Ohio Court of Appeals Affirms Probate Court Decision Removing Administrator of Estate

Elder Law Answers case summary.An Ohio Court of Appeals affirms a probate court’s judgment removing an administrator of an estate and appointing a successor administrator. The trial court did not err in removing Ashley Thompson as the administrator of the Estate of George W. Nugent, nor did it err in finding that she committed a “per se violation” of her fiduciary duty of loyalty. In re Estate of George W. Nugent (2023-Ohio-700, Case No. 22AP-296, March 7, 2023).

George W. Nugent passed away in April 2020 without a will. His next of kin was his sister, Nancy Nugent, who became the sole heir of his estate under intestacy laws. In July 2020, Ms. Thompson was appointed the administrator of Mr. Nugent’s estate, which was worth $2,102,962.82. Ms. Thompson claimed that Mr. Nugent had been in the process of writing a will prior to his passing that contemplated her and her husband receiving his estate.

Through a series of events, Ms. Thompson obtained an assignment from Ms. Nugent of her entire interest in the estate. The assignment gave this interest to Ms. Thompson individually. The probate court scrutinized and questioned this when Ms. Nugent filed a motion to remove Ms. Thompson as administrator in May 2021.

In particular, the court was concerned about whether Ms. Thompson was acting in the best interests of Ms. Nugent when she orchestrated the assignment because she did not put the interests of Ms. Nugent ahead of her own. The assignment put Ms. Nugent’s Medicaid and disability benefits at risk and would have deprived Ms. Nugent of the inheritance she would have needed if she lost her benefits. The trial court felt this conduct violated Ms. Thompson’s fiduciary duties as an administrator.

As a result, in July 2021, the court removed Ms. Thompson as administrator and replaced her with an attorney. Ms. Thompson objected, and the court overruled her. In May 2022, she filed a timely appeal.

The Court of Appeals finds that absent an abuse of discretion, the probate court has the latitude to remove a fiduciary pursuant to Ohio R.C. 2109.24. If there is no abuse of discretion, the Court of Appeals should not reverse the decision.

The Court of Appeals reviewed the probate’s court conclusion that Ms. Thompson violated her fiduciary duty to Ms. Nugent. It agreed that Ms. Thompson owed a strict duty of loyalty to Ms. Nugent as established by case law. It also agreed that she had engaged in self-dealing prohibited by Ohio R.C. 2109.44, which applies to fiduciaries appointed by and accountable to the probate court, including fiduciaries administering an estate.

While administrator, Ms. Thompson provided Ms. Nugent, as sole beneficiary, with the document needed to transfer her entire interest in the estate to Ms. Thompson. This act was not in the best interests or to the benefit of Ms. Nugent. It was to the detriment of Ms. Nugent. As such, it was a per se violation of her fiduciary duty of loyalty to Ms. Nugent. In addition, Ms. Thompson’s failure to advise Ms. Nugent to seek legal counsel until after the assignment was signed and the detriment to Ms. Nugent was realized was a further breach of loyalty.

Read the full text of this decision.