First of two parts
June M. Farrington was the ideal benefactor.
The unmarried Orchard Park woman was wealthy, generous and childless.
She established a trust in 1999 — from money she inherited from her father’s hand-tool fortune — leaving all of her assets to three charities upon her death.
So when she died in 2008 at age 84, her favored charities counted on sharing about $8 million.
But collecting what they think is due to them has been anything but simple for the Community Foundation for Greater Buffalo, the Nature Conservancy and the Women Children’s Hospital of Buffalo Foundation.
Instead, they are in a pitched battle in Erie County Surrogate’s Court against Farrington’s one-time estate lawyer, Stephen M. Newman. The charities’ attorneys say Newman — who caters to wealthy clients and has law offices in Amherst and Palm Beach County, Fla. — masterminded a “wrongful scheme” to steer the money to himself and a home aide, Joan Morgante, by changing Farrington’s will.
Newman and Morgante also eyed the assets of Farrington’s only surviving sibling, Worth Farrington, 85, who suffers from dementia and Parkinson’s disease.
“Having been thwarted from being able to fully loot June’s assets because of her untimely death, Newman and Morgante quickly moved on to Worth’s assets,” according to a court filing from attorney Catherine B. Eberl of the Hodgson Russ law firm, which represents the charities.
Newman paid himself more than $500,000 from the $1.2 million June M. Farrington Florida Revocable Trust — just one of her assets, according to an attorney for Public Administrator Acea M. Mosey, in court papers filed Feb. 8.
“There is no innocent explanation for Mr. Newman converting 40 percent of the trust assets to his own use,” attorney Stanley J. Collesano said in court papers.
Since then, Collesano has discovered Newman converted an additional $200,000 from the trust for his own use, putting the total at $748,500.
Newman also has paid Morgante more than $300,000 from the trust, according to Collesano’s law firm.
The Surrogate’s Court in November named Mosey to replace him as the Florida trust’s trustee, and Mosey also assumed his positions in Farrington’s living and charitable trusts.
14 lawyers, one judge
Nearly four years after June Farrington’s death, the fight over her money involves some of Buffalo’s most prominent law firms, including Hodgson Russ, which represents the charities, and Nixon Peabody, where Newman worked until last year. Newman has hired three lawyers to defend him, including Terrence M. Connors, one of Buffalo’s top lawyers.
At a hearing last month, 14 lawyers stood before Erie County Surrogate Barbara Howe, each trying to either recover money, defend how it was spent or look after someone involved in the case who, like Worth Farrington, needed legal protection because of fragile health.
The lawyers are scheduled to again appear before Howe on Wednesday, over the question of whether Newman should be ordered to return the $748,500.
As for her whole estate, the charities contend June Farrington was not competent to change her will, with the last change coming only 10 days before her death. The last will, naming Newman as sole executor, was “obtained by the undue influence of her lawyer,” according to legal papers filed by the Hodgson Russ lawyers.
“When we took a look at what occurred here, it caused us to pause,” said Daniel C. Oliverio, chairman at Hodgson Russ. “We’re confident the surrogate will be able to get to the bottom of it, one way or the other, and sooner rather than later.”
Newman was simply carrying out June Farrington’s last wishes, said Connors, his attorney, in court papers.
“She had second thoughts about leaving her wealth to charities with which she had no real relationship, so she asked her attorney to change her bequests to benefit her brother and her caregiver,” Connors said in court papers.
“Because the charities are unhappy with Ms. Farrington’s decision to take care of her brother and caregiver before them, they have attacked Ms. Farrington’s attorney and besmirched his reputation,” he said.
The Hodgson Russ lawyers said they reviewed June Farrington’s and Worth Farrington’s wills, trust agreements, estate tax returns and account statements among other documents.
They concluded Newman furthered his scheme by enlisting the help of Morgante.
Newman introduced Morgante to June Farrington, recommending that Morgante be hired as a caregiver, according to Eberl, a lawyer for the charities.
Morgante, 72, began working for Farrington in 2006.
The documents reveal “that Newman and Morgante were working together to weave their way into the Farrington siblings’ estate plans through fraud and undue influence and by taking advantage of June’s and Worth’s incapacity,” Eberl said.
