Opinion
E070316
09-19-2019
Conservatorship of the Estate of THOMAS S. TEDESCO DAVID WILSON, as Conservator, etc., et al. Petitioners and Respondents, v. THOMAS S. TEDESCO, Objector and Appellant.
Herzog, Yuhas, Ehrlich & Ardell, Ian Herzog, Evan D. Marshall; Swann, Carpenter, Wallis & McKenzie and Kevin McKenzie for Objector and Appellant. Holland & Knight, Stacie P. Nelson, Jonathan H. Park, Robert Barton and Roger B. Coven for Petitioner and Respondent David M. Wilson. Sheppard, Mullin, Richter & Hampton, Adam F. Streisand, Nicholas J. Van Brunt and Valerie E. Alter for Petitioners and Respondents Laura K. White, Julie M. Bas and Sandra L. Kay.
ORDER MODIFYING OPINION AND DENYING PETITION FOR REHEARING [NO CHANGE IN JUDGMENT]
THE COURT
The court has reviewed the petition for rehearing filed October 2, 2019. The petition is denied. The opinion filed in this matter on September 19, 2019, is modified as follows:
On page 2, in the last full paragraph, delete "heard on the merits" and replace with "considered." The last full paragraph should read:
Because a conservatorship over Thomas's estate had been established, the probate court possessed exclusive concurrent jurisdiction to discharge nonappointed counsel and to interfere in the civil court's appointment of a GAL. We further discern the court did not violate its duty to assure Thomas's claims against defendants (see fn. 6) and his daughters were considered. We therefore affirm the orders on the petitions for instruction.
There is no change in the judgment.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
McKINSTER
J. We concur: RAMIREZ
P. J. SLOUGH
J.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super.Ct.No. INP1400272) OPINION APPEAL from the Superior Court of Riverside County. Thomas H. Cahraman, Judge. Affirmed. Herzog, Yuhas, Ehrlich & Ardell, Ian Herzog, Evan D. Marshall; Swann, Carpenter, Wallis & McKenzie and Kevin McKenzie for Objector and Appellant. Holland & Knight, Stacie P. Nelson, Jonathan H. Park, Robert Barton and Roger B. Coven for Petitioner and Respondent David M. Wilson. Sheppard, Mullin, Richter & Hampton, Adam F. Streisand, Nicholas J. Van Brunt and Valerie E. Alter for Petitioners and Respondents Laura K. White, Julie M. Bas and Sandra L. Kay.
Objector and appellant Thomas S. Tedesco (Thomas), a conservatee, appeals from the orders on petitions for instructions regarding the administration of the conservatorship of his estate. He contends the probate court (1) had no authority to discharge legal counsel selected by him, (2) had no jurisdiction to interfere with the civil court's appointment of a guardian ad litem (GAL) for him, and (3) violated its duty to assure that his claims for misappropriation of funds were heard on the merits.
Because this case involves many individuals, some of whom share a common surname, we use first names after the initial introduction to avoid confusion. No disrespect is intended.
This appeal discusses the actions of two separate divisions of the Superior Court of Riverside County. We therefore identify the trial court as either the civil court or the probate court, unless otherwise indicated. (See fn. 12, post.)
Although Thomas is the named appellant, and the arguments on appeal purport to come from him, due to his legal incapacity, the arguments are those of counsel, who have not been appointed by the probate court. (See fn. 28, post.)
Because a conservatorship over Thomas's estate had been established, the probate court possessed exclusive concurrent jurisdiction to discharge nonappointed counsel and to interfere in the civil court's appointment of a GAL. We further discern the court did not violate its duty to assure Thomas's claims against defendants (see fn. 6) and his daughters were heard on the merits. We therefore affirm the orders on the petitions for instruction.
I. INTRODUCTION
On October 15, 2018, this court reserved ruling on appellant's motions filed September 25 and 26, 2018, to consolidate case Nos. E069438 and E070316 for purposes of oral argument and decision. The motions to consolidate are denied. (See further discussion in fn. 6, post.)
On January 24, 2019, this court reserved ruling on respondents' requests filed January 8, 2019, for judicial notice. The requests for judicial notice are granted.
Further, on the court's own motion, we take judicial notice of the numerous matters (including their records) that have been filed in this court and relate to this appeal:
(1) Carpenter et al. v. Superior Court (Wilson et al.) (Aug. 23, 2017, E068946), petition denied;
(2) Tedesco v. White et al. (Sept. 19, 2019, E069438) [nonpub. opn.];
(3) White et al. v. Superior Court (Carpenter et al.) (Apr. 27, 2018, E069890), petition denied;
(4) Tedesco v. Wells Fargo Bank, N.A., et al. (E070407), notice of appeal filed April 25, 2018; and
(5) Tedesco v. Superior Court (White et al.) (June 28, 2019, E072588), petition denied.
(6) Tedesco v. Superior Court (White et al.) (Sept. 12, 2019, E073517), petition denied.
Thomas is a wealthy nonagenarian, having amassed in excess of $30 million. He and his late wife Wanda Tedesco (Wanda) created an estate plan to benefit their three daughters, petitioners and respondents Laura White (Laura), Sandra Kay (Sandra), and Julie Bas (Julie), and their grandchildren. Following Wanda's death, Thomas married Gloria Basara (Gloria), who had two daughters from a prior relationship, Wendy Basara (Wendy) and Debra Wear (Debra). For the first six years of their marriage, no issues were raised regarding Thomas's estate plan, which favored his biological heirs. However, in 2013, after undergoing multiple surgeries, Thomas became intellectually impaired and susceptible to being unduly influenced. He ended his decades long relationship with his family/estate plan attorney, Burton A. Mitchell (Mitchell), limited contact with his daughters and, for the first time, expressed a desire to leave 75 percent of his estate to Gloria and 25 percent to charity.
Pursuant to her declaration, she spells her name, "Debra Wear." She is also referred to as "Debra R. Wear aka Debbie Basara Wear" in the record. We will use "Debra" for clarity. Also, Debra is "a paralegal for [Thomas's nonappointed] counsel [Russell Davis] and [facilitated] counsel's communications with [Thomas]."
Given the sudden, radical change in Thomas's mental functioning and behavior, in 2014, a conservatorship over his estate was established, along with court-appointed counsel to represent Thomas. Subsequently, Thomas, influenced by outside sources and represented by nonappointed counsel, initiated a civil action in the Superior Court of Orange County against his daughters and grandchildren, alleging they had misappropriated his assets. Petitioner and respondent David M. Wilson (Wilson), who had been appointed permanent conservator, retained specialized counsel to investigate the allegations. Based on the investigation, the allegations were determined to be baseless, and Wilson caused the action to be dismissed with prejudice.
Undeterred by Wilson's actions, Thomas, again represented by nonappointed counsel, petitioned the probate court for permission to retain nonappointed counsel and pursue a civil action against his daughters, individually and as trustees of various trusts, Wells Fargo Bank, N.A. (Wells Fargo), and his former attorneys Mitchell and Jeffer, Mangels, Butler & Mitchell (Jeffer Mangels) (collectively defendants) for, inter alia, misappropriation of assets. Wilson successfully opposed the petition. Nonetheless, Thomas filed the first of two actions in the civil court alleging cancellation/rescission of documents and transfers, breach of fiduciary duty, elder financial abuse, fraud and misrepresentation, negligence, conversion, and declaratory relief against defendants. Defendants successfully moved to strike the first complaint on the grounds Thomas could not retain counsel or initiate litigation without Wilson's or the probate court's permission. In a separate appeal, we affirm that order. (See Tedesco v. White et al., supra, E069438.)
There are no "defendants" in this matter because this appeal is from a conservatorship. Moreover, Wells Fargo, Mitchell, and Jeffer Mangels are not parties to this appeal; however, we will refer to these parties collectively as defendants because they were named defendants in the two civil actions.
Thomas, represented by nonappointed counsel, petitioned the probate court for the appointment of Stephen G. Carpenter (Carpenter) as GAL, for the purpose of filing an identical second civil action against defendants. Before the probate court could rule on Carpenter's petition, he withdrew it and submitted an ex parte application in the civil court to be appointed GAL for Thomas in the second civil action. The civil court granted the application, and the second civil action was filed.
