In In the Est. of Lemme, an administratrix of an estate hired her boyfriend to do legal work. No. 07-21-00300-CV, 2022 Tex. App. LEXIS 8829 (Tex. App.—Amarillo December 1, 2022, no pet. history). After an accounting was submitted, heirs objected to the amount of the fees paid. The trial court removed the administratrix for gross mismanagement, and she appealed.

The court of appeals first discussed the law regarding removing an administrator:

Gross misconduct or gross mismanagement is a ground for removal of an executor. “Gross misconduct” and “gross mismanagement” include, at a minimum: (1) any willful omission to perform a legal duty; (2) any intentional commission of a wrongful act; and (3) any breach of a fiduciary duty that results in actual harm to a beneficiary’s interests. “As a fiduciary, an executor has a duty to protect the beneficiaries’ interest by fair dealing in good faith with fidelity and integrity. His personal interests may not conflict with his fiduciary obligations to the estate.” In addition, a fiduciary owes a principal a high duty of strict accountability.

Id. The court of appeals then reviewed the evidence concerning the payment of attorney’s fees:

Richardson and Allen alleged that, considering the size of the estate and lack of complexity involved in handling it, the attorney’s fees charged by Durrance were not reasonable or necessary. They further asserted that fees charged for non-legal activities, such as consulting plumbers and realtors, should not have been charged to or paid by the estate. Richardson and Allen claimed that Cox’s relationship with Durrance influenced Durrance’s billing practices in this case and Cox’s decision to pay the excessive amounts, which significantly reduced the value of the estate and the ultimate amount received by the beneficiaries. Cox contends that she merely sought and paid for legal counsel and, as such, her actions could not constitute gross misconduct or gross mismanagement.

At the evidentiary hearing, Durrance’s invoice for $43,037.50, for services provided between March of 2019 and November of 2020, was admitted into evidence. Many entries were one-word descriptions of the work performed, such as “review,” “preparation,” and “plumber.” The invoice also reflected entries for “travel” and one 20-hour “site visit.” Richardson presented evidence that of the $43,037.50 paid to Durrance from estate funds, roughly $20,000 was paid for activities that were not legal in nature, such as communicating with plumbers, realtors, and utility companies. Durrance testified that he did not recall discussing any of the entries with Cox or Cox making any complaint about his invoices…

In sum, the evidence reveals that Durrance charged, and Cox paid, attorney’s fees that were not reasonable or necessary, including substantial charges for non-legal work. The evidence further shows that Cox failed to exercise meaningful oversight of the administration, instead delegating her fiduciary responsibilities to Durrance. Moreover, because Durrance and Cox are romantic partners who share a household, the payments to Durrance indicated that Cox favored her partner’s—and arguably her own—personal financial interests over those of the estate beneficiaries.

Id. The court then concluded that the evidence supported the trial court’s conclusion that the administratrix breached her fiduciary duty and engaged in gross mismanagement of the estate and affirmed the removal.

The court also affirmed the trial court’s award of attorney’s fees against the former administratrix. The court held that Section 351.003 of the Texas Estates Code allows certain costs and reasonable attorney’s fees to be assessed against an administrator when the administrator is removed for cause. The court stated: “Because Cox was removed for cause, it was proper for the trial court to charge her with the attorney’s fees incurred in removing her as administratrix.” Id. The court then reviewed the evidence of attorney’s fees, which included billing statements, hourly rate, number of hours, and testimony regarding segregation, and affirmed the award of $7,075 in attorney’s fees.

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Photo of David Fowler Johnson David Fowler Johnson

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David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the The Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary…

[email protected]

David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the The Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas. Read More

David’s financial institution experience includes (but is not limited to): breach of contract, foreclosure litigation, lender liability, receivership and injunction remedies upon default, non-recourse and other real estate lending, class action, RICO actions, usury, various tort causes of action, breach of fiduciary duty claims, and preference and other related claims raised by receivers.

David also has experience in estate and trust disputes including will contests, mental competency issues, undue influence, trust modification/clarification, breach of fiduciary duty and related claims, and accountings. David’s recent trial experience includes:

  • Representing a bank in federal class action suit where trust beneficiaries challenged whether the bank was the authorized trustee of over 220 trusts;
  • Representing a bank in state court regarding claims that it mismanaged oil and gas assets;
  • Representing a bank who filed suit in probate court to modify three trusts to remove a charitable beneficiary that had substantially changed operations;
  • Represented an individual executor of an estate against claims raised by a beneficiary for breach of fiduciary duty and an accounting; and
  • Represented an individual trustee against claims raised by a beneficiary for breach of fiduciary duty, mental competence of the settlor, and undue influence.

David is one of twenty attorneys in the state (of the 84,000 licensed) that has the triple Board Certification in Civil Trial Law, Civil Appellate and Personal Injury Trial Law by the Texas Board of Legal Specialization.

Additionally, David is a member of the Civil Trial Law Commission of the Texas Board of Legal Specialization. This commission writes and grades the exam for new applicants for civil trial law certification.

David maintains an active appellate practice, which includes:

  • Appeals from final judgments after pre-trial orders such as summary judgments or after jury trials;
  • Interlocutory appeals dealing with temporary injunctions, arbitration, special appearances, sealing the record, and receiverships;
  • Original proceedings such as seeking and defending against mandamus relief; and
  • Seeking emergency relief staying trial court’s orders pending appeal or mandamus.

For example, David was the lead appellate lawyer in the Texas Supreme Court in In re Weekley Homes, LP, 295 S.W.3d 309 (Tex. 2009). The Court issued a ground-breaking opinion in favor of David’s client regarding the standards that a trial court should follow in ordering the production of computers in discovery.

David previously taught Appellate Advocacy at Texas Wesleyan University School of Law located in Fort Worth. David is licensed and has practiced in the U.S. Supreme Court; the Fifth, Seventh, and Eleventh Federal Circuits; the Federal District Courts for the Northern, Eastern, and Western Districts of Texas; the Texas Supreme Court and various Texas intermediate appellate courts. David also served as an adjunct professor at Baylor University Law School, where he taught products liability and portions of health law. He has authored many legal articles and spoken at numerous legal education courses on both trial and appellate issues. His articles have been cited as authority by the Texas Supreme Court (twice) and the Texas Courts of Appeals located in Waco, Texarkana, Beaumont, Tyler and Houston (Fourteenth District), and a federal district court in Pennsylvania. David’s articles also have been cited by McDonald and Carlson in their Texas Civil Practice treatise, William v. Dorsaneo in the Texas Litigation Guide, and various authors in the Baylor Law ReviewSt. Mary’s Law JournalSouth Texas Law Review and Tennessee Law Review.

Representative Experience

  • Civil Litigation and Appellate Law