Fall 2004 Newsletter
Fiduciaries & Counselors Beware - A Lesson in Good Faith & Prudence
By Kimberley Ann Murphy, Esquire
"Just because you can does not mean that you should."
These are the words that a personal representative needs to heed when discharging his fiduciary duties. We as counsel, either for the fiduciary or the beneficiaries, need to be mindful of these principles as well, because the consequences can be significant. Removal is not the only remedy to handle an errant fiduciary. A suit to falsify the accounts and surcharge the personal representative (or "suit to surcharge and falsify") is one seldom used, but very powerful sword to wield. A personal representative may think that because he is in charge, he is above reproach. We as counsel should beware of the consequences of an improper charge to an estate - especially one involving our own fees. Disputes erupting between the fiduciary and the beneficiaries can greatly increase the cost of litigation, particularly if the fiduciary is unaware that he may have to pay for such costs of litigation out of his own pocket. The estate is not an arsenal from which to draw a limitless war chest. For those who underestimate the power of a suit to surcharge and falsify, you may reevaluate your position after reviewing some of the latest trends in the Commonwealth's courts.
A Fiduciary's Power- Where Does it Come From?
A personal representative's power comes from many sources, and it depends upon the nature of the estate. While a fiduciary has the estate funds available to him, and those funds appear to be at his sole disposal, he has to remember that he is serving a very distinct purpose. What he has the power to do, or not to do, whichever the case may be, turns on several factors.
For testate estates, the will is the controlling document, and it many times confers complete control over the entirety of the estate assets to the Executor,l including the decedent's real estate. For testate estates, "the whole personal estate goes into the hands of an administrator and nothing passes to the distributees unless and until all debts of the decedent have been paid and the costs of administration; then, if there is a surplus, it is divided among the same persons and in the same proportions as the real estate.,,2 The laws of intestacy, however, contemplate that the real estate is transferred directly to the heirs at law upon death, unless the decedent's personal estate is insufficient to pay the decedent's debts.3
Regardless of whether the estate is testate or intestate, the fiduciary has the power to collect property on behalf of the estate4 and to pay the debts of the decedent.5s In the event the fiduciary is granted powers under Virginia Code Ann. § 64.157, his powers become extremely far-reaching. A fiduciary may borrow money on behalf of the estate,6 hire accountants and attorneys,7 and even sell real estate under the estate's control8 We need to remember that these are broad powers, and can easily lead to fiduciary blunders. It is because of these powers that the beneficiaries are at the fiduciary's mercy.9 There are many pitfalls that the unwary fiduciary, and his counsel, can fall into. That is why it is imperative that we understand what behavior is and is not allowed, because, regardless of which side we may represent, these rules can dictate the possible remedies that may be necessary to solve a fiduciary's lapse in judgment.
Where are the Lines Drawn?
A personal representative qualifies before the circuit court in the jurisdiction in which the decedent died a resident, regardless of whether that fiduciary qualifies as an executor named under a will10 or is appointed administrator pursuant to the laws of intestacy.11 As such, that same court may remove the personal representative for cause, regardless if the individual is serving as an executor or administrator.12 Notwithstanding, the standard for removing a fiduciary appointed by a written instrument is higher than one appointed by the court.13 Removal is within the sound discretion of the court.14 While removal is certainly a plausible alternative, are there situations in which removal will not make the estate whole? Yes, particularly in circumstances in which the personal representative has misspent estate funds. The estate should not be forced to bear the burden of unnecessary and improper expenditures.
Although in a perfect world everyone is able to get along, in many estates that is simply not the case. There may be friction between the personal representative and the beneficiaries, but such friction, by itself, does not render a fiduciary unfit to serve in his capacity.15 There must be something more.16 The thing we as counsel must understand is that the personal representative's primary interest is "settling the estate, not unfaithfully or partially, but faithfully, for the welfare of all concerned."17 It is when a personal representative is unfaithful or biased that he puts himself in danger of being removed, or incurring personal financial liability. However, where is the line between proper and improper, and neutral versus biased? ·When should a personal representative take a position versus letting the beneficiaries battle it out between themselves? The answers may actually surprise you.