Wilson and Thomas's daughters returned to the probate court. Thomas's daughters, as cotrustees, petitioned the court for instructions declaring void all purported legal services agreements between Thomas and nonappointed counsel. Thomas's daughters argued that Thomas was subject to a conservatorship and thus lacked the legal capacity to enter into any legal transactions. Separately, Wilson, as the appointed conservator, filed an ex parte petition in the probate court for instructions/order (1) affirming his power to initiate and maintain litigation on Thomas's behalf, (2) instructing him to intervene in the second civil action for the purposes of dismissing it, and (3) limiting the initiation of litigation on behalf of Thomas to Wilson and court-appointed counsel, including specifically barring nonappointed counsel and Carpenter from initiating or pursuing litigation on behalf of Thomas. The probate court granted both petitions. This appeal followed.
II. PROCEDURAL BACKGROUND AND FACTS
On September 25, 2018, Thomas moved to consolidate this appeal with the appeal in Tedesco v. White et al., case No. E069438, for the purposes of argument and decision on the grounds there are common issues central to both appeals and consolidation will "serve judicial economy, expedite decision of the appeals, and assure a uniform and consistent decision which takes into account the entire procedural history and posture of the conservatee's actions."
We agree that an accurate account of the entire procedural history and posture of Thomas's actions requires consideration of the records filed in both appeals, that the opinions should be issued simultaneously, and that argument, if any, should be calendared for the same date. However, we disagree that there needs to be one opinion. (Sampson v. Sapoznik (1953) 117 Cal.App.2d 607, 609 ["granting or denying of a motion to consolidate appeals is entirely in the discretion of the reviewing tribunal."] These appeals come from separate actions in the lower court, one a conservatorship and the other a civil lawsuit. A uniform and consistent decision does not require consolidation. Rather, it may be accomplished by incorporation of the record from one appeal into the other, and vice versa. Thus, the motion to consolidate is denied. (See fn. 3, ante.)
A. General Background and Initiation of the Probate Case (Super. Ct. No. INP1400272 ).
1. Thomas's first marriage and the trusts.
Thomas obtained his wealth through the sale of the family business and the purchase of commercial properties. Thomas and Wanda were married in 1951, and they had three daughters (Laura, Sandra, & Julie). On July 28, 1988, Thomas and Wanda created the Tedesco Family Trust (Family Trust). In 1993, they requested Mitchell of Jeffer Mangels set up TW Tedesco Properties, L.P., a California limited partnership (Tedesco Properties). Tedesco Properties became the owner of various assets and real estate previously controlled by Thomas. Initially, Thomas was the sole owner of the one percent general partner's interest and 98 percent limited partner's interest, and Wanda owned the remaining one percent limited partner's interest; however, Thomas transferred his 98 percent limited partner's interest into the Family Trust and, in early 1995, assigned his general partner's interest to the Family Trust.
In April 2002, Wanda died, and the Family Trust was divided into five separate trusts, including a survivor's trust, which was renamed the Thomas S. Tedesco Living Trust (the Living Trust). Thomas is the sole beneficiary of the Living Trust, whose primary asset is Tedesco Properties. On February 11, 2011, Thomas executed the complete amendment and restatement of the Living Trust, and he subsequently amended it on February 23 and May 2, 2012, and again on June 29, 2013.
The Living Trust is relevant to our discussion because the transfers of the limited partner's interest and general partner's interest in Tedesco Properties were from the Living Trust to Thomas's daughters and grandchildren.
Between 1993 and 2013, Thomas (and Wanda during her life) annually transferred small percentages of Tedesco Properties' limited partnership interest (valued at or less than the annual gift-tax exclusion) to his daughters and grandchildren. On February 11, 2011, Thomas appointed his three daughters as his "true and lawful attorneys in fact . . . to act in any lawful way for [him] and in [his] name, place and stead and for [his] use and benefit as authorized." They were authorized to transfer trust assets and file any necessary tax returns. If a conservatorship was needed, he nominated his daughters to serve, acting by majority vote.
On September 6, 2012, W. Mae, LLC, a California limited liability company (W. Mae), was created. On December 26, 2012, Thomas gifted the Living Trust's general partner's interest in Tedesco Properties to W. Mae; however, the amendment to the certificate of limited partnership, which evidences this transfer, was not filed with the Secretary of State until April 4, 2013. On or about February 20, 2013, Thomas's daughters authorized Wells Fargo to change the signer on the Tedesco Properties' account. On June 5, 2013, Thomas resigned as trustee of the Living Trust, and his three daughters began to serve as successor cotrustees.
2. Thomas's second marriage.
In 2005, Thomas met Gloria. Thomas was approximately 78 years old, and Gloria was 73 years old. Gloria had two daughters from a previous relationship: Wendy and Debra. Thomas and Gloria married on March 25, 2007.
Mitchell on behalf of Thomas, drafted a prenuptial agreement and a modification to Thomas's estate plan. According to Mitchell, "there were extensive discussions regarding the house in both prenuptial and postnuptial planning. . . . Thomas . . . gave his 85% interest in the house in trust for life for Gloria along with $2 million, which reverts to the daughters after Gloria's death. . . . [However,] after Thomas's . . . surgeries, Gloria wanted outright ownership." According to Mitchell, "the pre-nuptial agreement and affiliated modifications to [Thomas's] estate plan granted Gloria a life estate right to reside in [Thomas's] residence for her lifetime should she survive [Thomas]. However, the estate plan documents do not bequeath to Gloria fee title to [Thomas's] interest in the residence."
3. The decline in Thomas's health.
According to Gloria, Thomas became ill in March 2013. He had bladder cancer surgery in April, back surgery shortly thereafter, and another bladder surgery in July 2013. According to Sandra and Laura, Thomas's memory took a "huge nose dive" in 2013, and he stopped paying bills and taxes, resulting in significant penalties. On September 9, 2013, Dr. Ivor J. Nazareth, a neurologist, evaluated Thomas and reported that he had "significant cognitive impairment with a Mini Mental State Examination score of 23 out of 30." According to Dr. Nazareth, Thomas's "inability to function consistently on a day-to-day basis suggests a far greater disability than his [MMSE] score indicates." The doctor opined that Thomas had "significant intellectual[] impairment and is unable to make consistent and reliable rational decisions, especially when it comes to his health or handling any financial issues, even simple ones. He needs total supervision."
The mini mental state examination (MMSE) is a 30-point test that uses a "set of questions for screening cognitive function." (See <https://patient.info/doctor/mini-mental-state-examination-mmse> [as of Sept. 19, 2019].)
4. Initiation of the conservatorship.
As Thomas's health declined, his daughters' access to him also declined. Their names were removed from a list of persons allowed into the gated community where Thomas and Gloria lived, and Gloria began to listen in on their phone conversations. Mitchell opined that "everything seemed all right with [Thomas] until [his] surgeries in 2013." Mitchell stated, "it was very difficult to communicate with his client [(Thomas)], as Gloria seemed to be blocking the calls. When [Mitchell] called, either [Thomas] was never there or someone else was on the phone. [Mitchell] related that he heard other voices in the background, particularly Gloria, telling Thomas what to say [and Mitchell] ha[d] seen scripts written for [Thomas] regarding what he [was] to say to his attorney."
Concerned about Thomas's health and Gloria's actions, on May 2, 2014, Laura petitioned for the appointment of a probate conservator of Thomas and for an order voiding the health care power of attorney held by Gloria. Laura alleged Thomas was unable to care for himself, and Gloria was detrimental to his well-being. Mitchell sought to represent Thomas in the conservatorship proceeding. On September 10, 2014, Thomas petitioned the court to allow Mary Gilstrap (Gilstrap) of Roemer & Harnik to represent him. Thomas's daughters and Mitchell (on behalf of Thomas) opposed the appointment of Gilstrap. On October 9, 2014, Laura amended her petition to request the appointment of a probate conservator of Thomas and his estate based on his incapacity to act on his own behalf and her concern that Gloria was unduly influencing him.
