You complete the closing checklist and the judge signs the Order of Discharge. You’re done right? Not necessarily. What do you tell your client when you’re served with a petition to reopen the estate from a then unknown heir, or from a disgruntled beneficiary who contends that she was defrauded out of her share of the estate? Fla. Pro. R. 5.460 provides that “[i]f, after an estate is closed, additional property of the decedent is discovered or if further administration of the estate is required for any other reason, any interested person may file a petition for further administration of the estate.” See also §733.903, F.S. which provides that “[t]he final settlement of an estate and the discharge of the personal representative shall not prevent further administration. The order of discharge may not be revoked based upon the discovery of a will or later will.” Although the aforementioned authority appears broad in its application, as you will see, the courts generally take a restrictive approach to reopening an estate.
In Arrieta-Gimenez v. Arrieta-Negron, 551 So. 2d 1184 (Fla. 1989), the parties were the beneficiaries of their late father’s estate. Petitioner accepted her siblings’ settlement offer that resolved a dispute over the division of their father’s real estate holdings in Puerto Rico. The settlement, following adversary proceedings, was reduced to a consent judgment. Twenty-three years later, petitioner discovered that her siblings had fraudulently misled her as to the extent of her father’s holdings in Puerto Rico and filed suit to reopen the estate. The district court denied the petition and the Florida Supreme Court affirmed. The court held that a consent judgment was entitled to res judicata effect and could only be attacked for fraud on the court. Because the case involved allegations of intrinsic fraud, the consent judgment was not subject to attack.
In Dean v. Bentley, 848 So. 2d 487 (Fla. 5th DCA 2003), after the decedent died, the trial court admitted a will in which the decedent devised all his property to his step-grandson. The personal representative (“PR”), an attorney, was contacted by an attorney who stated he had prepared a subsequent will for the decedent which named the devisee as sole beneficiary and as PR. The PR filed a petition for discharge without mentioning the subsequent will or the devisee. The court entered an order of discharge. The contesting devisee filed a petition for revocation of probate alleging fraud because the PR had been aware of the existence of the subsequent will. The trial court revoked probate of the will and reopened the estate. The order was affirmed on appeal.
In Feldan v. Goodman, 460 So. 2d 515 (Fla. 3rd DCA 1984), all interested persons waived a final accounting and the trial court entered an order of discharge. The will established a testamentary trust with petitioner as life beneficiary. The trust was funded from the residuary estate assets. After the estate was closed, the petitioner filed a petition: for revocation of an order of discharge, to reopen administration of the estate, and for a trust accounting. The basis of the petition was allegations of malfeasance, conflict of interest and fraud on the part of the Co-PR’s/Co-Trustees for failing to account for assets of the estate and a misappropriation of funds of the estate without the petitioner’s knowledge. The trial court dismissed the petition with prejudice. The appellate court reversed, in part, and remanded for further proceedings. The court held that the allegations should have been considered in the original probate proceeding.
In First Florida Bank, N.A. v. Shafer, 503 So. 2d 459 (Fla. 2nd DCA 1987), the decedent’s husband (“respondent”), was the primary beneficiary under his late wife’s will and the co-trustee of her testamentary trust. After probate was closed, the deceased’s daughter (“petitioner”) filed a petition to reopen probate alleging that respondent had caused his wife to transfer a substantial portion of her assets to him prior to her death and had exercised undue influence over his wife regarding the preparation of her will. The trial court denied the motion and the appellate court affirmed on the basis of statute of limitations. The court concluded that it was error for the trial court to entertain the petition to reopen probate in the same action in which order of discharge was rendered. The court held that “[w]here extrinsic fraud is alleged, the rule does indeed preserve the equitable remedy of an independent action, but “the action is not a continuation of the action in which the judgment . . . under attack was entered. A new complaint is filed, service of process is made and the new action follows the same procedure as other civil actions.” [citations omitted].” The case was remanded to the trial court to grant petitioners’ motion to dismiss without prejudice to the daughter’s attempt to initiate an independent action challenging the probate of her mother’s will.
In Fritsevich v. Estate of Voss, 590 So. 2d 1057 (Fla. 3d DCA 1991), decedent died intestate. After the notice of administration was published, petitioners file a petition to determine heirs arguing that respondent had fraudulently represented that she was the decedent’s first cousin and her sole heir. The probate court determined that respondent was the sole beneficiary, distributed the estate assets, issued an order of discharge and closed the estate. Petitioners subsequently filed suit seeking to reopen the estate, to re-determine the decedent’s heirs, and to reimburse distribution. The court granted respondent’s summary judgment on the basis of statute of limitations. The appellate court reversed. The court held that that summary judgment was inappropriate since respondent’s misrepresentation, if true, denied the petitioners access to the estate proceeding thus constituting a fraud upon the court.