Good Faith Means Staying Above the Fray
When counseling a personal representative, it important for him to understand that he is standing in the shoes of the deceased. If there exists a will, the executor has a duty to defend the intentions expressed by the testator in his will.18 He may not substitute his own interpretation of the testator's intentions,19 nor advocate a position advancing his own self-interest contradictory to the very instrument under which he qualified.20
While it is true that a fiduciary may initiate a Bill of Complaint for Aid and Direction,21 he must be clear in his objectives. We as counsel should ask what it is that the fiduciary is trying to accomplish, because it is the result sought that will be of most use in determining the propriety of the personal representative's actions. If the personal representative is also a beneficiary, his position comes under closer scrutiny.22 The line of demarcation is where the estate's interests end and the beneficiary's interests begin. However, while the litigation is proceeding, it seems that no one is focusing on the fiduciary's position until he either requests reimbursement for attorney's fees associated with the litigation, or the beneficiaries seek to have the fiduciary repay funds used toward litigation-related attorney's fees. So, how does an attorney representing a fiduciary know which attorney's fees are allowed and which are not?
As with most issues related to this subject, good faith in bringing the suit shall control.23 But this is not the only test. Central to all inquiries regarding the propriety of a fiduciary's behavior are two other tests besides good faith, to wit: "whether or not the fiduciary's conduct fell within the scope of his powers and duties; and whether or not the fiduciary exercised ordinary prudence in pursuing the ends sought."24 The questions involving good faith and prudence are the most critical and most illuminating.
Typically, lawsuits involving the estate and beneficiaries are ones in which the beneficiaries are left to "fight it Out."25 There are, of course, exceptions to this rule.26 Good faith requires that the suit be commenced in the execution of a fiduciary's duties.27 It is this amorphous "good faith" standard that can wreak havoc upon the unwary counselor. It should be remembered that:
a fiduciary is not required to act at his peril; he need not eat the doubtful vegetable in order to ascertain if it is a wholesome mushroom or a poisonous toadstool, . . . In such cases of doubt or difficulty the expense incident to instituting and conducting such a suit, including an allowance by the court of proper compensation to the fiduciary's counsel, is to be borne by the estate, not by the personal representative out of his own pocket or out of his compensation or commissions.28
Cases brought seeking interpretation of a will, or questioning how to distribute an estate appear to be within this standard. In fact, any case advancing the estate's interests fall within the ambit of above quoted rule.29
There are, actually, several cases that clarify the difference between the estate's interests and the fiduciary's self-interests. A personal representative may not litigate the interests of one class of beneficiaries over another,30 and if he does, he certainly cannot charge the estate with the attorney's fees expended on the ground that he was "defending the Will."31 Counsel should beware of the "will" or "estate contest" disguised as an "aid and direction" suit.32 In the Fairfax County Circuit Court case, Gaymon v. Gaymon, although the executor instituted an action for what he titled "aid and direction," most of the relief sought to divest a beneficiary of the property devised to her by the will. The executor stood to personally gain from the intended outcome. Since the expenditure of attorney's fees was before the court as a surcharge and falsification issue, the Honorable Arthur B. Vieregg, Jr., as part of a twenty eight page opinion, falsified the attorney's fees, and surcharged the executor for those fees spent in furtherance of his beneficial interest. In other words, because the ends sought were benefiting the fiduciary personally, and the suit was more akin to one between "feuding beneficiaries," it could not be said that the executor's actions were taken in good faith. It should be noted, however, that whether the personal representative has a vested interest in the outcome does nothing more than shift the burden of proof to him to show that his actions were proper.33
Another circuit court opinion, In re Estate of Wicker, disallowed attorney's fees in an action to establish a will brought by the executor. The opinion highlighted four cases decided by the Supreme Court of Virginia, but two of the four cases dealt with challenges to the fiduciary's behavior in administering the estate.34 The case Clare v. Grasty35 seemed to set the standard that if there was a reasonable ground brought for the removal of the fiduciary, the fiduciary could not charge the estate with his attorney's fees.36 Neither can a fiduciary charge the estate for attorney's fees associated with defending exceptions to his accounting.37 However, if an action brought against a fiduciary is groundless, the fiduciary's attorney's fees are allowed.38 The important rule to remember is that if a fiduciary's own behavior has brought about the contest, he should refrain from charging the estate with his attorney's fees until a court allows those fees as proper.
