This recent decision of the ARDC Hearing Board, In re George Krasnik, 2015 PR 00001, is significant because it holds that an attorney had no attorney-client relationship with the victim of elder abuse.
In recent years the ARDC has made a concerted effort to discipline lawyers involved in elder abuse. In this case a majority of the Hearing Board held that there was no misconduct because the lawyer did not represent the victim of the elder abuse. The facts set forth in the opinion are typical of the elder abuse scenario in which someone obtains the signature of a victim of dementia and then transfers all of the victim’s property to himself.
Factual Summary
Respondent testified that in about late March 2011, Stanislaw Zabielski, a Polish-speaking man in his mid to late sixties, came to his office and asked him to prepare a quit claim deed and a power of attorney for his childhood friend, Jan Muskala who was in the hospital. Zabielski “told him Muskala wanted to give Zabielski his home and wanted Zabielski to have a power of attorney for his property.” The attorney made no attempt to learn why Muskala was in the hospital or why Muskala wanted Zabielski to transfer property or designate a power of attorney.
The attorney, for a legal fee of $200 or $300, prepared a power of attorney for property and a quit claim deed. The attorney admitted that he had entered into an attorney-client relationship with Zabielski.
The attorney prepared a standard Illinois Statutory Short Form Power of Attorney for Property. “At Zabielski’s request, Respondent inserted an additional paragraph to the form which gave Zabielski the right to withdraw all of Muskala’s money from PNC Bank, either in cash or as a check payable to Zabielski, and to close any and all of Muskala’s bank accounts. Respondent did not view Zabielski’s request as being strange.” Page 5.
Another allegation: “At no time did Respondent meet with Muskala or take any other action to ensure that Muskala was competent and had the requisite mental capacity to enter into a contract or sign a power of attorney form.” Page 5.
A few weeks later, Zabielski returned with a signed and notarized quit claim deed. Respondent “took it upon himself to sign the form as agent of both the grantor and grantee.” Page 6. “Respondent took the executed deed to the Cook County Recorder’s office, tendered payment for any fees associated with the transfer, and recorded the deed. Thereafter, Respondent had no further contact with Zabielski.”
An attorney for the Cook County Public Guardian tesitifed that Muskala had a stroke in April 2011, became severely disabled, and was then abused by Zabielski when he went home to recover. On February 2, 2012, Catholic Charities obtained an order of protection prohibiting Zabielski from having any contact with Muskala and from abusing or exploiting him. Page 8. A geriatric psychiatrist determined that Muskala suffered from dementia after his stroke in April 2011.
The Public Guardian investigated the case and determined that Zabielski took all of Muskala’s money and closed his bank account and spent the money. Further, because of the quit claim deed, Muskala had to be moved out of his house.
The ARDC Complaint
The ARDC’s complaint was premised on the theory that Muskala was not an adverse party but, rather, was an intended third-party beneficiary of the attorney-client relationship between the Respondent and Zabielski. The ARDC pleaded several counts: (1) Failing to provide competent representation in violation of Rule 1.1; (2) failing to explain a matter to the extent reasonably necessary to permit the client to make an informed decision Rule 1.4(b); (3) Representing a client in which he had a conflict of interest Rule 1.7(a); Failing to consult with the client concerning the objectives of the representation in violation of Rule 1.4(a)(2); permitting a person who employed him and paid him to render legal services for another to direct or regulate the lawyer’s professional judgment in rendering such legal services in violation of Rule 5.4(c).
The Panel’s Decision
The Panel decided to dismiss the Complaint and all the charges of misconduct because it held that Muskala was not an intended third-party beneficiary of the attorney-client relationship between the Respondent and Zabielski. Page 14. The Panel explained: “Respondent knew that the documents he prepared would not be valid until they were executed by Muskala, notarized and, in the case of the power of attorney, attested to by someone who could confirm Muskala’s sound mind. Respondent had no involvement in the execution or notarization of the documents, and never saw the signed power of attorney until recently. Given these circumstances, we fail to see how the mere creation of documents, which were not signed by Muskala and which were requested by a person who owed no legal or fiduciary duty to Muskala, could have any direct impact on or benefit Muskala. Further, as to the drafting or recording of the quitclaim deed, Respondent’s representation of Zabielski involved a transaction, rather than a fiduciary relationship, for which he could expect Muskala to have his own representation. For these reasons, we find that the duties owed by Respondent to his client Zabielski did not extend to Muskala.” Pages 13-14.
The Dissent
The Majority decision provoked a thoughtful and powerful dissent from Heather H. Harrison. She concluded that Muskala was the intended third party beneficiary of the attorney-client relationship between Zabielski and respondent. Harrison cited the Short Form Power of Attorney which in her view clearly identified Muskala as the intended beneficiary of the relationship. The relationship between the holder of a power of attorney and the principal is that of an agency and the interests of the two persons are aligned. She writes: “Respondent failed to determine, or event attempt to determine, Muskala’s circumstances and objectives, failed to contact him for any information, and failed to explain the provision of the power of attorney or quit claim deed to him.” Page 18. Further the Respondent failed to even consider whether there was elder abuse or other circumstances.
My View
The dissent is correct. The lawyer should have been suspicious when Zabielski explained to him that Muskala wanted to give him his money and real property for nothing. It was obviously not an arm’s length transaction and the Majority opinion is a essentially a legal fiction. Any attorney asked to draft a power of attorney for someone else should be required to confirm that the person is of sound mind and able to executed the power of attorney. In sum, an atrocious decision and the administrator should appeal.
Edward X. Clinton, Jr.
Legal Ethics Lawyer 