Conservators’ Fees Receiving Closer Scrutiny

In the somber cool of Commissioner Gale P. Hickman’s courtroom, Jean Wren is on the hot seat.

Wren, a professional conservator, is asking the probate court commissioner to approve her $75-an-hour rate to take care of a Santa Ana war veteran who suffers from schizophrenia and cannot manage on his own. Hickman is grilling her about the fee she charges for services that range from paying the veteran’s care provider to taking him out for lunch and shopping.

The commissioner is especially skeptical of the tab for one three-hour outing.

“That’s $225 to take the guy shopping and to go to lunch at Sizzler,” Hickman says. “That’s quite a bite out of his estate, excuse the pun.”

Wren, seated at an attorney’s table before the commissioner, struggles to explain how she set her rate. There is a secretary and an accountant to pay. Office equipment to buy. The Cadillac she uses to tote clients. And compensation for the time she spends answering the veteran’s panicked phone calls.

Hickman ends the hourlong court session by slashing Wren’s bill, agreeing to pay her just $2,310 from the client’s estate--less than half the amount she sought.

The court session is part of an experimental and controversial new effort among Orange County’s probate judges to scrutinize as never before the fees that professional conservators are paid for overseeing the affairs of elderly and disabled people who cannot do it themselves.

The 9-month-old program, which increases scrutiny of fees that judges over the years have approved with little question, has raised strong protests from some of the nearly 50 conservators registered to do business in Orange County.

Within the close-knit world of probate law, there is angry talk by professional conservators and their attorneys of a possible lawsuit challenging the court’s new practice. At the very least, conservators are expected to go to a higher court to appeal the legality of the program, which was designed late last year and is believed to be the first in the state.

Ernest L. Hayward, a prominent Orange County probate attorney who represents about half a dozen professional conservators, says the new system is an unwelcome intrusion into a legitimate business.

“Where does it say that I have to buy a Ford Escort when I can drive a Lexus?” Hayward said. “If Mom’s money can afford to hire a quality conservator at $75 an hour, where does the court get off questioning the decision to hire the best people for the job? It’s a market-driven economy and if you charge the lowest rate, you will be left with conservators who are marginally qualified and marginally experienced.”

Lawrence Norman, a Laguna Hills attorney who represents several professional conservators, agreed.

“I think the court’s . . . micromanagement may drive some good people out of the [conservatorship] business,” Norman said.

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Under state probate law, judges must determine whether fees charged by conservators are reasonable. Court officials stop short of saying local conservators overcharge, or that they have engaged in price-fixing by billing clients at a fairly uniform rate that hovers around $75 an hour. But the judges note that for decades, fees paid to conservators from their clients’ estates have been approved with little scrutiny.

The system has gone “unexamined for a couple of decades,” Hickman said during last week’s court session.

The heightened scrutiny of fees in Orange County comes amid explosive growth statewide in the ranks of professional conservators--a job few people did 10 years ago. A statewide organization of professional conservators includes more than 200 members; dozens more work as conservators but are not members. Their fees range from $25 to $120 an hour.

Former social workers, county employees and bank trust officers are among the entrepreneurs who switched jobs to cash in on the demand for services that range from writing clients’ monthly bills to making critical medical decisions.

In Orange County, professional conservators manage about 10% of the 3,000 conservatorship cases. Most of the other cases are handled by family members and friends.

Some conservators have as many as five dozen clients and serve as custodians of millions of dollars in assets. Others manage a handful of cases at a time. There are no requirements that conservators possess any special qualifications.

Recently, however, the burgeoning industry has triggered a call for regulation from some lawmakers.

Separate bills pending in the Legislature would establish professional standards for conservators and set up a statewide registry for them, to better prevent the elderly and infirm from being defrauded by their caretakers. State law requires that each county keep its own registry of conservators with two or more clients.

In Orange County, the effort to tighten the reins on conservators has taken the form of monthly fee hearings during which professional conservators are called before Hickman to explain their pricing in what can be painful detail.

Hickman declined to comment on the program while cases are pending before him. Former Commissioner Thomas H. Schulte, who initiated the program last year, also declined to comment.

At fee hearings, Hickman pointedly asks conservators to justify their rates. He notes that some conservators pay their bookkeepers and caregivers $18 an hour, yet bill their clients at rates that are several times higher.

A selection of bills lodged in probate court shows the varied tasks for which conservators charge fees. In one case, a professional conservator billed $100 for depositing a check in her client’s bank account. Another charged $8 for receiving a phone call about her client’s death. Yet another conservator charged $50 an hour to spend 45 minutes buying clothes for the client.

But the bulk of the charges are mundane: visiting clients, delivering clothes and medication, and arranging for hospital or nursing home stays.

Wren and other professional conservators say they must bill at $75 an hour to cover their overhead expenses. “It’s the only way I can make a profit,” she said.

But Hickman is not convinced. After calculating in open court the compensation received by the county’s public guardians in similar cases, he decides that Wren can handle the veteran’s case for $35 an hour, and agrees to pay her only that much. Wren’s bill is reduced from $4,950 to $2,310.

Outside the courtroom, the conservator’s husband and attorney, John McDonald Wren, grumbles. “It’s socialism,” he says. “He’s against capitalism.”

Jean Wren, who has been a conservator for more than 20 years, acknowledged that the commissioner had the right to question her fees. “But he has to be reasonable,” she said.

“It used to be a labor of love,” said Wren, who manages 60 conservatorships. “I wanted to do it for nothing. But I can’t.”