** Courts & Lawyers Bilk Elderly 1 / 2
J.A.I.L. News Journal
Los Angeles, California May 27, 2001Courts And LawyersBilking The Elderly
What you are about to read is two parts of a series by the New York Daily News of a shocking report on how the wealthy and most politically well connected in the legal system are stripping those least able to protect their interests. Well spoken are the words of an 5/3/01 editorial which we will use to lead into this sordid affair. A second article will follow in the next J.A.I.L. News Journal.
-Ron BransonNEW YORK DAILY NEWS
Ideas & Opinions
Protect, don't fleece, helpless seniors
Few indicators tell more about a society than how it treats its elderly. By that measure, New York City is failing miserably. The latest outrage involves legal "protection" of the incapacitated or those deemed to be so. It's a nasty story of politically connected lawyers who are tapped by politically connected judges to serve as guardians. And who proceed to devour their clients' assets.
As revealed in chilling detail in a Daily News probe, a cottage industry in lucrative conservatorships has arisen in our city. Lawyers appointed by the courts are depleting legally the life savings of the
elderly and infirm by billing millions in inflated fees. Sworn to protect those most alone in the world, hundreds of attorneys instead grub fee after unreasonable fee, enriching themselves and stripping their wards' bank accounts.
Seniors Taken for Millions
Lawyers rack up fat fees
as guardians to the helpless
By THOMAS ZAMBITO, RUSS BUETTNER and JOE CALDERONE
Daily News Staff Writer
Court-appointed lawyers are siphoning off millions of dollars in fees from the assets of helpless elderly New Yorkers they are sworn to protect.
Nine years after a legislative overhaul of the state's guardianship laws, reforms meant to protect the assets of the elderly have had the unintended effect of creating a money trough for well-connected attorneys.
Since 1993, New York-area attorneys have been paid at least $63 million in fees from the assets of mostly elderly people whose money they were assigned to protect, according to a Daily News computer analysis of data provided by the state.
A News investigation into the guardianship system has found:
- Case after case of elderly wards whose life savings have been whittled away. Some lawyers are charging $300 an hour or more to perform routine functions, such as going over bank statements.
- A small cadre of lawyers — party loyalists, former judges and partners in the firms of some of the city's most powerful politicians — who receive the overwhelming majority of lucrative guardianship cases.
- Attorneys and judges who routinely ignore court rules designed to limit the number of guardianship-related appointments to no more than one per year that pays $5,000 or more.
- Judges and lawyers who do not report all guardianship appointments and legal fees to the state's Office of Court Administration. Court officials acknowledge many fees go unreported, a problem they say they are trying to correct.
- Few lawyers who are willing to take on the cases of those elderly people, often in nursing homes and without court-appointed guardians or family, with little or no assets.
Although many court-appointed guardians handle their duties ably, the guardianship system has produced a legal feeding frenzy, particularly in contested cases where there is considerable money involved.
Last year, for example, a Manhattan judge approved nearly $330,000 in attorneys' fees from $900,000 in assets that belonged to elderly Holocaust survivor Aron Katz.
Attorneys in Brooklyn are seeking more than $200,000 in legal fees from the estate of Tony Mafoud, the deceased owner of a Brooklyn pita empire.
Two years ago, a Queens judge awarded more than $360,000 in fees from the assets of a 94-year-old Queens woman. Among those receiving money were two well-connected Queens Democrats.
Fees are often requested for duties that have little or nothing to do with preserving the assets of elderly clients.
Attorneys in one guardianship case from the same law office billed for drafting and reading the same internal memo. Another attorney in a different case billed $37.50 to leave a phone message.
Last year, one guardian received $1,100 for challenging another attorney's fee request.
Hospitals or nursing homes often seek a guardian to be appointed so that someone can apply for Medicaid on behalf of the patient. Nursing homes and hospitals want the private money spent down so they can get this person Medicaid eligible," one judge told The News. "That's the attitude in court."
Billing Out of Hand
The News also uncovered cases in which a dozen or more attorneys have been appointed, each separately billing against the assets of incapacitated clients.
Manhattan Supreme Court Justice Lorraine Miller, for example, turned down fee requests from six attorneys representing the children of a 95-year-old woman with a $2.3 million fortune who needed a guardian after she was found wandering the streets of her upper East Side neighborhood searching for her young children.
The firm's two partners submitted bills for $415 and $395 an hour, one associate wanted $240 an hour and two others $230 and $220 an hour for a total of 230 hours on "a relatively simple matter."
Miller said that when two or more partners or associates conversed in person or by telephone in the same office, all billed for their time.
"It has become apparent," Justice Miller declared in a recent decision, "that where there is an estate of some size an unintended result has been to create a 'cottage industry' with fees for evaluators, fees for petitioner's attorneys, fees for geriatric social workers and physicians and fees for an attorney for the alleged incapacitated person."
The News investigation also revealed many guardianship appointments go to a handful of lawyers.
Two — Lois Rosenblatt and former Queens Appellate Division Justice Joseph Kunzeman — have received more than 200 appointments in the past 10 years. Fifteen other lawyers got 100 or more appointments in the same period, according to The News computer analysis. An additional 27 New York-area lawyers have received 75 or more cases. ....
Increasingly, judges involved in appointing guardians themselves question whether the system works to benefit their wards — or the increasing number of lawyers making a living pursuing such cases. "You wonder, are you making an appointment merely for the purpose of churning a fee?" one judge told The News.
"Experts are brought in, fees are generated. This lawyer gets a fee, that lawyer gets a fee. A doctor gets a fee. Is it being done to protect [a ward] or is it being done to generate patronage for someone? That's the question."
When a court determines someone is incapacitated, guardians are appointed to watch over their finances, visit them and oversee their medical care.
The 1992 reforms, however created more jobs for attorneys, including a court evaluator to recommend whether a guardian is necessary and a lawyer to represent the interests of elderly clients.
The intent was to give judges more power to oversee the affairs of people unable to take care of themselves. But the changes created more fees for attorneys, particularly in hotly contested cases. ...
"It's completely crazy," said Booth Glen, a former Manhattan judge who helped draft changes to the guardianship law. "The solution bears no relationship to the problem." ....
The issue of inflated fees was reignited last year when two Brooklyn attorneys wrote a letter to district Democratic leaders saying they'd been frozen out of key court appointments despite unquestioned loyalty to the party.
After the letter surfaced, the state's chief judge, Judith Kaye, empaneled a commission on fiduciary appointments and opened an investigation into whether judges have rewarded cronies with plum assignments. A report expected to recommend legislative changes will be issued later this year.
"A lot of us have felt that the statute needed to be tinkered with," said Jonathan Lippman, state chief administrative judge. "There was not enough feedback when it was first introduced. But it's too much to say that the statute itself led to the [questionable] appointments. The problem may be with the application." The result is that attorneys too often charge large fees for small tasks. ....
Original Publication Date: 5/20/01
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