Debra and Wendy had taken Thomas to Gilstrap's office for the "express purpose of making estate planning changes" to Thomas's irrevocable trust.
On October 17, 2014, the probate court, on its own motion, appointed Kenneth Jenkins (Jenkins) as GAL for Thomas "with authority to investigate, retain and discharge counsel" for Thomas's protection. The probate court noted Gloria had opposed the conservatorship while admitting "she [was] acting as [Thomas's] health care agent . . . [which] strongly implies her concession that the proposed conservatee lacks any ability to make his own health care medical decisions and thus provides a showing of his incapacity." Jenkins opposed the appointment of attorney Gilstrap as counsel for Thomas on conflict of interest grounds because Gloria's attorney had recommended Gilstrap to Thomas.
After his appointment as GAL, Jenkins engaged attorney David Humphrey, Jr. (Humphrey) to represent Thomas. Nonetheless, attorney Terence Nunan of Parker, Milliken, Clark, O'Hara & Samuelian (Parker Milliken) appeared in the action claiming to represent Thomas and seeking attorney fees for such representation. The probate court found "the attorney retainer agreement (engagement letter) executed by the then proposed conservatee [(Thomas) with attorney Nunan was] invalid" because Thomas lacked the capacity to engage counsel. The court expressed concern "with regard to circumstances under which Nunan [had been] retained, particularly following this court's appointment of a [GAL] for the specific purpose of obtaining conflict-free counsel to represent the proposed conservatee. The [GAL] performed as directed and attorney Humphrey was selected for representation. It is unclear to this court what need or additional benefit was obtained by the retention (however questionable) of co-counsel."
At a hearing on March 3, 2015, the probate court relieved Jenkins of his duties as GAL. That same day, Sandra requested the appointment of Jenkins as the conservator of Thomas and his estate, and Laura joined in the request.
On March 27, 2015, in the Superior Court of Orange County, Thomas (represented by attorney Humphrey & Stephanie Weisman of Cosgrove, Cosgrove & Humphrey) filed a petition (to remove trustees & establish a claim to property under Prob. Code, §§ 850, 859) against his daughters, grandchildren and various trusts under which his heirs were beneficiaries. (Super. Ct. No. 30-2015-00779594-PR-TR-CJC (the Orange County action).) The lawsuit challenged the December 26, 2012 and March 12, 2013, transfers of Thomas's partnership interest in Tedesco Properties, along with Thomas's resignation as trustee of the Living Trust. The Orange County action was dismissed with prejudice on January 14, 2016.
On April 25, 2015, Dr. David W. Trader performed a comprehensive geriatric psychiatric examination of Thomas, pursuant to the probate court's order under Evidence Code section 730.
Dr. Trader noted Thomas's medical history. There were no medical records to review from Thomas's primary physician, Murray Taylor, M.D.; however, Richard G. Byrd, M.D., examined Thomas on April 16, 2014. In his September 12, 2014 deposition, Dr. Byrd stated that Thomas "has significant dementia, most likely of the Alzheimer's type," and he does not have "the ability to comprehend complex medical issues, . . . or . . . understand and interpret complex legal issues." As noted, ante, Dr. Nazareth agreed that Thomas "has significant intellectual[] impairment and is unable to make consistent and reliable rational decisions, especially when it comes to his health or handling any financial issues, even simple ones."
Dr. Trader reviewed the March 16, 2015 declaration of Shelly Counts, R.N., Director of Operations for Concierge Nursing Direct, Inc. Nurse Counts' declaration stated that Thomas was receiving "24-hour, 7-day a week" private duty services and caregiving assistance. Nurse Counts "related how she initially interacted with Dr. Byrd" regarding Thomas's care; however, "after Dr. Byrd was terminated, Gloria . . . refused to allow the licensed nurses to communicate with Dr. Taylor, [Thomas's] subsequent physician."
Dr. Trader spoke with Thomas's family and Mitchell. Sandra reported that Gloria's daughters had tried to take Thomas to an attorney, prompting Sandra and her sisters to file a temporary restraining order for financial elder abuse. Sandra also stated that Thomas received a quarterly income of $175,000, and his trust paid the caregivers and the majority of his bills. Thomas's daughters detailed Gloria's actions of keeping them from Thomas and causing him to believe they were stealing from him. Gloria admitted there had been a change in her relationship with Thomas's daughters beginning in April 2013; however, she claimed it was due to their taking "advantage of Tom financially." Mitchell described Thomas as (1) a "tough character, who . . . always knew what he wanted to do," (2) being "very close" to his family, and (3) someone who "would have done anything for his three daughters."
On January 14, 2015, Laura filed an elder or dependent adult abuse restraining order against Gloria's daughters on the grounds they were scheming to sabotage Thomas's relationship with his daughters, attempting to have Thomas amend his estate plan to favor Gloria, and trying to have Thomas's daughters removed as trustees of the relevant trusts. Laura alleged that Thomas's housekeeping staff and caregivers witnessed Gloria and her daughters (1) contact an estate plan attorney for an appointment for Thomas to change his estate planning documents, (2) tell Thomas that his daughters were mean to Gloria and wanted to take him away from them, (3) attempt to get Thomas to sign documents despite his telling them no and refusing to hold a pen, and (4) disparage Thomas's physician and Mitchell.
Mitchell also observed that after the surgeries in 2013, (1) Thomas was no longer "the Tom he knew," (2) Gloria blocked Mitchell's phone calls or listened in and told Thomas what to say during the phone calls, and (3) Gloria "wanted outright ownership" of Thomas's property regardless of the prenuptial agreement.
Regarding Thomas's estate plan, Mitchell explained that "historically" Thomas's "primary goal was to transfer as much of his wealth to his daughters and grandchildren tax-free and minimize the taxes." He explained Tedesco Properties was formed to accomplish the transfer of wealth and Thomas "approved of this in 2012 and transferred control to his daughters." Mitchell opined that Thomas knew what he was doing in 2012, and his actions were "very consistent with what he had always done." He added, "[Gloria] was not a factor in the 2012 decision to transfer control of the properties. It was driven by state and tax law."
Dr. Trader also spoke with Thomas personally. Thomas told Dr. Trader that his daughters and Mitchell were "in cahoots," and his daughters were trying to take over his property and money. Thomas believed he had a lawsuit against his daughters based on his name being forged on a document. He estimated his net worth to be $25 to $30 million, and he disclosed that he wanted to give "75% of his estate to Gloria and 25% to charity." Thomas scored 19 out of 30 on the Montreal Cognitive Assessment, a test similar to the MMSE, but regarded as providing "a more accurate assessment of mild deficits in cognitive functioning compared to the MMSE." Thomas's score was "suggestive of a moderate level of cognitive impairment."
"The Montreal Cognitive Assessment (MoCA) is a brief, 30-question test that helps health care professionals detect cognitive impairments very early on, allowing for faster diagnosis and patient care. MoCA is the most sensitive test available for detecting Alzheimer's disease, measuring executive functions and multiple cognitive domains which are important components not measured by the MMSE." (See <https://www.mocatest.org/about/> [as of Sept. 19, 2019].)
According to Dr. Trader, Thomas had minimal understanding and appreciation of his medical conditions, his estate plan, his properties, and the receipt of rent. Thomas "assumed that because the money was not going directly to him, his daughters must have been stealing it." Dr. Trader opined Thomas was "unable to provide properly for his personal needs for physical health, food, clothing, or shelter. [He] has deficits in . . . mental functioning, particularly understanding his situation, memory, reasoning, and planning, organizing, and carrying out actions in his own rational self-interest that directly impact his ability to provide for his basic needs." Thus, Dr. Trader recommended the appointment of a neutral conservator of Thomas. The doctor also supported the appointment of a conservator of Thomas's estate on the grounds he "lacks sufficient mental capacity to manage his own financial resources and resist fraud or undue influence."
At the time of Dr. Trader's examination, the Orange County action was pending; however, when Dr. Trader asked Thomas whether he knew he was suing his children and grandchildren, he replied, "I don't know. I might be. I don't know." When asked what the lawsuit was about, he did not know.
