Conservators mess up when they do not understand their role. New Tennessee law fixes that

by Amy Bryant 

Editorial: Mayor's big-hearted bad judgment

Mayor John Tecklenburg should have known better than to loan himself without court permission $80,000 from accounts he controlled as conservator for an elderly former neighbor. Probate Judge Irvin Condon was right to remove Mr. Tecklenburg from the conservatorship after his violation of state law.

Mishandling Johnnie Wineglass’ finances showed the job should have been done by a professional. The mayor, a real estate agent by trade, said he did not know he needed court permission to loan himself the money.

“I think you meant well, but we can’t set a precedent of self-dealing,” the judge told Mr. Tecklenburg on Tuesday. Mr. Condon’s remark about “self-dealing” particularly stung Mr. Tecklenburg and could have an impact on his professional life.

The mayor agreed to become the woman’s conservator in 2008 — for free — when she started losing her memory and became unable to manage her money. He took out loans of $20,000 in 2011 and $35,000 in 2014 to benefit his wife’s gift shop, which was later sold; a third loan of $25,000 was taken out in 2016 to help him cover living expenses as he transitioned into the job of mayor. All the loans were repaid on time, with 5 percent interest, including an additional $877.22.

Mr. Tecklenburg also used $25,000 of the woman’s money to buy an Edisto Island tax sale property in 2011 and then sold it back to the original owner, yielding a $3,000 profit for her. Special conservators appointed by the court called it a risky move with the potential of leaving the woman with property that could have been difficult to convert into cash to pay her bills.

In the end, no harm was done to Ms. Wineglass’ finances. And by all accounts, Mr. Tecklenburg took on the job out of the goodness of his heart. But he should have sought legal advice about lending himself money. It was a case of big-hearted bad judgment.

In his official capacity, we expect the mayor to be more careful. Mr. Tecklenburg is the leader of the state’s largest city and plays a major role in how it brings in and spends its funds. It’s critical that the public have confidence in his judgment as well as his ability to handle money and follow the law. He will need to work hard to earn back any confidence lost as a result of this episode.

A report prepared for the judge by the special conservators recommended Mr. Tecklenburg continue to manage the woman’s money, as did two of her goddaughters. But Judge Condon was right to remove the mayor from the job. Violating the law is reason enough, even if no harm was done. Being mayor affords Mr. Tecklenburg no special consideration, and the judge would be expected to handle similar cases in the same manner.

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Editorial: Mayor's big-hearted bad judgment

Judge rules Charleston mayor can no longer manage elderly woman's finances

Mayor John Tecklenburg (center)

Charleston County Probate Judge Irvin Condon decided Tuesday that Charleston Mayor John Tecklenburg can no longer serve as the manager of an elderly woman's finances after finding Tecklenburg made loans to himself from her funds without getting prior approval from the court, which violated state law.

The judge’s decision came after professional conservators appointed to review the details of the case recommended that Tecklenburg be allowed to continue serving as conservator for the woman, Johnnie Wineglass, who is 93. 

Condon disagreed.

"I think you meant well, but we can't set a precedent of allowing self-dealing," Condon said.

In legal terms, self-dealing is when a trustee takes advantage of their position for their own personal gain. The law says "any transaction which is affected by a conflict of interest is void unless the transaction is approved by the court after notice to interested persons and others as directed by the court."

The judge temporarily suspended Tecklenburg from handling Wineglass' funds in an order filed May 1, explaining that the details of the loans were unclear and needed to be reviewed further. The hearing Tuesday was to determine whether those financial documents showed self-dealing, and whether Tecklenburg should be removed or reinstated as conservator.

Tecklenburg took out three loans totaling $80,000 over five years. He borrowed $20,000 in 2011 and $35,000 in 2014 for his wife Sandy Tecklenburg's gift shop, Meeting Street Gallery; and one personal loan in the amount of $25,000 in 2016.

He repaid each loan in full with 5 percent interest before taking out the next loan. Tecklenburg incidentally paid about $877 more than he owed in interest.

He said in a written statement to the court that the interest rate he paid is comparable to a rate he'd pay if he had borrowed the money from a bank.

