Battley v. Banks
Robert BATTLEY, Personal Representative in the Estate of Dorothy Battley v. Michael G. BANKS
Attorneys
T. Sean Daugherty, Rockville, for appellant., Michael Banks, Rockville (Kamiko Battley, on the brief), Alexandria, VA, for appellee.
Full Opinion (html_with_citations)
As personal representative of the Estate of Dorothy Battley, appellant Robert Battley appeals from three orders issued by the Circuit Court for Montgomery County, sitting as the Orphansâ Court, which respectively granted appellee Michael G. Banks, the former guardian of Ms. Battleyâs property, guardianship commissions and attorneyâs fees. The first order permitted Banks to pay himself, âfrom the former guardianship bank account,â his guardianship commissions before turning over Ms. Battleyâs assets to the personal representative. The second order directed Banks âto write himself a checkâ from the same bank account for the probate fees he had paid in opening Ms. Battleyâs estate. And the third order awarded Banks $300.00 in attorneyâs fees for his efforts to open Ms. Battleyâs estate and directed that a check in that amount be sent to Banks âimmediately.â
Appellant contends that in each instance, the orphansâ court erred. For the most part we agree. Hence, we shall vacate in full the first and second orders, but as for the third order, we shall vacate it only to the extent that it instructed appellant to pay the funds immediately and not in accordance with the payment schedule in Md.Code (1974, 2001 Repl.Vol., 2006 Supp.), § 8-105(a) of the Estates and Trusts Article (âETâ).
In November 2002, Dorothy Battley executed a will. The will named appellant, who was Ms. Battleyâs nephew, as the personal representative of her estate and bequeathed all of her property to Kimiko Battley, her deceased brotherâs wife. In the event Kimiko did not survive Ms. Battley, the property was to go to appellant, as the residuary beneficiary.
On February 18, 2003, Ms. Battley, suffering from dementia, was admitted to the Woodside Center, a nursing home in Silver Spring, Maryland. Five months later, on July 28, 2003, the Montgomery County circuit court appointed Banks as the guardian of Ms. Battleyâs property and appellant as guardian of her person.
On July 3, 2004, Ms. Battley passed away. Thereafter, Banks filed a petition in the circuit court requesting termination of the guardianship and authorization to transfer âall assets at the time of the death of Dorothy Battleyâ to the personal representative of her estate, who had not as yet been appointed. Banks further asked the court to order whomever was ultimately appointed the personal representative of Ms. Battleyâs estate to investigate the value of Ms. Battleyâs assets prior to July 9, 2003, the date on which he was appointed guardian of her property.
With that petition, Banks submitted the final âAnnual Fiduciary Report,â which consisted of a final accounting of Ms. Battleyâs assets and a proposed distribution of them. The report also contained Banksâs claim for guardianship commissions in the amount of $861.47.
On September 10, 2004, the circuit court approved Banksâs final accounting and proposed distribution, but specified that âthe guardianâs commissions be limited to $550.25.â That same day, the court entered a separate order discharging Banks as the guardian of Ms. Battleyâs property and directing him to transfer âall assets at the time of [her] deathâ to the person âto be appointedâ personal representative of her estate. But it denied Banksâs request that the personal repre
Over a year later, after no action had been taken by anyone to open the estate, Banks filed a petition for judicial probate in the orphansâ court, requesting, among other things, that he be appointed the personal representative of Ms. Battleyâs estate. At that time, he also filed a notice of judicial probate and paid the register of wills $52.84 in probate fees to open Ms. Battleyâs estate.
In the probate petition Banks asserted that the âonly known assetsâ were a Bank of America account containing $1286.24 and a âRepresentative Payee accountâ at Woodside Center with $255.59 in it, although he claimed that he had been informed by Woodside Center that, prior to Ms. Battleyâs enrollment at that facility, she âappeared to have an account in excess of $70,000.â The petition concluded with Banksâs request for authorization to pay himself $550.25 in guardianship commissions previously approved by the circuit court.