It seems, however, that if the executor undertakes a suit to establish a will under which he is not a beneficiary, the likelihood of a court finding that he has acted in good faith appears to be greater.39 Notwithstanding, the Virginia Supreme Court has made it clear that such cases are decided on an individual basis,40 and this is not to say that simply because a personal representative is also a beneficiary, he may not institute a suit on behalf of the estate.41 The burden is upon the fiduciary to show that his actions were taken in good faith.42 Again, unless the suit is absolutely one for aid and direction, it is wise to wait for a court order allowing payment of attorney's fees from the estate.
Additionally, once an aid and direction suit has been fully litigated, the personal representative may not appeal the decree as he received the relief he was seeking (i.e., aid and direction).43 The key is whether the estate's interests have been adversely affected.44 Personal representatives and their attorneys need to be mindful of the difficulties associated with litigation involving beneficiaries, especially when the personal representative himself is a beneficiary. It is always best to bring the suit in his capacity as beneficiary, than to bring it in his fiduciary capacity. In the latter situation, the personal representative runs the risk of removal or a suit to surcharge and falsify.45 In other words, it is best to stay above the fray as a personal representative, and leave the fighting between the beneficiaries.
Prudence Sometimes Means Not Hiring Counsel
The standard, as enunciated by the Virginia Supreme Court, holds that personal representatives
are required to do those things which a man of reasonable intelligence and prudence would be expected to do in the management of his own affairs, but this rule, like most rules, is to be construed in the light of the conditions obtaining when it is applied."
As a trustee, she was held to the duty of acting in good faith, in the exercise of a fair discretion, in the same manner in which a man of reasonable intelligence and prudence would act in the management of his own affairs in the light of the conditions facing him.46
Prudence means weighing the possible outcome against the costs associated with the litigation. If the end sought is going to be overcome by the cost of reaching that point, is it prudent to hire an attorney to pursue it? It depends. "There must be some reasonable ground to justify the [fiduciary] and to render the employment of counsel reasonably necessary to aid in the discharge of the duties of the [fiduciary] and the protection of the [estate] property."47 Personal representatives should, therefore, carefully weigh the costs and alternatives of the litigation they intend to bring.
To Except or to Surcharge - That is the Question
Many times, it is not until the estate is ready for final distribution that the beneficiaries finally realize what fees and costs have been incurred by the fiduciary. By that point, the damage is done. Or, is it? What recourse do beneficiaries have against an errant fiduciary? And, what, if anything, can an attorney representing a fiduciary do to protect his client?
First and foremost, the Virginia legislature has promulgated a statute designed to give beneficiaries the ability to request copies of the accountings, so long as those requests are in writing.48 However, that statute merely gives the beneficiaries the right to see what has been done over the course of twelve months of the administration. It does not present the beneficiaries with any remedy. In reality, besides depending upon the Commissioner of Accounts to intercede when a problem presents itself, the beneficiaries have few options. The difficulty with relying upon the Commissioner of Accounts is that the beneficiaries are not parties to the proceedings before the Commissioner, and so a fiduciary's accounting has the possibility of concealing improper expenditures. Thus, the beneficiaries have only two primary modes of corrective action.
The aggrieved beneficiaries can file exceptions to the findings of the Commissioner of Accounts within fifteen days of the accounting being approved.49 While that mode is economically feasible, if the Commissioner rules against the beneficiaries, the beneficiaries appeal the Commissioner's findings to the circuit court, and absent pure questions of law, the commissioner's findings are left intact unless found to be unsupported by the evidence.50 Notwithstanding, the beneficiaries can opt to forego filing exceptions and file a suit to surcharge and falsify the account.51 This is a procedure that has been around for many, many years, but is not utilized very often.52 It is, however, an extraordinary remedy, and should only be used in situations in which the fiduciary makes improper and excessive expenditures.