On June 8 and 9, 2015, the probate court conducted a court trial on the petition to appoint a conservator of Thomas and his estate. On June 15, 2015, the probate court appointed Jenkins as the temporary conservator of Thomas's estate; however, the court denied the petition to appoint a temporary conservator of Thomas because his "needs are currently being adequately met through the use of the existing estate documents."
On June 12, 2015, in the Orange County action, Thomas petitioned the court to compel accounting of the Living Trust, to suspend the powers of the cotrustees, and to appoint a temporary trustee, or control the expenditures of the cotrustees and remove them.
On July 31, 2015, Parker Milliken for Thomas petitioned for the appointment of Wilson as the conservator of the estate. On August 10, 2015, the parties stipulated and agreed to the appointment of Wilson as permanent conservator of the estate.
On January 4, 2016, Wilson filed a disassociation/termination of Parker Milliken from representing Thomas. On February 24, 2016, Humphrey filed a substitution of attorney leaving Thomas in propria persona.
See footnote 11, ante.
5. The conservator's first account.
On June 28, 2016, Wilson (represented by Robert Barton of Holland & Knight) filed the first account, which covered the period from August 10, 2015 through May 31, 2016. According to the documents attached to the first account, Wilson and counsel (law firms with expertise in trust and estate matters and legal malpractice) investigated the claims asserted in the Orange County action, along with potential claims against Wells Fargo and former attorneys at Jeffer Mangels. As a result of those investigations, Wilson decided not to pursue the claims asserted in the Orange County action or any claims against Wells Fargo or Jeffer Mangels. On December 21, 2016, the probate court approved the first account.
Holland & Knight specializes in the area of trust and estate dispute resolution, and Parker Mills specializes in legal malpractice claims.
6. The probate court's appointment of counsel and the appearance of Thomas's nonappointed counsel.
a. Russell Davis's first request to be appointed as Thomas's counsel.
On April 28, 2016, Wilson petitioned the probate court for the appointment of independent counsel to represent Thomas. In June 2016, Thomas requested the appointment of Russell Davis (Russell) as independent counsel. Russell represented that he had "received a telephone call from" Thomas who wanted legal representation. Russell retained Anthony Bassanelli, M.D., a board certified psychiatrist, to evaluate Thomas's current capacity to designate an attorney to represent him. Dr. Bassanelli met with Thomas on May 27, 2016, and then informed Russell that Thomas "clearly had sufficient capacity to designate an attorney of his choice to represent him."
See footnote 1, ante.
Although Russell declared that he was referred to Thomas by an attorney in San Diego, one year later he admitted he was acquainted with Thomas from "our golf club and was with him on a Mediterranean cruise in 2007."
On August 4, 2016, the probate court conducted a hearing on the appointment of counsel for Thomas. The court noted that "unappointed counsel" Russell appeared "'specially'" for Thomas to inform the court that Thomas had "decline[d] an appointment from the court's CRC qualified appointments list." The court denied the request to appoint Russell and, instead, appointed Jeremy J. Ofseyer (Ofseyer) "as court qualified counsel." The court explained that the "history of this case reflects a crucial need that independent counsel represent [Thomas], meaning that counsel be not related with or retained by family members who may have or might be involved in influencing the conservatee and retained counsel."
On August 29, 2016, Wilson filed a request for an elder or dependent adult abuse restraining order against Russell on the grounds he "continued to [have] contact with [Thomas,]" attempted to influence his thoughts regarding court-appointed counsel Ofseyer, and caused Thomas distress and confusion. Russell continued to refuse Wilson's request to cease contacting Thomas. On September 12, 2016, the probate court admonished Russell to stop contacting Thomas, and warned him that if he continued, "it may start fitting under the elder abuse statute, and there may be injunctive relief of another type, which, if violated, would then lead to a misdemeanor on behalf of an experienced member of the bar."
b. Russell's second request to be appointed as Thomas's counsel.
Within months of being appointed, Ofseyer moved to withdraw as court-appointed counsel for Thomas. In December 2016, Russell filed a second request to be appointed counsel for Thomas. On December 9, 2016, the probate court conducted a hearing on Ofseyer's motion to withdraw. Gloria, through her attorney David M. Grey (Gloria's attorney), supported Ofseyer's motion because "there's a significant conflict" based on his meeting "several years ago with [Gloria], her attorneys, and representatives." The court referenced findings in previous orders that Gloria took Thomas to a number of attorneys for the purpose of changing his estate plan when he was not capable of doing that, or understanding what he was doing, "[c]ompletely avoiding his own long-term family lawyer [(Mitchell)] he had had for more than 20 years." Also, the court noted that "there was evidence received from people in the home, of workers in the home, servants, who had seen evidence of influence, of script writing. Scripts for [Thomas]." The court denied Russell's request and appointed Julia Burt as counsel for Thomas.
c. Carpenter's petition to file a civil action against defendants, and Russell's third request to be appointed as Thomas's counsel.
On May 12, 2017, Dr. Bassanelli submitted a letter in which he opined that Thomas had major neurocognitive disorder, without behavioral disturbance, mild severity, and significant short-term memory deficits that impair complex activity. He nonetheless opined that Thomas had "preserved capacity to work with an attorney of his choice," "preserved testamentary capacity," "preserved capacity for financial decision-making," and "preserved medical decision-making capacity." Dr. Bassanelli added that there was "no evidence of any undue influence on [Thomas's] legal, testamentary, financial or medical decision-making capacities."
On May 23, 2017, Gloria's attorney (Grey) sent a letter to Wilson's attorney (Barton) referencing an earlier letter Grey had sent on May 12, 2017. Grey was inquiring about (1) Wilson's intentions regarding Thomas's potential claim against Wells Fargo, and (2) warning of the imminent statute of limitations deadline. Grey also requested the evidence Barton and Wilson had relied upon in finding "no evidentiary basis to pursue" the Orange County action.
On June 8, 2017, Carpenter, represented by Russell, petitioned the probate court ex parte for an order (1) broadening Thomas's power to allow him to file a separate civil action against defendants for various claims, which Wilson had already investigated and determined were meritless, and (2) authorizing Thomas to engage the services of the Herzog, Yuhas, Ehrlich & Ardell (The Herzog firm) and Joseph Davis (Joseph) to represent him in a civil action. Carpenter attached the proposed complaint to his first petition. Carpenter conceded the probate court's authorization was necessary "[a]s a conservator has been appointed for [Thomas], he lacks the legal capacity to engage attorneys to bring any litigation on his behalf."
Carpenter is a retired bank executive who "has known the conservatee for about 13 years," is a "good friend," and "is concerned about the well-being of the conservatee." However, according to Wilson, Carpenter "came into [Thomas's] life after [meeting] his wife Gloria." Shortly after Wilson was appointed conservator, "Carpenter and [Gloria's] daughter, Debbie Ware, had [Thomas] call [Wilson] and request an immediate meeting[; however,] it was really . . . Carpenter and Ms. Ware requesting the meeting, and they wanted information relating to the status of the case."
Including claims for "damages, financial elder abuse, and to seek restitution for the wrongful transfers of the conservatee's property."
Wilson opposed Carpenter's first petition on the grounds (1) it "is nothing but a back door effort to thwart prior court orders," and (2) "the pursuit of these claims are not in the best interest of [Thomas] or his Estate and . . . the Court has already determined [Thomas] does not have the ability to retain counsel or to substantially resist undue influence." Thomas's daughters also opposed the petition on the grounds Thomas was barred from relitigating claims that were asserted in the Orange County action and dismissed with prejudice.
At the hearing on June 8, 2017, the probate court noted that Russell was using Carpenter in an "effort to be the lawyer, in effect, for [Thomas]." The court continued the hearing on Carpenter's first petition to August 10, 2017 to allow the parties to address the issue of whether res judicata would bar the proposed civil action. However, the court instructed Wilson's attorney to sue Wells Fargo Bank today, "if you think that you should sue Wells Fargo." In July 2017, Gloria (represented by Grey) filed a response brief in support of Carpenter's first petition. The August 10, 2017 hearing was continued to September 7, 2017.
