In Re The Conservatorship of Alfonso B. Patton ( 2012 )

IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
October 23, 2012 Session
IN RE THE CONSERVATORSHIP OF
ALFONSO B. PATTON
Appeal from the Probate Court for Davidson County
No. 10P191 Hon. David Randall Kennedy, Judge
No. M2011-01296-COA-R3-CV - Filed December 6, 2012
In this conservatorship case, Gloria and John Walker filed a petition in which they sought to
be appointed as the conservator of Alfonso B. Patton. Patricia Richmond protested, alleging
that she would be an appropriate conservator. Prior to a full hearing on the petition, the trial
court appointed the Walkers as temporary conservators of the estate and Patricia Richmond
as a temporary conservator of the person. Following approximately one year of protracted
litigation, the court confirmed that Alfonso B. Patton was in need of a conservator of his
estate and of his person. The court subsequently appointed a neutral, third-party as
permanent conservator of the estate and of the person. Patricia Richmond appeals. We
affirm the decision of the trial court.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Probate Court Affirmed;
Case Remanded
J OHN W. M CC LARTY, J., delivered the opinion of the court, in which H ERSCHEL P. F RANKS,
P.J., and C HARLES D. S USANO, J R., J., joined.
James D. R. Roberts, Jr. and Janet L. Layman, Nashville, Tennessee, for the appellant,
Patricia Richmond.
Peggy D. Mathes, Nashville, Tennessee, for the appellee, Guardianship and Trust,
Corporation.
Paula Whitson Reed, Nashville, Tennessee, attorney ad litem for the appellee, Alfonso B.
Patton.
OPINION
I. BACKGROUND
Alfonso B. Patton (“Ward”) was born on October 15, 1917. Ward owned a 50 percent
interest in Patton Brothers Funeral Home (“the funeral home”) and worked at the funeral
home for most of his life. While married to Kathryn Patton, he fathered one child, Patricia
Richmond (“Daughter”), with Christine King in 1953. Initially, he did not admit paternity
of Daughter. Following Ms. Patton’s death in 2005, Daughter was adjudged to be Ward’s
biological child pursuant to an order entered in 2006. At some point, Ward acknowledged
Daughter as his child.
In November 2006, Daughter sought appointment as Ward’s conservator. She
subsequently dismissed the petition. On January 23, 2008, Ward executed a durable power
of attorney, naming Daughter as his attorney-in-fact. The 2008 appointment invalidated
George Baker’s appointment as Ward’s attorney-in-fact. While acting as Ward’s attorney-in-
fact, Daughter awarded herself and her husband, Ronnie Richmond (“Husband”), a combined
salary in excess of $100,000; loaned in excess of $200,000 to her daughter and son-in-law
(collectively “the Lowes”); purchased two properties, one for $137,000 and another for
$245,000; and used a substantial amount of Ward’s monetary assets to renovate Ward’s home
and the newly purchased properties. Daughter purchased several vehicles and made other
substantial expenditures. She also re-titled several of Ward’s properties by adding herself
to the title or removing Ward from the title and substituting either herself or herself and
Husband. Throughout her tenure as Ward’s attorney-in-fact, Ward’s estate dramatically
decreased in monetary value.
On February 3, 2010, Gloria Walker and John Walker (collectively “the Walkers”)
filed a petition, alleging that Ward was in need of a conservator.1 The Walkers also filed a
petition for recoupment against Daughter, alleging that she had engaged in self-dealing while
acting as Ward’s attorney-in-fact. The recoupment petition and the instant case were
bifurcated. As relevant to this case, the Walkers initially sought a neutral, third-party to serve
as Ward’s conservator but subsequently amended the petition to request their appointment
as conservator. They alleged that Ward was advanced in age and suffered from “Alzheimer’s
disease and an advanced stage of dementia.” They asserted that during Mr. Baker’s tenure
as Ward’s attorney-in-fact, Mr. Baker sold four of Ward’s properties in a lump sale for less
than what the properties were worth. They feared that the same would occur during
Daughter’s tenure as Ward’s attorney-in-fact and asserted that Daughter had already
conveyed several properties, resulting in Ward’s detriment.
1
Ms. Walker was Ward’s second cousin and Mr. Walker’s mother.
