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In re Convervatorship of Vote

Court of Appeal of Iowa

November 20, 2013

IN THE MATTER OF THE CONVERVATORSHIP OF VERA MAE VOTE, Ward, CATHERINE KINSEY, Conservator-Appellant. IN THE MATTER OF THE ANCILLARY ESTATE OF VERA MAE VOTE, Deceased.

Appeal from the Iowa District Court for Dallas County, John D. Lloyd and Terry R. Rickers, Judges.

Attorney for personal representative appeals the court's order removing attorney and personal representative from the case.

Valerie Cramer of Cramer Law, P.L.C., Des Moines, for appellant.

John P. Roehrick of Gaudineer, Comito & George, L.L.P., West Des Moines, for appellee.

Considered by Vogel, P.J., and Danilson and Tabor, JJ.

TABOR, J.

This appeal involves the conservatorship and estate of Vera Vote. The district court removed the personal representative and her attorney. The attorney now claims the court failed to follow the procedures in Iowa Code section 633.65 (2009), and reached other incorrect determinations about the handling of the probate matters. Because we determine the court followed the statutory procedure for removal of a fiduciary and took the steps necessary to account for and maintain the assets of the estate, we affirm.

I. Background Facts and Proceedings

Dewey and Vera Vote, an elderly couple, lived in a Dexter, Iowa house titled in joint tenancy with rights of survivorship. Nancy Nevins, Dewey's daughter from a former marriage, also lives in Iowa. Catherine Kinsey, Vera's daughter from a former marriage, lives in Indiana. When Vera became ill with dementia she entered an Adel, Iowa nursing home. Dewey visited Vera regularly at the nursing home until he died in August 2010. That same month, Kinsey decided to move her mother to a nursing home in Indiana.

Kinsey hired Indiana attorney Stephen M. Gentry to assist in her Indiana application for guardianship of Vera. In October 2010 the Indiana court appointed Kinsey temporary guardian, followed by the court's November appointment of Kinsey as Vera's guardian [hereinafter Indiana guardianship].[1]Kinsey hired Iowa attorney Valerie Cramer to assist in the ancillary conservatorship of Vera in Iowa [hereinafter Iowa conservatorship].[2] Kinsey's November 3, 2010 Iowa petition states "the only assets in the Conservatorship are an old automobile and the real estate, " and a conservatorship is necessary to sell Iowa real estate.

On November 25, 2010, Vera died. On January 4, 2011, the Indiana court appointed Kinsey the personal representative of Vera's estate [hereinafter Indiana estate]. Kinsey's petition for appointment stated Vera died intestate. The Indiana court required Kinsey to file a $17, 000 bond.

In the Indiana guardianship, Kinsey filed a January 19, 2011 final account, report, petition to terminate guardianship, and request for guardian/attorney fees. Kinsey asserted "the guardianship does not have sufficient funds" to pay the fees, and requested the fees become a lien on Vera's Iowa real estate. Kinsey also asked the court to order "the Guardian [Kinsey] make [a] distribution of the balance shown on the final accounting to the personal representative of the Estate of Vera, " [also Kinsey]. An attached exhibit, "Guardian's Final Accounting, " showed total original assets of $75, 140. The Indiana exhibit stated:

[$69, 740(Iowa house) $2900 (car)

$2500("bank account, money, insurance payable to estate")]

Total Assets

Original

$75, 140.00

ADDITIONAL RECEIPTS

Sale of Chevy Impala

$2, 200.00

Social Security Retirement

$2, 184.60

_________

Total Assets

Estate

$77, 324.60[3]

DISBURSEMENTS

Decatur Township Care Center

$1, 061.60

Town of Dexter -house utilities

$247.75[4]

_________

Total Disbursements

$1, 309.35

RECAPITULATION

Original Assets

$75, 140.00

Adjustments-car sold for $2200

$700.00

Additions [matches social security]

$2, 184.60

_________

Total Assets

Estate

$77, 324.35[5]

Less Disbursements

$75, 315.25

DISTRIBUTION

Catherine Kinsey -Personal

Representative of [Vera Estate]

[Sources Unexplained]