Approximately two weeks later, appellant filed Ms. Battleyâs will, naming him as personal representative, with the register of wills. In response, Banks filed an âAmended Petition for Judicial Probateâ with the orphansâ court, requesting that appellant be removed as personal representative and that he, Banks, be appointed special administrator of the estate; that he, as special administrator, be authorized to distribute Ms. Battleyâs personal property to Kimiko Battley, in accordance with the will; and that he further be authorized to pay himself the circuit court-approved $550.25 in guardianship commissions owed to him. As grounds for these requests, Banks claimed that, at no time during the fifteen months following Ms. Battleyâs death, did appellant contact Banks or the nursing home; that appellant âdid not claim [Ms. Battleyâs] bodyâ; and that appellant had neither provided âadequate information regarding the financial affairs of his Aunt, Dorothy Battley,â
In response to Banksâs petition, appellant denied that he had ever abandoned his auntâs body, pointing out that he had, in fact, paid for her funeral expenses and further insisting he had âprovided financial information including [Ms. Battleyâs] bank statements directly to Michael Banks.â He added that, notwithstanding Banksâs claims to the contrary, he had never been guardian of Ms. Battleyâs property and hence had never made expenditures in that capacity; and that, in any case, âthe Court [had] never requested information from him.â Finally, he asserted that Banksâs âdefamatory allegationsâ had no foundation in fact and that Banks himself had âfailed to conduct an investigationâ into Ms. Battleyâs assets while he was still the guardian of her property.
On March 22, 2006, after a hearing, the orphansâ court ordered that Ms. Battleyâs will be admitted to probate and appointed appellant, in accordance with the will, as personal representative of Ms. Battleyâs estate. Following that decision, Banks filed a petition requesting the $550.25 in guardianship commissions previously authorized by the circuit court and for $300 in attorneyâs fees
On April 26, 2006, appellant, as personal representative, filed a petition to administer Ms. Battleyâs estate as a small estate.
On June 20, 2006, the orphansâ court held a hearing on Banksâs request for both $550.25 in guardianship commissions and $300 in attorneyâs fees. During the hearing, Banks asserted he had not paid himself guardianship commissions, in accordance with the circuit courtâs earlier order authorizing him to do so, because of âan oversight.â When the hearing ended, the orphansâ court ruled that, since âBanks had a rightâ at the time the circuit court granted his request for guardianship commissions âto pay himself out of the remaining balance of [Ms. Battleyâs] funds, the sum of $550.25,â he could âdo it now since he did not do it before.â
On June 22, 2006, the orphansâ court awarded Banks the $300 in attorneyâs fees he had requested and ordered that a check in that amount âbe sent to Michael G. Banks, Esq. immediately,â but the court was silent as to Banksâs requested guardianship commissions.
On July 5, 2006, Banks filed a claim against Ms. Battleyâs estate for the $52.84 in probate fees he had paid to open the estate, but appellant, as personal representative, disallowed that claim. Thereafter, both parties requested that the orphansâ court issue a written order regarding Banksâs guardianship commissions.
On July 25, 2006, the orphansâ court entered two orders: one directing Banks to âwrite himself a checkâ from Ms. Battleyâs Bank of America account âin the amount of $52.84â for the probate fees and the other permitting Banks to âpay himself the commissions owed from the former guardianship bank account, pursuant to the previous order of court.â This appeal followed.
Appellant moves to strike the appendix to Banksâs brief, which consists of a letter from Banks to appellant requesting âall asset information related to the Dorothy Battley Estate,â Banksâs petition for termination of guardianship in the circuit court, and a receipt from the register of wills for Banksâs payment of the sum of $52.84. Appellant argues that the documents were not introduced below, and hence should not be considered on appeal. Banks has filed no opposition.
Because the record confirms appellantâs assertion that neither of these two documents were introduced below and because ordinarily such documents will not be considered on appeal, we will grant this motion. See, e.g., Prince Georgeâs County v. Local Govât Ins. Trust, 388 Md. 162, 170 n. 6, 879 A.2d 81 (2005).
