wherever you go when you die, I doubt you receive calls from bill collectors.

There's also the advantage of time, which is usually seen as a disadvantage but may be a real asset. Most creditors want their money ASAP. But most creditors understand enough about probate to know that the release of funds takes time. That makes them willing to accept much less than the amount owed if they can get the money right away. For instance, a credit card company with a claim of $10,000 may be able to accept $7,000 or $8,000 (or even less) if they can receive payment ASAP. There's only one way to find out, and that's by asking for a discount. The worst thing that can happen is the creditor tells you "no."

One final note: if you do settle for less than the value of the debt, the difference between the debt amount and the settlement amount is income to the estate (as forgiven debt).

4. As I said previously, the key to dealing with claims is to go on the offensive. That means following up on the claims in court.

Many times a claimant either won't have an attorney, or will have an attorney who isn't familiar with court procedures (a dead giveaway: the attorney who filed the claim is out of state). The latter is especially true for Cook County probate court, which has its own system for dealing with claims. Basically, once a claim is filed with the court, the claim is assigned to "claims call." Claims call is held on the fourth Monday of every month - here's November's claims call, if you want to see a sample. (New claims calls will be posted at the Cook County Probate Division's web page, under the Online Case Info tab. If you visit this page, be sure to check out the picture of RuPaul!)

Section 12.10 of the Cook County Court Rules states that:

(e) It is the duty of the attorney for the representative to appear in court on the call of a claim listed on the claim calendar. Subject to the discretion of the court, failure of the attorney to appear shall be deemed to be a consent to the allowance of the claim unless a responsive pleading has been filed.

So the estate's attorney should be present at all court hearings. But this goes the other way as well. Section 18-7 of the Illinois Probate Act states that "[o]n the call of a claim it may be allowed, set for trial, continued or dismissed." My experience is that a probate judge will dismiss a claim (if asked to do so) if the claimant's attorney doesn't show up for two court hearings in a row.