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Settlement Reached in Fee Dispute in Family Trust Case in Florida

November 20, 2015 | Posted in : Ethics & Professional Responsibility, Expenses / Costs, Fee Dispute, Fee Dispute Litigation / ADR, Unpaid Fees

A recent Daily Business Review story, “Settlement Reached in Lawsuit Over Attorney Fees,” reports that Miami attorney Bruce Katzen has reached a confidential settlement with Wells Fargo Bank over a $1.6 million lawsuit he filed to collect overdue fees and costs.

The settlement, which was approved, stemmed from a Katzen filed on behalf of a college student who alleged he was owed money from a 4-year old family trust case.  Katzen, of Kluger Kaplan Silverman Katzen & Levine, filed his action for attorney fees in Miami-Dade Circuit Court in March.

At the time he filed his suit, Katzen said, "The conduct of the professional fiduciaries is outrageous, especially in light of a Third District Court of Appeal ruling saying they are responsible for breach of fiduciary duty.  They have not had a conscience from the beginning in this case, and the fiduciaries continue to try to protect each other instead of looking out for the interests of the beneficiary."

The underlying case dealt with Katzen's representation of Hunter Wolk, then a 20-year-old college student.  The complaint, filed four years ago in Miami-Dade Circuit Court, alleged that Wolk's great-aunt, Coral Gables resident Lois Kritchman, left instructions for her trust to continue paying for Wolk's college education, which she had done for two years.

Wells Fargo, the co-trustee overseeing Kritchman's trust along with her son, William Kritchman, refused to pay for Wolk's education, according to Katzen's suit. In April 2011, Katzen sued to compel Wells Fargo to pay.

The litigation grew bitter and drawn out: Katzen filed 13 motions for sanctions against Wells Fargo for allegedly withholding discovery.  Miami-Dade Circuit Judge Jorge Cueto ruled Wells Fargo violated rules of procedure and ordered the bank to pay Katzen $60,000 individually and not out of the trust.

In 2012, Cueto also found Wells Fargo and William Kritchman breached their fiduciary duty and should have paid Wolk's educational costs from the trust.  The trustees appealed to the Third District Court of Appeal, which affirmed Cueto and found the trustees breached the trust and did not act in good faith by refusing to pay Wolk.

The appellate court also granted Wolk's motion for attorney fees and costs and remanded to the trial court to fix an amount.

Wells Fargo subsequently asked to be dropped from the case and said any attorney fees should be paid from the trust since it was no longer a trustee in the case.  Coral Gables Trust Co. took over as trustee.