The Guardianship Commissions
Appellant claims that the orphansâ court erred in permitting Banks to pay himself, from the former guardianship bank account, $550.25 in guardianship commissions before turning over that account to appellant as the personal representative of the estate. Even though the circuit court had previously approved the commissions, he argues that, once the guardianship was terminated, Banks, as guardian, was not permitted by law to do anything other than turn over that account to appellant without deducting any commissions. When that was done, Banksâs claim for guardianship commissions would then be treated as a general creditorâs claim, according to appellant, and paid in accordance with ET § 8-105(a)
A person appointed as the âguardian of the property of ... a disabled person,â pursuant to ET § 13-201(a), becomes âvest[ed],â under ET § 13-206(c), with âtitle to all property of the ... protected person that is held at the time of appointment or acquired later.â His activities are overseen by the circuit court, which has âexclusive jurisdiction over protective proceedings for disabled persons,â under ET § 13-105(b). A guardian of the property may, among other things, âpay or apply income and principal from the estate as needed for the clothing, support, care, protection, welfare, and rehabilitation of the disabled person,â under ET § 13-214(b)(2). In administering the disabled personâs estate, a guardian is required under ET § 13-212 to âexercise the care and skill of a man of ordinary prudence dealing with his own property.â And, for his efforts, the guardian is entitled, under ET § 13-218, âto the same compensation and reimbursement for actual and necessary expenses as the trustee of a trust.â
At the outset, we note that, under ET § 13-221, upon the death of a ward, âhis personal representative, the guardian, or any other interested person may petition the court to terminate the guardianship proceedingsâ and that, under ET § 13-221(c) the â[tjermination and final distribution of [his] estateâ is to âbe made in compliance with the provisions of the Maryland Rules, applying to a fiduciary.â
The principal Maryland Rule governing the termination of a guardianship and the final distribution of guardianship assets is Rule 10-710. Successive sections of that rule state that â[g]rounds for the termination of a fiduciary estate shall include ... the death of the minor or disabled person,â Rule 10-710(a); that â[w]ithin 45 days after the fiduciary discovers that the grounds for termination exist, the fiduciary shall file a petition requesting the court to terminate the estate,â Rule 10 â 710(b); that âthe petitioner shall file with the petition a copy of the death certificate,â Rule 10 â 710(e)(4); and that the petitioner shall âgive notice of the filing of the petition to the persons named as distributees in the proposed final distribution, to the other persons entitled to notice of annual accounts,
The rule also provides that â[i]f the petitioner is the fiduciary, the petitioner shall file with the petition a final accounting containing the same information required in annual accountings by Rule 10-708,
But, as for the disposition of the deceased wardâs assets, we must turn to a provision of the Estates and Trusts Article which governs the estates of decedents, regardless of their ante-mortem status. And that is ET § l-301(a), which provides that â[a]ll property of a decedent shall be subject to the estates of decedents law, and upon the personâs death shall pass directly to the personal representative, who shall hold the legal title for administration and distribution.... â Under ET §§ 2-101 and 2-102, any claims against that property fall under the jurisdiction of the âorphansâ court,â âor the court exercising the jurisdiction of the orphansâ court.â
It is a basic canon of statutory construction and one to which we routinely subscribe that when statutes are in pari materia, âit is presumed that the [Legislature] ... intended ... [them] to blend into a consistent and harmonious body of law.â State v. Bricker, 321 Md. 86, 93, 581 A.2d 9 (1990). âTherefore, various consistent and related enactments, although made at different times and without reference to one another, nevertheless should be harmonized as much as possible.â Id.
The same canon applies to rules and statutes that are in pari materia. As we stated in Davis v. Mills: âWhen the Maryland Rules deal with the same subject matter as a statute, [the relevant rules and statutes] are to be âconstrued so as to harmonize with each other and not produce an
Applying this venerable rule of interpretation to the above mentioned statutes under the Estates and Trusts Article, we conclude that, under ET § l-301(a), when a ward dies, all the wardâs property becomes the assets of his decedent estate, and where a personal representative has been appointed to the wardâs estate, title vests immediately, in that person. In short, the wardâs assets, upon his death, become the assets of his decedent estate. The guardianâs duties are then reduced to filing a petition to terminate the estate together with a final accounting and proposed final distribution of the wardâs property, pursuant to Rule 10-710(b) and ET § 13-221, and thereafter to transfer to the personal representative all of the decedentâs property, as required by ET § l-301(a).
Moreover, after death of the ward, the guardian may be awarded guardianship commissions. Rule 10-710(f) states that the guardian of the property who files a petition to terminate his guardianship upon the wardâs death âshall file with the petition a final accounting ... together with the proposed final distribution of any remaining assets of the estate.â This âproposed final distributionâ does not exclude the guardianâs compensation.
