Florida Senate - 2021 COMMITTEE AMENDMENT
Bill No. SB 954
Ì283472/Î283472
LEGISLATIVE ACTION
Senate . House
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The Committee on Judiciary (Bean) recommended the following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Section 733.6171, Florida Statutes, is amended
6 to read:
7 733.6171 Compensation of attorney for the personal
8 representative.—
9 (1) Attorneys for personal representatives are shall be
10 entitled to reasonable compensation payable from the estate
11 assets without court order. An attorney accepting an engagement
12 to represent an estate in probate or other administration must
13 obtain a fee disclosure statement signed by the person
14 responsible for administering the estate. Such statement must
15 specify all of the following:
16 (a) The attorney fee for representing the estate in probate
17 matters is not set by law and is not required to be based on the
18 size of the estate.
19 (b) The fee is subject to negotiation between the personal
20 representative and the attorney.
21 (c) The selection of the attorney to represent the estate
22 is at the discretion of the personal representative, and the
23 personal representative is not required to select the attorney
24 who drafted the will.
25 (2) The attorney, the personal representative, and persons
26 bearing the impact of the compensation may agree to compensation
27 determined in a different manner than provided in this section.
28 Compensation may also be determined in a different manner than
29 provided in this section if the manner is disclosed to the
30 parties bearing the impact of the compensation and if no
31 objection is made as provided for in the Florida Probate Rules.
32 (3) Compensation for ordinary services of attorneys in
33 formal estate administration is presumed to be reasonable if
34 based on the compensable value of the estate, which is the
35 inventory value of the probate estate assets and the income
36 earned by the estate during the administration as provided in
37 the following schedule:
38 (a) One thousand five hundred dollars for estates having a
39 value of $40,000 or less.
40 (b) An additional $750 for estates having a value of more
41 than $40,000 and not exceeding $70,000.
42 (c) An additional $750 for estates having a value of more
43 than $70,000 and not exceeding $100,000.
44 (d) For estates having a value in excess of $100,000, at
45 the rate of 3 percent on the next $900,000.
46 (e) At the rate of 2.5 percent for all above $1 million and
47 not exceeding $3 million.
48 (f) At the rate of 2 percent for all above $3 million and
49 not exceeding $5 million.
50 (g) At the rate of 1.5 percent for all above $5 million and
51 not exceeding $10 million.
52 (h) At the rate of 1 percent for all above $10 million.
53 (4) In addition to fees for ordinary services, the attorney
54 for the personal representative shall be allowed further
55 reasonable compensation for any extraordinary service. What is
56 an extraordinary service may vary depending on many factors,
57 including the size of the estate. Extraordinary services may
58 include, but are not limited to:
59 (a) Involvement in a will contest, will construction, a
60 proceeding for determination of beneficiaries, a contested
61 claim, elective share proceeding, apportionment of estate taxes,
62 or any adversarial proceeding or litigation by or against the
63 estate.
64 (b) Representation of the personal representative in audit
65 or any proceeding for adjustment, determination, or collection
66 of any taxes.
67 (c) Tax advice on postmortem tax planning, including, but
68 not limited to, disclaimer, renunciation of fiduciary
69 commission, alternate valuation date, allocation of
70 administrative expenses between tax returns, the QTIP or reverse
71 QTIP election, allocation of GST exemption, qualification for
72 Internal Revenue Code ss. 6166 and 303 privileges, deduction of
73 last illness expenses, fiscal year planning, distribution
74 planning, asset basis considerations, handling income or
75 deductions in respect of a decedent, valuation discounts,
76 special use and other valuation, handling employee benefit or
77 retirement proceeds, prompt assessment request, or request for
78 release of personal liability for payment of tax.
79 (d) Review of estate tax return and preparation or review
80 of other tax returns required to be filed by the personal
81 representative.
82 (e) Preparation of the estate’s federal estate tax return.