"My intent with regards to each of these loans was to supplement and grow the limited funds that I was handling for Ms. Johnnie," he said in the report submitted to Condon.

Tecklenburg also purchased a tax sale property on Edisto Island in 2011 with $25,000 of her funds and sold it back to the original owner. The transaction yielded a $3,000 profit for Wineglass.

The special conservators appointed by the court, Catherine Kennedy of Columbia and Ayesha Washington of Charleston, noted in their report that it was a risky move.

"Ms. Wineglass could have been left with real estate that might have been difficult to convert to cash to pay her bills," they wrote.

Wineglass is a former neighbor of the Tecklenburgs and is now in an assisted-living facility. She did not appear in court, but several relatives and godchildren wrote letters to the judge asking that Tecklenburg remain serving as the manager of her finances.

The special conservators, who were appointed for their expertise in probate law, agreed with the family members. Kennedy served as probate court judge in Columbia from 1987 to 1999.

"Although he violated the law, his stated intent was to benefit Ms. Wineglass, and ultimately she was repaid with substantial return exceeding bank interest," they wrote.

They also noted that Tecklenburg is not a lawyer and wasn't represented by one when taking on the conservatorship about a decade ago.

Condon offered Tecklenburg the chance to testify, but he declined.

Reached by phone hours after the hearing, Tecklenburg said the judge's decision took him by surprise.

"I thought he would follow the special conservators' advice," he said. "It was just like his mind was made up. I just respectfully disagree with his opinion."

Condon said the case was difficult for the court, but he did not think Tecklenburg had acted as a responsible conservator as he had made "risky investments" with Wineglass' funds.

"It appears Mr. John Tecklenburg meant well, and did good deeds for the protected person, Ms. Johnnie Wineglass," he said. "But one cannot do a good deed and then take advantage of your position as fiduciary. A fiduciary does not make loans to himself and family-controlled businesses without court approval, especially unsecured loans."

He also indicated that Wineglass herself wanted Tecklenburg removed from the role.

The judge cited a letter he received in January 2009 from attorney Kevin Eberle, who had been Wineglass' next door neighbor for 13 years. A month earlier, Tecklenburg was appointed temporary conservator. In the letter, Eberle said he was concerned because Wineglass had come to him, upset, and "adamant that she did not want Mr. Tecklenburg to serve."

In April 2009, four months after Condon received that letter, Tecklenburg was appointed permanent conservator for Wineglass.

Eberle said late Tuesday that at the time he raised those concerns, he did not realize Wineglass' mental state was deteriorating.

"I wish I had the benefit of hindsight," he said. "I regret that Judge Condon would not have picked up the phone and called me."

In his ruling Tuesday, Condon ordered Tecklenburg to cover all the court fees associated with the case. The judge said he would not be referring the case to another court for further prosecution. Tecklenburg has the right to appeal the decision within 10 days.

Tecklenburg said he didn't know if he would appeal. He's waiting to see a copy of the judge's written orders.

Wingate said one reason they might appeal is because the conservators did not find proof of self-dealing after reviewing the extensive financial records. A court order that suggests otherwise might have wide-ranging consequences for Tecklenburg, who is a real estate agent by trade.

"In his profession, he might have to answer questionnaires from insurers or entities he enters into contracts with (that ask) 'Have you ever had any form of violations under the law?' He might have to answer, 'Yes,' " Wingate said.

In an interview with the newspaper in May, Tecklenburg explained how he became the conservator for Wineglass in 2008.

She became a close family friend when they lived next to each other on Moultrie Street near Hampton Park. After the family moved elsewhere, Tecklenburg said he continued checking on her periodically.

On one visit, he discovered Wineglass had fallen victim to a series of telephone scams and had gone into significant debt. That's when he decided to help her sort out her finances, which he said was like a part-time job for the first few years.

He never charged Wineglass any fees for his services.

Once the house was sold and her debt paid off, she moved into a full-time care facility. The money she had left was about $50,000.

Tecklenburg said his goal was simply to grow that small fund so she could continue paying for her care.

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Judge rules Charleston mayor can no longer manage elderly woman's finances