The Estate Sale
One day early in the summer of 2001, Michael Verbrick was cutting the grass at his home on Colfax Avenue South, directly across the street from Bernadine Riske's house. Verbrick was about to grab his weed whacker to tame some unruly patches when he realized he had lent it to a friend. Just as he was getting ready to go call that friend, he noticed that someone was cleaning out Riske's house--and that that someone had just tossed a weed whacker into a dumpster outside the house. Verbrick asked if he could retrieve it, and, with the permission of the cleaners, hopped in the dumpster to get it.
"Under the weed whacker were her tax returns, with her Social Security number, her pay stubs, some stuff about investments--complete with account numbers," Verbrick remembers. "I thought to myself, 'Something's not right here.'"
Verbrick is sitting in his St. Paul office, a tiny, cluttered space barely larger than a cubicle. An attorney, Verbrick has his own practice, specializing in immigration law. He also has a habit of running his fingers upward through a tangle of brown hair. Together with Verbrick's perennial five o'clock shadow, the hair contributes to a constant appearance of exhaustion.
Like other neighbors on the block, Verbrick knew Riske--at least a little. "She always kept to herself," he says. "Once in a while I shoveled her walk or cut her grass." She had given his children some of the books she'd written--pamphlets, really, fables about animals and nature ("Dee-Dee Chickadee Gets Lost," "Dee-Dee Chickadee the Peacemaker").
It's not that she was the block's crazy old lady, he maintains. She participated in neighborhood activities, came to the block parties. "But it was common knowledge that Bernadine was slipping," he says. "She wasn't all there. Her personal appearance was unkempt. She could carry on a conversation, but she wasn't always lucid. I thought somebody should call someone to do something. But I never did. I thought somebody must be taking care of her, somehow.
"At that point, I didn't really consider it any of my business."
Then, all of sudden, she was gone.
One Sunday in late July, several weeks after the weed-whacker incident, Verbrick and his family came home from a weekend trip. They noticed what appeared to be an estate sale at Riske's house, a three-story, cream-colored Victorian looming over the quiet block just south of Lake Street. It was already 5:00 p.m. and the sale was starting to wind down, but Verbrick and his wife quickly went over to take a look at the house. "It was a grandma house," he recalls. "It obviously hadn't been maintained very well over the years. But it seemed structurally sound. It had nice architectural details. Beautiful hardwood floors, built-in cabinets, a fireplace downstairs, one upstairs in the master bedroom."
Verbrick noticed that the third floor had been finished to include two or three bedrooms. "This would make a perfect rental property," he thought to himself. He had heard once that Riske, in the 1950s, 1960s, and 1970s had had boarders living with her, and he thought unhappily about the prospect of the house being turned into a boardinghouse once again.
Over time the neighbors learned that Riske was living in a nursing home and that her estate was being handled by a conservator, Wells Fargo Bank. They started to wonder what would happen to the house, but they never saw signs that anything was happening. The house stood empty.
Several months later, in March 2002, a neighbor told Verbrick that the house had been sold to a man named Christopher Horty. "I had concerns that the buyer might turn it into a boardinghouse, just because of the physical layout," Verbrick says. Add to that the fact that no one on the block had realized the house was being sold, and the questions started to grow in Verbrick's mind.
"Everybody in the neighborhood was waiting for the For Sale sign to go up. It never happened," Verbrick says. "Everyone in the neighborhood is anticipating who the new neighbors will be. Your typical stuff: Will they have kids or dogs or whatever. Nothing's happening, and nothing's happening, and nothing's happening. Then all of a sudden, boom--it's sold."
Verbrick was curious. He made his way to the probate division of Hennepin County District Court and took a look at Riske's file. Though Verbrick is a practicing attorney, he doesn't know much about probate law. But he quickly familiarized himself with Riske's situation. Verbrick knew that the elderly Riske had lived frugally. Still, he was a little surprised to see that her estate was so big: it would turn out to be worth more than $1.5 million. No wonder, then, that as her faculties declined, Riske had seemed increasingly paranoid that people might be out to get her fortune.
The file also contained a petition asking the court's permission to sell Riske's home, Verbrick remembers, and notes scheduling a hearing on the matter for March 20. That confused him. "But the house is already sold," he thought to himself. "How does Christopher Horty know enough to buy a property that was never advertised? How did the conservator sell something before he had the authority to sell it? What guarantee does anyone have that the price of the sale was fair?"