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Daughter denied any wrongdoing and filed a counter-petition, requesting her
appointment as Ward’s conservator. She alleged that Ward designated her as his choice of
conservator pursuant to the durable power of attorney and that she was due favorable
consideration in the court’s determination because she was Ward’s daughter. In the interim,
she requested appointment of either herself or another person as Ward’s temporary
conservator.
Following a hearing, the court found that Ward was in need of a conservator of his
estate and of his person, appointed the Walkers as temporary conservators of Ward’s estate,
and appointed Daughter as the temporary conservator of Ward’s person. The court ordered
Daughter to
convey, transfer, restore, re-title and assign into the name of the Estate Co-
Conservators on behalf of [Ward], any and all assets that were transferred out
of the name of [Ward] into her name and/or into anyone else’s name, including
[Husband]. Any such asset shall be titled in the names of “Gloria E. Walker
and John W. Walker, Jr., Co-Conservators for Alfonso. B. Patton.”
The court revoked all previous durable powers of attorney and ordered Daughter to submit
an accounting of her management of Ward’s estate and any additional information needed
to complete Ward’s tax return.
Following the court’s order, the parties filed exhaustive motions and petitions
proclaiming that the other had engaged in wrongdoing and that his or her respective
appointment as permanent conservator of Ward’s estate was proper because he or she had
not engaged in wrongdoing. Additionally, Daughter alleged that the temporary appointment
of the Walkers as Ward’s conservator was invalid because the court did not consider any
medical evidence regarding Ward’s ability to care for himself. Meanwhile, Husband and the
Lowes were added as parties to the case in order to facilitate the reconveyance of assets that
they had received during Daughter’s tenure as Ward’s attorney-in-fact. Ward was ordered
to undergo a medical examination, which revealed that Ward was in fact suffering from
advanced dementia and was in need of a conservator or guardian to act on Ward’s behalf
given the nature of his disability. Eventually, Daughter was held in contempt and placed in
jail for her failure to re-convey several of Ward’s assets. Daughter was released the next day
when she followed the court’s order. Following Mr. Walker’s admission that he had
borrowed funds from the estate for his personal use without the court’s permission, Mr.
Walker withdrew as temporary conservator of Ward’s estate. Mr. Walker also admitted that
he had stayed in one of Ward’s properties while acting as conservator of Ward’s estate.
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During subsequent hearings on Ms. Walker’s remaining petition and Daughter’s
responsive petition, Ms. Walker admitted that she was unaware of Mr. Walker’s unauthorized
expenditures. She also admitted that in the course of nine months, she and Mr. Walker spent
$182,622 of estate funds. She explained that they spent more than $36,000 to assist the
funeral home “because the business was going downhill.” She acknowledged that she did
not seek advice as to whether investing in the funeral home would benefit Ward’s estate and
that Ward had not received a salary from the funeral home in several years. She also
acknowledged that her mother owned part of the funeral home property and that her mother
had assigned the interest in the property to her. She believed that Daughter should remain
in the position as conservator of Ward’s person but asserted that Daughter would not be an
appropriate conservator of Ward’s estate given Daughter’s past depletion of Ward’s assets.
Daughter admitted that she depleted Ward’s assets but asserted that each expenditure
and conveyance was made with Ward’s approval. She noted that she was the sole beneficiary
in Ward’s holographic will and that Ward sought to leave his assets to her upon his death.
She argued that she improved Ward’s residence, that she purchased properties to ensure that
he received rental income, and that she simply sought to ensure that Ward was “well taken
care of for the rest of his life.” She presented evidence to establish that Ward’s physical
condition and his residence dramatically improved during her tenure as Ward’s attorney-in-
fact. She claimed that the Walkers ceased payment of Ward’s salary from the funeral home
in 2010, unnecessarily depleted Ward’s estate, and failed to pay the taxes on Ward’s
properties. She alleged that Mr. Walker used funds from the estate for his personal use and
had been dishonest, namely he exaggerated his yearly income and neglected to mention that
his driver’s license had been suspended for failure to pay child support. She presented
evidence to establish that the Walkers, along with Mr. Baker, had engaged in a scheme to
forge a will in which they would profit from Ward’s death.