Cash

$5, 575.00

Real Estate

$69, 740.00

Total Distribution

$75, 315.25

On February 7, 2011, the Indiana court approved Kinsey's final report and petition to terminate guardianship. The court found the guardian and attorney fees "reasonable" and ordered: "[D]ue to the unavailability of sufficient cash to pay, at this time, the fees of Kinsey [$3987.99], [6] Gentry [$2323.50], and Cramer [$3758.75] approved herein, any balance owed shall be a lien" on the Dexter, Iowa house. The order further provided: "The distribution made by the Guardian [Kinsey] of the balance shown on the final accounting to the personal representative of [Vera's estate—Kinsey] is hereby approved." Next, Cramer filed an "affidavit of foreign judgment" in Dallas County, Iowa CVCV36751 on March 22, 2011. In the affidavit Cramer identified Vera's Dexter, Iowa house, attached the foreign [Indiana] judgment, and listed the identical judgment creditors/amounts owed as listed in the February 7 Indiana court order terminating Kinsey's Indiana guardianship.

In the Iowa ancillary conservatorship case, Kinsey filed a March 22 final conservatorship report for November 9 to November 25, 2010. Kinsey requested: "On termination funds and assets of this Conservatorship will be distributed to Estate of Vera Mae Vote." The Iowa report stated: (1) $0 cash on hand, $0 funds received, $0 disbursements; and (2) $67, 000 total value of assets (Dexter house) of ward "at close of account period."[7] Also on March 22, 2011, the Iowa court approved Kinsey's final report and terminated the Iowa ancillary conservatorship.

In a separate March 22, 2011 Iowa filing, "application for appointment of personal representatives of nonresident estate, " Kinsey stated Vera died intestate owning real property in Iowa valued at $67, 000 [hereinafter Iowa estate].[8] Kinsey also stated the Indiana court had appointed her the estate administrator, and she requested the Iowa court appoint Iowan Karla Clendenen[9]co-personal representative. Kinsey asserted no bond is necessary because she posted a $17, 000 bond in Indiana, she is the sole heir, and "the only asset in Iowa is the house."[10] The Iowa court granted Kinsey's request on the same day. At the end of May 2011 the Iowa Department of Human Services (DHS) filed a claim in the Iowa estate case for more than $120, 000, citing Iowa Code section 249A.5(2).

On September 27, 2011, in the Iowa estate, Clendenen filed a "combined petition for authority to sell real estate and report of sale." The petition states: "Subject to the approval of the Court, the Administrator has accepted an offer from Brad Wildson to purchase the [Dexter house] for a total purchase price of $8500."[11] The petition further stated, "at the time of the sale, the property was severely distressed accounting for its sale price, " and "[a]ll interested persons have not consented to the sale of the Real Estate." Documents attached included the purchase agreement and the county's assessment of the house at $69, 740.

In an October 23, 2011 letter, attorney Jeffrey Bump informed the buyers Clendenen had good and marketable title to the Dexter house, subject to exceptions, including: (1) no order approving the proposed sale is shown as having been granted, and "I require that an order be entered authorizing the sale" and "authorizing the administrator to complete the sale"; (2) due to the large variance between assessed value and purchase price, "I require proof Notice of the Application to Sell this property and the hearing date has been given to the DHS, which has filed a significant claim in the estate"; and (3) the abstract reveals a judgment in favor of Gentry, Kinsey, and Cramer "filled March 22, 2011 and shown as case CVCV36751—I require this judgment be released of record."[12]

Immediately before the Iowa estate hearing on November 1, 2011, two relevant filings occurred. First, Nevins, Dewey's daughter, objected to the estate's request to sell the real estate and the request for extraordinary fees. Nevins contended she is Vera's heir "as shown by a copy of [Vera's] Will which was filed in this court. (See Ruling and Memorandum Order of December 8, 2010 – GCPR022273 [Iowa conservatorship])." Nevins argued there had been "no inventory filed or accounting of the proceeds received by the Conservator and counsel was on notice of such as well as the above-referenced Will" and no showing DHS was given notice of or consented to the proposed sale.

