Victims' Stories

AN ESTATE PLAN THAT WAS SET UP TO SAVE MONEY BECAME A LUCRATIVE SOURCE
FOR FEES FOR ATTORNEYS AND THE ACCOUNTANT

Louis Falk and his wife Marice had combined assets of 1.6 million dollars. In 1990 Louis decided to do estate planning, by setting up revocable trusts. To fund the trust it was essential to divide the properties jointly owned with his wife. Louis was an attorney for 41 years, specializing in probate and real estate and was also represented by counsel. In the prior year in 1989 his wife Marice attempted suicide. She was diagnosed by the Miami-Dade County court to be a paranoid schizophrenic. She was Baker acted and was declared incompetent and her daughter Linda was appointed to be Marice's guardian. By order entered in 1990 the court approved the splitting of the jointly owned assets and to place the Falk's property into two revocable living trusts one for Marice and the other for Louis. The trust provided for discretionary income for the lifetime of the surviving spouse and upon the demise of the husband and wife the principle was to go to their daughter Linda and son Steven. The trusts reserved the right to Marice and Louis to revoke and amend same, with the written consent of the trustee Linda.

Out of concern for his son Steven who was mentally ill, Louis modified his revocable trust providing that on his death, his estate was to go to the daughter Linda and in trust for his son fearing that in her mental condition Marice would not provide for the mentally disabled son. Louis died shortly thereafter in 1993 at age 83. In 1995 the elderly Marice was informed by daughter Linda of the change made by Louis in his revocable trust. Upon demands and threats by Marice, Linda voluntarily terminated the guardianship. Marice's behavior became increasingly contentious and erratic and she estranged herself from Linda. In her schizophrenic state Marice made constant death threats against Linda and her family. Marice retained attorney Richard Milstein, to file suit against Linda, for alleged undue influence over the father Louis to appropriate his share of the estate from Marice, for assigning inaccurate values in splitting her parents' properties and for giving more to the father than the mother. Linda was represented by counsel at all times. Milstein, an attorney with Akerman, Senterfitt, billed Marice for substantial fees for himself as well as for many other lawyers in that firm for allegedly conferring with each other.

Although a trial was held, Milstein never proved undue influence over the father by Linda. Linda named 43 individuals on her witness list. There was testimony from the attorney of the late Louis that he was of sound mind at the time he modified his revocable trust. A 30 minute video tape of Louis was presented in which he expressed his desire to modify his revocable trust to make his daughter and son the beneficiaries upon his death. It was proven that Linda never contested or thwarted any legal matter or desire of her parents, nor had she personally inherited, benefited, or appropriated any money from the estate or even took guardianship fees. The charge of undue influence was dropped. It was conceded that the estate planning saved the estates of Marice and Louis over a quarter million dollars, which otherwise would had to be paid out in estate taxes. Milstein pressed on with accusations and claims of damages, surcharges and for interest against Linda in a total sum in excess of 1.2 million dollars. This was in addition to the $650,000 that the mother had left in her estate on her death, after paying her living expenses and litigation fees and expenses. Linda was subjected to an 8 day non-jury trial. In effect Judge Shapiro nullified the orders of the predecessor judges approving the various proceedings on the revocable trusts. A judgment of close to 1.3 million dollars was entered against Linda Linda was subjected to damaging interviews Milstein gave to the news media and with derogatory letters disseminated in Linda's neighborhood. Linda was forced to file for Chapter 11 bankruptcy to protect her and her husband's successful real estate business. These businesses had nothing to do with the revocable trusts into which Linda was drawn into out of consideration for her family.

Marice had undergone two open heart surgeries and suffered from breast cancer. A few months after the final judgment was entered in March 1998 she, died in August, 1998 at the age of 74. So, that she never enjoyed any benefit from the extensive litigation, except for receiving a substantial bill for legal fees. Milstein alone amassed legal fees in the substantial sum of $388,000 and a fee of $40,000 for the accountant. Linda finally reached a settlement but, Judge Shapiro's apparent main concern was that Milstein's and the accountant be paid in full the substantial fees and expenses they claimed. Linda was forced to settle the case with Mr. Milstein so that she could terminate the forced bankruptcy and move on with her life. She relinquished her right to what little was left, approximately $300,000 of her parent's 1.6 million dollar estate after all the other legal and professional fees and expenses were paid and a trust was set up for the mentally disabled brother Steven.