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Court Decides Motion for Summary Judgment

A New York Probate Lawyer said that before the court is a motion for summary judgment filed in connection with petitions for the removal of fiduciaries in the related estates of the decedents. For the reasons set forth below, the court declines to entertain those portions of the motion seeking the removal of fiduciary in any and all of his fiduciary capacities or seeking relief from the other, and denies the balance of the relief, except that the request for an order compelling compliance with discovery demands will be held in abeyance pending the court’s review of all of the relevant documents in camera.

A Kings County Estate lawyer said that Decedents were a husband and wife who tragically died together in an automobile accident on April 22, 2005. They were survived by their three adult sons, movants herein. Both decedents executed wills on November 19, 1986, and both wills provide that in the event that the sons is not survived by a spouse, then the brother shall serve as Executor.

A New York Estate Lawyer said the wills were filed for probate on October 13, 2005 and admitted to probate on March 1, 2006. Letters testamentary in each estate issued to the son on March 3, 2006. At the same time, the son received letters of trusteeship in the father’s estate.

On November 1, 2007, movants filed petitions seeking (1) the revocation of letters testamentary issued to the son in each of the two estates; (2) the revocation of letters of trusteeship issued to the son in the estate of the father; (3) the appointment of the co-administrators, c.t.a. of each estate; and (4) a court order directing the son to file accounts as executor of both estates and trustee in the estate of the father.

Manhattan Probate Lawyers said that movants aver that there was intense hostility between the respondents and decedents (and decedents’ sons, movants herein) since 1997, due to disputes over family business interests. According to movants, respondents were not permitted to attend decedents’ funerals. Despite this history, prior to their unexpected deaths in 2005, the decedents never revoked their 1986 wills or executed new estate planning documents. In their affirmation in opposition, respondents claim that they hold no animosity toward movants.

New York City Probate Lawyers said the motion for summary judgment presently before the court seeks an order: (a) granting summary judgment removing the son as executor of the estates of the parents; (b) granting summary judgment removing the co-trustees of the Trust and the Trust due to misconduct including self-dealing, conflict of interest and waste of estate and trust assets, and directing respondents to account as executors and co-trustees; (c) compelling respondents to comply with discovery demands served on September 28, 2009.
Counsel for respondents filed an affirmation in opposition to the motion which asserts that following the filing of the petitions for removal and for accountings, respondents provided informal accountings and interim judicial accountings along with thousands of pages of documents in response to demands for production. Counsel argues that there are numerous disputed, material and relevant factual issues concerning the conduct of the executors which cannot be resolved as a matter of law.

Movants then responded with a reply affirmation arguing that the respondents’ opposition to the motion is based upon unsubstantiated and self-serving allegations and contains no documentation to directly refute movants’ charges of fiduciary misconduct and self-dealing.
Summary judgment may be granted only when it is clear that no triable issue of fact exists. The court’s function on a motion for summary judgment is “issue finding” rather than issue determination, because issues of fact require a hearing for determination. Consequently, it is incumbent upon the moving party to make a prima facie showing that he is entitled to summary judgment as a matter of law. The papers submitted in connection with a motion for summary judgment are always viewed in the light most favorable to the non-moving party.

If the moving party meets his burden, the party opposing the motion must produce evidentiary proof in admissible form sufficient to establish the existence of a material issue of fact that would require a trial. In doing so, the party opposing the motion must lay bare his proof. “[M]ere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” to overcome a motion for summary judgment.

Pursuant to EPTL 1-2.7 a trustee is a fiduciary. As a fiduciary, a trustee “owes a duty of undivided and undiluted loyalty to those whose interests the fiduciary is to protect”. A trustee is duty-bound to act in good faith in the administration of a trust, with honesty and undivided loyalty to the beneficiaries and avoid any circumstances whereby the trustee’s personal interest will come in conflict with the interest of the beneficiaries. The purpose of this rule is to ensure that the trustee’s acts are above suspicion and that the trust receives the trustee’s uninfluenced judgment.

The conduct of the trustee, as reflected in both the charges made by movants and the response thereto, is the subject of a factual dispute, namely, whether the withdrawal of principal from the Trust was proper pursuant to a corporate agreement or whether the agreement was limited to an insurance policy that had long ago been surrendered. This dispute cannot be determined in the context of this motion. This portion of the motion is denied.

The request for relief stems from a discovery schedule established in connection with the intermediate accounts filed by fiduciaries of the estates and trusts. Movants’ counsel concurs that respondents turned over many documents responsive to movants’ demand for discovery and inspection, but that respondents refused to supply retainer agreements and time and billing records for the attorneys and accountants who had rendered services to the estates and trusts, or the retainer agreements between attorneys and any related entities. These refusals were made on the grounds of attorney client privilege, as expressed in a letter dated March 26, 2010. Subsequently, counsel for respondents agreed, at a court conference held on July 21, 2010, to provide billing records and the records were provided to movants’ counsel on September 1, 2010. However, all pertinent information was redacted from the billing records provided by respondents, making it impossible for movants to determine or object to the reasonableness of the fees charged.