But the circuit courtâs right to approve guardianship commissions does not imply, in this instance, the authority to permit the guardian of the property to pay himself those commissions before handing the deceased wardâs property over to the personal representative. For, as we have previously pointed out, under ET § l-301(a), â[a]ll property of a decedent shall be subject to the estates of decedents law, and upon the personâs death shall pass directly to the personal representative, who shall hold the legal title for administration and distribution.... â That means that, at the moment of the wardâs death, his assets under the guardianship immediately become assets of his estate. An order by the orphansâ court allowing the guardian to collect his commissions before hand
Indeed, ET § 13-214 specifies the distributions that a guardian may make âwithout court authorization or confirmationâ: when a minor ward attains majority; when the disability of a ward ceases; and when a minor or disabled person dies.
But in the third situation, that is, when the ward dies, the guardian has no statutory authority to meet all prior claims and expenses of administration (which would of course include guardianship commissions) before distributing the assets of the decedent to the personal representative of the decedentâs estate. In fact, when the ward dies, the guardian is authorized, by ET § 13-214(c)(3), only to âdeliver to the appropriate
In sum, where the termination of a guardianship is due to a minor ward attaining majority or the cessation of a disabled wardâs disability, the guardian is permitted, without a prior court order, to meet all prior claims and expenses of administration before distributing the remainder of the personâs estate. But, where the termination of a guardianship is due to the death of the ward, the guardian has no such authority. Thus, Maryland clearly disfavors a former guardian paying any âprior claims and expenses of administration,â including guardianship commissions, from the assets of the former guardianship after the ward dies, in contrast to being directed to do so before distributing the property of the guardianship estate to a ward who attains majority or whose disability has ended.
For Banks to pay himself his guardianship commissions upon the wardâs death, if it can be done at all, under ET § 13-214, requires a court order. But, as we have pointed out, such a court order would, under ET § 1 â 301(a), wrongly permit the former guardian to invade the assets of the decedentâs estate.
Other states with statutes that fail, as Marylandâs does, to directly address this issue have reached the same conclusion. See, e.g., State v. Estate of Taylor, 29 Colo.App. 231, 484 P.2d 1262, 1263 (1971) (âIt is generally held, in the absence of statute ... that upon the death of a person under guardianship, the statutory scheme applicable to decedentsâ estates becomes operative, and that debts incurred during the guardianship are to be classified in accordance with the law fixing priorities in the distribution of decedentsâ estates.â); In re Bohnstedt, 125 A.2d 580, 582 (Del.Ch.1956) (â[Ajlmost but not all of the Courts which have considered our problem have concluded that after the death of the mentally ill person the trustee, absent statutory authority, has no power to pay
Moreover, those state courts that have taken the contrary-position, that is, that, upon the death of a ward, the guardian has the right to collect his commissions before distributing the wardâs assets to the personal representative, only underscore our point. Those decisions were based on state statutes and rules that clearly granted the guardian the right to pay himself any commissions owed him after the death of the ward. See, e.g., Midland Natâl Bank & Trust v. Comerica Trust Co. of Florida, 616 So.2d 1081, 1084 (Fla.Dist.Ct.App. 1993) (Florida Probate Rules permit guardians âto pay from guardianship funds the final costs of administration ... including guardian and attorneyâs fees, which had been included in the final accounting as unpaid and which, either in the absence of objection or after objection and court resolution, would be paid by the guardian prior to distributionâ of the remainder of the funds to the persons entitled to them.); Treadway v. Motague-Elliston, 138 Ariz. 133, 673 P.2d 331, 333 (App.1983) (The Arizona statute authorizes a conservator to reimburse himself, from the conservatorship estate, the âexpenses of administration,â including the âfees and expenses reasonably incurred in -winding up the affairs of the conservatorship estate,â before delivering the remaining estate to the personal representative of the deceased personâs estate.)
No Maryland statute or rule grants comparable authority to a Maryland guardian of the property when the ward has died.
We are not unsympathetic to Banksâs position and the possibility that, because of the small size of the estate and the priorities laid out in ET § 8-105(a), as a general creditor, his claim may be relegated to the bottom of the statutory list of payment priorities and thus he may never be paid his court-approved commissions totaling $550.25. We also recognize that there are sound reasons for allowing a guardian to collect his commissions from a former guardianship account before handing over that account to the personal representative of the wardâs estate.