Following the presentation of the above evidence and several additional hearings not
relevant to the appeal of the final order, the court finally found that neither Ms. Walker nor
Daughter were suited to perform as Ward’s conservator. The court found that it was in
Ward’s “paramount best interest” to appoint a third party as Ward’s permanent conservator.
Therefore, the court appointed Guardianship and Trust, Corporation (“GTC”) as the
conservator of Ward’s estate and of his person. Relative to Daughter, the court stated,
The [c]ourt finds that the pending claims brought by the [Walkers] against
[Daughter] concerning her actions as attorney in fact for [Ward] prior to the
filing of this conservatorship action create an insurmountable conflict of
interest that prevents [Daughter] from serving as conservator of [Ward’s
property]. If appointed to serve in this position [Daughter] would literally be
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charged with the responsibility of prosecuting a claim, as conservator, against
herself, individually.
The [c]ourt finds that [Daughter] has established a history of violating orders
of this [c]ourt and refusing to follow [c]ourt orders. The [c]ourt further finds
that [Daughter] has engaged in self-dealing to the detriment of [Ward] while
serving as attorney in fact for [Ward] and has exercised poor judgment in the
management of [Ward’s] affairs while acting as his attorney in fact. Just one
example of this poor judgment was the use of $137,000 of [Ward’s] money to
purchase a home [], titling that property in [her and Husband’s name],
spending approximately $130,000 of [Ward’s] money to renovate this home,
and then listing the home for sale for $154,000 within a relatively short period
of time.
The [c]ourt finds that in regard to the care of [Ward’s person], there is no
question but that [Ward’s] living conditions [] have been enhanced by
[Daughter’s actions]. The testimony is undisputed that [Ward] lived in a home
that was dirty and not well kept before [Daughter] became involved in
providing assistance to him and that his circumstance has substantially
improved with her assistance.
The [c]ourt further finds that [Daughter] may serve as [Ward’s] caretaker []
without being the conservator of his person. The [c]ourt finds that it would be
appropriate for [Daughter] to continue as the caretaker [] and may be paid
under the terms currently in place, pending further orders of the [c]ourt, but it
would not be in [Ward’s] best interest [] for [Daughter] to serve as the
conservator of his person.
This timely appeal followed.
II. ISSUES
We consolidate and restate the issues raised on appeal by Daughter as follows:
A. Whether the trial court abused its discretion by appointing GTC as Ward’s
conservator.
B. Whether the trial court failed to protect Ward’s estate.
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III. STANDARD OF REVIEW
“[A] petition for the appointment of a conservator requires the [trial] court to make
legal, factual, and discretionary determinations[,]” each of which requires a different standard
of review. Crumley v. Perdue, No. 01-A-01-9704-CH00168, 1997 WL 691532, at *2 (Tenn.
Ct. App. Nov. 7, 1997). In the instant case, the conservatorship issues on appeal relate to the
trial court’s designation of a conservator, which is always left to the discretion of the trial
court. Tenn. Code Ann. § 34-3-103; see also In re Rockwell, 673 S.W.2d 512, 516 (Tenn.
Ct. App. 1983). “A trial court abuses its discretion only when it ‘applie[s] an incorrect legal
standard or reache[s] a decision which is against logic or reasoning that cause[s] an injustice
to the party complaining.’” Eldridge v. Eldridge, 42 S.W.3d 82, 85 (Tenn. 2001) (quoting
State v. Shirley, 6 S.W.3d 243, 247 (Tenn. 1999)). If a discretionary decision is within a
range of acceptable alternatives, we will not substitute our judgment for that of the trial court
simply because we may have chosen a different alternative. White v. Vanderbilt Univ., 21
S.W.3d 215, 223 (Tenn. Ct. App. 1999).
IV. DISCUSSION
A.
“The purpose of a conservatorship proceeding is to protect the person and property
of a disabled person.” In re Conservatorship of Clayton, 914 S.W.2d 84, 90 (Tenn. Ct. App.
1995). In conservatorship cases, it is the petitioner’s burden to prove by clear and convincing
evidence that the proposed ward is a “disabled person.” In re Conservatorship of Groves,
109 S.W.3d 317, 330 (Tenn. Ct. App. 2003). Tennessee Code Annotated section 34-1-101
defines a “disabled person” as:
[A]ny person eighteen (18) years of age or older determined by the court to be
in need of partial or full supervision, protection and assistance by reason of
mental illness, physical illness or injury, developmental disability or other
mental or physical incapacity.