A settlement of accounts (hereinafter "accounting") is presumed to be prima facie correct until it is duly surcharged and falsified.53 "Prima facie evidence is evidence which on its first appearance is sufficient to raise a presumption of fact or establish the fact unless rebutted. It imports that the evidence produces for the time being a certain result, but that the result may be repelled."54
Historically, the accounts of a fiduciary were examined and settled in front of a Commissioner, which is why they bear a presumption in favor of being correct.55 It is because of the examination by a Commissioner of the Accounts that the burden of proof in a surcharge and falsify would devolve upon the party complaining.56
Today, a Commissioner of Accounts reviews the vouchers and statements produced by the fiduciary.57 The presumption that an approved accounting is correct is still the law in the Commonwealth. A complainant in a surcharge and falsify action has the duty to specify the errors contested in the accounting.58 Further, the burden of proof, or onus probandi, in a surcharge and falsify action is tragically upon the party contesting the accounting.59
Notwithstanding, there are occasions for which this burden of proof shifts to the fiduciary. The ex parte settlement (or accounting, as it is commonly known) is prima facie evidence to show the situation of the personal estate of the decedent.60 However, "such accounts are not evidence at all . . . that the claims stated in them were debts justly due by the deceased."61 The propriety of the expenditure is an important distinction, as it is that issue that triggers shifting of the burden of proof from the beneficiary contesting the accounting to the fiduciary defending it. When the question of payment of attorney's fees in conjunction with lawsuits instituted against or involving the beneficiaries, the question is typically not whether the payment was made, or that the amount paid was incorrect.62 The question is whether it was proper for the personal representative to pay the associated attorney's fees.
In most cases involving the expenditure of attorney's fees, there is no discrepancy as to the amount the fiduciary spent on attorney's fees, who received the attorney's fees, or whether the fees were expended in furtherance of litigation instituted by personal representative. It is the disagreement as to the propriety of payment of those fees that an approved accounting does not establish, prima facie or otherwise.63
When a fiduciary holds an interest adverse to the estate he represents, which does not grow out of its due administration, the executor stands in the position of proving his demand as if the accounting had never been made.64 It is because of this burden shifting that the attorney's fees paid by a personal representative out of the estate can be a charge against him personally.65 This is why it is so important for attorneys to counsel the personal representative about the propriety of the actions he has taken.
Further, for those who feel that your advice may insulate your fiduciary client, beware of Gaymon v. Gaymon. The Honorable Arthur B. Vieregg, Jr. held that advice of counsel was not a defense as it is the duty of the fiduciary, and not of counsel, to weigh the costs of going forward with a particular course of action.66 It should also be noted that although there is no case decided by the Virginia Supreme Court speaking to the defense of advice of counsel, attorneys and fiduciaries alike should be careful about the use of such a defense, as it could lead to an argument that the personal representative has abdicated his role as fiduciary.67
So, What's A Lawyer to Do?
We need to educate our client. We need to tell our fiduciary client that spending attorney's fees in litigation may not be proper, especially if he stands to personally gain from that litigation. We need to obtain a clear and specific set of goals the personal representative wants to achieve, and an analysis of whether any of those goals are in reality beneficiary issues. If you represent a beneficiary, make sure you keep a careful eye on the litigation, and more importantly, on who's bankrolling it. It may come back to haunt the personal representative, and as a result, reimburse the estate. After all, it is ultimately the protection of the corpus of the estate with which the courts are most concerned.
1 See, e.g., Bruce v. Farrar, 156 Va. 542, 545 (1931).
2 Id. at 551.
3 Id. (stating "the real estate descends directly to the heirs in parcenary at the moment of the death of the ancestor, but subject to the contingency that if personal assets are not sufficient for the payment of debts, creditors may bring a suit in equity for a sale of so much of the real estate as may be necessary for that purpose"). See also VA. CODE ANN. § 64.1-1 (Michie 2004) (espousing the rule that realty passes directly to the heirs at law).
