Summary
The Massachusetts Appeals Court affirmed a Probate and Family Court judgment rejecting claims that Tony and Chris Baker lacked authority under their mother's durable power of attorney to make substantial gifts to themselves and Lisa LoPorto. The court held that the power of attorney authorized gifts to the attorneys themselves and that the defendants met their fiduciary burden to show the gifts were consistent with Frances Fern's expressed standard and interests. The court also affirmed the denial of attorney's fees and costs under G. L. c. 215, § 45.
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Practice areas
Questions Presented
- Whether the gifting provision in Frances's durable power of attorney authorized Anthony and Christopher Baker to make gifts to themselves.
- Whether the defendants proved that the gifts were consistent with their fiduciary duties and with the standard of Frances's intended donative choices.
- Whether the Probate and Family Court abused its discretion by denying the defendants' request for attorney's fees and costs under G. L. c. 215, § 45.
Holdings
- The 2013 power of attorney's gifting provision authorized Anthony and Christopher Baker to make gifts to themselves because it expressly granted gifting authority and permitted gifts to persons who, in their opinions, would be the donees Frances might choose; the language was sufficient at least where the attorneys were the principal's immediate family members.
- The defendants met their burden of proving that they acted in good faith and in Frances's interests and reasonably concluded that Frances would have chosen to make the gifts to them and Lisa and not to Tracey.
- The Probate and Family Court did not abuse its discretion by denying the defendants' request for attorney's fees and costs, and the Appeals Court denied the defendants' request for fees and costs on appeal.
Key quotations
“If Tony and Chris could prove that gifts to themselves met that standard, then for a court to construe the gifting power so strictly as to nevertheless bar such gifts -- particularly to two of the most natural objects of Frances's affection -- would risk "destroying the purpose of the power" (citation omitted).” (14)
“The critical issue under the power of attorney was not Frances's actual donative intent, but instead whether Tony and Chris had shown that, in their opinions developed in accordance with their fiduciary duties, Frances would have chosen to make the gifts at issue.” (15)
“But it "still pay[s] homage to the usual American rule against an automatic award of fees to the prevailing party, and require[s] a reason, grounded in equity, why an award shifting fees should be made."” (19)
Factual background
Frances R. Fern executed a 2013 durable power of attorney authorizing Anthony and Christopher Baker to make outright gifts of her property to persons who, in their opinion, would be the donees Frances might choose. In 2016, while Frances had advanced dementia and was living in a health-care facility, the Bakers caused gifts totaling $5.576 million to be made to themselves and $43,000 to Lisa LoPorto, relying on their understanding of Frances's wishes and anticipated tax savings. Frances's daughter Tracey challenged the gifts as unauthorized, inconsistent with Frances's donative intent, and a breach of fiduciary duty.
Procedural history
Tracey Fern filed suit in the Barnstable Division of the Probate and Family Court challenging gifts totaling approximately $5.576 million to Anthony and Christopher Baker and $43,000 to Lisa LoPorto. After an eight-day trial, the Probate and Family Court found for the defendants on all claims and denied the defendants' request for attorney's fees and costs. Tracey appealed, and the defendants cross-appealed. The Appeals Court affirmed the judgment in all respects and denied the request for appellate attorney's fees and costs.