83 If this return is prepared by the attorney, a fee of one-half of
84 1 percent up to a value of $10 million and one-fourth of 1
85 percent on the value in excess of $10 million of the gross
86 estate as finally determined for federal estate tax purposes, is
87 presumed to be reasonable compensation for the attorney for this
88 service. These fees shall include services for routine audit of
89 the return, not beyond the examining agent level, if required.
90 (f) Purchase, sale, lease, or encumbrance of real property
91 by the personal representative or involvement in zoning, land
92 use, environmental, or other similar matters.
93 (g) Legal advice regarding carrying on of the decedent’s
94 business or conducting other commercial activity by the personal
95 representative.
96 (h) Legal advice regarding claims for damage to the
97 environment or related procedures.
98 (i) Legal advice regarding homestead status of real
99 property or proceedings involving that status and services
100 related to protected homestead.
101 (j) Involvement in fiduciary, employee, or attorney
102 compensation disputes.
103 (k) Proceedings involving ancillary administration of
104 assets not subject to administration in this state.
105 (5) Upon petition of any interested person, the court may
106 increase or decrease the compensation for ordinary services of
107 the attorney or award compensation for extraordinary services if
108 the facts and circumstances of the particular administration
109 warrant. In determining reasonable compensation, the court shall
110 consider all of the following factors, giving weight to each as
111 it determines to be appropriate:
112 (a) The promptness, efficiency, and skill with which the
113 administration was handled by the attorney.
114 (b) The responsibilities assumed by and the potential
115 liabilities of the attorney.
116 (c) The nature and value of the assets that are affected by
117 the decedent’s death.
118 (d) The benefits or detriments resulting to the estate or
119 interested persons from the attorney’s services.
120 (e) The complexity or simplicity of the administration and
121 the novelty of issues presented.
122 (f) The attorney’s participation in tax planning for the
123 estate and the estate’s beneficiaries and tax return
124 preparation, review, or approval.
125 (g) The nature of the probate, nonprobate, and exempt
126 assets, the expenses of administration, the liabilities of the
127 decedent, and the compensation paid to other professionals and
128 fiduciaries.
129 (h) Any delay in payment of the compensation after the
130 services were furnished.
131 (i) Any other relevant factors.
132 (2)(6) If a separate written agreement regarding
133 compensation exists between the attorney and the decedent, the
134 attorney must shall furnish a copy to the personal
135 representative prior to commencement of employment, and, if
136 employed, must shall promptly file and serve a copy on all
137 interested persons. Neither A separate agreement or nor a
138 provision in the will suggesting or directing that the personal
139 representative retain a specific attorney does not will obligate
140 the personal representative to employ the attorney or obligate
141 the attorney to accept the representation, but if the attorney
142 who is a party to the agreement or who drafted the will is
143 employed, the compensation paid may shall not exceed the
144 compensation provided in the agreement or in the will.
145 Section 2. Section 736.1007, Florida Statutes, is amended
146 to read:
147 736.1007 Trustee’s attorney fees.—
148 (1) If the trustee of a revocable trust retains an attorney
149 to render legal services in connection with the initial
150 administration of the trust, the attorney is entitled to
151 reasonable compensation for those legal services, payable from
152 the assets of the trust, subject to s. 736.0802(10), without
153 court order. The trustee and the attorney may agree to
154 compensation that is determined in a manner or amount other than
155 the manner or amount provided in this section. The agreement is
156 not binding on a person who bears the impact of the compensation
157 unless that person is a party to or otherwise consents to be
158 bound by the agreement. The agreement may provide that the
159 trustee is not individually liable for the attorney fees and
160 costs.
161 (2) Unless otherwise agreed, compensation based on the
162 value of the trust assets immediately following the settlor’s
163 death and the income earned by the trust during initial
164 administration at the rate of 75 percent of the schedule
165 provided in s. 733.6171(3)(a)-(h) is presumed to be reasonable
166 total compensation for ordinary services of all attorneys
167 employed generally to advise a trustee concerning the trustee’s
168 duties in initial trust administration.
