Over the next couple of articles, I want to talk about a disgusting example of a breach of fiduciary duty that was ruled on in the Circuit Court of The Sixth Judicial Circuit in and for Pinellas County, Florida at the end of February of this year. The case in question (Edward Reid Mcdaniel, plaintiff, Vs. Tania Nichole Drapp and Michael Roland Streiff, defendants) will leave you shaking your head – as it should – but it is also the perfect commentary on the importance of a probate attorney when you are going through the probate process.
Let’s Begin with a Quick Recap of What a Breach of Fiduciary Duty Actually Means…
When we talk about fiduciary duty, we are talking about one person or company’s obligation to act in the best interest of someone else while managing their property or assets. For example, a financial advisor has a fiduciary duty to provide sound financial advice that is in the best interest of their client.
A breach of fiduciary duty, however, is a failure on the part of this person (the fiduciary) to carry out this duty with a high standard of care. For example, if that same financial advisor mentioned above were to advise investing in a company that is owned by a friend so that they can make personal gains rather than carry out their duty to provide sound financial investment advice.
Fiduciary Duty As It Applies to Probate Court
We can apply the term “fiduciary duty” to a variety of occupations and scenarios, but when applied in the context of probate court, it is generally used to define the duties of the executor of the estate.
It is the duties of an estate executor to process the estate of the deceased via probate court to the best of their ability with their fiduciary duty in mind. This duty includes the inventory and appraisal of the estate as well as keeping an accurate record of the expenses of administration so that they can be reimbursed by the estate of the deceased.
When the executor of an estate carries out their responsibility as they should, they have carried out their fiduciary duty and the estate of the deceased is closed and the assets are distributed among the beneficiaries.
If an executor of an estate is suspected of failing to carry out their fiduciary duty, however, they are contested in the court by the beneficiaries of the estate and given a chance to defend the topic of contention. The probate judge then makes a finding based on the evidence before them.
Should the executor of the estate be found to have breached their fiduciary duty by failing to act in the best interests of the estate, they will be relieved of their duty and fined as well as made to repay the money that was mismanaged.
Preventing Misconduct by Estate Executors
Preventing misconduct by estate executors is obviously in the best interest of the estate in question and the best way to do this is to retain a probate attorney.
There are three ways in which a probate attorney can come into play with the processing of an estate through probate court.
Firstly, when writing your last will and testament, it is possible to have a probate attorney serve as the executor of your estate. This is not the solution for everyone, but if you have a particularly large estate and have a trusted attorney, you may choose to name them as executor. When you take this avenue, your attorney not only has a fiduciary duty to your estate, but they have experience with the system and a lot more to lose if they do not carry out their duty as required of them.
Secondly, if you are named as the executor of an estate, you can hire a probate attorney to help you to navigate through the probate process. Having an attorney by your side will ensure that the probate process goes as required by law and help you to keep proper accounting and proper records so that should your fiduciary duty be questioned, you can provide reliable evidence that you carried out your duty as required under the advice of a legal professional.
Thirdly, if you are named as an executor of an estate and you know that you need assistance, but you can manage a large portion of the executor role yourself, you can hire a probate attorney to provide you with limited advice. In this role, an attorney will serve as a consultant who can advise when you have questions and take a “backseat” role.
Why Are We Talking About the Breach of Fiduciary Duty?
Today’s article focused on the topic of fiduciary duty and the breach of that duty to lay a foundation of understanding for tomorrow’s follow-up article. In tomorrow’s article, I will focus specifically on the case of Edward Reid Mcdaniel, Plaintiff, Vs. Tania Nichole Drapp and Michael Roland Streiff, Defendants, as it played out in the Florida civil court. I will discuss how vitally important it is to really know who you are handing over the responsibility of your care to and how, when Edward Reid McDaniel’s daughter grossly neglected her fiduciary duty to her father, the Florida civil courts stepped in…