Court Determined the Global Settlement Agreement Contained Clear Terms

The case of Bivins v. Guardianship of Bivins, No. 4D16-234, 2017 WL 1908386 (Fla. 4th DCA 2017) raises two issues on appeal. First, whether a trial court must enforce a settlement agreement, concerning the assets of an incompetent ward, where the guardian retained some assets to pay guardianship expenses. Secondly, whether upon the death of a ward, a guardian may retain part of deceased ward’s assets to pay for present and future guardianship expenses.

Oliver Bivins, the ward, had a personal guardian appointed when he was declared incompetent. In the following years, litigation continued between the ward’s guardian and the ward’s child, Julian Bivins. The ward died in 2015, and the guardian and Julian entered into a Global Settlement Agreement.

The Global Settlement Agreement dealt with real property in New York City. The Global Settlement Agreement allowed Julian to purchase the property for $5,000,000, so long as he committed to stringent time constraints. If Julian decided to purchase the property, the Agreement determined how the ratio of the proceeds of the purchase were to be used. Under the Agreement, Ciklin Lubitz & O’Connell law firm would act as the escrow agent, holding $150,000 in trust for debts owed to the law firm of Levine & Susanceck, and $125,000 for guardianship expenses. Additionally, the Agreement stated that part of the proceeds were to pay the attorney’s fees and costs of the law firm of Beys Stein Mobargha & Berland, LLP pursuant to a court order. The Agreement did not specifically allow any of the proceeds to be held in escrow by Beys Stein. The Agreement instead directed all remaining proceeds to be transferred to a trust located in Texas. Julian complied with the Global Settlement Agreement and purchased the property located in New York.

Julian became the temporary administrator of the wards estate when the ward died.  Julian requested that the guardian file a final report. The final report indicated that, pursuant to the agreement, Ciklin Lubitz & O’Connell held $150,000 in trust for fees due to Levine & Susaneck and $125,000 for guardianship expenses. Ciklin Lubitz & O’Connell also held an additional $400,994.35 for the guardianship matter. The guardian held $155,383.51 for the ward’s assets in a Wells Fargo checking account that were not proceeds from the sale of the New York property. During trial, Julian learned that Keith Stein and Beys Stein Mobargha & Berland, LLP, held back $72,433.94 from the sale of the New York Property, as they asserted to have acted as closing agent for the transaction.

Julian moved for release of all the ward’s monies being held back, arguing that the Agreement mandated the transfer of the $400,994.35 and the $72,433.94, as they were proceeds from the sale of the New York Property.  Additionally, Julian asserts that other money in the guardian and his attorney’s possession should be transferred to the deceased ward’s estate. The guardian counters Julian’s argument stating that the money was necessary to pay for the guardian’s expenses and fees as Julian had brought multiple lawsuits against the guardian and his attorney’s after the ward had died.

The trial court ordered the guardian to release the $400,994.35, but permitted the guardian to retain the $72,433.94 held in escrow by Stein, and the $185,000 held in escrow by Ciklin Lubitz & O’Connell, and the $155,383.51 held in the guardian’s Wells Fargo account. Julian sought to appeal this order.

Regarding the first issue, Julian asserts that the trial court erred because the Global Settlement Agreement did not permit Stein to retain the $72,433.94 from the proceeds of the New York property sale. The court looks to determine whether the trial court could act contrary to the Global Settlement Agreement and the Court of Appeals reviewed this issue de novo. “In Florida, settlement agreements are ‘highly favored’ ‘and will be enforced when it is possible to do so.’ ” U.S. Bank Nat’l Ass’n v. Benoit, 190 So.3d 235, 237 (Fla. 4th DCA 2016) (quoting Treasure Coast, Inc. v. Ludlum Constr. Co., 760 So.2d 232, 234 (Fla. 4th DCA 2000)). “Where the contractual language is clear, courts may not indulge in construction or modification and the express terms of the settlement agreement control.” Sec. Ins. Co. of Hartford v. Puig, 728 So.2d 292, 294 (Fla. 1999).

In the case at bar, the Global Settlement Agreement is clear. Although the Global Settlement Agreement states proceeds from the sale of the New York property were to pay the law firm of Beys Stein Mobargha & Berland, LLP’s prior legal fees, nothing in the Global Settlement Agreement provides that Stein could hold any of the proceeds in escrow.

The second issue that Julian contends, is that because the ward has died, the ward’s estate should take control of the ward’s property pursuant to Florida Statue 733.607(1). A guardian “is entitled to a reasonable fee for services rendered and reimbursement for costs incurred on behalf of the ward.” § 744.108(1), Fla. Stat. (2016). When a guardian seeks discharge, “[t]he guardian applying for discharge may retain from the funds in his or her possession a sufficient amount to pay the final costs of administration, including guardian and attorney’s fees regardless of the death of the ward, accruing between the filing of his or her final returns and the order of discharge.” § 744.527(2), Fla. Stat. (2016).

In Romano v. Olshen, 153 So.3d 912, 920–21 (Fla. 4th DCA 2014), this court held that the death of a ward does not terminate a guardian’s access to the ward’s property. We reasoned that “[t]he guardian of property is not discharged upon the ward’s death, but must continue the administration until a petition for discharge is granted and his or her final accounting is approved.” Id. at 920. Thus, “Chapter 744 contemplates that a guardian will perform services and be able to access the guardianship estate even after the death of the ward.” Id.

Julian uses both the Romano case and Florida Statue Chapter 744 to argue that only the retention of monies to pay for past and current guardianship expenses is permitted, not for future expenses. However, Florida Statue Section 744.527(2) provides in relevant part that “he guardianship may retain funds to pay for fees “accruing between the filing of his or her final returns and the order of discharge.” Thus, the statute “contemplates that a guardian will perform services … after the death of the ward.” Therefore, a guardian may retain funds needed to pay for future fees and costs that accrue during the process of concluding the guardianship estate.

Additionally, the court relied upon Julian’s use of the case, Batzle v. Baraso, 776 So.2d 1107 (Fla. 5th DCA 2001), which held that “a probate court may not indefinitely extend a temporary plenary guardianship after a ward has died.” Presently, in this case, the guardian does not seek to extend the guardianship, but rather retain part of the deceased ward’s funds so as to pay the guardian’s fees and costs. Consequently, under Chapter 744, the guardian is permitted to retain these types of funds. 

The appellate court holds that $72,433.94 must be transferred into the trust account in Texas pursuant to the parties Global Settlement Agreement. Additionally, the remainder of the lower court’s order is affirmed.

NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL

If you or anyone you know is in need of representation in actions involving Guardianship, Probate and/or Trust Disputes, or questions pertaining to such proceedings, please contact The Law Offices of Glenn M. Mednick, P.L., at (954) 315-1154 or gmednick@mednicklawgroup.com.