169 (3) An attorney who is retained to render only limited and
170 specifically defined legal services shall be compensated as
171 provided in the retaining agreement. If the amount or method of
172 determining compensation is not provided in the agreement, the
173 attorney is entitled to a reasonable fee, taking into account
174 the factors set forth in subsection (6).
175 (4) Ordinary services of the attorney in an initial trust
176 administration include legal advice and representation
177 concerning the trustee’s duties relating to:
178 (a) Review of the trust instrument and each amendment for
179 legal sufficiency and interpretation.
180 (b) Implementation of substitution of the successor
181 trustee.
182 (c) Persons who must or should be served with required
183 notices and the method and timing of such service.
184 (d) The obligation of a successor to require a former
185 trustee to provide an accounting.
186 (e) The trustee’s duty to protect, insure, and manage trust
187 assets and the trustee’s liability relating to these duties.
188 (f) The trustee’s duty regarding investments imposed by the
189 prudent investor rule.
190 (g) The trustee’s obligation to inform and account to
191 beneficiaries and the method of satisfaction of such
192 obligations, the liability of the trust and trustee to the
193 settlor’s creditors, and the advisability or necessity for
194 probate proceedings to bar creditors.
195 (h) Contributions due to the personal representative of the
196 settlor’s estate for payment of expenses of administration and
197 obligations of the settlor’s estate.
198 (i) Identifying tax returns required to be filed by the
199 trustee, the trustee’s liability for payment of taxes, and the
200 due date of returns.
201 (j) Filing a nontaxable affidavit, if not filed by a
202 personal representative.
203 (k) Order of payment of expenses of administration of the
204 trust and order and priority of abatement of trust
205 distributions.
206 (l) Distribution of income or principal to beneficiaries or
207 funding of further trusts provided in the governing instrument.
208 (m) Preparation of any legal documents required to effect
209 distribution.
210 (n) Fiduciary duties, avoidance of self-dealing, conflicts
211 of interest, duty of impartiality, and obligations to
212 beneficiaries.
213 (o) If there is a conflict of interest between a trustee
214 who is a beneficiary and other beneficiaries of the trust,
215 advice to the trustee on limitations of certain authority of the
216 trustee regarding discretionary distributions or exercise of
217 certain powers and alternatives for appointment of an
218 independent trustee and appropriate procedures.
219 (p) Procedures for the trustee’s discharge from liability
220 for administration of the trust on termination or resignation.
221 (5) In addition to the attorney’s fees for ordinary
222 services, the attorney for the trustee shall be allowed further
223 reasonable compensation for any extraordinary service. What
224 constitutes an extraordinary service may vary depending on many
225 factors, including the size of the trust. Extraordinary services
226 may include, but are not limited to:
227 (a) Involvement in a trust contest, trust construction, a
228 proceeding for determination of beneficiaries, a contested
229 claim, elective share proceedings, apportionment of estate
230 taxes, or other adversary proceedings or litigation by or
231 against the trust.
232 (b) Representation of the trustee in an audit or any
233 proceeding for adjustment, determination, or collection of any
234 taxes.
235 (c) Tax advice on postmortem tax planning, including, but
236 not limited to, disclaimer, renunciation of fiduciary
237 commission, alternate valuation date, allocation of
238 administrative expenses between tax returns, the QTIP or reverse
239 QTIP election, allocation of GST exemption, qualification for
240 Internal Revenue Code ss. 303 and 6166 privileges, deduction of
241 last illness expenses, distribution planning, asset basis
242 considerations, throwback rules, handling income or deductions
243 in respect of a decedent, valuation discounts, special use and
244 other valuation, handling employee benefit or retirement
245 proceeds, prompt assessment request, or request for release from
246 personal liability for payment of tax.
247 (d) Review of an estate tax return and preparation or
248 review of other tax returns required to be filed by the trustee.
249 (e) Preparation of decedent’s federal estate tax return. If
250 this return is prepared by the attorney, a fee of one-half of 1
251 percent up to a value of $10 million and one-fourth of 1 percent
252 on the value in excess of $10 million, of the gross estate as
253 finally determined for federal estate tax purposes, is presumed
254 to be reasonable compensation for the attorney for this service.
