A New York Probate Lawyer said this is a probate proceeding where the decedent’s son, who is the sole distributee and the sole income beneficiary of a testamentary trust consisting of the entire residuary estate, seeks to revoke his waiver and consent to probate so that he may conduct SCPA 1404 examinations and file objections to probate, if appropriate; and, seeks for an order directing the preliminary executors to discontinue a pending landlord/tenant holdover proceeding they commenced against him in connection with his occupancy of a portion of real property that appears to be the sole asset available to fund the trust. The movant’s four sons, two of whom are infants for whom a guardian ad litem was appointed, are the contingent remaindermen of the trust.
The relevant facts are the following:
A New York Estate Lawyer offered for probate is the will dated 30 January 2000 along with a codicil dated 20 July 2009. The codicil amended the will to include a newborn grandson. Both the will and codicil were drafted by an attorney and their execution was attorney-supervised; both were witnessed by three witnesses who also executed self-proving affidavits; it leaves all tangible personal property to the son; in paragraph FOURTH (A) and (C), the entire residuary estate is placed in trust, with all net income, payable to the son quarter-annually or at more frequent intervals if necessary during his lifetime, with the remainder divided equally among the decedent’s grandchildren; and, in paragraph FOURTH (B), the “sole and absolute discretion” is vested in the trustees to invade the corpus of the trust in such amounts and at such times as they shall deem appropriate and necessary for the health, welfare, support and maintenance of the son, and directs that such invasion “shall” be made “without considering the effect such invasion may have upon any third persons, including the remaindermen.”
A Queens Probate Lawyer said the jurisdiction in the probate proceeding is complete. The son and the two adult grandchildren filed waivers and consents to probate. Preliminary letters testamentary, limited by SCPA 805 (3), issued to the proponents who are also the nominated trustees.
The estate’s only asset appears to be a two-family home in the Bronx, valued at $450,000 in the probate petition. The upstairs apartment is occupied by the son, his wife and the youngest grandchild, and a tenant rents the downstairs apartment.
A Long Island Probate Lawyer said that soon after obtaining preliminary letters, the preliminary co-executors commenced separate holdover proceedings in the Civil Court of Bronx County, one against the son, and the other against the former downstairs tenant who allegedly was paying less than fair market value rent to the son who, in turn, failed to turn it over to the fiduciaries. At that time, the preliminary executors contended that the annual cost to maintain the property exceeded all liquid estate assets because the son kept the money paid by the downstairs tenant and simultaneously failed to pay fair market use and occupancy for the upstairs apartment that he occupies.
Consequently, in response to the holdover proceeding, the son commenced the proceeding at bar. Pending the further order of the court, the preliminary executors were temporarily restrained from proceeding with the holdover proceeding against the son.
The parties entered into a stipulation in open court. Apparently, a portion of the stipulation relating to use and occupancy payments by the son was extended by the parties. In other words, the stipulation provides that the temporary restraining order prohibiting the preliminary executors from continuing the holdover proceeding against the son would remain in effect in order to preserve the status quo pending a determination of the merits of the son’s application, and the son would pay the preliminary executors the sum of $900 per month. While the parties were supposed to make further attempts to resolve the matter with the assistance of the guardian ad litem, no resolution has been achieved. Rather, the situation has deteriorated as, instead of paying $900 per month to the preliminary executors, at least, for October and November of 2010, the son only paid Con Edison bills. According to the son, he was justified in withholding the rent because the preliminary executors failed to pay those bills as agreed.
The parties continue to dispute the actual monthly and annual cost to maintain the property.
The court’s ruling on the matters at issue:
First, the question is whether the son should be permitted to withdraw his waiver and consent to probate so that he may pursue discovery, and, thus, decide if he should file objections to probate. To revoke or withdraw his waiver and consent to probate in this pre-probate context, the son must demonstrate the merits of his application and a reasonable probability of success, notwithstanding that more relaxed proof of “good cause” is allowed before a decree is entered.
Here, on 25 September 2009, the son executed a waiver and consent to probate. On 14 April 2010, the son filed an application to revoke that waiver and consent on the ground that he lacked independent counsel and was not served with the propounded instrument at the time he executed it, and the decedent had difficulty reading and writing the English language.
Bearing in mind that the instrument and codicil were drafted by an attorney, their execution was attorney-supervised, the self-proving affidavits, the absence of any evidence or allegation of undue influence or lack of testamentary capacity, and that there are no other interested persons, the son’s allegations as to his potential basis for filing objections are conclusory. What’s more, the son did not dispute the allegations that prior to executing the waiver and consent, he met with the preliminary executors’ attorney who informed him about the probate process and the terms of the will. Clearly, it was only when the preliminary executors would not allow the son to operate the realty as he pleased that he questioned the validity of the will.
