(Alameda County Super. Ct. No. HP05237122)
The opinion of the court was delivered by: Ruvolo, P. J.
CERTIFIED FOR PARTIAL PUBLICATION*fn1
Conservator Fessha Taye brought this litigation on behalf of conservatee Ida McQueen, a mentally and physically disabled elder, against several of McQueen's family members and the family's legal representative.*fn2 Specifically, it was claimed that these individuals violated the terms of a trust set up for McQueen by her father when they sold the family residence, in which McQueen held a life estate, without her consent or knowledge and then misappropriated the entirety of the sales proceeds for their own use.
Following a jury trial, Taye, on McQueen's behalf (respondent), obtained an award of $99,900 in damages against three of five defendants who proceeded to trial--Alameda County attorney Carol Veres Reed (the family attorney), trustee Ray Blackshire (McQueen's uncle), and Earline Drumgoole (McQueen's sister) (collectively referred to as appellants).*fn3 The jury found each appellant liable on various causes of action, including financial elder abuse, concealment, conversion, breach of fiduciary duty, and negligence. After the trial, the court awarded respondent $320,748.25 in attorney fees and conservatorship costs.
Appellants have filed this appeal claiming multiple instances of prejudicial error, including that the instructions given to the jury on the collateral source rule and the Rules of Professional Conduct were erroneous. Appellants also claim that the trial court unduly restricted appellant Reed's testimony and barred admission of relevant evidence so that she was not allowed to provide a full explanation on the reasonableness of her actions as it related to the claim of financial elder abuse. Appellants further argue that respondent failed to state a cause of action for conversion, and that the trial court erred in submitting this theory to the jury. Lastly, it is claimed that the attorney fee award was excessive and should be reduced. We reject all of these contentions and affirm.*fn4
II. FACTS AND PROCEDURAL HISTORY
McQueen is a senior citizen, whose date of birth is February 16, 1935. She suffers from mild mental retardation, progressive spastic quadriparesis, scoliosis, osteoporosis, arthritis and has a history of hypertension. She uses a wheelchair and is unable to read or write.
A testamentary trust was created for McQueen's benefit by her now-deceased father, Earl Blacksher, under his 1989 will.*fn5 The will gave McQueen the right to live in the family home located at 10709 Estepa Drive in Oakland during her lifetime. The will also provided that the trustee, in his discretion, shall pay as much of the trust principal as he deems necessary for McQueen's care, comfort and health expenses during her lifetime. Upon McQueen's death, the will directs that the remaining trust assets shall vest in any of Blacksher's six children who may be living, in equal shares. Blacksher named his two brothers, Lee and appellant Ray Blackshire, as co-trustees of the trust for McQueen.
Earl Blacksher died on or about March 1, 1990. On April 10, 1990, Lee and Ray Blackshire were appointed as co-administrators of Blacksher's estate. At the time of Blacksher's death, a mortgage with Beneficial Finance existed against the family home. Lee Blackshire, in his capacity as co-administrator of the estate of Earl Blacksher, and with court permission, loaned the estate sufficient funds to pay off the existing Beneficial Finance mortgage. This transaction reduced McQueen's monthly expenses to an amount she could reasonably afford to pay from her Social Security Supplemental Income (SSI). McQueen's sister, appellant Earline Drumgoole, administered McQueen's financial affairs after the death of their father, including becoming McQueen's representative payee for her SSI benefits.
An order for final distribution of the estate of Earl Blacksher was prepared by appellant Reed, an attorney whose father had drafted Earl Blacksher's will. The order for final distribution was filed and recorded in Alameda County on September 20, 1994. The order formally created a trust, it designated the family residence as the trust res, and it directed the trustee to pay the net income of the trust to McQueen for her care, comfort and support during her natural life. Lee Blackshire subsequently died. On September 21, 1994, appellant Ray Blackshire was appointed sole administrator of the estate of Earl Blacksher.
By court order in 1994, appellant Reed was to receive $3,321.93 for her attorney fees for services rendered to the estate. Appellant Ray Blackshire was to receive $2,321.93 in executor fees. However, there was no money in the estate to pay these fees.
After Earl Blacksher's death in 1990, McQueen continued to live in the family home with assistance from caregivers. In early 2000, McQueen was placed in a skilled nursing facility due to medical complications. Despite McQueen's desire to return to the family home once her physical condition stabilized, she was unable to do so due to severe habitability problems in the home as well as lack of wheelchair access. In May 2001, McQueen moved into Gerrylaide Manor, a community care facility in the Cherryland area of unincorporated Alameda County, with the assistance of the Regional Center of the East Bay (Regional Center).
