Court Opinion

ID: 2822552
Source: CourtListenerOpinion
Date Created: 2015-07-30 21:21:28.820094+00
Date Added: 2024-06-11T13:37:16.767538
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT

                            NEAL SIMMONS,
                               Appellant,

                                     v.

             ESTATE OF DR. ADRIENNE S. BARANOWITZ and
                  MERRILL LYNCH TRUST COMPANY,
                             Appellees.

                     Nos. 4D13-4503 and 4D14-746

                              [May 6, 2015]

   Consolidated appeal from the Circuit Court for the Fifteenth Judicial
Circuit, Palm Beach County; Martin Colin and Edward Garrison, Judges;
L.T. Case No. 502011CP001024XXXXSB.

   John P. Fenner, Boca Raton, for appellant.

  Gary L. Rudolf of Rudolf & Hoffman, P.A., Fort Lauderdale, for appellee
Merrill Lynch Trust Company.

GERBER, J.

    The estate’s personal representative appeals from several of the circuit
court’s orders disposing of the estate. We affirm all of the orders except
for one portion of an order directing the personal representative’s counsel
to disgorge fees which the court determined to be excessive. In the appeal
of that portion of the order, the personal representative argues that the
court had no personal jurisdiction over counsel to compel the
disgorgement of fees. We agree and reverse on that argument only.

   We summarize the pertinent portions of the court’s findings of fact and
the record before turning to the jurisdictional question.

   The personal representative filed a petition for discharge and final
accounting. The accounting indicated that the personal representative
and his counsel received certain amounts as compensation for their
services.
   The trustee of the decedent’s trust filed objections to the accounting,
as well as a petition to review the compensation which the personal
representative and his counsel received. The trustee argued that the
compensation received was excessive in relation to the compensable value
of the estate and that any excessive compensation should be refunded.
See §§ 733.617(1) & 733.6171(3), Fla. Stat. (2010) (respectively providing
that compensation to the personal representative and counsel shall be
based on “the compensable value of the estate”).

   The court held an evidentiary hearing on the objections and petition.
At the hearing, the personal representative, through counsel, argued that
the court lacked jurisdiction over counsel because counsel was not a party.
The personal representative and his counsel then presented evidence in
an attempt to support the compensation which they received. See §
733.6175(3), Fla. Stat. (2010) (“The burden of proof of propriety of the
employment and reasonableness of the compensation shall be upon the
personal representative and the person employed.”).

   Following the hearing, the court entered an order determining that the
compensation which the personal representative and his counsel received
was excessive. The court ordered the personal representative and his
counsel to disgorge those amounts which the court determined to be
excessive.

    This appeal followed. The personal representative argues, among other
things, that the court had no personal jurisdiction over his counsel
because his counsel never was served with initial process by a summons
or formal notice.

   We agree, pursuant to our recent decision in Kozinski v. Stabenow, 152
So. 3d 650 (Fla. 4th DCA 2014). There, three sisters were beneficiaries
under their mother’s will and trust. Two of the sisters filed a petition to
review the compensation of the third sister in her capacity as personal
representative and trustee. The petition asked the court to determine the
reasonableness of the compensation and also “to enter such surcharge or
disgorgement orders as are warranted.” The petition was not formally
served upon the personal representative/trustee, but was sent via e-mail
service to her counsel.

   The personal representative/trustee filed a motion to dismiss arguing,
among other things, that the sisters failed to invoke the court’s personal
jurisdiction over her where they sought surcharge and disgorgement
against her in her individual capacity.       According to the personal
representative/trustee, a surcharge action, which is based on a breach of

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fiduciary duty, was an adversary proceeding which required formal notice
or a complaint served under the Florida Rules of Civil Procedure in order
to obtain personal jurisdiction over her individually.

   The sisters disagreed and argued that the petition was not an adversary
proceeding and did not require formal notice. The sisters maintained that
the remedy of a “refund” was indistinguishable from a “surcharge,” and
asserted that the court already had jurisdiction over the personal
representative/trustee by virtue of her initial pleadings.

   The trial court denied the motion to dismiss, but we reversed. We
agreed with the personal representative/trustee’s argument that “the
remedy of ‘surcharge’ sought in the [sisters’] petition against her
individually constituted an adversary proceeding requiring service by
formal notice under the Florida Probate Rules in order for the probate
court to have personal jurisdiction over her individually, as opposed to
personal jurisdiction over her as personal representative or trustee.” Id.
at 651.

   Here, as in Kozinski, the remedy sought in the petition against the
personal representative’s counsel was against him individually. Therefore,
service by formal notice under the Florida probate rules was required for
the court to have personal jurisdiction over him.

    The trustee argues that service by formal notice is not required because
the Florida probate code gives a court the authority to review the propriety
of any compensation paid to a personal representative’s employee and, if
that employee has received excessive compensation, to order that
employee to make appropriate refunds. See § 733.6175(1), Fla. Stat.
(2010) (“The court may review the propriety of the employment of any
person employed by the personal representative and the reasonableness
of any compensation paid to that person or to the personal
representative.”); § 733.6175(3), Fla. Stat. (2010) (“Any person who is
determined to have received excessive compensation from an estate for
services rendered may be ordered to make appropriate refunds.”);
Richardson v. Jones, 508 So. 2d 739, 740 (Fla. 2d DCA 1987) (rejecting
counsel’s argument that because the personal representative paid him
personally, rather than having been paid from the estate, the court had no
authority to order a reimbursement; “The court’s order simply carries out
its obligation to review and determine the reasonableness of compensation
to be paid to an attorney for a personal representative.”).

   We disagree with the trustee’s argument. We recognize that the Florida
probate code gives a court the authority to review the propriety of any

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compensation paid to a personal representative’s employee and, if that
employee has received excessive compensation, to order that employee to
make appropriate refunds. See §§ 733.6175(1) & (3), Fla. Stat. (2010).
Here, however, the issue is not the court’s authority to act, but the manner
by which the court notifies the employee that action may be taken. As we
held in Kozinski, service by formal notice is required.

   Based on the foregoing, due to the lack of service by formal notice on
the personal representative’s counsel, we reverse that portion of the circuit
court’s order directing counsel to disgorge fees which the court determined
to be excessive. We remand for further proceedings upon service by formal
notice upon the personal representative’s counsel.

   Affirmed in part, reversed in part, and remanded.

WARNER and MAY, JJ., concur.

                            *         *        *

   Not final until disposition of timely filed motion for rehearing.

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