January 27, 2010
TATIANA ROSSIUS, PLAINTIFF-APPELLANT,
MARIA KRASHENINNIKOFF, AND ILBER SABANOSKI, DEFENDANTS.
IN THE MATTER OF THE ESTATE OF MARIA KRASHENINNIKOFF, DECEASED
On appeal from the Superior Court of New Jersey, Chancery Division, Ocean County, Docket Nos. C-124-07 and 171589.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued November 30, 2009
Before Judges Alvarez and Coburn.
Plaintiff Tatiana Rossius, the successful party in a probate dispute in which she alleged undue influence on the part of Ilber Sabanoski upon the decedent, Maria Krasheninnikoff, appeals the probate court's award of counsel fees to Sabanoski's attorney. We reverse.
Rossius filed an action on May 14, 2007, to evict Sabanoski from the Lakewood premises she owned jointly with decedent, who died on February 27, 2007. On June 29, 2007, an order was entered compelling defendant to vacate the residence within fourteen days. A consent order was subsequently entered requiring Sabanoski to vacate the premises within thirty days so that the property could be marketed for sale. Sabanoski continued to occupy the premises even though he was not paying taxes, insurance or even the utilities. Accordingly, a motion to enforce litigant's rights was filed on September 25, 2007. Sabanoski filed opposition on or about September 28, 2007.
Contemporaneously, Rossius discovered that Sabanoski had obtained letters testamentary from the Ocean County Surrogate's Court by falsely claiming that he was kin to decedent. As a result of this discovery, Rossius filed a motion to extend the time for the filing of a complaint in the probate matter on October 17, 2007. The proceedings were consolidated under the probate part caption.
On December 19, 2007, Rossius's motion for leave to file an objection to probate was granted. The matter was listed for trial on June 17, 2008.
Not long before the three-day trial, Sabanoski fired his attorney. He appeared pro se in the probate matter. Both parties were directed, at the close of the proceedings, to prepare for the court's benefit, a list of proposed findings of fact and statements of law. Sabanoski obtained his former attorney's assistance in preparing his written submissions to the court.
On August 8, 2008, the court determined that Sabanoski had engaged in the tort of undue influence and awarded the entire estate to Rossius under the terms of an earlier will. The court found that Sabanoski improperly influenced decedent, whose competence was then in doubt, to make defendant the sole beneficiary named in her will despite her prior relationship with Rossius.
Furthermore, aided by a power of attorney granted to him by decedent, Sabanoski had borrowed $15,000 secured by a mortgage on the jointly-owned premises. Sabanoski did not vacate the home until removed by the Ocean County Sheriff's Department on October 1, 2008.
On September 3, 2008, defendant's prior counsel, Joseph Ottino, Esquire, filed an application for fees relating to his representation of Sabanoski on a variety of matters. Rossius's attorney opposed the application; however, the opposition was not received by the court for reasons neither known to the parties nor ascertainable from the record. Ottino was awarded counsel fees in the amount of $10,868.51. Again, for reasons not discernable from this record, Ottino did not serve Rossius's attorney with copies of the order. Only when Rossius's attorney inquired about the status of the motion did he learn that the motion had been granted, despite his opposition, and that an award had been made. The application for reconsideration was denied April 24, 2009.
It was not disputed in the probate proceedings that Sabanoski did not maintain the premises in good repair, paid no expenses while living there, and encumbered the property with a $15,000 mortgage towards which he made no payment. Sabanoski is now a wanted person on unrelated charges and his whereabouts are unknown.
Plaintiff contends the court erred in the counsel fee award, not only because each side ordinarily bears his or her own counsel fees under the American Rule, but because Sabanoski was found to have exercised undue influence over decedent. We are constrained to agree.
In the ordinary case, New Jersey favors the American Rule. In re Niles, 176 N.J. 282, 293-94 (2003). The rule serves the following purposes: "(1) unrestricted access to the courts for all persons; (2) ensuring equity by not penalizing persons for exercising their right to litigate a dispute, even if they should lose; and (3) administrative convenience." Id. at 294. A court may, however, in its discretion allow fees under limited circumstances when a fund in court is available. R. 4:42-9(a)(2).
In a probate action, allowance may be made for legal fees out of decedent's estate even if probate is refused. R. 4:42-9(a)(3). Where probate is granted and there is reasonable cause for contesting the validity of the will, an allowance may be made to both the proponent and the contestant. Ibid. But where the wrongful conduct of one party triggers otherwise unnecessary litigation, no allowance of counsel fees will be made to the wrongdoer. In fact, in some circumstances, counsel fees for the innocent prevailing party may be charged against that individual. See id. at 296-300. This prevents the wrongdoer, an individual who commits the tort of undue influence, for example, to benefit from his wrongdoing to any extent and protects the estate from being diminished by the litigation engendered by the wrongdoing. See id. at 298-99. In fact, "undue influence represents such an egregious intentional tort that it establishes a basis for punitive damages in a common law cause of action." Id. at 300. Thus not only will a wrongdoer be denied payment of his or her legal fees out of a fund in court, he or she may be liable for counsel fees or punitive damages, to the prevailing party.
If counsel fees were to be awarded to anyone, it should have been to Rossius. Sabanoski was clearly the wrongdoer in possession of a questionable power of attorney granted by decedent and equally dubious letters testamentary. The award of counsel fees to Sabanoski out of the anticipated proceeds of the sale of decedent's property means that Rossius is being compelled to pay for both the injury done to the property by virtue of Sabanoski's waste and mortgage encumbrance, and the legal fees she incurred during the litigation caused by Sabanoski's wrongful conduct. It was Sabanoski's "perfidy that brought about the litigation." In re Landsman's Will, 319 N.J. Super. 252, 274 (App. Div.), certif. denied, 162 N.J. 127 (1999). Accordingly, it was an abuse of discretion for the court to award him counsel fees. Ibid.
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