At least one court has observed that, just as the compensation for a personal representative in handling a decedentâs
Finally, appellant, relying on DeFelice v. Riggs Nat. Bank of Washington, 55 Md.App. 476, 462 A.2d 88 (1983), claims that âthe [orphansâ] court had no jurisdiction to interpret the orders of the circuit court in the first instance because no request had been made to determine title of the guardianship accounts which Banks had conceded in the filing of his petition ... were estate assets.â But DeFelice has no applicability here. In that case, the personal representative sought to receive the insurance proceeds from the car accident in which the decedent had died. Id. at 477, 462 A.2d 88. When the personal representative learned that the insurance company had already paid the proceeds to a third party, he filed suit in the orphansâ court to force that third party to return the proceeds to the estate. Id. The orphansâ court found that the payment of the proceeds directly to the third party was appropriate. Id. We vacated that decision, holding that the orphansâ court âdid not have jurisdiction to consider the issue
But in the instant case, there is no dispute as to the title of the assets in question, that is, the guardianship account. Both parties agree that Ms. Battley owned the monies in that account. The dispute is whether Banks could withdraw his commissions from that account before handing over the account to appellant to administer.
The Probate Fees
Appellant contends that the orphansâ court erred in âpermitting Banks to âwrite himself a checkâ from the former guardianship accountâ for the $52.84 in probate fees he paid to open Ms. Battleyâs estate. Specifically, appellant argues that, after he disallowed Banksâs claim for the $52.84 for âprobate fees allegedly associated with his petition to administrate the estate and seeking his appointment as personal representative,â Banks should have filed a âpetition for allowance [with] the courtâ as required by ET § 8-107(b). Since Banks failed to do so, the court should not have, appellant claims, awarded Banks those fees. In fact, according to appellant, the $52.84 could only be paid to Banks by appellant, as the personal representative, in accordance with the payment priorities set out in ET § 8-105(a).
âIt is well settled that the âfindings of fact of an Orphansâ Court are entitled to a presumption of correctness.â â Pfeufer v. Cyphers, 397 Md. 643, 648, 919 A.2d 641 (2007) (internal citations omitted). âIt is equally well settled, however, that interpretations of law by such courts are not entitled to the same âpresumption of correctness on review: the appellate court must apply the law as it understands it to be.â â Id. (internal citations omitted). âThus, an appellate court ... must determine whether the conclusions of law made by a trial
On June 29, 2006, Banks filed a claim for $52.84 against Ms. Battleyâs estate with appellant who had, by that time, been appointed the personal representative of the estate. Approximately a week later, on July 5, 2006, Banks filed this claim with the register of wills. On that same day, he also filed a similar claim with the orphansâ court, entitled âSupplemental Information for a Claim against Decedentâs Estate,â asking to be reimbursed for the $52.84 in probate fees that he had expended on behalf of the estate.
The following day, appellant sent Banks a notice of disallowance of his claim and filed this notice with the register of wills on July 7, 2006. Then, on July 25, 2006, the orphansâ court entered an order, directing Banks to âwrite himself a check fromâ Ms. Battleyâs bank account âin the amount of $52.84.â But Banksâ claim for fees was barred under § 8-107(b) of the Estates and Trusts Article.
When appellant disallowed his claim, Banks failed, as required by ET § 8-107(b), to file a petition for allowance of the claim with the court and hence his claim was, under that subsection, âforever barred.â For ET § 8-107(b) provides that if the personal representative disallows a claim, âthe claimant is forever barred to the extent of the disallowance unless he files a petition for allowance in the court or commences an action against the personal representative ... within 60 daysâ after the personal representative mails the notice of disallowance.