On February 9, 2000, appellant Reed and her brother, attorney Richard K. Veres, visited McQueen in the facility in order to have her to sign a power of attorney, which they had prepared, appointing appellant Earline Drumgoole to act on McQueen's behalf. No one at the facility or the Regional Center was notified in advance of their visit to McQueen, so McQueen had no one with her to help her understand the purpose of the document. McQueen signed the power of attorney by making a mark on the document. The power of attorney was witnessed by appellant Reed and Richard K. Veres and notarized by Richard K. Veres. Afterward, McQueen told a worker at the facility that some people visited her and had her sign something, but she did not know the people or what she had signed.*fn6
On October 5, 2004, appellant Ray Blackshire, acting in his capacity as trustee, executed a document selling the family residence to a third party, Phillip Edwards, under a grant deed, which was then recorded on October 26, 2004. The sale price paid for the subject property was $240,000. The sale was completed without McQueen's consent and without authorization from the probate court. The money from the sale was held in appellant Reed's general attorney/client trust account. Appellant Reed eventually distributed the sale proceeds among family members including appellant Ray Blackshire, appellant Earline Drumgoole, Earl Blacksher, Jr., Burt Blacksher, Alonzo Blacksher (son of Arthur Blacksher) and the children of Earl Blacksher's deceased daughter Geraldine Blacksher Kane. Appellants Reed and Ray Blackshire were paid their court-ordered probate fees that they were owed from years earlier. Appellant Drumgoole was repaid for money she spent to keep the family residence out of foreclosure.
In November 2004, the Regional Center first learned that McQueen's home had been sold without her knowledge or consent, and that she had not received any proceeds from the sale of the house. On December 16, 2005, Fessha Taye was appointed limited conservator of the estate of Ida McQueen.
A lawsuit was eventually brought by the conservator naming, among other individuals, the five defendants who proceeded to trial: (1) McQueen's sister Earline Drumgoole; (2) McQueen's uncle Ray Blackshire, (3) attorney Carol Veres Reed, (4) Reed's brother Richard K. Veres, and (5) McQueen's nephew Alonzo Blacksher. The operative complaint alleged causes of action for financial elder abuse, fraud and concealment, conversion, breach of fiduciary duty and negligence. The principal allegation underlying this lawsuit was that defendants "prepared and fraudulently obtained a power of attorney from Ida McQueen, fraudulently and secretly executed documents to wrongfully transfer title and sell the Subject Property, and thereafter wrongfully converted the cash proceeds from such sale to themselves for their own use and to the exclusion of Trust Beneficiary, Ida McQueen." It was alleged that these actions were in direct contravention of the terms of the trust that was set up for McQueen by her father, Earl Blacksher.
At trial, appellants were represented by appellant Reed's husband, James E. Reed.*fn7 In a pretrial ruling, the court held as a matter of law that there was no ambiguity with regard to the intent of the testator, Earl Blacksher, that in creating a life estate in the family home for McQueen, he intended for her to hold this interest for the duration of her life and that interest "doesn't extinguish just because it's sold." Consequently, even though McQueen could no longer reside in the family home, she was entitled to any income that might result from the sale of the house.*fn8
Appellants were allowed to argue at trial that they had a good faith reasonable belief that McQueen's life estate had ended, despite the fact that the trial court had made a legal ruling resolving that issue against appellants. Appellants also claimed that McQueen could never have benefitted from the sale of the family home and, in fact, she would have been harmed because if she had received any of the sale proceeds, her SSI and Medi-Cal benefits would have been reduced and possibly lost altogether.
The jury heard conflicting expert testimony on this hypothesis. Respondent's expert witness, Kevin Urbatch, testified that with appropriate financial planning, such as the creation of a special needs trust for McQueen's benefit, the testator's intent could have been carried out and the proceeds from the sale of the family home could have been preserved for McQueen while her SSI and Medi-Cal benefits were protected. In rebuttal, appellants' expert witness, Stephen Dale, testified that while presently there is a way to create a special needs trust under these circumstances, this option did not really exist in California during the relevant time frame.
The jury was given a separate verdict form for each defendant for each theoryof liability. Before the case was submitted to the jury, the courtentered non-suit in favor of defendant Alonzo Blacksher. Appellant Ray Blackshire was found liable for conversion, breach of fiduciary duty, and concealment. Appellant Earline Drumgoole was found liable for negligence, conversion, breach of fiduciary duty, and concealment. Appellant Carol Veres Reed was found liable for financial elder abuse, breach of ...