On June 16, 2017, The Herzog Firm, Joseph & Russell, representing Thomas, petitioned for termination of the conservatorship (terminating petition) based, inter alia, on the failure to advise Thomas of his rights at the time the conservatorship was established, the absence of a valid waiver of statutory rights, and the absence of any need for a conservatorship. Hearing on the terminating petition was continued to September 7, 2017.
On June 22, 2017, Burt filed a motion to be relieved as counsel for Thomas on the grounds "non-Court appointed counsel has caused an irreparable breakdown of [her] attorney/client relationship with [Thomas], and therefore [she] can no longer adequately represent [him]." In response, on or about August 2, 2017, Russell filed a third ex parte petition to be appointed counsel for Thomas on the grounds Burt had submitted her resignation. Hearing on Russell's petition was continued to September 27, 2017.
On July 10, 2017, Wilson filed a notice of disassociation/termination of counsel for Thomas, disassociating and terminating The Herzog Firm, Joseph and Russell. On January 5, 2018, the probate court denied Russell's third request to be appointed counsel for Thomas.
B. First Civil Action (Super. Ct. No. PSC1703036 ).
Despite the probate court's contrary rulings, on June 9, 2017, The Herzog Firm and Joseph, acting as counsel for Thomas, initiated the first civil action (Super. Ct. No. PSC1703036). The complaint alleged Thomas was "given authority by the Riverside Superior Court pursuant to Probate Code §§1873 and 1874 to bring this action." Thomas's daughters moved to strike the complaint on the grounds Thomas, the conservatee, "lacks capacity to sue [them], and that the issue of [his] capacity to sue [them] is currently pending before the Probate Court."
On or about June 2, 2017, Thomas entered into an attorney-client agreement with The Herzog Firm. According to the agreement, The Herzog Firm would represent Thomas in a civil action "arising out of misappropriation, diversion, and handling of [Thomas's] assets." They would be paid their expenditures (costs), along with compensation on a contingency basis. The contingency basis provided: 33 and one-third percent if the case settled before filing suit, 40 percent if settlement after filing suit, and 50 percent in the event of an appeal. Further, the agreement provides that The Herzog Firm, in "their sole discretion," "may advance costs, expenses, investigation, expert, and consultant fees" for Thomas's case, and Thomas "is to pay costs, expenses, and investigation charges and will either advance such or promptly reimburse attorneys for them."
On August 10, 2017, the civil court granted the motion to strike and dismissed the action. The court expressed concern that The Herzog Firm and Joseph "knew that [Thomas] was under a conservatorship and had not yet even filed any petition with the probate court that would allow them the ability to represent [Thomas] or otherwise move forward with this litigation." The court added, "[o]f concern is the fact that the Complaint alleges that the probate court gave authority for this action to be brought, an allegation which does not appear to be borne out by the Court records." Thomas unsuccessfully moved for a new trial, and the matter is the subject of a separate appeal. (See Tedesco v. White et al., supra, E069438.)
C. The Ex Parte Petition for Appointment of Carpenter as GAL (Super. Ct. No. INP1400272 ), and the Second Civil Action (Super. Ct. No. PSC1704669 ).
On August 15, 2017, following the dismissal of the first civil action, Russell filed an ex parte petition in the probate court (Super. Ct. No. INP1400272) to appoint Carpenter as GAL for Thomas (Carpenter's second petition). Wilson opposed the petition on the grounds that it was "really a disguised attempt at reconsideration" of Carpenter's first petition because that petition "sought permission for [Thomas] to be allowed to file a civil complaint, while the current one seeks [Carpenter's] appointment as [GAL] in order to file the same civil complaint." Wilson declared that he, along with his attorneys, had met with Thomas's court-appointed counsel (attorneys Burt & Ofseyer) who, independently, chose not to pursue any action. He believed that "[n]on-appointed Counsel are making baseless allegations of wrongdoing (costing [Thomas's] estate what may be hundreds of thousands of dollars) based on alleged statements from an incapacitated conservatee, [Thomas], who apparently does not accurately recall all the facts involved." Wilson also questioned Carpenter's motivations, explaining, "Shortly after [Wilson's] appointment, Mr. Carpenter and [Gloria's] daughter, [Debra] had [Thomas] call [Wilson] and request an immediate meeting. Upon arrival, [Wilson] learned that it was really Mr. Carpenter and [Debra] requesting the meeting, and they wanted information relating to the status of the case. They appeared to have already obtained some (inaccurate) information regarding [Thomas's] assets." Wilson questioned why Carpenter and "related individuals" were interfering in Thomas's affairs "when there are independent, court-appointed professionals handling the matter." Thomas's daughters also opposed Carpenter's second petition. The request for ex parte relief was denied; however, the matter was set for hearing on September 7, 2017.
Carpenter claimed that the "statute of limitations appears to bar an action against Wells Fargo Bank."
On August 23, 2017, this court denied Carpenter's petition for writ of mandate, which requested the court direct the probate court to rescind its August 16, 2017 order continuing Carpenter's petition to a later date. (Carpenter et al. v. Superior Court (Wilson et al.) (Aug. 23, 2017, E068946).)
On August 25, 2017, The Herzog Firm, Joseph, and Russell, acting as counsel for Thomas and Carpenter (as GAL for Thomas), initiated a second civil action against defendants for cancellation/rescission of documents and transfers, breach of fiduciary duty, elder financial abuse, fraud and misrepresentation, negligence, conversion, and declaratory relief. The complaint alleges the conservatorship of the estate of Thomas was "not established in compliance with the relevant" law, and "any orders purporting to appoint a temporary or permanent conservator are void, invalid and of no force or effect."
No court had yet appointed Carpenter as GAL for Thomas.
On September 15, 2017, the probate court heard argument on Carpenter's second petition and other matters, and took all matters under submission. Also, at the court's direction, the Honorable Reva G. Goetz, a retired probate judge, served as an independent witness to a meeting between Thomas, Wilson, and court-appointed attorney Burt. Judge Goetz filed a declaration describing her observations of the meeting. According to Judge Goetz's observations, Thomas knew very little about the cases filed on his behalf by nonappointed counsel, and he did not know the names of his nonappointed counsel. When asked about each of the attorneys by name, he stated: (1) Russell was honest, and they met on a vacation many years ago; (2) he had not known Joseph very long and did not remember how they met; and (3) he had not known Mr. Herzog's correct name and did not remember how they had met. Thomas also stated that he did not know what his attorneys' objectives were and did not remember signing an engagement letter with The Herzog Firm. Finally, Thomas stated that Carpenter was a friend, but it was possible they met through Russell.
On October 10, 2017, The Herzog Firm, Joseph, and Russell withdrew Carpenter's second petition in the probate court. On October 17, Joseph filed an ex parte application in the civil court to appoint Carpenter as GAL for Thomas for the purpose of the second civil action. No notice was provided to Wilson or Thomas's daughters. That same day, the civil court granted the application and appointed Carpenter as GAL for Thomas. On October 30, 2017, Thomas's daughters filed an ex parte petition to set aside the civil court's order. Wilson filed a declaration in support of the daughters' ex parte petition. The civil court denied the daughters' request for ex parte relief and continued the hearing on their application to December 20, 2017.
Nearly two months after Carpenter, as GAL for Thomas, had filed the second civil action.
On November 17, 2017, Thomas's daughters, as cotrustees, joined by Wilson, petitioned the probate court for instructions declaring void all purported legal services agreements between Thomas and nonappointed counsel. Thomas's daughters argued that Thomas was subject to a conservatorship and thus lacks the legal capacity to enter into any legal transaction. The Herzog Firm, Joseph, and Russell, for Thomas, demurred to the petition, requested the probate court take judicial notice of the civil court's order appointing Carpenter as GAL, and filed objections to the petition on behalf of Thomas.
By order dated December 28, 2017, as clarified on January 5, 2018, the probate court (Super. Ct. No. INP1400272) granted Burt's motion to be relieved as counsel, denied Russell's request to be appointed counsel, and appointed Kevin McKenzie (McKenzie) as Thomas's counsel. The court authorized attorney McKenzie to "delegate some of the work to some of the attorneys in his office."
According to the proof of service, McKenzie is with the law firm of Swan Carpenter Wallis & McKenzie, and not with The Herzog Firm, Joseph, or Russell.