In Grimes v. Estate of Stewart, 506 So. 2d 465 (Fla. 5th DCA 1987), after the estate was closed, the petitioner filed an objection to the distribution of assets and a petition to revoke probate. Petitioner alleged that she is an heir at law and niece of the decedent and a beneficiary of the decedent’s inter vivos trust and will. As an interested party, petitioner was entitled to notice of the probate of her aunt’s estate. Although the respondent/PR knew these facts, he failed to provide her with notice and failed to identify any person other than himself as a beneficiary of the estate. In addition, Respondent had the decedent declared incompetent and three months prior to her death procured her execution of the will which was probated. The probate court dismissed the petition because it was untimely. The appellate court reversed because the petition was timely and petitioner had sufficiently alleged fraud as a basis to open the estate after the order of discharge. In addition, the court held that “[a]n adjudication of incompetency of a testator creates a prima facie case against the proponent of such a will. Such a situation imposes a duty on the part of the proponent to reveal to the probate court and all known beneficiaries the fact of the decedent’s incompetency.
In Liechty v. Hall, 687 So. 2d 64 (Fla. 5th DCA 1997), the appellate court reversed an order dismissing with prejudice petitioner’s verified petition for revocation of probate and petition for subsequent administration on the basis that the will admitted to probate was a forgery. The court held that fraud was recognized as a justification for reopening an estate even after an order of discharge of the personal representative had been entered. The court indicated that on remand, petitioner must have leave to file amended petitions that more fully plead the facts and circumstances surrounding the fraud or forgery, or its discovery.
In Padgett v. Estate of Padgett, 318 So. 2d 484 (Fla. 1st DCA 1975), almost two months after the order of discharge was filed, petitioner filed a petition to set aside the order of distribution claiming that the testator was incompetent or under undue influence. The probate court ruled that the petition was barred because it was not filed prior to the order of discharge. The order was affirmed on appeal. The court held that the statutory period allowed to an heir or distributee to petition the court for revocation of probate was binding in the absence of factual allegations of fraud, overreaching or mistake as to reasonably require investigation by the court. As there were no such allegations, the trial court did not commit err in dismissing the petition.
In Payette v. Clark, 559 So. 2d 630 (Fla. 2nd DCA 1990), the decedent’s intestate estate was distributed to the named beneficiaries and a final order of discharge was entered. Although Petitioner was a beneficiary, she was not listed as a beneficiary or interested party, received no notice, and was not included in the distribution. After the estate was closed, the petitioner filed a motion to re-open the estate. The probate court denied the motion on the basis of statute of limitations. The appellate court reversed. The court reasoned, in part, that if the allegations of omissions and misrepresentations on the part of the personal representative are true they constitute fraud upon the court and the estate should be reopened.
In Sokol v. Moses, 545 So. 2d 950 (Fla. 3rd DCA 1989), the decedent died leaving four adult children. Respondent filed a petition for family administration declaring that her mother had died leaving a will in which respondent was the sole beneficiary. The three remaining children signed affidavits confirming the petition for family administration and a Waiver of Priority, Consent to Appointment of Personal Representative, and Waiver of Notice and Bond. The probate court entered an Order of Family Administration ordering immediate distribution of the decedent’s assets to respondent. Over a year later, petitioner filed a complaint in the civil division which was dismissed without prejudice. Thereafter, the petitioner filed the following petitions in the probate division: an amended petition for appointment of an administrator ad litem, and an amended petition to revoke probate, to set aside an order of family administration, to probate a later discovered will, and for injunctive relief. The petitions were declared adversary. The probate court denied the petitions. The appellate court affirmed on the basis of statute of limitations.
In Tillman v. Falconer (In re Estate of Clibbon), 735 So. 2d 487 (Fla. 4th DCA 1998), approximately ten months after the PR had been discharged, petitioners filed a petition to reopen the estate on the basis of fraud or mistake. Petitioners alleged that decedent executed her will a few days after entering a nursing home and died twenty-two months later, her prior will named petitioners as beneficiaries, and respondent failed to give notice to petitioners of the probated will in order to avoid an attack on the validity of the prior will. The lower court granted respondent’s motion for summary judgment and the appellate court affirmed. The court reasoned that petitioners’ allegations were insufficient to constitute the type of fraudulent misconduct that were acceptable grounds for reopening decedent’s estate and “that, in order for rule 1.540(b) to apply, the disputed order must have been entered in an adversary proceeding, and the movant must have been a “party or party’s legal representative” to that proceeding.” [emphasis added]. The order of discharge which appellants seek to set aside was not entered in an adversary proceeding.
