Mastro Case: Judge Says Guardian Can't be Paid From Funds for Creditors

A federal bankruptcy judge closed a short, strange chapter Tuesday in the long-running bankruptcy saga of former Seattle real-estate magnate Michael R. Mastro.

Judge Marc Barreca turned down a bid by the guardian for the now-incapacitated Mastro to pay her, and her lawyer, from funds administered by Mastro's chief adversary, court-appointed trustee James Rigby.

That's the same pot of money from which Mastro's many creditors might one day recover a fraction of their losses. The bankruptcy is Washington's largest ever, with Mastro reporting debts of $570 million.

Mastro's guardian, former state Supreme Court Justice Faith Ireland, asked last week for compensation from Rigby's funds because she said Mastro couldn't pay her. She also said she needed her own lawyer because Mastro's longtime attorney had a conflict of interest:

As guardian, she argued, she's required to act in Mastro's best interests. However, she added, Mastro's lawyer is obligated to follow Mastro's instructions from before he was incapacitated — even if they aren't in his best interests.

Ireland's lawyer, Mark Walters, acknowledged in court that the proposal and circumstances were "incredibly unusual — I almost can't believe it."

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Judge Says Mastro Guardian Can't be Paid From Funds for Creditors

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