And then Verbrick saw the appraisal of the property on file. The six-bedroom home in the heart of Uptown had been valued at $140,000. Houses in the area are currently selling for $315,000-$380,000; one four-bedroom single-family home on the same block is listed at $344,000. Riske's house was in bad shape, and the sale had taken place before this summer's real estate season. But neither of those factors fully explains the valuation.
Given the other information he had gathered--that the house had sat empty for a long time, it had been sold with no advertising, neighbors who'd expressed interested in buying the property never had an opportunity to bid on it, Riske had no known relatives--Verbrick was convinced that something was amiss.
"This woman is completely unable to look out for her interest," he says. "I thought I should make some phone calls. I didn't get any answers."
Verbrick even called Richard Wolfson, a court referee in Hennepin County District Court's probate division, and registered his concerns about Riske's case. Wolfson passed the information on to the county's senior services division, which reviewed the complaint but did not assign it for investigation.
He was left feeling that Riske had vanished into the ether, leaving a nice house and sizable assets behind. At worst, he feared, someone might be taking advantage of her. At best, it seemed, no one cared much about her at all.
"Part of the answer I got was, 'This is the way it's always done,'" Verbrick continues. "I was stunned."
What do we know about Bernadine Riske?
Her full name is Sarah Bernadine Riske, but most people know her as Bernadine. She was born September 5, 1914 in Superior, Wisconsin. Under the company name of Brisk Publishing, she has self-published children's books that she wrote and illustrated. She never married or had children. She has no siblings and no close relatives. She used to enjoy bird watching. She had worked as a civil servant for various local and federal government agencies, including the Internal Revenue Service.
And thanks to her thrifty, never-waste-money lifestyle, she managed to squirrel away a tidy nest egg. She bought and still owns a six-plex on Fremont Avenue South in Minneapolis, just a few blocks away from the old house on Colfax where she lived for half a century.
The neighbors on her former block are a close-knit crew; they watch out for each other. "Everyone knew of Bernadine and had at least had a few conversations with her," remembers Denita Selchow, who until earlier this year lived a couple of doors down from Riske's house.
Neighbors say Riske was an independent, if slightly eccentric, fixture on the block. For a time, one neighbor remembers, Riske's cataracts were so bad that she could only see by holding a small spyglass up to her eye. But that didn't stop her from joining a tour the neighbor (who asked not to be named) organized to Madrid, Barcelona, and Paris--and going sightseeing all by herself.
But in recent years people realized Riske was slipping. "We knew things were getting hard for her," says Selchow. "She got locked in her house one day. She was getting older. She had locked herself in another time. The police were there at least two times."
Though they knew Riske was having difficulties, they didn't know how serious the problems were. After all, most of them only saw Riske at block parties, or occasionally strolling down the street to the bus stop or working in the garden. A lot can happen in the crevices of an old house, shielded from the view of even the most well-meaning of neighbors. The neighbor who traveled to Europe with Riske, for instance, didn't realize the extent of the older woman's decline until the day of the estate sale. "I went out of curiosity," the neighbor remembers. "She did live there a long time. I was interested in seeing the things that would have been for sale."
There is a pensive pause as she recalls going through the house, and up to the attic. "She had holed herself up in the attic. There was a portable toilet," she says, with a hint of melancholy. "Evidently she was quite paranoid."
Indeed, Riske's paranoia was pronounced and sometimes accompanied by delusions. One night early in November 2000, Riske activated her Lifeline alarm, an electronic device that sends out a call for help when pressed. In response, officers from the Minneapolis Police Department arrived at Riske's home. "Upon arrival, the resident yelled out the window that she needed help and was unable to unlock the doors," the subsequent police report reads.
The officers first tried to kick in the front door, breaking a glass window, but were still unable to enter. They then moved to a side door, where they were able to get in. An ambulance arrived.
Apparently it was Riske's paranoia--specifically, her fear that someone was after her money--that led to the call. According to court papers in her conservatorship file, she was "having paranoid delusions of being robbed and trapped in her home with the elderly council [sic] from Wells Fargo."
Additionally, the court papers stated that Riske's house "was dirty and had a great deal of rotten food in it. [Riske was] quite disheveled and smelly upon admission, was incontinent of stool and needed immediate bathing. Respondent states strangers dumped rotten meat into her refrigerator."