The Attorneyâs Fees
Appellant argues that the orphansâ court erred in awarding Banks $300 in attorneyâs fees. Neither of the two statutes permitting such an award in estate matters, ET §§ 7-602 and 7-603, were applicable, he maintains, to Banksâs predicament. He claims that Banksâs services in opening the estate were âpart of a guardianâs duties for which commissions are allowableâ and hence Banks should not be paid attorneyâs
We agree with appellant that ET § 7-603 is not relevant to Banksâs claim for attorneyâs fees. That section states that, â[w]hen a personal representative or person nominated as personal representative defends or prosecutes a proceeding in good faith and with just cause, he shall be entitled to receive his necessary expenses and disbursements from the estate regardless of the outcome of the proceeding.â Clearly, this section does not apply to Banks, who was neither the personal representative nor a person nominated as personal representative.
But ET § 7-602(a) is relevant. That section states that â[a]n attorney is entitled to reasonable compensation for legal services rendered by him to the estate and/or the personal representative.â Generally, such services must âhave been rendered âfor the protection or benefit of the estate.â â Banashak v. Wittstadt, 167 Md.App. 627, 666, 893 A.2d 1236 (2006) (quoting ET § 7-401(y)). And services rendered âfor the protection or benefit of the estateâ include âthe rare case where the assets of an estate are increased in value or protected from dissipation as the result of an action brought by someone other than the personal representative for the benefit of the estate as a whole.... â Clark v. Rolfe, 279 Md. 301, 307, 368 A.2d 463 (1977) (emphasis added).
That was the case here. The orphansâ court found that Banksâs actions, for which he was charging $300 in attorneysâ fees, were for the benefit of Ms. Battleyâs estate. It stated during the hearing that â[t]hereâs really no dispute, is there, that Mr. Banks had to open the estate ... I donât believe for one second that Mr. Banks would have gone to the trouble to open an estate, [if] in fact Ms. Battley had a will and he said, âNo, no, donât bother Mr. Banks, Iâve got a will and Iâm going
The orphansâ courtâs findings of fact are entitled to a presumption of correctness, Pfeufer, 397 Md. at 648, 919 A.2d 641, and that presumption has not been rebutted by appellant. No attempt was made by appellant to open Ms. Battleyâs estate for more than fifteen months after her death. Indeed, it was not until Banks attempted to rectify this omission by opening the estate himself that appellant submitted Ms. Battleyâs will to probate.
Moreover, appellantâs counter-argument that Banksâs attempt to open the estate was not for the benefit of the estate is without merit. It is true, as appellant suggests, that Banksâs actions in attempting to become personal representative were contrary to Ms. Battleyâs wishes. But, more than fifteen months had passed since Ms. Battleyâs death, without appellant opening her estate. And the orphansâ court concluded, based on Banksâs representations as it was entitled to do, that appellant would not have begun probate proceedings had Banks not initiated those proceedings by filing a petition for judicial probate.
Nor is appellantâs alternative position persuasive. He argues that, as it was Banksâs duty, as the former guardian of Ms. Battleyâs property, to open the estate, he had no basis on which to claim attorneyâs fees on top of his guardianship commissions. He further points out that, â[f]rom the record, it appears that the orphansâ court believed the petition for probate was done in the course of Banksâs services as a guardian,â that is, that it was âministerialâ work done as the
Except for certain duties prescribed by statute and rules, Banksâs duties as guardian legally ended with the termination of the guardianship. Any actions he took thereafter to open Ms. Battleyâs estate went beyond what he was required to do as Ms. Battleyâs guardian. See ET §§ 1 â 301(a); 13 â 214(c); 13-221; Rule 10-710. While it is true that the orphansâ court did state, during the hearing, that, when Banks was attempting to open the estate, he was âworking as a guardian performing legal services [for Ms. Battley] ... as part of what [he] should do with the balance of the assets that [he] had,â and Banks did respond by stating that â[he] opened the estateâ only â[a]fter repeated attemptsâ to contact appellant about Ms. Battleyâs âmeager personal propertyâ and the balance of what was in her bank account. Nonetheless, the reason the court awarded Banks attorneyâs fees was, as it put it: âThereâs really no dispute, is there, that Mr. Banks had to open the estateâ because appellant would not have otherwise.
Furthermore, the distinction that appellant is attempting to make between âministerialâ work and legal services is not relevant here and his reliance on Saint Ignatius Roman Catholic Congregation, Inc. v. Harvey, 268 Md. 634, 303 A.2d 389 (1973) in support of that effort is misplaced. In Harvey, the personal representative of a decedentâs estate, who was also an attorney, sought and received, from the orphansâ court, both personal representativeâs commissions as well as counsel fees for services rendered on behalf of the estate. Id. at 636-37, 303 A.2d 389. The services rendered included preparation of, among other things, a federal estate tax return, a petition for probate, and a petition âto make distribution under the direction of the Orphansâ Court.â Id. at 638-39, 303 A.2d 389.
