Depending on your perspective, this case is either proof of what proper estate planning can do or an exercise in frustration in a case of elder financial abuse. A court decision has ruled that a bank may use funds from an estate to defend a court battle where the daughter of a wealthy woman is fighting against her mother’s wishes to leave a significant amount of money to non-family members. The State Court of Appeals says that the Sonoma County bank that is a trustee of the $8.5 million estate is entitled to use funds from the estate to defend the mother’s wishes. The daughter sued the bank to stop it from paying its lawyers until she can prove allegations of elder financial abuse.
It’s important to note that in a case where a daughter is suing a bank to halt payment of legal fees in an estate battle, the issue at hand is the bank’s right to tap the estate funds to defend the mother’s wishes. The Press Democrat in Santa Rosa, CA, reports that a three-judge panel rejected the daughter’s demand to halt payments of bank lawyer fees being generated in an estate battle. The daughter wanted to stop the bank from tapping these funds while she fights to prove a case of elder financial abuse. The ruling does not speak to the elder financial abuse issue.
“If a parent truly wants to leave something to someone who is not their natural heir, they can provide for the defense of that gift in the event the heirs attack it,” Santa Rosa attorney Lewis Warren told the paper in its article, “Big legal fight after Kentfield woman leaves part of $8.5M estate to gardener“. Warren represents the bank.
Doolittle is suing the gardener and Exchange Bank, claiming that her mother, Constance Doolittle, was suffering dementia when she hired Amador in 2004 to maintain her landscaping. In the lawsuit, the daughter says that he tricked Constance into thinking he had affections for her and convinced her to add him to her will, as well as to spend tens of thousands of dollars investing in coffee plantations in his home country of Nicaragua. If the trust is carried out, the gardener will get about $3 million.
Constance decreased the inheritances of her two daughters to $500,000 each and made Exchange Bank her trustee. The daughters were estranged from their mother, and Constance envisioned attacks on her competence, so she had herself examined by a psychologist. That doctor determined she had sufficient mental capacity to make financial decisions, and she had signed documents from an estate planning attorney who confirmed her decisions were not the product of fraud.
She died in February 2014, and her daughter sued a few months later.
“Connie obviously anticipated the possibility of a challenge after her death and there is no logical reason why she would have wanted her representatives to be compensated less generously,” than before she died, the judge wrote.
That was super smart, and something you should discuss with a qualified estate planning attorney.
Reference: The (Santa Rosa, CA) Press Democrat (October 23, 2015) “Big legal fight after Kentfield woman leaves part of $8.5M estate to gardener“
