GUARDIAN OF PERSON REMOVED FOR SELF-DEALING AND BREACH OF FIDUCIARY DUTIES
The court permanently removed accountant Gloria Byars as guardian of the estates of two elderly persons where she was engaged in self-dealing and breached her fiduciary duties and imposed a surcharge for her misconduct, while also warning the Philadelphia Corporation for Aging to conduct due diligence before nominating guardians to protect the elderly and incapacitated. The court sustained objector’s objections.
The Philadelphia Corporation for Aging, or PCA, petitioned for adjudications of incapacity and appointment of a plenary guardian of the persons and estates of Margareta and Edmund Berg. After hearings, the court found that the Bergs were incapacitated and in need of guardianship services. PCA proposed accountant Gloria Byars. Margaret’s brother, and objector herein, did not oppose accountant’s nomination. Shortly thereafter, accountant moved the Bergs from their home to an assisted living facility. She filed a petition for leave to sell their home and sought court authorization to make various expenditures of principal from the Bergs’ estate, including $11,500 to be paid to DEPCO, LLC, the company she hired to clean out the Bergs’ home. Objector filed an answer, asserting that the proposed sale price was substantially below fair market value. In new matter, he sought accountant’s removal, revealing that accountant’s husband owned DEPCO, LLC and that she had been convicted of multiple counts of passing bad checks in Virginia. At a hearing, accountant gave what the court described as “gravely concerning” testimony which rendered her claim that she properly administered the Bergs’ estate not credible. The court permanently removed accountant as guardian and ordered her to file a formal accounting. Accountant failed to appear at a hearing on the remaining objections and her attorney, who did appear, could not explain accountant’s absence. Objector noted there was no documentation to support the validity of substantial payments to home health aides. He also introduced evidence that accountant wrote three checks from the Bergs’ account to someone named Asia Jones and then endorsed the checks to herself. The checks were later cashed through a check-cashing service. “It is virtually beyond question that the combined $34,112.80 that account paid to her company, herself, and the home health aides without any evidence to support the validity of the payments constituted a serious breach of her fiduciary duties,” the court said. Moreover, regardless of whether Asia Jones was a fiction, accountant failed to document any services Jones may have provided the Bergs in violation of the rule that fiduciaries must produce evidence of the propriety of disbursements. Thus, the court rejected the account, denied accountant’s request for fees and surcharged her $34,113 for improper expenditures, $24,480 for objector’s legal fees and cost and $4,488 in fees she already collected. The court said it was “deeply disappointed” in PCA and disturbed by its lack of due diligence in examining the history and fitness of accountant to serve as guardian before nominating her in this and other cases. “The court sincerely hopes that the discovery of accountant’s malfeasance will serve as a clarion call to make the larger changes necessary to protect incapacitated Pennsylvanians.”
Reference: Digest of Recent Opinions, Pennsylvania Law Weekly, 41 PLW 554, Tuesday, June 12, 2108, In re: Estates of Berg, PICS Case No. 18-0670 (C.P. Philadelphia May 10, 2018) Herron, J.
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