864 P.2d 1346 | Or. Ct. App. | 1993
Plaintiff appeals from final orders of the probate court in a conservatorship proceeding. ORS 19.010. She challenges the authority of the court, after the protected person dies, to order conservators to retain assets of the estate to pay expenses of administration. She also challenges the court’s orders approving a special master’s findings and allowing payment of attorney fees. We review de novo, ORS 19.125(3), and affirm.
Hide Naito (Hide) was plaintiffs husband and the founder and chairman of the board of directors of Norcrest China Company (Norcrest). In 1987, the court appointed plaintiff as Hide’s conservator. She placed his property and jointly held assets into the conservatorship estate. She discovered two stock certificates in Hide’s name for 750 shares of Norcrest in a safe deposit box held jointly by Hide and plaintiff. She also found a stock agreement in Hide’s name describing 50 voting and 700 non-voting shares of Norcrest stock. She sought a determination from the court as to whether Hide owned the stock, whether Norcrest owed Hide compensation and whether Hide remained a guarantor of any of Norcrest’s liabilities.
On October 26,1987, the probate court appointed a special master, McEwen, to make findings on those issues. McEwen’s law firm, Cake, Hardy, Buttler, McEwen & Weiss (Cake, Hardy), represented Norcrest at the time of the relevant stock transactions. Weiss, who is a partner in the firm of the co-conservators’ attorney, had been McEwen’s partner in Cake, Hardy until he left the firm in 1977. On October 27, 1987, an attorney representing defendant Samuel Naito, Hide’s son (son), notified the court and plaintiffs attorney, Tongue, that Weiss and McEwen had been law partners. Tongue responded in writing that he did not believe “the previous partnership * * * will cause any difficulty.”
McEwen met with the parties’ counsel on October 29,1987. After reviewing the evidence, he submitted a report to the probate court on January 22, 1988, in which he found that Hide did not own the Norcrest stock, that Norcrest did not owe Hide past compensation and that Hide was no longer responsible for any of Norcrest’s liabilities.
In May, 1988, at son’s request, the court substituted son for plaintiff as conservator. Plaintiff appealed her removal. In September, 1988, the court appointed Schwab as co-conservator. On August 8, 1989, while plaintiffs appeal was pending, Hide died.
Hide’s will provided that all of his property should be held in trust during plaintiffs lifetime and used for her benefit. However, Hide held all significant assets, except the family home and adjoining lots, jointly with plaintiff. The conflict between the trust provision and the joint title created a dispute over ownership of Hide’s assets. Schwab recommended, and the court ordered, binding arbitration to settle the ownership of assets dispute. The parties appointed an arbitrator, who ruled that all jointly held assets passed to plaintiff on Hide’s death by operation of law. The co-conservators and plaintiff agreed to maintain $100,000 of jointly held assets in the conservatorship estate to pay conservatorship expenses.
The co-conservators cashed a $50,000 certificate of deposit from the conservatorship estate and used $25,000 of it to pay attorney fees. In January, 1991, the court ordered the sale of Hide’s residence to pay the conservator’s attorney fees. In February, 1991, the court ordered the co-conservators to retain the property pending this appeal. The court also ordered all jointly held assets returned to plaintiff, including reimbursement of the $25,000. The court denied plaintiffs petition to terminate the conservatorship.
Our statement in Naito was arguably too broad.
“The order of termination shall direct the conservator to deliver the assets in the possession of the conservator to the protected person or successors:
“(a) Immediately, to the extent that they are not required for payment of expenses of administration and debts incurred by the conservator for the account of the estate of the protected person * *
Under the statutory scheme, when the protected person dies, the conservator retains the estate for delivery to the personal representative or other proper person,. ORS 126.337(1), and the court orders delivery of the retained assets to the protected person’s successors, except for assets required for estate expenses. ORS 125.387(2)(a). Assets necessary to pay expenses remain in the conservatorship estate until the expenses are paid. ORS 126.387(2). Those assets
The court’s procedure here follows the statutory scheme. The court ordered that defendants, in accordance with ORS 126.337(1), retain estate property and, pursuant to their authority in ORS 126.313(7), sell the residence to generate funds necessary to compensate their attorneys. ORS 126.263(2). The court has statutory authority to make those orders. The court did not err. Because the conservators’ duty to pay expenses of administration is not fulfilled, the court also did not err in denying plaintiffs motion to terminate the conservatorship.
Plaintiff assigns error to the court’s order adopting the special master’s findings, because the conservatorship had terminated due to Hide’s death, and because McEwen had an appearance of bias. We have concluded that the conservatorship survived the death for purposes of paying expenses. We address only the appearance of bias.
Plaintiff, through her attorney, waived any claim that McEwen could not serve as a special master free from the appearance of bias. Waiver is the intentional relinquishment of a known right. Drews v. EBI Companies, 310 Or 134, 150, 795 P2d 531 (1990); Grau v. Northwestern Mutual Insurance Co., 221 Or 240, 245, 350 P2d 1082 (1960); Kahl v. Pool, 47 Or App 43, 48, 613 P2d 1078 (1980). An attorney, acting as the client’s agent, may waive the client’s objection to a referee or special master. See Delp v. Schiel, 223 Or 267, 271, 354 P2d 299 (1960). Plaintiffs attorney assured defendants that McEwen’s past involvement with Norcrest and his former association with Weiss would not “cause any difficulty.” The trial court concluded that that statement was a waiver that bound plaintiff, and that her correspondence with the court also supported that conclusion. We agree.
Finally, plaintiff assigns error to the court’s July 31, 1990, and February 5, 1991, orders awarding attorney fees and expenses incurred by defendants. She asserts that the court cannot award attorney fees for work attributable to the arbitration. Defendants were not parties to the arbitration. However, they filed detailed accountings that establish that the attorneys’ work supported the purpose of the conservatorship and that the expenses incurred were reasonable. We see no reason to disturb the court’s orders.
Affirmed.
Son was appointed personal representative on August 15, 1989, pursuant to decedent’s will.
We do not modify our holding in Naito v. Naito, supra, 99 Or App at 611, that the wife’s appeal in that case was moot. She raised no claim about her removal that required resolution after the character of the conservator’s powers and duties changed due to Hide’s death. ORS 126.337.