4 See Bruce, 156 Va. at 551. See also VA. CODE ANN. § 64.1-139 (Michie 2004); Isbell v. Flippen, 185 Va. 977, 981 (1947) (stating that "one of the primary obligations of the personal representative is to collect the assets of the estate") (citations omitted).
5 See id.
6 See VA. CODE ANN. §64.1-57(f) (Michie 2004).
7 See VA. CODE ANN. § 64.1-57(k) (Michie 2004).
8 See VA. CODE ANN. § 64.1-57(b) (Michie 2004).
9 See Leavell v. Smith's Exec'r, 99 Va. 374, 379 (1901).
10 See VA. CODE ANN. §§ 75,117 & 136 (Michie 2(04).
11 See VA. CODE ANN. 118 (Michie 2004).
12 See VA. CODE ANN. § 26-3 (Michie 2004) (providing in pertinent part "If the order of the court or clerk is not complied with, or whenever from any cause it appears proper, the court may revoke and annul the powers of any such fiduciary"). An executor, just like an administrator, may only be removed for cause. See Clark v. Grasty, 210 Va. 33, 37 (1969); Beavers v. Beavers, 185 Va. 418, 423 (1946) (upholding the construction that §§ 2637 and 2639 (i.e., §§ 64.1-116 and 118 in 2004 Code), when read together, dictates that an administrator may only be removed for cause).
13 See Clark, 210 Va. at 37 (using principals from trust law stating that "more is required to remove a trustee appointed by the creator of the trust than is required to remove one appointed by the court) (citing Willson v. Kable, 177 Va. 668, 676 (1941) and Nickels v. Horsley, 126 Va. 54, 55 (1919)).
14 See id.
15 See id. at 38 (adopting the reasoning used in removal of a trustee).
16See Nickel's Adm'r v. Horsley, 126 Va. 54, 57 (1919).
17 Nickel's Adm'r, 126 Va. at 57.
18 See Butt v. Murden, 154 Va. 10, 152 S.E. 330 (1930).
19 See id. See also Clare v. Grasty, 213 Va. 165, 169 (1972); Gaymon v. Gaymon, 63 Va. Cir. 264, 281 (Vieregg, J., Fairfax Co. Cir. Ct., Oct. 14, 2(03).
20 See Clare, 213 Va. at 169 (holding "'But as an executor entrusted by his testator with only the Virginia assets of the estate, Grasty's primary and pervading duty was to the testator and the legal directions in his wilL' Whether Grasty had law which might support his position is not material, since it is the executor's duty to make every effort to carry out the testator's intention").
21 See Sproul v. Hunter, 122 Va. 102, 109 (1917).
22 See, e.g., Gaymon v. Gaymon, 63 Va. Cir. 264, 290-91 (Vieregg, J., Fairfax Co. Cit. Ct., Oct. 14, 2003); In re Estate of Wicker, 58 Va. Cir. 331,333-37 (Hammond, J., Henrico Co. Cir. Ct., Mar. iI, 2002).
23 See Shepherd v. Darling, 120 Va. 586,591 (1917).
24 Gaymon, 63 Va. Cit. at 281(citing Commercial & Savings Bank v. Burton, 183 Va. 133, 149 (1944)).
25 See Butt v. Murden, 154 Va. 10, 15 (1930).
26 In re Estate of Wicker, 58 Va. Cir. 331, 333-334 (Va. Cir. Ct., 2002) (stating "The distinction is drawn between services that benefit the Estate, through legal representation of the administrator or executor, and services performed personally for a potential beneficiary of the Estate").
27See Clare v. Grasty, 213 Va. 165, 170 (1972); see also Leavell v. Smith's Exec'r, 99 Va. 374,379 (1901).
28 Gaymon, 63 Va. Cir. at 282 (quoting Harrison, Wills and Administration, § 560, at 231).
29 See, e.g., O'Brien v. O'Brien, 259 Va. 552 (2000), and Colley v. Cox, 209 Va. 811 (1969), discussed in Gaymon, 63 Va. Crr. at 28788.