Ordinarily if a party objects to a discovery demand, that party is to serve a response which states with reasonable particularity the reasons for each objection. If objection is made to part of an item or category, the part is to be specified. Here, the fiduciaries objected to certain disclosures, by use of redactions, but failed to state the reason for such; providing materials in redacted form with a brief mention that the documents attached are “redacted” does not constitute as a valid reason for an objection to the disclosure.

When a claim of privilege is presented, it may be advisable to conduct an in camera review of documents claimed to be privileged. The court may defer determination of a motion to compel discovery until after an in camera inspection of certain materials by the court since it does not affect substantial rights.

CPLR 3122(b) establishes the requirement under New York law for a privileged document log when a party seeks to claim an attorney-client privilege. The Court of Appeals has recommended that a party seeking to protect documents from disclosure compile a privilege log, specifying the nature of the documents and the basis for the privilege claim, in order to aid the court in its assessment of a privilege claim and enable it to undertake in camera review.

The attorney-client privilege seeks to insure that one seeking legal advice will be able to confide fully and freely in his attorney, secure in the knowledge that his or her confidences will not later be exposed to his or her legal detriment. The attorney-client privilege has been codified in CPLR 4503(a)(1), which bars disclosure of any confidential communications between a client and his/her attorney.

Because a determination of whether documents are privileged is fact-specific, an in camera review of such documents may have to be undertaken before resolving the issue. The burden of proving that all the requisites of the privilege are present falls on the person asserting the privilege.

n the experience of this court, it is highly unusual for fiduciaries to assert a claim of privilege concerning billing records, and the extensive redaction of data from the records supplied by respondents in this matter creates a virtual mockery of the notion of disclosure. At the same time, the court is cognizant that the attorney client privilege is “of the oldest among common law evidentiary privileges, fostering the open dialogue between lawyer and client that is deemed essential to effective representation” and that the court, too, has not yet seen the redacted data, which may be more sensitive than it appears from the surrounding un-redacted data.

A final determination on the motion for summary judgment to compel production of un-redacted copies of the billing records and production of the requested retainer agreements is held in abeyance pending an in camera review of all of the pertinent documents in un-redacted form.
Any request for relief seeking to compel distributions by of the executor of the two estates or as trustee of the two trusts is stayed by his death, until such time as a fiduciary is appointed for his estate and the personal representative is substituted in place of the executor.

In connection with the conduct of Thomas as trustee, movants argue that the trustees failed to properly include all assets in calculating principal distributions, and that distributions of interest have been questionable. In response, counsel for the respondents argues that distributions from the trust have correctly been based upon “then existing principal,” and that interest in her retained earnings in the Enterprises is payable over 10 years, pursuant to the relevant shareholders’ agreement, which impacts on the distributions payable by the trustees.

The proper computation of distributions from the trusts is an issue of fact rather than an issue of law. As noted above, accountings have been filed by the trustees, and the information contained in the accounts and in the objections thereto will be pertinent to a final computation. This portion of the motion for summary judgment is denied.

The removal of respondents’ counsel on grounds of conflict of interest and misconduct and the setting of counsel’s fees are fact-based determinations, not properly decided in the context of this motion for summary judgment. This portion of the motion is denied.

Movants claim that respondents have paid excessive legal and accounting fees and have taken excessive commissions. Moreover, they seek an order surcharging the fiduciaries for these payments and for losses resulting from their conduct.

The court denies as moot those portions of the motion numbered (a) and (b) seeking the removal of the heirs in any and all of his fiduciary capacities, and denies the requests for relief in items (b), (d), (e), (f), and (g) in the motion for summary judgment, which seek: (b) the removal of the co-trustee; (d) an order compelling distributions of principal; (e) an order compelling distributions of income; (f) the removal of respondents’ counsel, and (g) the imposition of a surcharge on the fiduciaries. As to the request for relief in item (c), the court will conduct an in camera review of all of the documents requested in un-redacted form and then issue a determination on the motion for summary judgment to compel production of un-redacted copies of the billing records and to compel production of the retainer agreements.

If you are an heir, whose right was deprived by reason of a last will and testament, you can consult our Kings County Will Contest Lawyers, who will inform your rights as heirs. For the probate of a will of a decedent, we also have Kings Probate Attorneys. Call us now here in Stephen Bilkis, we will provide the advice you need.

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