The restructuring of the Farringtons’ estates eliminated outright gifts to the charities and created perpetual charitable trusts, with Newman acting as co-trustee and collecting commissions, she said.
“Newman slowly began to restructure the siblings’ estate plans so that he would benefit from their estates,” Eberl said in her filing.
One of the changes provided a commission on assets already in their trusts, she said.
“The amount of this commission ultimately calculated on June’s living trust after her death was $203,327 per trustee, to be paid in addition to executor’s commissions, annual trustee’s commissions, paying out commissions and Nixon Peabody’s legal fees,” according to her filing. “In one fell swoop, Newman succeeded in securing both a lump sum distribution from the estate and a lifelong annuity for acting as trustee, with the power to appoint his successor.”
As Newman restructured the siblings’ estate plans, he and Morgante were discussing the Farringtons’ assets, the charities’ attorneys say.
An email log from Nixon Peabody, where Newman worked as a partner until last April, shows 445 emails between Morgante and Newman between February 2006 and April 2011. Morgante on Sept. 26, 2007, forwarded two emails to Newman with subject headings mentioning Cooper Industries stock — which accounted for a substantial portion of the siblings’ wealth.
“The emails show that Morgante, whose supposed role was merely to act as a care aide to the Farringtons, apparently knew about her employers’ wealth and was discussing it with Newman, their attorney,” the charities said in a court filing. Morgante is trying to block the charities’ lawyers from being allowed to read the emails, while the lawyers want the surrogate to allow their disclosure.
Peter J. Brevorka, who is Morgante’s attorney, said it would be inappropriate for Morgante to reply to questions from The News, given the ongoing litigation.
But Morgante, in an affidavit filed in Surrogate’s Court, denied scheming with Newman.
For two years, Morgante said, she prepared June Farrington’s meals, drove her to appointments, took her for walks and made sure she took her medicine. She also took her to visit her brother, Worth, numerous times each week while he was at Father Baker Manor.
“Because we spent eight to 10 hours a day together, seven days a week, Ms. Farrington and I developed a friendship,” Morgante said. “Ms. Farrington truly cared for me and, at times, became extremely possessive of me.”
“The only time I became aware that I might benefit from Ms. Farrington’s estate was after she met with Mr. Newman in June 2008,” Morgante said. “After meeting with Mr. Newman, Ms. Farrington emerged from the dining room and came into the kitchen. Ms. Farrington hugged me and stated, in front of other aides, that I would not have to worry because she had made certain that I was taken care of.”
Eberl said that on June 3, “it appears Newman had June and Worth sign several documents, dramatically altering their estate plans.”
June Farrington died 10 days later.
Changes in the wills
Each of the new wills named Newman as sole executor.
The changes included deleting the provisions for charities in June’s Florida trust and including Morgante as a beneficiary of the estate. That change allowed Morgante to withdraw the principal of the trust at any time, Eberl said.
Morgante said she did not ask Newman to arrange a bequest from an estate or trust owned by one of the Farringtons.
But William V. Badgley of Buffalo, who began working as a caregiver to both Farringtons in 2006, said June Farrington’s mental and physical capacity had been deteriorating since he went to work for the two.
Badgley, in an affidavit, said he believed Farrington “was not able to handle any part of her finances going back at least two years prior to her death.”
“Joan Morgante has advised all caregivers on several occasions to not write anything negative about June and Worth’s mental competency in the logbook because she did not want the charities to get any of their money,” Badgley said.
“Sometime during the winter of 2010 while driving in the car with Joan Morgante, she asked me to lie and testify under oath that June Farrington wanted to leave all her money and property to Joan Morgante,” Badgley said in the affidavit. “In exchange, Joan would give me $10,000. I did not accept this offer because I knew it was not June Farrington’s wishes.”
To help him fight the charities’ allegations, Newman turned to Connors.
“The transactions we have reviewed are supported by valid trust instruments,” Connors said.
“These documents prevail unless there’s some showing of incompetency or undue influence,” Connors said. “To date, we have not seen evidence of that.”
In court papers, Connors contended the charities are objecting because they do not like that June Farrington changed her mind.
“They have insisted that Ms. Farrington was not entitled to change her mind after her initial decisions to dispose of her estate,” Connors said in the court filing.
PART TWO: In search of a marriage license