In the instant case, it is undisputed on appeal that Ward was disabled and in need of a
conservator of his estate and of his person. We affirm the court’s decision in that regard.
Having determined that the appointment of a conservator of the estate and of the person was
necessary, we must consider whether the trial court abused its discretion by appointing GTC
as Ward’s conservator. See Rockwell, 673 S.W.2d at 516 (providing that the designation of
the conservator is left to the discretion of the trial court).
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“A conservator occupies a fiduciary position of trust of the highest and most sacred
character.” Grahl v. Davis, 971 S.W.2d 373, 377 (Tenn. 1998) (citing Meloy v. Nashville
Trust Co., 149 S.W.2d 73 (Tenn. 1941)). The conservator is tasked with managing the estate
to the ward’s “best advantage” and preserving the estate for the ward in the event that the
ward recovers. Id. “Persons do not attain the office of conservator by contract or family
relation.” AmSouth Bank v. Cunningham, 253 S.W.3d 636, 642 (Tenn. Ct. App. 2006).
“They are appointed to act in the best interest[] of the disabled adult person for whom they
are partially or fully responsible in the discretion of the court.” Id. In determining which
person should be appointed, the court is guided by the following statutory order of priority:
(1) The person or persons designated in a writing signed by the alleged
disabled person; (2) The spouse of the disabled person; (3) Any child of the
disabled person; (4) Closest relative or relatives of the disabled person; and (5)
Other person or persons.
Tenn. Code Ann. § 34-3-103. However, the order of priority is “[s]ubject to the court’s
determination of what is in the best interest of the disabled person.” Tenn. Code Ann. § 34-
3-103. Thus, in appointing a conservator pursuant to Tennessee Code Annotated section 34-
3-103, the trial court must make two determinations: (1) what is in the best interest of the
disabled person and (2) “based on the first determination, who is the appropriate conservator
given the prioritized list.” Crumley, 1997 WL 691532, at *3.
Once appointed, “[t]he authority, rights and responsibilities of a conservator are not
independent of the court.” Cunningham, 253 S.W.3d at 642. The conservator must “‘act as
the court’s agent’” and may be discharged “if the court determines that the conservator has
failed to perform its duties and obligations, or if the court determines the conservator has
failed to act in the ward’s best interest so as to warrant modification.” Id. at 642-43 (quoting
Clayton, 914 S.W.2d at 90). Indeed, “[t]he court itself is ultimately responsible for the
disabled persons who come under its care and protection.” Clayton, 914 S.W.2d at 90
(citations omitted).
Daughter asserts that the trial court abused its discretion by appointing GTC as Ward’s
conservator. She notes that Ward appointed her as his power of attorney, thereby designating
her as his choice of conservator, that she was Ward’s daughter, and that her care for Ward
was more than adequate. She claims that her expenditures were authorized by Ward and that
Ward sought to leave his entire estate to her, not third parties or distant relatives. GTC
responds that the trial court did not err in appointing the permanent conservator. GTC
acknowledges that Daughter served as Ward’s attorney-in-fact but asserts that Ward never
designated her as his conservator when he executed the durable power of attorney.
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Tennessee Code Annotated section 34-6-104 provides, as relevant to this case,
(a) If, following execution of a durable power of attorney, a court of the
principal’s domicile appoints a conservator [] charged with the management
of all of the principal’s property or all of the principal’s property except
specified exclusions, the attorney in fact is accountable to the fiduciary as well
as to the principal. The fiduciary has the same power to revoke or amend the
power of attorney that the principal would have had if the principal were not
disabled or incapacitated.
(Emphasis added). Thus, the court may appoint a conservator to act on a principal’s behalf
even if the principal executed a durable power of attorney naming another party as his or her
attorney-in-fact. However, the statute further provides, in pertinent part,
A principal may nominate, by a durable power of attorney, the conservator,
guardian of the estate or guardian of the principal’s person for consideration
by the court if protective proceedings for the principal’s person or estate are
thereafter commenced.