Approximately forty minutes later, co-administrator Clendenen filed a report and inventory she had signed on September 15, 2011, showing Kinsey as Vera's only heir at law. The report stated Vera owned real estate valued at $8500 and $14, 214.18 in a Wells Fargo bank account "at the time of death" for a total Iowa gross estate of $22, 714.18. The attached schedule J, "funeral expenses incurred in administering property in the gross estate, " listed $4673.68 funeral expenses, $654.28 administrative expenses, $4069.28 attorney fees, and $130.58 costs for total expenses of $9527.82.

At the November 1, 2011 Iowa estate hearing, attorney Colin Crow, not attorney John Roehrick, represented Nevins and attorney Cramer represented Clendenen. Clendenen testified the assessed value of the "land only" is $13, 700, the cost to tear down the house would decrease this land value, and no one bid at auction. During Clendenen's testimony, the following exchange occurred:

CRAMER: So, Your Honor, this is my bill, and I haven't even included the expenses it's going to cost me to close this real estate.
THE COURT: So is it your position that any real estate attorney handling the estate is entitled to extraordinary fees for the services rendered in connection with the sale of the real estate?
CRAMER: Yes, Your Honor.

During cross-examination, Clendenen stated she did not remember whether the $14, 000 Wells Fargo checking account included funds received by Vera's estate, and she had no knowledge "those funds were ever in Dewey Vote's name alone." Attorney Crow questioned Cramer about her bill, and Cramer first stated each of the charges on her bill constituted extraordinary fees, including preparation of subpoenas, phone calls with executors, the sale of the real estate, preparation of affidavits, and fees to obtain birth certificates. Cramer then stated she could probably agree the birth certificate fees were not extraordinary but "nothing else."

Nancy Nevins testified she had attempted to probate her father's estate twice and in the beginning she could not find his will. "The bond was not waived [by my siblings] when I couldn't find my dad's will, so it sat in limbo." She found her father's will "this summer in between some pictures at his house, not where my dad said it was." Nevins stated she has been appointed the administrator of her father's estate and does not yet have a full accounting of it. Nevins believes (1) Vera is one of Dewey's heirs in his will but not his sole heir, and (2) Dewey's will states Nevins is to be executor without bond. Nevins informed the court a "hearing is in fifteen days."

Regarding Vera's estate, Nevins testified: "We actually gave Vera's original will to the court December 8, 2010, and it has been totally ignored, and I think it's been ignored because I am an heir." Further, "there were never executors appointed in Vera's estate, only administrators, because again they continued to ignore the will that I sent to the judge and everyone else."

Regarding Cramer's attorney fee bill for Vera's estate, Nevins testified:

Q. And is it possible that the hours on Ms. Cramer's bill are not directly related to the time spent on Vera's estate but rather related to the lack of cooperation in Dewey's estate? A. Yes, actually the subpoenas were for my dad's estate records, not for Vera's. Vera does not have a checking account. She had dementia for a very long time.
Q. So the $14, 000 listed now in the checking account on the [Vera estate] report and inventory . . . do you [know] where that $14, 000 came from? A. I'm guessing because . . . [s]omeone took the money out of [Dewey's] account on August 30, 2011, and we do not have the records back from Wells Fargo yet who exactly did take it.
Q. So about the same amount that was taken out of your deceased father's account is now sitting in your mother's estate; is that correct? A. It appears so, yes.

The court's November 1, 2011 calendar entry order, "on the record made, " denied the application for extraordinary fees as premature, approved the application to sell real estate, and "authorized and directed" the administrator of Vera's estate "to complete the sale." Further, the court sua sponte ordered "no estate funds are to be moved out of the State of Iowa without prior court approval." On November 2, Clendenen executed a court officer deed transferring the Dexter house from Vera's estate to grantees Bradley J. and Teresa M. Waldron for $8500. The transaction was entered upon the auditor's transfer books on November 10, 2011.

Because numerous, additional filings in both the Iowa conservatorship case and the Iowa estate case are relevant to the district court's combined final order and to this appeal, we discuss the additional filings under subheadings in an attempt to avoid confusion.

A. Vera's Iowa Estate—ESPR022360.

On January 4, 2012, Cramer filed a "notice to court, " requesting the court take judicial notice of ...


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