In a stunning ruling, a California appellate court on Thursday declared that a Silicon Valley trustee and his two attorneys are not entitled to a penny of compensation, after a years-long dispute over their six-figure bill to briefly manage a disabled San Jose man's life savings.
The decision is a major victory for Danny Reed, a brain-injury victim whose story was featured in July in this newspaper's investigation "Loss of Trust" -- an exposé of how the Santa Clara County Superior Court long allowed estate managers to receive outlandish fees for their court-appointed duties serving the disabled and elderly.
Not only was the ruling major vindication for the 37-year-old man who waged a rare fight against powerful interests in the local courts, it also sets legal precedent that strengthens the rights of others to maintain control of their court-overseen trusts.
"This is much bigger than me," Reed said Thursday. "It's for all the people who can't understand what's going on. This is something that will help them too."
Reed's life became entangled in Santa Clara County's probate court after a pair of accidents left him partially disabled. The money he received in legal settlements was set aside in a special needs trust overseen by a judge.
While Reed never sought help, a probate judge appointed trustee Thomas Thorpe in 2010 to temporarily oversee Reed's trust -- including $650,000 and a townhouse -- when questions arose over his mother's handling of the funds.
Thursday's opinion, written by 6th District Court of Appeal Acting Presiding Justice Eugene Premo, reversed a lower court's order that Reed's trust must pay $51,285 to Thorpe and his two attorneys, Diane Brown and Michael Desmarais. The trio originally sought $108,771 for Thorpe's 4½ months on the job.
The appellate court said the judge had the power to appoint Thorpe but should not have awarded him and his attorneys any fees, because the trust document included a provision that explicitly denied any new trustees payment for"> their services. That was a provision of Reed's trust document that Thorpe and his attorney had tried unsuccessfully to change.
Thursday's ruling, however, did not address another $146,000 in fees that the lower court ruled Reed's trust must pay Desmarais for his work defending Thorpe's original bill. That dispute is part of a second case that the appellate court is still to consider.
It remained unclear whether Thorpe would appeal the ruling to the state Supreme Court. Calls to Thorpe and his attorneys were not returned.
Full Article and Source:
Appellate Court: Disabled San Jose Man Owes Nothing to Trustee and Attorneys in Bitter Probate Dispute
Document: Ruling in Favor of Danny Reed
San Jose Appeals Court Justice Accuses Estate Trustee of 'Feeding Frenzy'