255 These fees shall include services for routine audit of the
256 return, not beyond the examining agent level, if required.
257 (f) Purchase, sale, lease, or encumbrance of real property
258 by the trustee or involvement in zoning, land use,
259 environmental, or other similar matters.
260 (g) Legal advice regarding carrying on of decedent’s
261 business or conducting other commercial activity by the trustee.
262 (h) Legal advice regarding claims for damage to the
263 environment or related procedures.
264 (i) Legal advice regarding homestead status of trust real
265 property or proceedings involving the status.
266 (j) Involvement in fiduciary, employee, or attorney
267 compensation disputes.
268 (k) Considerations of special valuation of trust assets,
269 including discounts for blockage, minority interests, lack of
270 marketability, and environmental liability.
271 (6) Upon petition of any interested person in a proceeding
272 to review the compensation paid or to be paid to the attorney
273 for the trustee, the court may increase or decrease the
274 compensation for ordinary services of the attorney for the
275 trustee or award compensation for extraordinary services if the
276 facts and circumstances of the particular administration
277 warrant. In determining reasonable compensation, the court shall
278 consider all of the following factors giving such weight to each
279 as the court may determine to be appropriate:
280 (a) The promptness, efficiency, and skill with which the
281 initial administration was handled by the attorney.
282 (b) The responsibilities assumed by, and potential
283 liabilities of, the attorney.
284 (c) The nature and value of the assets that are affected by
285 the decedent’s death.
286 (d) The benefits or detriments resulting to the trust or
287 the trust’s beneficiaries from the attorney’s services.
288 (e) The complexity or simplicity of the administration and
289 the novelty of issues presented.
290 (f) The attorney’s participation in tax planning for the
291 estate, the trust, and the trust’s beneficiaries and tax return
292 preparation or review and approval.
293 (g) The nature of the trust assets, the expenses of
294 administration, and the claims payable by the trust and the
295 compensation paid to other professionals and fiduciaries.
296 (h) Any delay in payment of the compensation after the
297 services were furnished.
298 (i) Any other relevant factors.
299 (2)(7) If a separate written agreement regarding
300 compensation exists between the attorney and the settlor, the
301 attorney must shall furnish a copy to the trustee prior to
302 commencement of employment and, if employed, must shall promptly
303 file and serve a copy on all interested persons. A separate
304 agreement or a provision in the trust suggesting or directing
305 the trustee to retain a specific attorney does not obligate the
306 trustee to employ the attorney or obligate the attorney to
307 accept the representation but, if the attorney who is a party to
308 the agreement or who drafted the trust is employed, the
309 compensation paid may shall not exceed the compensation provided
310 in the agreement.
311 (8) As used in this section, the term “initial trust
312 administration” means administration of a revocable trust during
313 the period that begins with the death of the settlor and ends on
314 the final distribution of trust assets outright or to continuing
315 trusts created under the trust agreement but, if an estate tax
316 return is required, not until after issuance of an estate tax
317 closing letter or other evidence of termination of the estate
318 tax proceeding. This initial period is not intended to include
319 continued regular administration of the trust.
320 Section 3. Subsection (4) of section 733.106, Florida
321 Statutes, is amended to read:
322 733.106 Costs and attorney fees.—
323 (4) If costs and attorney fees are to be paid from the
324 estate under this section, s. 733.6171(4), s. 736.1005, or s.
325 736.1006, the court, in its discretion, may direct from what
326 part of the estate they shall be paid.
327 (a) If the court directs an assessment against a person’s
328 part of the estate and such part is insufficient to fully pay
329 the assessment, the court may direct payment from the person’s
330 part of a trust, if any, if a pour-over will is involved and the
331 matter is interrelated with the trust.
332 (b) All or any part of the costs and attorney fees to be
333 paid from the estate may be assessed against one or more
334 persons’ part of the estate in such proportions as the court
335 finds to be just and proper.