30 Shocket v. Silberman, 209 Va. 490, 493 (1969) (quoting Ferrell v. Basnight, 127 S.E.2d 219, 221-22 (N.C. 1962) (holding that "an executor cannot litigate the claims of one set of legatees against the others at the expense of the estate").
31See McCormick v. Elsea, 107 Va. 472,474-75 (1907) (holding that although a fiduciary, the victorious executrix could not charge the estate with attorney's fees for a purpose from which she stood to gain).
32 See generally Gaymon v. Gaymon, 63 Va. Cir. 264 (Vieregg, J., Fairfax Co. Cir. Ct., Oct. 14, 2003).
33 See Gaymon, 63 Va. Cir. at 288 (citing Scott v. Porter, 99 Va. 553, 556 (1901».
34 See Estate of Wicker, 58 Va. Cir. at 331-335.
35 213 Va. 165 (1972).
36 See Clare, 213 Va. at 170-72, discussed in Estate of Wicker, 58 Va. Cir. at 334.
37 See Perrow v. Payne, 203 Va. 17, 30-31 (1976), discussed in Estate of Wicker, 58 Va. Cir. at 334-35.
38Willson v. Whitehead, 181 Va. 960, 966 (1943); see also Clare, 213 Va. at 172 (discussing Willson v. Whitehead).
39 See Butt v. Murden, 154 Va. 10, 16 (1930).
40 See id. The Virginia Supreme Court went on further to say:
What prudence demands and what good faith involves is, of course, largely to be determined by the 'conditions of the estate and the particular facts of the individual case. And I do not think that any fair minded man could read the record in this case and not be impressed with its difficulty and doubtfulness on the facts of testator's testamentary capacity. And for that reason I am of opinion that the executors were clearly justified in defending the will against attack to the very last court open to them. It seems to me that as personal representatives of this estate they acted in good faith and as ordinary business men in employing counsel to aid them. Id. at 18.
41 See Gaymon, 63 Va. Cir. at 288.
42 Scott v. Porter, 99 Va. 553, 556 (1901).
43 Shocket v. Silberman, 209 Va. 490, 492-93 (1969); see also Caine v. Freier, 264 Va. 251, 257 (Va., 2002) (stating that "in the present case, the personal representative is not aggrieved by the decree from which it seeks an appeal. In the bill of complaint, the Bank merely asked for the aid and guidance of the lower court in administering the decedent's estate, and the decree complained of gave it that relief').
44 See id.
45See generally Gaymon v. Gaymon, 63 Va. Cir. 264 (Vieregg, J., Fairfax Co. Cir. Ct., Oct. 14, 2003).
46See Commercial & Savings Bank v. Burton, 183 Va. 133, 139
47Stull v. Harvey, 112 Va. 816, 822 (1911).
48 See VA. CODE ANN. § 26-12.4 (Michie 2004).
49 See VA. CODE ANN. § 26-33 (Michie 2(04).
50 See VA. CODE ANN. § 26-33 (Michie 2004); see also Morris v. United Virginia Bank, 237 Va. 331, 337 (Va., 1989) (holding "While the report of a commissioner in chancery does not carry the weight of a jury's verdict, Code § 8.01-610, it should be sustained unless the trial court concludes that the commissioner's findings are not supported by the evidence.
51 See VA. CODE ANN. § 26-34 (Michie 2004).
52See Harrison, Wills and Administration, §549 at 216 (stating that"suits to surcharge and falsify are seldom used in Virginia").
53 See Young v. Bowen, 131 Va. 401, 404 (1921). See also VA. CODE ANN. § 26-34 (Michie 2004); Butt v. Murden, 154 Va. 10 (1930); Butt v. Murden, 149 Va. 518 (1927); Scott v. Porter, 99 Va. 553 (1901); Leavell v. Smith's Ex'r, 99 Va. 374 (1901); Robinett's Adm'r v. Robinett's Heirs, 92 Va. 124 (1895); Hurt v. West's Adm'r, 87 Va. 78 (1890); and Radford v. Fowlkes, 85 Va. 820
54 Babbitt v. Miller, 192 Va. 372, 379-80 (1951).
55See Atwell's Adm'r v. Milton, 14 Va. (4 Hen. & M.) 253, 256 (1809).