Tenn. Code Ann. § 34-6-104(b) (emphasis added). If a ward makes such a nomination,
“[t]he court shall make its [conservatorship] appointment in accordance with the principal’s
most recent nomination in a durable power of attorney except for good cause or
disqualification.” Tenn. Code Ann. § 34-6-104(b).
In this case, Ward’s durable power of attorney did not provide for the express
nomination of a conservator if protective proceedings were commenced following the
appointment of Daughter as Ward’s attorney-in-fact. As relevant to this issue, the document
merely provided, “This Power of Attorney shall not be affected by subsequent disability or
incapacity of the principal.” Accordingly, we reject Daughter’s assertion that Ward’s general
execution of the durable power of attorney effectively designated her as conservator pursuant
to Tennessee Code Annotated section 34-3-103. See generally In re Conservatorship of
Davenport, No. E2004-01505-COA-R3-CV, 2005 WL 3533299, at *20 (Tenn. Ct. App. Dec.
27, 2005) (providing that while the ward designated a conservator to act on her behalf when
she executed her durable power of attorney, the designation was of no effect because the
person nominated was deceased).
We also reject Daughter’s remaining assertions, namely that the court erroneously
ignored the statutory order of priority and her continued personal care for Ward. We do not
wish to discount the fact that Daughter was Ward’s child or that she provided loving care for
Ward and improved his physical condition. However, this court, like the trial court, cannot
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ignore the fact that if appointed as conservator, Daughter would be tasked with acting as the
court’s agent and safeguarding Ward’s estate. As noted by the court, Daughter consistently
displayed a defiant attitude toward the court as evidenced by her refusal to follow the court’s
orders. Problems may arise in the future regarding Ward’s personal care that would require
Daughter to work with the court and follow court orders. Questions also remain as to
whether Daughter would act in Ward’s best interest relative to estate matters when she
depleted Ward’s estate in such a short amount of time. Regardless of whether Ward intended
for Daughter to receive the balance of his estate upon his death, the person or entity acting
as conservator must safeguard the estate for Ward, not his intended beneficiaries. With all
of these considerations in mind, we agree with the trial court that Daughter’s appointment
as conservator would not be in Ward’s best interest. Accordingly, we conclude that the court
did not abuse its discretion in appointing GTC to act as Ward’s conservator of his estate and
of his person.
B.
Daughter asserts that the court’s appointment of the Walkers as temporary
conservators resulted in the dissipation of Ward’s assets. GTC responds that the court
considered Mr. Walker’s mishandling of funds at the final hearing on the petition for
conservatorship and acted to protect Ward’s estate by formally removing the Walkers as
conservators. In Daughter’s reply brief, she asserts that in addition to the dissipation of the
estate caused by the Walkers, nearly $90,000 in attorney fees and mediation expenses were
paid to third parties following GTC’s appointment as conservator.
While we agree that Mr. Walker resigned as conservator following his admission that
he mishandled funds and that Ms. Walker was ultimately discounted as a co-conservator, we
cannot fault the court for its appointment of the Walkers as temporary conservators. The
Walkers presented themselves as responsible relatives that were concerned about Ward’s
welfare. The court held numerous hearings in its effort to monitor the estate. Additionally,
the court appointed a neutral party as conservator of the estate following Mr. Walker’s
mishandling of funds and Ms. Walker’s failure to monitor Ward’s estate. We do not believe
that the court abused its discretion by attempting to find a relative that could responsibly act
as Ward’s conservator and then removing the relatives when they were subsequently proved
unworthy. Likewise, we disagree with Daughter’s assertion that the appointment of GTC
resulted in the further dissipation of Ward’s assets. The alleged erroneous expenditures listed
in the reply brief relate to fees and expenses incurred in the conservatorship action that
Daughter vehemently opposed and prolonged. The fees and expenses were adjudged by the
trial court to be appropriate expenditures that should be charged against the estate.
Additionally, the expenditures included approximately $30,000 of Daughter’s attorney fees.
This issue is without merit.
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V. CONCLUSION
The judgment of the trial court is affirmed, and the case is remanded for such further
proceedings as may be necessary. Costs of the appeal are taxed to the appellant, Patricia
Richmond.
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JOHN W. McCLARTY, JUDGE
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