NY Court of Appeals establishes new fiduciary rules

Long Island Business News, Dec 13, 2002 by Rosamaria Mancini

Political party leaders and high-level court employees would be barred from serving as court-appointed fiduciaries under new rules adopted by the New York State court system.

The rules, approved by the Court of Appeals after consultation with the Administrative Board of the Courts, were based on the recommendations of the Commission on Fiduciary Appointments. The commission conducted an assessment of the current system after concerns were raised about the courts' practice of selecting fiduciary appointments based on factors other than merit.

Chief Judge Judith S. Kaye said that court-appointed fiduciaries that assist in resolving cases must be based on value and that appointees be "scrupulous, conscientious individuals with sufficient training and experience to perform this vitally important work."

"The new rules governing fiduciary appointments achieve this by establishing strict guidelines for assignments and a more accountable regulatory structure," Judge Kaye said.

A. Thomas Levin, president elect of the New Year State Bar Association and a partner in Mineola-based Meyer, Suozzi, English & Klein, said the NYSBA's special committee on fiduciary appointments studied the matter and found that new rules were necessary.

"The bottom line is that there were abuses of the public's trust and something needed to be done," Levin said.

The new rules and procedures require that:

* All fiduciary candidates meet specific training and experience requirements.

* Fiduciaries may receive only one appointment in a single calendar year paying $5,000 or more.

* Fiduciaries who reach a cap of $50,000 in aggregate payments from their appointments in a single calendar year will be ineligible for appointments in the next calendar year.

* Judges who award $5,000 or more to a fiduciary appointee must provide a written justification for the award.

* Absent a compelling reason, no receiver or guardian (or the receiver's or guardian's law firm) may be appointed as his or her own counsel.

* Former judges and their immediate relatives are ineligible for appointment, within the jurisdiction where the former judge served, for a period of two years after the judge leaves the bench.

* State and county political leaders, their immediate relatives and their law firms are ineligible for appointment.

* Persons who serve as judicial campaign officials, their immediate relatives and their law firms are ineligible for appointment by the judge they served for a period of two years after the judicial election.

* Misconduct or unsatisfactory performance will result in removal of fiduciaries from the eligibility lists.

Chief Administrative Judge Jonathan Lippman described the new rules as the latest step in the court system's work to reform the fiduciary assignment process in the state ands ensure accountability in assignments.

Most of the rules and procedures are set to take effect Jan. 1, 2003.