Background
After their mother died, approximately $3 million passed directly to Joanne Black through payable-on-death accounts. Joanne’s brother and conservator, Bernard Black, obtained court authorization to disclaim Joanne’s interests after representing that the assets would be protected in a supplemental needs trust. He instead transferred roughly two-thirds to that trust and one-third to an Issue Trust benefiting himself and his children.
The probate court later found that Bernard had breached his fiduciary duties and committed civil theft, removed him as conservator, and entered a $4.6 million judgment against him. After extensive litigation and a prior appellate remand, the probate court voided the disclaimers under C.R.C.P. 60(b), removed Bernard as trustee of the supplemental needs and Issue trusts, and denied his motion to terminate Joanne’s conservatorship retroactively based on a 2016 New York guardianship ruling.
The Court’s Holding
The Colorado Court of Appeals affirmed the order voiding the disclaimers. It held that Joanne had sufficiently and timely sought C.R.C.P. 60(b) relief, Bernard received notice and an opportunity to be heard, and the probate court acted within its discretion under Rule 60(b)(4). The statutory rule making a delivered disclaimer irrevocable did not control because the court vacated its prior authorization for Bernard to execute the disclaimers on Joanne’s behalf rather than permitting Joanne to revoke her own disclaimer.
The court also upheld Bernard’s removal as trustee. The Colorado Probate Code authorized the probate court to remove him on its own motion, he had adequate notice, and the record supported findings that he funded the trusts with misappropriated conservatorship assets, disobeyed court orders, and could not be trusted to administer the funds properly. Finally, the law-of-the-case doctrine foreclosed Bernard’s renewed effort to terminate the conservatorship retroactively because another division had already held that he lacked standing to seek that relief.
Key Takeaways
- A probate court may grant relief from an order under C.R.C.P. 60(b)(4) when changed circumstances make its continued prospective application inequitable.
- The Colorado Probate Code permits a probate court to remove a trustee on its own initiative when statutory grounds exist and proper notice is provided.
- Law of the case generally bars a party from relitigating an issue already decided in an earlier appeal in the same proceeding absent changed conditions, error, or manifest injustice.
Why It Matters
The decision confirms that Colorado probate courts retain tools to unwind judicial authorization obtained or used through fiduciary misconduct, even after prolonged litigation. It also distinguishes between revoking an irrevocable disclaimer and vacating the court order that authorized a fiduciary to execute the disclaimer for a protected person.
The opinion further illustrates that trustee removal may proceed under the Probate Code independently of the Colorado Uniform Trust Code and that repeated noncompliance with court orders can support removal. The opinion is unpublished under C.A.R. 35(e).