J and C formed their family Trust to benefit their son. A few years later they were divorced prior to J’s death in 05′.
J’s brother M was appointed as J’s estate administrator and all of the estate assets were to be transferred into the Trust, for the sole benefit of the son. M was also the acting trustee of the Family Trust appointed by J after the divorce.
Soon after the estate closed C noticed that money was missing and things were not quite right with the way M was acting. In 2006 C hired the Pedder firm of Lafayette, Matt Toth lead attorney, to file a removal petition of M and have a private fiduciary take over the Trust.
M was represented by a prominent attorney in Oakland, CA, until he was removed as Trustee. After that M was in Pro Per. M’s Trust Account was around $2 million short. The Pedder Firm was originally able to recover approximately $1 million.
After the new Trustee was appointed and records and bank balances were checked it was discovered that M had damaged the Trust by an additional $939,000 and the Pedder firm was able to obtain a judgment in that amount against M in 2008.
M, who at one time lived in Virginia, returned to Virginia, which made collection efforts difficult. M moved the money from small bank to small bank. He purchased thousands of dollars in U.S. Postal money orders. He did own a house in Virginia and once the California judgments were domesticated in Virginia the Virginia Court ordered the house sold. Additionally M was served with Debtor interrogatories that he failed to respond to, that resulted in the Virginia Court issuing a warrant for his arrest.
When it was time to seize the house Counsel went to the property with a locksmith and was not able to get in and ended up breaking a window. Once inside the house they discovered that M had flown in from California the night before and told them to get out of his house. The police were called and M refused to exit the house and the SWAT team was brought in. There was an eight hour standoff between the SWAT team and M that ended with the SWAT team throwing in flash bang grenades and arresting M. The house was sold and the proceeds paid over to the Trust.
M was arraigned in Criminal Court for trespassing. After the arraignment, M remained in custody and was taken before the Judge for his contempt violation in not showing up for his debtor interrogatories. M was instructed to answer the questions and after 2 hours of “I do not remember” he was returned to the Courtroom. The Judge gave M ten days in jail to think about what he might remember. After the ten days M seemed to remember a few minor things. The Judge did not find his story credible and found that the time in jail did help his memory and gave M another 20 days to think some more.
Before the 20 days were up M filed for bankruptcy, which gave him an automatic stay on the collection actions against him and allowed him to be released from jail. Once out M rented a U-Haul and loaded it up and left Virginia to return to San Diego to live with his parents. He then transferred some of the funds to his parents approximately $435,000. That money is in the process of being recovered by the bankruptcy court.
Over the past 4 years M has flooded the bankruptcy court with meritless motions. In 2010, M started filing frivolous suits in San Diego County Superior Court asking the San Diego Court to set-a-side the Alameda County Judgments. M has also filed additional suits naming everyone that was ever involved with the Trust case for various meritless claims. Additionally, he has repeatedly filed the same matters in Federal Court. The Federal Court has declared him to be a vexatious litigant. However, that does not stop M, as he is now having his mother and father file on his behalf, even though his father passed away M is now signing his father’s name as his power of attorney.
The case goes on and on and from court to court.
Lesson learned – when a client chooses a close relation to be trustee, thoroughly check them out. M was not his brother’s son’s keeper for sure.