Accordingly, that branch of the application seeking to revoke the waiver and consent is denied. The son failed to demonstrate any merit to or reasonable probability of success on his potential objections to probate.
Second, the question is with regard to the holdover proceeding against the son which is more problematic.
Here, just after the commencement of the probate proceeding, the relationship between the son and the preliminary executors deteriorated; on the one hand, the fiduciaries and their counsel believed that the son was required to pay fair market value for his use and occupancy of the property in order to maintain the property and possibly increase the value of the potential trust estate for the remaindermen while, on the other hand, the son believed he could live at and maintain and manage the property himself, in any manner he saw appropriate.
Neither position is entirely correct. As a rule, when construing or reviewing the terms of a will or trust instrument, the prime consideration is the intention of the testator as expressed therein. In this regard, a review of paragraph FOURTH would reveal that the primary concern of the decedent was to place the economic interests of the son first, even to the exclusion of the remaindermen, assuming that, in the trustees’ sole discretion, such exclusion is appropriate and necessary for the health, welfare, support and maintenance of the son. Obviously, the son is entitled to all of the trust income. It appears that if the realty was sold for approximately its appraised value, the sum paid to the trustees would be in the $400,000 to $425,000 range. It also appears that the son is willing to accept a reduction in the rent for the apartment that he is occupying in lieu of income from the trust. Based upon the intent of the testator, as gleaned from the testamentary trust provisions, it appears that the fiduciaries would be in violation of their obligation to carry out the testator’s intent should they insist upon selling the realty, unless the reduced rent that the son is willing to pay plus the fair market rent paid by the tenant of the other apartment is insufficient to cover the projected administration expenses of the estate and trust as well as the cost of maintaining the property.
The son and the preliminary executors seem to agree, at least in principle, with the foregoing analysis of the circumstances under which the son’s family could continue to occupy one of the apartments instead of selling the property with the concomitant result of evicting the son’s family. Unfortunately, the parties have been unable to agree both upon the reasonableness of the expenses and legal fees incurred by the preliminary executors to date and upon the terms of the interim stipulation entered into on the record in open court. While it would clearly be a breach of their fiduciary duty for the fiduciaries to insist upon a sale for the sole reason that retention of the property would result in their receiving a smaller commission, it is equally clear that the trustees, and not the son, have the right to manage the property. In addition, it is also clear that it is not feasible for the son to occupy the apartment rent-free or to agree to pay a reduced rent and then not honor that agreement. In fact, the guardian ad litem is concerned that the son is not willing to agree to any feasible plan that would allow his continued occupancy of the apartment.
Accordingly, the temporary restraining order previously entered with regard to the holdover proceeding against the son is lifted as of 1 April 2011, unless by 25 March 2011, the son submits to the court, the guardian ad litem and the preliminary executors’ attorney proof that he has paid a total of at least $5,400 to either the preliminary executors or Con Edison for his use and occupancy of the apartment for the six-month period from October 2010 through March 2011; in case that the son has not paid that amount for that time period, he may pay the entire amount or any outstanding balance thereon at any time up to 25 March 2011; and, in case that the son timely establishes that he has paid the sum of $5,400 for the six-month period, the court will render a supplemental decision and order further extending the temporary stay and directing all parties, their respective counsel and the guardian ad litem to appear at a conference dealing with all of the issues relating to the realty and to produce certain documents at that time.
In a nutshell, that branch of the son’s application seeking to revoke or withdraw his waiver and consent to probate is denied, subject to modification in the event that the son establishes that he paid $5,400 as directed; and, that branch of the son’s application seeking for an order directing the preliminary executors to discontinue the holdover proceeding as well as lifting the temporary restraining order as to the holdover proceeding against the son as of 1 April 2011 is also denied.
The court is satisfied that the testator executed the will dated 30 January 2000 and codicil dated 20 July 2009 in compliance with the statutory requirements and that, at the time of their execution, the testator was competent to make a will and was free from restraint.
Accordingly, a decree is settled admitting the will dated 30 January 2000 and codicil dated 20 July 2009 to probate, without prejudice to any party taking any position in an appropriate proceeding with regard to whether the estate expenses incurred to date were necessary or reasonable, or whether there is any basis for not allowing the proponents to serve either as executors or trustees.
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