The Court of Appeals, however, reversed the lower courtâs grant of those fees, stating that âif all of these activities constituted legal services, it is difficult to identify the duties performed by [counsel] as personal representative for which he [also] sought and received compensation.â Id. at 639, 303
Appellant also contends that âclaims against a guardianship estate cannot be made after the guardianship has been terminated.â But Banksâs claim for attorneyâs fees were filed against Ms. Battleyâs estate, not her guardianship assets.
Finally, appellant argues that even if the orphansâ court did not err in awarding Banks attorneyâs fees, it abused its discretion in awarding him $300 for such fees as that amount was excessive when compared to the meager value of the estate. Compensation for legal work for the benefit of an estate must âbe fair and reasonable in the light of all the circumstances to be considered in fixing the fee of an attorney.â ET § 7-602(b). The âprincipal elementsâ to be considered by the orphansâ court in determining the reasonableness of an award of attorneyâs fees include âthe amount [of the requested fee] involved, the character and extent of the services, the time employed, the importance of the question, the benefit to the estate and the customary charges made for similar services.â Wolfe v. Turner, 267 Md. 646, 653, 299 A.2d 106 (1973). Once an award is made, it âwill not be disturbed in the absence of proof of abuse of discretion ... which generally means that the fee allowed is shown to be so unreasonably small or so unreasonably high as to amount to an abuse.â Id.
The orphansâ court had before it evidence as to the amount of the requested fee, the character of the service, the time employed, the importance of the work, and the benefit to the estate. It stressed that, without Banksâs work, the estate would probably have never been opened.
We do find, however, that the orphansâ court erred in ordering that âa check ... be sent to Michael G. Banks, Esq [sic ] immediately.â That court could only, at most, direct the personal representative of the estate to pay Banksâs claim, subject to the payment priorities set forth in ET § 8-105(a). See Barter Sys., 64 Md.App. at 264, 494 A.2d 964.
Prospective Application
Because of the long-standing division among the courts below as to whether to permit a former guardian to pay himself commissions from a former guardianship account before transferring that account to the personal representative of a deceased ward, because it would be grossly unfair for those guardians who have relied upon the decades-old practices of their localities permitting the pre-transfer collection of such fees, see James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 536, 111 S.Ct. 2439, 115 L.Ed.2d 481 (1991) (internal citations omitted), and because there are, in fact, sound reasons for those well-established practices, we choose to apply this rule prohibiting such pre-transfer collections âto this case and prospectively to all such causes of action [occurring] after the filing of the opinion in this case.â Boblitz v. Boblitz, 296 Md. 242, 273, 462 A.2d 506 (1983). In so doing, we apply âselective prospectivity,â which âis distinguishable from pure prospectivity in that the new pronouncement applies to the case in which it is made and not solely to cases arising after
MOTION TO STRIKE APPENDIX TO APPELLEEâS BRIEF GRANTED.
ORDERS DIRECTING APPELLEE TO PAY HIMSELF GUARDIANSHIP COMMISSIONS AND PROBATE FEES VACATED.
ORDER AWARDING APPELLEE ATTORNEYâS FEES VACATED AS TO REQUIREMENT THAT âA CHECK SHALL BE SENT TO MICHAEL G. BANKS, ESQ IMMEDIATELYâ; ORDER OTHERWISE AFFIRMED.
CASE REMANDED TO THE ORPHANSâ COURT FOR MONTGOMERY COUNTY FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION.
COSTS TO BE PAID BY APPELLEE.
. A line was drawn through this request by the circuit court, apparently when it signed the order.
. It is unclear if Banks meant that appellant should have provided this information to Banks, the circuit court, or the orphans' court.
. According to Banksâs petition, appellant had been the guardian of Ms. Battleyâs property before Banksâs appointment in July 2003.
. The $300 represented one hour of work at Banksâs rate of $300 per hour.