On February 6, 2018, Wilson filed an ex parte petition in the probate court for instructions/order (1) affirming Wilson's power to initiate and maintain litigation on Thomas's behalf, (2) instructing Wilson to intervene in the second civil action for the purposes of dismissing it, and (3) limiting the initiation of litigation on behalf of Thomas to Wilson and court-appointed counsel, including specifically barring nonappointed counsel and Carpenter from initiating or pursuing litigation on behalf of Thomas. The Herzog Firm, Joseph and Russell objected to Wilson's petition.
A hearing on the daughters' petition was held on March 22, 2018. On April 4, 2018, the probate court granted the petition. The court ruled all legal services agreements between Thomas and nonappointed counsel (including The Herzog firm, Evan Marshall, Joseph, & Russell) were void, and affirmed the termination of the nonappointed counsel's agreements and services by Wilson. Also on March 22, 2018, the probate court heard Wilson's petition for instructions/order. The court affirmed Wilson's power to initiate and maintain litigation on Thomas's behalf, instructed him to intervene in the second civil action for the purpose of dismissing it, and ordered that any future litigation on behalf of Thomas "shall be initiated exclusively by the Conservator [Wilson] or Court-Appointed Counsel Kevin McKenzie." Nonappointed counsel, The Herzog Firm, Joseph, and Russell, as well as court-appointed counsel, McKenzie, filed a notice of appeal on behalf of Thomas.
III. DISCUSSION
Thomas appeals the orders instructing Wilson to void all legal services agreements between Thomas and nonappointed counsel and to intervene in the second civil action for the purpose of dismissing it. Thomas contends the probate court (1) had no authority to discharge legal counsel selected by him, (2) had no jurisdiction to interfere with the civil court's appointment of a GAL for him, and (3) violated its duty to assure that his claims for misappropriation of funds are heard on the merits. For the reasons stated herein, we reject Thomas's contentions.
See footnote 3.
A. Standard of Review.
We review an order instructing the estate's administrator for abuse of discretion. (See Estate of Denton (1971) 17 Cal.App.3d 1070, 1075.)
B. The Instruction to Discharge Counsel Selected by Thomas Was Proper.
Thomas challenges the probate court's authority to discharge his private counsel, arguing: (1) the court is authorized to appoint counsel only in the absence of privately retained counsel; (2) neither the court nor Wilson may obstruct Thomas's right to independent counsel; (3) the appointment of Wilson as the conservator did not mean Thomas was disabled from seeking independent counsel (Prob. Code, § 1872), and the absence of a binding contract does not nullify his independent legal representation; (4) he has a constitutional right to counsel of his choice; (5) independent counsel is necessary when Wilson undermined Thomas's claims to recover damages; and (6) neither the court nor Wilson may interfere with appointed counsel's decision to associate other counsel's assistance. In short, Thomas argues the probate court had no authority to prevent or obstruct him from retaining independent counsel. Not so.
1. Thomas's right to independent counsel of his choice is not absolute.
Thomas contends he was able to retain private counsel, and neither Wilson nor the probate court could interfere with his choice. We disagree.
Once a conservatorship of an estate is established, the conservator has the authority to "[c]ommence and maintain actions and proceedings for the benefit of the ward or conservatee or the estate" (Prob. Code, § 2462, subd. (a)) and retain an attorney to advise and represent the conservator in all matters, including actions and proceedings (id., at § 2451.5, subd. (c)). Here, with the probate court's authorization, Wilson retained counsel to investigate Thomas's claims. Based on counsel's analysis, Wilson concluded any legal action against defendants was not in Thomas's best interests. Unhappy with this conclusion, Thomas requested independent counsel. Independent counsel (Burt & Ofseyer) were appointed but did not pursue any action. Thomas then "retained" nonappointed counsel to challenge Wilson's and his independent counsel's decision. In response, Wilson successfully challenged Thomas's retention of nonappointed counsel.
Since 2014, Thomas's estate has been under conservatorship. As a conservatee, Thomas lacks legal capacity to retain independent counsel absent probate court approval. Pursuant to Civil Code section 40 and Probate Code section 1872, subdivision (a), the appointment of a conservator of an estate is an adjudication of the conservatee's legal incapacity to enter into transactions, including making a contract, incurring a debt, and delegating power. (Prob. Code, § 1870.) While the conservatee (Thomas) retained (1) the right to control an allowance, wages or salary, (2) the right to make a will, and (3) the right to enter into transactions to the extent reasonable to provide the necessaries of life (Prob. Code, § 1871), he or she may not enter into a contract for legal services. (Conservatorship of Chilton (1970) 8 Cal.App.3d 34, 40 [affirming the trial court's denial of an award of attorney fees where a conservatee signed a retainer agreement when he or she "had no capacity to enter into a valid contract employing petitioner . . . as [his or] her attorney"]; Sullivan v. Dunne (1926) 198 Cal. 183, 193-194 [attorney could not contract with incapacitated person].) Thus, on his own, Thomas was unable to retain The Herzog firm, Evan Marshall, Joseph or Russell as his independent counsel.
"Subject to Section 1871 of the Probate Code, and subject to Part 1 (commencing with Section 5000) of Division 5 of the Welfare and Institutions Code, after his or her incapacity has been judicially determined a person of unsound mind can make no conveyance or other contract, nor delegate any power or waive any right, until his or her restoration to capacity." (Civ. Code, § 40, subd. (a).)
"Except as otherwise provided in this article, the appointment of a conservator of the estate is an adjudication that the conservatee lacks the legal capacity to enter into or make any transaction that binds or obligates the conservatorship estate." (Prob. Code, § 1872, subd. (a).)
The Probate Code provides four ways for Thomas to pursue representation by nonappointed counsel. First, Thomas could have petitioned the probate court to broaden his power to enter into a transaction to retain counsel. (Prob. Code, § 1873, subd. (a).) On June 8, 2017, Thomas initiated such a petition (Super. Ct. No. INP1400272); however, it was never ruled upon. Second, an "interested person" could have petitioned the court to "instruct the . . . conservator . . . in the administration, management, investment, disposition, care, protection, operation, or preservation of the estate, or the incurring or payment of costs, fees, or expenses in connection therewith." (Prob. Code, § 2403, subd. (a).) Third, Gloria "or any relative or friend of the conservatee or other interested person" could have filed a "petition for the termination of the conservatorship" stating "facts showing that the conservatorship is no longer required." (Prob. Code, § 1861, subds. (a), (b).) Here, nonappointed counsel filed two such petitions and appointed counsel filed one; however, they withdrew them prior to disposition. And finally, Thomas could have sought to hire counsel on a contingency basis by having Wilson seek court approval of such contract. (Prob. Code, § 2644, subd. (a).) None of these ways were pursued to completion.
In short, as a conservatee, Thomas's right to independent counsel is not absolute; counsel must be approved by the probate court.
2. Thomas has no constitutional right to counsel of his choice.
Notwithstanding the above, Thomas argues he has a constitutional right to counsel of his choice. Not so.
A conservatee is entitled to independent counsel when his or her conservator or representative seeks to pursue an action that would significantly impact the conservatee's fundamental rights. (Michelle K. v. Superior Court (2013) 221 Cal.App.4th 409, 445; see Wendland v. Superior Court (1996) 49 Cal.App.4th 44, 46-48 [conservatee entitled to an independent advocate when his wife, acting as the temporary conservator, petitioned the court to remove his feeding tube].) However, as stated ante, a conservatee lacks legal capacity to contract with an attorney. (Prob. Code, § 1872, subd (a); Civ. Code, § 40.) This legal incapacity/disability also means that Thomas is unable to retain counsel of his choice absent probate court approval. To hold otherwise would nullify the relevant statutory authority that requires the probate court's approval and appointment of, and payment to, counsel representing the conservatee (namely, Prob. Code, §§ 1470, 1471, 1872, & 2644). Thomas therefore has no constitutional or statutory right to counsel of his choice absent probate court approval.
