Conservator removal; MCL 700.5414; Fiduciary duties; MCL 700.1212; MCL 700.5416; Prudent investor rule; MCL 700.1502; Attorney fees; Reasonableness; Smith v Khouri; Arbitration; Settlement agreement; Altobelli v Hartmann

The court held that the probate court did not err by denying appellant-former conservator’s request for arbitration and did not abuse its discretion by removing him as conservator for his mother. The protected individual’s adult children had entered a settlement agreement after arbitration that made appellant conservator and another sibling guardian. Later disputes arose over appellant’s accountings, delays in producing financial records, attorney fees paid from the estate, unequal gifts, and a $170,000 loan the protected individual had made to appellant. On appeal, the court first held that the arbitration clause did not require arbitration because it covered challenges to enforcement of the settlement agreement, and the agreement concerned appellant’s original appointment, not “future actions once appointed.” Thus, the probate court could not require a party “‘to arbitrate an issue which [she had] not agreed to submit to arbitration.’” The court next held that good cause supported removal because a conservator is a fiduciary and must act with “reasonable care, skill, and caution.” The court focused on appellant’s approval of the attorney’s (C) fee increase from $250 to $500 per hour. Although appellant relied on the State Bar economics survey, the court held that the survey was only one factor and that reasonableness required consideration of the “totality of special circumstances” applicable to the case. The probate court properly considered that the issues were not novel, C lacked probate-litigation experience, incurred no unusually large expenses, and was not prevented from handling other matters. It also found C’s work did not benefit the protected individual or the estate, but instead increased costs and helped appellant withhold information from other siblings. Because appellant failed to sufficiently investigate the reasonableness of the 100% fee increase, he breached his fiduciary duty, giving the probate court good cause to remove him. Affirmed.