. The Maryland Code, Estates and Trusts Article, § 5-601(a) provides: âIf the property of the decedent subject to administration in Maryland is established to have a value of $30,000 or less as of the date of the death of the decedent, the estate may be administered as a small estate.â
. After appellant noted this appeal, the Maryland Department of Health and Mental Hygiene (DHMH) filed a claim against Ms. Battleyâs estate for $54,484.76 to recover expenditures made by the Maryland Medical Assistance Program on behalf of Ms. Battley as a Medical Assistance recipient. That claim, however, was disallowed and then ultimately
. ET§ 8-105(a) states:
If the applicable assets of the estate are insufficient to pay all claims in full, the personal representative shall make payment in the following order:
(1) Fees due to the register;
(2) Costs and expenses of administration;
*648 (3) Funeral expenses as provided in § 8-106 of this subtitle;
(4) Compensation of personal representatives as provided in § 7-601 of this article, for legal services as provided in § 7-602 of this article, and commissions of licensed real estate brokers;
(5) Family allowance as provided in § 3-201 of this article;
(6) Taxes due by the decedent;
(7) Reasonable medical, hospital, and nursing expenses of the last illness of the decedent;
(8) Rent payable by the decedent for not more than three months in arrears;
(9) Wages, salaries, or commission for services performed for the decedent within three months prior to death of the decedent;
(10) Old age assistance claims under Article 88A, § 77 of the Code; and
(11) All other claims.
. The provisions governing guardianships have been in force since 1969, when the Legislature enacted Article 93A, entitled "Protection of Minors and Other Persons Under Disability,â for "the revision and recodification, in a uniform structure, of the laws relating to guardians, committees, conservators, and the protection of property of minors, incompetents, drunkards, senile persons, and other persons generally unable to manage their affairs and property ... and providing rules
. Rule 10-708 requires the guardian, in the annual accountings, to submit information in the format provided by that rule, concerning the wardâs assets and income, and disbursements made on the disabled the wardâs behalf.
. ET § 13-214(c)(4) further provides: "If a guardianship is terminated for reasons other than the attainment of majority, cessation of disability, or death of the protected person, the guardian shall distribute the estate in accordance with the order of the court terminating the guardianship.â
. Those subsections provide respectively: "When a minor attains his majority, his guardian, after meeting all prior claims and expenses of administration, shall distribute the estate to the former minor as soon as possible....â ET § 13-214(c)(l) (emphasis added); "If the guardian is satisfied that the disability of the disabled person has ceased or if the court has found ... that the disability has ceased, the guardian, after meeting all prior claims and expenses of administration, shall distribute the estate to the former disabled person as soon as possible.â ET § 13-214(c)(2) (emphasis added).
. We are also mindful that some states treat guardianship commissions as liens on the decedent's estate. See, e.g., In re Clantonâs Estate & Guardianship, 171 Cal. 381, 153 P. 459, 461 (1915) ("[W]e see no reason why [the guardianâs] equitable lien [on the decedent's land] may not extend to the fund resulting from the sale of the interest of the decedent in the land.â); Riley v. Superior Court, 49 Cal.2d 305, 316 P.2d 956, 960 (1957) ("[Tjhe court has jurisdiction to award the guardian fees and to declare a lien in the guardianâs favor even though all the property has been turned over to the administrator of the deceased wardâs estate.â); State v. Greenhaw, 50 Ariz. 436, 72 P.2d 950, 951 (1937) (â[A]11 debts legally incurred by the estate of an incompetent
We decline to follow these states. A lien, in Maryland, may only be created by "contract, statute, or rule of law.â Montgomery County v. May Dept. Stores Co., 352 Md. 183, 195, 721 A.2d 249 (1998) (quoting Chevy Chase Bank, FSB v. Chaires, 350 Md. 716, 731, 715 A.2d 199 (1998)). Here, however, there is no contract. Nor is there any Maryland statute, rule, or law which grants a former guardian a lien for unpaid guardianship commissions on a deceased wardâs estate.
. Appellant also cites ET § 13-220 in support of the proposition that termination of a guardianship ends the "right and power pertaining to the office of guardian.â That section, however, only addresses situations where a guardianship terminates due to the "death, disability, resignation, or removalâ of the guardian, ET § 13-220(a), and does not address the termination of a guardianship as a result of the ward's death.