Contested Accountings in Miami, Florida

When a personal representative administers an estate or a trustee manages a trust, they have a fiduciary obligation to account for all assets, income, expenses, and distributions. Beneficiaries who receive these accountings have the right to review them and, if they identify errors, omissions, or misconduct, to file formal objections. A contested accounting arises when one or more beneficiaries challenge the accuracy or propriety of a fiduciary's accounting. The Law Offices of Albert Goodwin, PA represents beneficiaries and fiduciaries in contested accounting proceedings throughout Florida.

What Is a Fiduciary Accounting?

A fiduciary accounting is a formal financial report prepared by a personal representative or trustee that details the administration of an estate or trust over a specific period. In Florida, the requirements for estate accountings are governed by the Florida Probate Code, Chapter 733 of the Florida Statutes, while trust accountings are governed by the Florida Trust Code, Chapter 736 of the Florida Statutes.

Under Florida Statute Section 733.5036, a personal representative must file an accounting of the estate's administration with the court. The accounting must include a complete record of all receipts, disbursements, distributions, and other transactions involving estate assets. Similarly, under Florida Statute Section 736.0813, a trustee has a duty to provide qualified beneficiaries with an annual accounting that shows the trust's assets, liabilities, receipts, and disbursements.

The purpose of an accounting is to provide transparency and allow beneficiaries to verify that the fiduciary has properly managed the assets entrusted to their care. If a beneficiary believes the accounting is inaccurate or reflects misconduct, they have the legal right to object.

Grounds for Objecting to an Accounting

Beneficiaries may object to an accounting on a variety of grounds. The following are among the most common reasons accountings are contested in Florida:

Excessive Fees and Commissions

One of the most frequent grounds for contesting an accounting is the claim that the personal representative or trustee has charged excessive fees. Under Florida Statute Section 733.617, a personal representative is entitled to reasonable compensation, and Section 736.0708 similarly provides that a trustee is entitled to reasonable compensation. When fees appear disproportionate to the work performed or exceed the amounts authorized by statute or the governing instrument, beneficiaries may object. This includes both the fiduciary's own compensation and fees paid to attorneys, accountants, and other professionals retained during the administration.

Undisclosed Transactions

A fiduciary has a duty to disclose all transactions involving estate or trust assets. If the accounting fails to reflect certain transactions, such as asset sales, loans, or transfers, this omission may form the basis of an objection. Undisclosed transactions may indicate breach of fiduciary duty, self-dealing, or an attempt to conceal mismanagement of assets.

Asset Mismanagement

Fiduciaries have a duty to prudently manage the assets under their control. Under Florida's Prudent Investor Rule, codified in Florida Statute Section 518.11, a trustee must invest and manage trust assets as a prudent investor would, considering the purposes, terms, distribution requirements, and other circumstances of the trust. Similarly, a personal representative must manage estate assets with reasonable care. If an accounting reveals poor investment decisions, failure to diversify, or neglect of income-producing assets, beneficiaries may contest the accounting on the ground of mismanagement.

Self-Dealing and Conflicts of Interest

A fiduciary is prohibited from engaging in self-dealing or transactions that present a conflict of interest. Under Florida Statute Section 736.0802, a trustee has a duty of loyalty and must administer the trust solely in the interests of the beneficiaries. If the accounting reveals transactions in which the fiduciary personally benefited, such as purchasing trust assets for themselves, lending trust funds to related parties, or using estate assets for personal purposes, beneficiaries have strong grounds for objection.

Failure to Collect or Preserve Assets

A personal representative or trustee has a duty to identify, collect, and preserve all assets belonging to the estate or trust. If the accounting shows that assets were not collected, were allowed to deteriorate, or were lost due to the fiduciary's negligence, beneficiaries may object. This includes failure to pursue claims owed to the estate, failure to maintain real property, and failure to secure personal property.

Improper Distributions

Beneficiaries may also object to an accounting that reflects improper distributions. This includes distributions made to persons not entitled to receive them, distributions made in incorrect amounts, premature distributions made before the resolution of claims or taxes, and distributions that do not comply with the terms of the will or trust instrument.

The Process for Filing Objections

The process for contesting an accounting in Florida depends on whether the accounting relates to an estate or a trust.

