Appeal from the Superior Court of the District of Columbia (I-108-96) (Hon. Jose M. Lopez, Trial Judge).
The opinion of the court was delivered by: Thompson, Associate Judge
Submitted September 28, 2007
Before KRAMER and THOMPSON, Associate Judges, and SCHWELB, Senior Judge.
On March 10, 2005, the Superior Court removed appellant Teresa Arnold as guardian/conservator of the estate of Frances Sue Randolph-Bray, Arnold's grandmother. On January 9, 2006, the court entered a further order holding Arnold liable for attorney's fees billed by the lawyer that the court appointed to act as successor guardian/conservator. Arnold filed this appeal after the court denied her motion for reconsideration of that sanctions order. We agree that the court should have reconsidered and vacated its order sanctioning Arnold. We therefore reverse.
On July 10, 1996, the Superior Court Probate Division first appointed Arnold to serve as guardian and conservator for Randolph-Bray, who was then 76 years old and suffering from dementia. Over the years, Randolph-Bray became increasingly disoriented and uncooperative, became a colostomy patient, and came to need assistance with every aspect of personal hygiene. Arnold took Randolph-Bray into her home, and for most of Arnold's period of guardianship and conservatorship, cared for Randolph-Bray full-time, feeding, bathing, dressing and transporting her, and administering her medications. The court issued orders approving compensation to Arnold for her caregiving services, at the rate of "$50 per day on which she provides care to the Ward."
As conservator, Arnold was required to "account to the court . . . at least annually on the anniversary date of appointment, and at other times as the court may direct." D.C. Code § 21-2065 (a). As guardian, she was required to "[r]eport in writing the condition of the ward and of the ward's estate that has been subject to the guardian's possession or control, as ordered by the court on petition of any person interested in the ward's welfare or as required by court rule, but at least semi-annually." D.C. Code § 21-2047 (5). Because of Arnold's failure to file reports when due on a number of occasions, the court required her to show cause why she should not be removed as guardian/conservator and, in October 2004, removed her as guardian and conservator for her delinquency. The court subsequently set aside that removal after Arnold and the court-appointed successor fiduciary, Brian Kass, Esq., filed a joint-petition explaining that Arnold had not received notice of the hearing. The court entered its March 10, 2005 removal order after Arnold again failed to timely file a guardianship report. The court once again appointed Kass as successor guardian/conservator.
Randolph-Bray died on April 25, 2005. The Superior Court appointed an Auditor-Master to determine the final accounting of Randolph-Bray's estate. Kass, as successor guardian/conservator, undertook to marshal the assets and records pertaining to the ward Randolph-Bray. At one point he informed the Auditor-Master that he was unable to "obtain the necessary financial documents from the removed fiduciary." The Superior Court docket sheet shows that on May 10, 2005, Kass nevertheless filed his Conservator's Final Account and Final Semi-Annual Guardianship Report on Behalf of the Removed Guardian Teresa Arnold. On September 19, 2005, Kass also filed a fee petition with the Auditor-Master, seeking $4,702.74 in hourly-rate fees and expenses for his (and his associates') work.
The Auditor-Master concluded that Arnold had not properly accounted for $12,493.83 of Randolph-Bray's assets and was therefore liable to Randolph-Bray's estate for that amount. In its January 9, 2006 order, the Superior Court accepted several of Arnold's exceptions to the Auditor-Master's report and accordingly reduced the liability amount found by the Auditor-Master from $12,493.83 to $8,431.42.*fn1
In addition, apparently sua sponte, the court augmented that award by $6,014.56, stating that, "to the extent that Ms. Arnold's failing lead [sic] to the appointment and services of the successor fiduciary, Brian L. Kass, a judgment for his fees, which are undisputed, is entered against Ms. Teresa Arnold and Fidelity and Deposit Company of Maryland [Arnold's surety], jointly and severally . . . . "
On January 20, 2006, Arnold filed a motion pursuant to Superior Court Probate Division Rule 430 (a),*fn2 asking the court to reconsider the portion of the January 9, 2006 order holding her liable for payment of Kass's fees, arguing that, pursuant to Superior Court Probate Division Rule 308,*fn3 the fees were the responsibility of the estate. In an order dated February 24, 2006, the court denied the motion for reconsideration. The court reasoned that Arnold "breached her fiduciary duties by failing to comply with the accounting requirements of the court. As a result the court had to appoint an attorney to complete her work. It would be an injustice to the estate to charge [it] for the attorney's fees that were merely generated by the breach of [Arnold's] fiduciary duty."*fn4 The court explained that in holding Arnold personally liable for Kass's fees, it "was not imposing a penalty or a fine," but "exercising its authority in equity" to "impos[e] a sanction on the removed fiduciary." The court acknowledged that Arnold's "lack of sophistication" in accounting for estate assets may have led to her omissions, but stated that "justice and equity would not permit that for such mitigating factors[,] the estate be held responsible for such expenditures."
Arnold filed a notice of appeal on March 17, 2006, challenging the February 24, 2006 order denying her motion for reconsideration.
Arnold argues that she was entitled to "relief from operation of the [January 9, 2006] order," Superior Court Probate Division Rule 430 (a)(7), because she cannot properly be held liable for the fees of the successor guardian/conservator. She relies on our case law holding that a trial court may not sanction a party by requiring payment of (another party's) attorney's fees absent a finding of bad faith. See, e.g., Oliver v. Mustafa, 929 A.2d 873, 879 (D.C. 2007), and cases cited therein. However, those authorities are inapposite in the circumstances presented here. The court did not hold Arnold liable for the attorney's fees of an adverse party (the circumstance addressed in Oliver and cases cited therein) or for attorney's fees qua attorney's fees.*fn5 Rather, the court charged her with liability for payment of compensation and costs of the ...