336 (c) In the exercise of its discretion, the court may
337 consider the following factors:
338 1. The relative impact of an assessment on the estimated
339 value of each person’s part of the estate.
340 2. The amount of costs and attorney fees to be assessed
341 against a person’s part of the estate.
342 3. The extent to which a person whose part of the estate is
343 to be assessed, individually or through counsel, actively
344 participated in the proceeding.
345 4. The potential benefit or detriment to a person’s part of
346 the estate expected from the outcome of the proceeding.
347 5. The relative strength or weakness of the merits of the
348 claims, defenses, or objections, if any, asserted by a person
349 whose part of the estate is to be assessed.
350 6. Whether a person whose part of the estate is to be
351 assessed was a prevailing party with respect to one or more
352 claims, defenses, or objections.
353 7. Whether a person whose part of the estate is to be
354 assessed unjustly caused an increase in the amount of costs and
355 attorney fees incurred by the personal representative or another
356 interested person in connection with the proceeding.
357 8. Any other relevant fact, circumstance, or equity.
358 (d) The court may assess a person’s part of the estate
359 without finding that the person engaged in bad faith,
360 wrongdoing, or frivolousness.
361 Section 4. Subsection (2) of section 736.1005, Florida
362 Statutes, is amended to read:
363 736.1005 Attorney fees for services to the trust.—
364 (2) If attorney fees are to be paid from the trust under
365 subsection (1), s. 736.1007(5)(a), or s. 733.106(4)(a), the
366 court, in its discretion, may direct from what part of the trust
367 the fees shall be paid.
368 (a) All or any part of the attorney fees to be paid from
369 the trust may be assessed against one or more persons’ part of
370 the trust in such proportions as the court finds to be just and
371 proper.
372 (b) In the exercise of its discretion, the court may
373 consider the following factors:
374 1. The relative impact of an assessment on the estimated
375 value of each person’s part of the trust.
376 2. The amount of attorney fees to be assessed against a
377 person’s part of the trust.
378 3. The extent to which a person whose part of the trust is
379 to be assessed, individually or through counsel, actively
380 participated in the proceeding.
381 4. The potential benefit or detriment to a person’s part of
382 the trust expected from the outcome of the proceeding.
383 5. The relative strength or weakness of the merits of the
384 claims, defenses, or objections, if any, asserted by a person
385 whose part of the trust is to be assessed.
386 6. Whether a person whose part of the trust is to be
387 assessed was a prevailing party with respect to one or more
388 claims, defenses, or objections.
389 7. Whether a person whose part of the trust is to be
390 assessed unjustly caused an increase in the amount of attorney
391 fees incurred by the trustee or another person in connection
392 with the proceeding.
393 8. Any other relevant fact, circumstance, or equity.
394 (c) The court may assess a person’s part of the trust
395 without finding that the person engaged in bad faith,
396 wrongdoing, or frivolousness.
397 Section 5. This act shall take effect July 1, 2021.
398
399 ================= T I T L E A M E N D M E N T ================
400 And the title is amended as follows:
401 Delete everything before the enacting clause
402 and insert:
403 A bill to be entitled
404 An act relating to attorney compensation; amending s.
405 733.6171, F.S.; requiring an attorney who accepts
406 certain engagements to obtain a fee disclosure
407 statement signed by the person responsible for
408 administering an estate; requiring that such
409 disclosure statement contain certain statements;
410 deleting provisions relating to the determination of
411 reasonable compensation for attorneys of personal
412 representatives; deleting provisions relating to
413 petitions to increase or decrease compensation for
414 such attorneys; amending s. 736.1007, F.S.; deleting
415 provisions relating to the determination of reasonable
416 compensation for attorneys of trustees; deleting
417 provisions relating to petitions to increase or
418 decrease compensation for such attorneys; amending ss.
419 733.106 and 736.1005, F.S.; conforming provisions to
420 changes made by the act; providing an effective date.