Celia Newman died in August 2004. Her three children, Ilana, Adina, and Max survived her. As administrator of Celia’s estate, Adina discovered several questionable financial transactions between Celia and Max, including use of Celia’s money for a down payment on a house and withdrawal of over $300,000 from Celia’s IRA. Max subsequently refused to cooperate with the administration of the estate. As a result, Adina brought claims against Max for return of property and documents, breach of fiduciary duty, violation ofArizona’s Vulnerable Adults Statute, conversion, and reformation. Following trial, the trial court found that Max breached his fiduciary duties and entered judgment in an amount exceeding $700,000, including $278,000 for double damages under A.R.S. § 14-3709(D). The Court also found that Max violatedArizona’s Vulnerable Adults Statute and thus forfeited the benefits he would have otherwise received under Celia’s will. This appeal followed.
The Arizona Appeals Court first held that a prior order with regard to the decedent’s property is required in order for double damages to be assessed under A.R.S. § 14-3709(D). Subsection (D) states that an order of disclosure is prima facie evidence of the personal representative’s right to the property, thereby implying that an order of disclosure must precede a double damages award under subsection (D). The Court clarified, however, that a violation of an order is not required prior to a double damages award; the issuance of an order itself is sufficient. Because no order of disclosure existed prior to the trial court’s double damages award against Max, theAppeals Court vacated that portion of the judgment.
The Court next concluded that an individual who occupies a position of trust and confidence with regard to a vulnerable adult and breaches a duty of trust to that adult thereby automatically forfeits any benefits from the decedent’s estate. Here, Max breached his duty by “failing to keep clear and accurate records, commingling funds, and engaging in transactions that benefited him without advising Celia to seek” independent advice.
Finally, the Court held that there is no jury trial right with regard to a breach of fiduciary duty claim in the probate context because such a claim is equitable in nature and no jury trial right existed for equitable claims at the time of the adoption of Arizona’s Constitution.
Judge Barker authored the opinion in which Judges Irvine and Johnsen concurred.