3. The probate court did not err in instructing the conservator to discharge Thomas's nonappointed counsel.
Finally, Thomas contends independent counsel is necessary because Wilson had undermined his claims against defendants. He further asserts that neither the probate court nor Wilson may interfere with appointed independent counsel's decision to associate nonappointed counsel's assistance. While we agree that Thomas is entitled to independent counsel when Wilson takes actions contrary to Thomas's best interests, we disagree with appointed counsel retaining or associating in nonappointed counsel.
The fundamental premise underlying Thomas's challenge to the probate court's authority to instruct Wilson to discharge his nonappointed counsel assumes Thomas possesses the legal ability to retain or direct counsel. This assumption is incorrect. As an incapacitated person, Thomas lacks the legal ability to retain or direct counsel. (Civ. Code, §§ 40, 2356, subd. (a)(3) [an agency terminates upon the "incapacity of the principal to contract"]; Prob. Code, § 1872, subd. (a); Conservatorship of Chilton, supra, 8 Cal.App.3d at pp. 40-41; Sullivan v. Dunne, supra, 198 Cal. at pp. 193-194.) However, upon his request, the probate court must appoint independent counsel. (Prob. Code, § 1471, subd. (a) [probate court must appoint counsel when a conservatee "requests the appointment of counsel to assist" in certain proceedings].)
Here, independent counsel was appointed for Thomas in response to a petition filed by Wilson on April 28, 2016. The petition was granted on August 4, 2016, with the appointment of Ofseyer, and again in December 2016 with the appointment of Burt. However, nonappointed counsel continued to interfere with both the attorney-client relationship between Burt and Thomas, and the conservatorship. By June 2017, Burt asked to be relieved as Thomas's counsel on the grounds "non-Court appointed counsel has caused an irreparable breakdown of [her] attorney/client relationship with [Thomas], and therefore [she] can no longer adequately represent [him]." Thus, in December 2017, the court appointed McKenzie to represent Thomas.
Nonetheless, Thomas contends that neither the probate court nor Wilson may interfere in McKenzie's decision to approve and join in the civil action, including McKenzie's decision to retain or associate in nonappointed counsel to pursue such civil action. Thomas offers no evidentiary or legal support for his contention that attorney McKenzie is vested with the authority to appoint and retain other counsel by "associating them," with the exception of his reference to Conservatorship of Drabick (1988) 200 Cal.App.3d 185, 212-213, superseded by statute as stated in Conservatorship of Wendland (2001) 26 Cal.4th 519, 541. In that case, the Court of Appeal held that the court-appointed counsel for a conservatee in a persistent vegetative state was not obligated to oppose the conservator's request to remove a feeding tube. (Conservatorship of Drabick, supra, 200 Cal.App.3d. at p. 212.) Rather, the "conservatee's attorney must advocate the conservatee's best interests." (Id. at pp. 213-214.)
Thomas's claim that McKenzie may retain or associate in nonappointed counsel contravenes the express provisions of the Probate Code. Pursuant to Probate Code section 2644, subdivision (a), a conservator or GAL, not court-appointed counsel, may contract with an attorney on a contingency basis, but only with a court order. McKenzie was appointed in December 2017; however, there is no evidence he conducted an independent analysis of Thomas's alleged claims, found merit to them, or determined he (McKenzie) was unable to adequately represent Thomas's interest without the assistance of nonappointed counsel. Moreover, there is no evidence McKenzie sought approval from either Wilson or the probate court to pursue the civil litigation and engage nonappointed counsel to do so. The probate court affirmed Wilson's "power to initiate and maintain litigation on [Thomas'] behalf," instructed Wilson to "intervene in the [second civil] action pending in Riverside County, Superior Court Case No. PSC1704669 . . . for the purposes of dismissing" the action and ordered that "[a]ny future litigation initiated on behalf of the [Thomas] shall be initiated exclusively by [Wilson] or Court-Appointed Counsel Kevin McKenzie." While the probate court authorized either Wilson or McKenzie to initiate future litigation on Thomas's behalf, it did not authorize McKenzie to retain or associate in nonappointed counsel.
Probate Code section 2644, in relevant part, provides: "Where it is to the advantage, benefit, and best interest of the . . . conservatee or the estate, the guardian or conservator of the estate may contract with an attorney for a contingent fee for the attorney's services in representing . . . conservatee or the estate in connection with a matter that is of a type that is customarily the subject of a contingent fee contract, but such a contract is valid only if (1) the contract is made pursuant to an order of the court authorizing the guardian or conservator to execute the contract or (2) the contract is approved by order of the court." (Italics added.)
For the above reasons, we conclude the probate court had the authority to discharge nonappointed counsel and did not abuse its discretion in instructing Wilson to do so.
C. The Probate Court Did Not Err in Interfering with the GAL Appointed by the Civil Court.
Thomas contends the probate court lacked jurisdiction to interfere with the appointment of Carpenter as his GAL, arguing (1) Wilson did not have exclusive authority to take legal action on behalf of Thomas; (2) the civil court had exclusive jurisdiction (Code Civ. Proc. § 372); and (3) the probate court had no authority to instruct Wilson to intervene in the second civil action. Thomas's contention is wrong.
1. The probate court had exclusive concurrent jurisdiction over the appointment of Carpenter as GAL.
Thomas contends the civil court is vested with the jurisdiction to appoint Carpenter as GAL. We disagree.
"'Under the rule of exclusive concurrent jurisdiction, "when two [California] superior courts have concurrent jurisdiction over the subject matter and all parties involved in litigation, the first to assume jurisdiction has exclusive and continuing jurisdiction over the subject matter and all parties involved until such time as all necessarily related matters have been resolved." [Citations.] The rule is based upon the public policies of avoiding conflicts that might arise between courts if they were free to make contradictory decisions or awards relating to the same controversy and preventing vexatious litigation and multiplicity of suits.' [Citation.] Ordinarily, '[p]riority of jurisdiction resides in the tribunal where process is first served.'" (People ex rel. Garamendi v. American Autoplan, Inc. (1993) 20 Cal.App.4th 760, 769-770, italics added.)
Here, the tribunal where process was first served is the probate court when the petition for conservatorship of Thomas and his estate was filed in 2014. As a result of that petition, the probate court, on its own motion, appointed Jenkins as GAL for Thomas "with authority to investigate, retain and discharge counsel" for Thomas's protection. Subsequently, in June 2015, the court appointed Jenkins as the temporary conservator of Thomas's estate; however, two months later, the parties stipulated and agreed to the appointment of Wilson as the permanent conservator of the estate. In 2017, Carpenter petitioned the probate court to be appointed as GAL for Thomas. Prior to obtaining a ruling, Carpenter withdrew his petition in the probate court and refiled it in the civil court where he applied, ex parte, to be appointed GAL. No notice was provided to Wilson, Thomas's daughters, or the probate court. The civil court granted the ex parte request.
We conclude the civil court lacked jurisdiction to grant the ex parte request because the probate court was vested with exclusive concurrent jurisdiction. While "the rule of exclusive concurrent jurisdiction is a rule of policy and countervailing policies may make the rule inapplicable" (People ex rel. Garamendi v. American Autoplan, Inc., supra, 20 Cal.App.4th at p. 770), we perceive no policy that would justify abating the probate court's authority in this matter. Also, since the probate court possesses knowledge of the circumstances giving rise to the conservatorship, it is less likely to be manipulated by a party due to ignorance of the facts. The driving force behind Carpenter's request appears to be Gloria, her daughters, and nonappointed counsel (who lacked independence because they were assisted by Gloria's daughter, Debra, paralegal to Russell). Their motivation therefore is suspect.
2. Wilson possesses the exclusive authority to take legal action on behalf of Thomas.
Notwithstanding the above, Thomas contends Wilson does not have exclusive authority to take legal action on Thomas's behalf because Code of Civil Procedure section 372 allows for the appointment of a GAL for a party where a conservator has been appointed. Absent statutory language vesting exclusive authority in a conservator, Thomas argues the civil court's appointment of Carpenter was proper. We disagree.