In Van Dusen v. Southeast First Nat’l Bank, 478 So. 2d 82 (Fla. 3rd DCA 1985), the PR filed a petition for discharge with an attached plan of distribution. The petition indicated that interested persons had thirty days in which to file objections to the report of receipts disbursements or the proposed distribution of assets. No objections were filed. After filing a report of distribution which indicated that all assets of the estate had been distributed and claims paid, the PR was discharged. Approximately four years later, the decedent’s heirs sued the PR alleging copyright infringement and breached its fiduciary duty. The lower court granted defendants’ motion for summary judgment. The appellate court vacated the judgment on copyright infringement because the cause of action was preempted by the Federal Copyright Act of 1976 and that such cause of action is cognizable only in the Federal courts. Further, the appellate court concluded that the trial court erred in granting summary judgment in favor of defendant for breach of fiduciary duty. The court reasoned in part: “Southeast Bank invites us to hold that a personal representative may escape liability after wrongfully giving away an asset of the estate if it procures a discharge before interested persons discover its wrongful acts. We decline this invitation. Such a holding would radically change the nature of the relationship between the personal representative and the estate and the persons interested therein and would give the fact of discharge a significance beyond that to which it is entitled. We recognize that it is the public policy of this state that the estates of decedents be finally determined with dispatch, see Gadsden v. Jones (“The remedy intended by the Legislature was … a speedy ‘release from the duties of Executor or Executrix, Administrator or Administratrix,’ after a faithful and honest discharge of the trust.” (Emphasis supplied.)). However, this policy must be harmonized with the larger policy that requires the uncompromising fidelity of personal representatives. See generally § 733.609, Fla. Stat. (1983). We conclude that the legislature intended for a modified res judicata concept to be applicable in probate cases. Under this concept, the price of immunity is disclosure. If the personal representative has not disclosed its disposition of an asset of the estate, it is not entitled to the sanctuary provided by section 733.901(5), at least not where, as here, it is alleged that the asset was intentionally given away to a party who was not entitled thereto. Cf. Connelly v. Florida National Bank of Jacksonville, 120 So. 2d 647 (Fla. 2d DCA 1960). Southeast Bank did not disclose in the petition for discharge or otherwise its disposition of the copyright in the contents of the Van Dusen manuscript. With regard to the statute of limitations defense, the general rule in Florida is that “a statute of limitations begins to run when there has been notice of an invasion of legal rights or a person has been put on notice of his right to a cause of action.” Kelley v. School Board of Seminole County, 435 So 2d 804, 806 (Fla. 1983); see also Nolen v. Sarasohn, 379 So. 2d 161, 162-63 (Fla. 3d DCA 1980). An action for breach of fiduciary duty is founded upon a statutory liability, § 733.609, Fla. Stat. (1983), and is, therefore, governed by a four-year statute of limitations. § 95.11 (3)(f), Fla. Stat. (1983).”
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PRACTITIONER’S CORNER: The majority of the cases turn on the application of Fla. R. Civ. P. 1.540(b) which has a one-year statute of limitations to vacate a judgment, decree, order, or proceeding. The one-year statute of limitations applies to “(1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial or rehearing; and (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party” and constructive fraud (see §95.031(2)(a), F.S.). Fraud on the court is excluded. See Rule 1.540(b)(5).
Sec. 731.107, F.S. provides that the “rules of civil procedure shall be applied in any adversary proceeding in probate.” See also Rule 5.025(d)(2) which provides that “after service of formal notice,… The Florida Rules of Civil Procedure govern…”. Therefore, Rule 1.540 only applies to probate proceedings if the proceeding at issue is an “adversarial proceeding”, either specified or declared adversarial, pursuant to Fla. Prob. R. 5.025(a) and (b). If the judgment or order at issue is not the subject of an adversarial proceeding, then the statute of limitations is governed by Ch. 95, F.S. See Van Dusen v. Southeast First Nat’l Bank, 478 So. 2d 82 (Fla. 3rd DCA 1985).