Estate Accounting Objections

Under Florida Statute Section 733.5036, when a personal representative files an accounting with the probate court, interested persons are entitled to receive notice and an opportunity to examine the accounting. Beneficiaries who wish to object must file their objections with the court within the time period specified in the notice. The objections must be specific, identifying the particular items or entries in the accounting that are challenged and the grounds for each objection. Vague or generalized objections may be stricken by the court.

Once objections are filed, the court will typically schedule a hearing. The personal representative bears the burden of proving that the accounting is accurate and that all transactions were proper. The objecting beneficiary must identify the specific items in dispute, but the fiduciary must justify their conduct.

Trust Accounting Objections

For trust accountings, the process may differ depending on the terms of the trust and the manner in which the accounting is provided. Under Florida Statute Section 736.0813, a trustee must provide a trust accounting to qualified beneficiaries at least annually and upon termination of the trust. If a beneficiary objects to the accounting, the matter may be brought before the court through a petition or complaint. Under Florida Statute Section 736.1008, a beneficiary may have a limited time to contest a trust accounting after receiving adequate disclosure, so it is important to act promptly upon receiving a trust accounting.

Common Issues in Contested Accountings

In our experience handling contested accounting cases, certain issues arise with particular frequency:

Inadequate record-keeping. Fiduciaries sometimes fail to maintain adequate records of their transactions, making it difficult or impossible to verify the accuracy of the accounting. Poor record-keeping may itself constitute a breach of fiduciary duty and can shift the burden to the fiduciary to explain discrepancies.

Commingling of funds. A fiduciary must keep estate or trust assets separate from their personal assets. Commingling funds makes it difficult to trace assets and may indicate mismanagement or self-dealing.

Delayed accountings. Fiduciaries who delay providing accountings may be attempting to conceal problems or may simply be neglecting their duties. Beneficiaries have the right to demand timely accountings, and unreasonable delay may warrant court intervention.

Inconsistencies between accountings and supporting documents. When the figures in an accounting do not match bank statements, tax returns, or other supporting records, this raises serious concerns about the accuracy and integrity of the accounting.

Remedies Available to Beneficiaries

If objections to an accounting are sustained, the court may order a variety of remedies, including:

Surcharge. The court may surcharge the fiduciary, meaning the fiduciary is held personally liable for losses caused by their misconduct or negligence. Surcharge is a powerful remedy that compensates beneficiaries for the harm caused by the fiduciary's breach of duty.

Removal of the fiduciary. Under Florida Statute Section 733.504 (for personal representatives) or Section 736.0706 (for trustees), the court may remove a fiduciary who has breached their duties, failed to account properly, or otherwise demonstrated that they are unfit to serve. The court may then appoint a successor fiduciary to complete the administration.

Disgorgement of fees. If the fiduciary charged excessive fees, the court may order the return of all or a portion of the fees previously paid.

Attorney's fees and costs. In some cases, the court may award attorney's fees and costs to the prevailing party. Under Florida Statute Section 736.1004, the court has discretion to award fees and costs in trust proceedings as justice requires.

Revised accounting. The court may order the fiduciary to prepare and file a revised accounting that accurately reflects the administration of the estate or trust.

How We Help

The Law Offices of Albert Goodwin, PA provides experienced representation in contested accounting matters. For beneficiaries, we thoroughly review fiduciary accountings, identify discrepancies and potential misconduct, and aggressively pursue objections to protect our clients' interests. We work with forensic accountants and other experts to trace assets, quantify losses, and build compelling cases for surcharge and other remedies.

For fiduciaries facing objections, we provide defense of accounting practices, assist in preparing accurate and complete accountings, and work to resolve disputes efficiently. Whether through negotiation, mediation, or litigation, our goal is to achieve the best possible outcome for our clients.

Contact a Florida Contested Accounting Attorney

If you have received a fiduciary accounting that you believe is inaccurate or reflects misconduct, or if you are a fiduciary facing objections to your accounting, the Law Offices of Albert Goodwin, PA can help. Time limits may apply to your right to object, so it is important to act quickly. Call us at 786-522-1411 or email [email protected] to schedule a consultation. Our office is located at 121 Alhambra Plz # 1000, Coral Gables, FL 33134.