In re Estate of Miller, 243 S.W.3d 831 (Tex. App.—Dallas 2008, no pet. h.).
Removal of Executor & Return of Fees
Attorney was named as the independent executor of his great-uncle’s will. Before being appointed by the court, he entered into a fee agreement with Beneficiary that include provisions for Attorney to receive a contingency fee. After being appointed, Attorney hired himself as the attorney for the estate. Attorney was not a beneficiary of the will nor was he entitled to a fee under the terms of the will. Attorney filed the inventory over one year late. Later, he sold some of the estate property taking almost $100,000 in “compensation.” (Note that experts testified that Attorney’s services were worth about $5,000). Beneficiary filed an ancillary action to have Attorney removed as the executor alleging that Attorney grossly mismanaged the estate. For example, Attorney lent estate money to one of his other clients and did not pay property taxes causing the property to be scheduled for foreclosure. The trial court agreed, removed Attorney, and ordered him to reimburse the estate for the fees he received. Attorney appealed and the appellate court affirmed.
The court reviewed Attorney’s actions and found that they amounted to gross mismanagement of the estate under Probate Code § 149C. For example, he unnecessarily delayed performing the administration of the estate, he improperly made excessive fee payments to himself, he lent estate property to a client without receiving a promissory note or collateral, and he did not make property tax payments.
Note: The court included a detailed discussion of why it was proper for the trial court to exclude evidence supporting Attorney’s fee claim.
Moral: An attorney serving as a personal representative should not mismanage the estate. The attorney should not charge excessive fees, make late filings, drag out the administration of the state, lend estate property to others, or otherwise breach fiduciary duties.