Code of Civil Procedure, section 372, subdivision (a)(1), in relevant part, provides: "When . . . a person for whom a conservator has been appointed is a party, that person shall appear either by a guardian or conservator of the estate or by a guardian ad litem appointed by the court in which the action or proceeding is pending, or by a judge thereof, in each case. A guardian ad litem may be appointed in any case when it is deemed by the court in which the action or proceeding is prosecuted, or by a judge thereof, expedient to appoint a guardian ad litem to represent the . . . person for whom a conservator has been appointed, notwithstanding that the person may have a . . . conservator of the estate and may have appeared by the . . . conservator of the estate. . . ." (Code Civ. Proc., § 372, subd. (a)(1), italics added.)
Code of Civil Procedure section 372 contemplates the existence of a conservator—over whom a probate court exercises control—and thus acknowledges the possibility of jurisdiction resting in the probate court. Thomas has failed to cite to any authority that holds that a GAL appointed after the conservator, and by a different court, enjoys controlling power in the event of a conflict between the two.
Since Code of Civil Procedure section 372 recognizes the possibility of jurisdiction resting in the probate court, the fact that the probate court has overseen the conservatorship of Thomas's estate since 2014 means the appointment of a GAL was within the probate court's authority. "The superior court is divided into departments, including the probate department, as a matter of convenience; but the subject matter jurisdiction of the superior court is vested as a whole." (Estate of Bowles (2008) 169 Cal.App.4th 684, 695.) "'"It follows, . . . where a proceeding has been . . . assigned for hearing and determination to one department of the superior court by the presiding judge . . . and the proceeding . . . has not been finally disposed of . . . it is beyond the jurisdictional authority of another department of the same court to interfere with the exercise of the power of the department to which the proceeding has been so assigned . . . . If such were not the law, conflicting adjudications of the same subject-matter by different departments of the one court would bring about an anomalous situation and doubtless lead to much confusion."" (Glade v. Glade (1995) 38 Cal.App.4th 1441, 1449-1450.)
Here, the civil court acknowledged the superiority of the probate court's jurisdiction when it stated its appointment of Carpenter was "under the assumption . . . that this action was filed appropriately on behalf of [Thomas]." The civil court added that if there were an order from the probate court stating otherwise, it "would be dispositive." Since the probate court exercised jurisdiction over the conservatorship of Thomas's estate and appointed a conservator, the conservator (Wilson) possesses the exclusive authority to maintain litigation on Thomas's behalf. (Prob. Code, § 2642.)
3. The probate court is authorized to instruct Wilson to intervene in the civil action.
Thomas contends the probate court had no authority to instruct Wilson to intervene in the civil action. We reject his contention.
As stated, ante, the probate court has exclusive concurrent jurisdiction over the appointment of a GAL. (Greene v. Superior Court (1951) 37 Cal.2d 307, 310 ["when two or more courts in this state have concurrent jurisdiction, the court first assuming jurisdiction retains it to the exclusion of all other courts in which the action might have been initiated"].) Additionally, the probate court was permitted to instruct Wilson to intervene in the civil action. (See Finley v. Perry (1962) 207 Cal.App.2d 363, 364 ["The probate court . . . instructed the executor to withdraw from the compromise and seek dismissal of the civil action" and the Court of Appeal affirmed such actions]; Glade v. Glade, supra, 38 Cal.App.4th at pp. 1449-1450 ["'it is beyond the jurisdictional authority of another department of the same court to interfere with the exercise of the power of the department to which the proceeding has been so assigned'"]; In re Marriage of Schenck (1991) 228 Cal.App.3d 1474, 1483-1484 [civil law & motion department had no authority to order the sale of the family home based on husband's accrued support arrearages when the family law court still had jurisdiction to divide the community interest in that home]; Burkle v. Burkle (2006) 144 Cal.App.4th 387, 393 ["When a dissolution proceeding is pending, neither party to that proceeding has the right to file a separate civil action to enforce an interim support order issued in the dissolution proceeding. The same rule applies to filing a purported tort action arising from conduct that relates to the interim support order and, but for the dissolution proceeding, would not have occurred."].)
Moreover, contrary to Thomas's claim, Probate Code section 2403 permits the probate court to instruct a conservator to take actions necessary for the "protection . . . or preservation of the estate." Here, nonappointed counsel entered into legal services agreements with Thomas that would obligate Thomas to pay costs, expenses, and investigation charges. The funds necessary to pay these expenses would come from the conservatorship estate, regardless of whether the claims prove successful. If they are not successful, the conservatorship estate may incur liability for a malicious prosecution claim. Alternatively, if they are successful and Thomas's gifts to his daughters and grandchildren are rescinded, the conservatorship estate may be responsible for significant taxes and financial penalties.
Under the doctrine of exclusive concurrent jurisdiction, and the provisions of Probate Code section 2403, the probate court possesses the authority to instruct Wilson to intervene in the civil action for the purpose of challenging the appointment of a GAL and having the action dismissed.
D. The Probate Court Did Not Violate Its Duty Regarding Thomas's Claims for Misappropriation of Funds.
Finally, Thomas argues the probate court violated its duty to assure that his claims against defendants were heard on the merits by instructing Wilson to intervene in and dismiss the second civil action. We disagree.
The probate court did not prevent Thomas from pursuing his alleged claims. Rather, it denied nonappointed counsel of the right to represent him. Following the mechanisms established by the Probate Code, the court established a conservatorship over Thomas's estate, and appointed an independent conservator. Wilson looked into Thomas's alleged claims when he retained independent counsel (law firms with expertise in trust and estate matters and legal malpractice) to investigate the claims. As a result of that investigation, Wilson determined the claims were meritless and contrary to Thomas's best interest. Wilson reported his actions and decision in his first account in June 2016. The probate court's approval of the first account ratified the decision that pursuit of Thomas's alleged claims was not in his best interests.
Although the probate court had appointed independent counsel to represent Thomas, nonappointed counsel—on Thomas's behalf—intervened in the conservatorship to challenge Wilson's actions. Nonappointed counsel sought to establish Thomas's capacity to pursue the claims and terminate the conservatorship. Nonappointed counsel made communication between Thomas and appointed counsel difficult. Also, nonappointed counsel dictated Thomas's decision to initiate actions in the civil court. It appears that nonappointed counsel were unhappy with the probate court's refusal to appoint them to represent Thomas and, thus, sought to involve another division of the superior court in the hope of obtaining a more favorable result. However, the fact that a party is dissatisfied with one court's decisions does not mean that that court has violated any duty owed to the party. The probate court was aware of Thomas's mental function deficits, which rendered him susceptible to undue influence, and appointed a conservator of his estate as well as independent counsel. Because nonappointed counsel were connected to Gloria and her daughters, the probate court sought and appointed independent court-qualified counsel.
Contrary to Thomas's accusation, the probate court has not violated its duty to assure that his claims are heard on their merits. Rather, the court has sought to protect Thomas, in his incapacity, from undue influencers, including nonappointed counsel who refuse to accept the court's denial of their request to be appointed as Thomas's independent counsel. Nonappointed counsel's claim that Thomas has been denied his day in court is disingenuous given their refusal to accept the probate court's rulings in search of a more favorable one in another forum. Nonappointed counsel sought to bind Thomas to legal services agreements with full knowledge that he lacked capacity to contract. And, they fault the probate court for declaring those agreements to be void despite their concession Thomas had no legal capacity to enter them.
There is substantial evidence that Thomas has benefitted by the conservatorship of his estate. His accusations that his daughters and his longtime attorney Mitchell were "in cahoots," and his daughters were trying to take over his property and money are not borne out by the record. "It is a sad feature of conservatorship proceedings that conservatees are sometimes unable to comprehend the good intentions and deeds of others. As a previous court observed, '[t]he individual who first suggests the need for a caretaker, like a lightning rod, often attracts to his [or her] person the lasting wrath and suspicion of the supposed incompetent . . . .' [Citation.] So it appears here." (Conservatorship of Cornelius (2011) 200 Cal.App.4th 1198, 1207.) Despite Thomas's criticism, we conclude the probate court did not violate its duty to assure Thomas's claims against defendants were heard on the merits.
IV. DISPOSITION
The orders appealed from are affirmed. Petitioners and respondents are awarded costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
McKINSTER
J. We concur: RAMIREZ
P. J. SLOUGH
J.