56 See id. (stating "can there be a doubt that a copy of the account so exhibited, examined, allowed, and admitted to record by the proper tribunal, would prima facie be so far conclusive evidence, in favour of the executor, in an action brought upon his official bond, as to shift the burden of proof, as to any thing which might surcharge or falsify such account, from the executor to the plaintiff.")
57See McIntyre's Adm'r v. Wright's Adm'r, 113 Va. 299, 301
58See Powers v. Powers, 174 Va. 164, 169 (1939).
59 See Commercial & Savings Bank v. Burton, 183 Va. 133, 139
(1944) (quoting Powers v. Powers, 174 Va. 164, 169 (1939)).
60 See Leavell v. Smith's Exec'r, 99 Va. 374, 378 (1901).
62 In those situations, the burden of proof would be upon the beneficiary. McIntyre's Adm'rv. Wright's Adm'r, 113 Va. 299,301302 (1912). In McIntyre's Adm'r, the complainant pointed to disbursements with merely oral testimony as to the personal nature of debts paid as proof of surcharge and asked that the amount be surcharged. The court refused to do so ruling that the evidence failed to overcome the presumption of correctness, stating specifically the following:
It is not permissible for us to assume that a commissioner of accounts would treat such checks as "proper and satisfactory vouchers," showing that "all funds coming into his (the administrator's) hands had been properly accounted for," or that an intelligent court would have confirmed a report based upon such vouchers. The admissible evidence is not sufficient to surcharge and falsify the account, and it must be taken as correct. McIntyre's Adm'r v. Wright's Adm'r, 113 Va. 299,301302 (1912).
63Leavell, 99 Va. at 378.
64 See Scott v. Porter, 99 Va. 553, 556 (1901).
65 See Gaymon, 63 Va. Cir. at 289-90.
66 See id. Further, the advice of counsel defense typically deals with losses directly attributable the action or inaction by the attorney. See, e.g., Mills' Adm'rv. Talley's Adm'r, 83 Va. 361 (1887) (attorney was negligent, inter alia, in failing to file suit Within the limitations period).
67 See, e.g., Bliss v. Spencer, 125 Va. 36,53 (1919) (holding that "Such abdication .. "" constituted a plain dereliction of the very duty which the office of guardian is created to perform). Currently, there are no cases decided by the Virginia Supreme Court with regard to abdication by a fiduciary in a decedent's estate. However, it should be well taken that any abdication of his role as fiduciary can have serious consequences.
Ms. Murphy is an associate attorney with the law firm of HALE, HASSAN, CARLSON & PENN, PLC, located in Fairfax, Virginia. Ms. Murphy concentrates her practice in the areas of Estates and Trusts (planning and litigation) and Business (incorporation, planning, sale/purchase & litigation). Ms. Murphy graduated from the Michigan State University College of Law magna cum laude in 2000. She acted as co-counsel in a case recently decided by the Fairfax County Circuit Court dealing with many fiduciary issues . including surcharge and removal. Gaymon v. Gaymon, Chancery Nos. 152472; 171423, Fix. Co. Cir. Ct., 63 Va. Cir. 264; 2003 Va. Cir. LEXIS 202 (The Honorable Arthur B. Vieregg, Jr., Oct. 14,2003). Ms. Murphy is admitted to practice before the Supreme Court of Virginia (2000), U.S. District Court for the Eastern District of Virginia (2000), and the Fourth Circuit Court of Appeals (2003). Ms. Murphy is a member of the Order of the Barristers, the MSU-DC Alumni Association Executive Board (Secretary), the Virginia Bar Association (member: Wills, Trusts &Estates, Administrative Law and Young Lawyers sections), and the American Bar Association (member: Litigation and Law Practice Management sections). She is also co-chair of the Wills, Trusts & Estates Section of the Fairfax Bar Association.