Riske was taken to Fairview University Medical Center, where she was diagnosed with dementia along the lines of Alzheimer's disease. On November 20, 2000, hospital staff petitioned to commit Riske as mentally ill. "The treatment team believes [Riske] suffers from dementia and can no longer care for herself," the petition states.
On December 20, 2000, Riske was committed to Hillcrest Health Care Center, a nursing home in Wayzata. "The Court considered assisted living, but rejected that due to the fact that Respondent is unwilling to cooperate with in-home services," the order states. "She would need round-the-clock services to remain in the community and those are not available at this time."
A few months later, Hennepin County District Court Judge Patricia Belois placed Riske under conservatorship, meaning that because she was no longer able to make responsible decisions about herself or her finances, the court would appoint conservators to manage her personal care and her estate. "Sarah B. Riske is 86 years old, is not married, and has no known family," the order reads. "Her illness includes delusions and hallucinations, and she needs assistance with all of her daily activities. She also needs assistance with her financial matters, and it is believed her assets are significant. The conservatee lacks sufficient understanding or capacity to make or communicate responsible decisions concerning her person and her estate or financial decisions."
The court appointed conservators to take care of Riske: Professional Fiduciary, Inc. would be responsible for managing Riske's personal needs, and Wells Fargo Bank Minnesota would manage her estate.
This picture of Bernadine Riske is sad and lonely--and no doubt far from complete. But now that Riske isn't able to fill in the blanks herself, court records and neighbors' recollections are all that are left. There isn't anyone to preserve her memories, or to carry on for her where she left off. She must rely on her conservators--and the court that appointed them--to take care of her.
It's a huge duty to take on the responsibility of tending to another person's affairs, especially when it might include years of managing complicated, expensive care. In Riske's case, the conservators are professional; they're in the business of taking on this responsibility, and they get paid plenty to do so.
According to an account filed with the court by Wells Fargo, the conservatorship fees are substantial. For the first year or so of conservatorship, ending in February 2002, Riske's estate paid $7,888 to Professional Fiduciary, Inc. Almost $3,400 was paid to Sweeney, Borer & Sweeney, the law firm representing the conservators. And Wells Fargo was paid $13,237 in guardianship/conservatorship fees, as well as a $350 "asset set-up fee." The bank also reimbursed itself $15 for keys to Riske's house.
Though he didn't know the specifics when he started looking into Riske's case, Michael Verbrick figured the bank was earning a handsome fee for taking over Riske's finances. And he feared that the seemingly quick and quiet sale of the big, cream-colored Victorian wasn't in Riske's best interest.
Verbrick simply wanted some assurance that the bidding process had been fair, the price was fair, and that the new owner would comply with the zoning code and maintain the property as a single-family home. When he didn't get that, he decided to go to court. But to reach a point where he had the legal standing to question the sale, Verbrick needed to represent someone closer to Riske; a few neighbors weren't enough.
"I needed to get a client, and that client had to be the next of kin of Bernadine," he says.
He thought that Riske's parents had been born in Norway. Since she herself never married or had kids, Verbrick figured her closest relatives were probably in Norway, too. So he hired an investigator--one versed in both genealogy and Norse language and culture--to track down Riske's family. After some digging, the investigator located Arlen Oanes and Emma Oanes, distant cousins of Riske's, in North Dakota. They had fallen out of touch with Riske, though they remembered her visits to their farm when she was in her teens and 20s. Once Verbrick explained the situation to them, they signed on as clients.
On July 15, Verbrick, his neighbors, and Riske's relatives had their day in court. At issue before Hennepin County District Court Judge Patricia Belois--the same judge who had committed Riske and later appointed the conservators to take care of her and her estate back in April 2001--was whether to sell the house, and whether to approve the current purchase agreement with Christopher Horty. Everyone agreed that Riske wouldn't be able to return to the house herself, so it should be sold and the money used to provide for her care. It was the sale to Horty, however, that was in contention.
(Horty and his attorney, Robert Striker, did not attend the trial. Striker declined to comment for this story. A Wells Fargo spokeswoman also said the bank does not comment on cases currently in litigation, nor would it comment on its services for elders in general.)
Throughout the day, Judge Belois heard testimony from employees of Wells Fargo that once the conservators were appointed, it took several months to clean out the house and sell her personal property. It then took several more months to put the house up for bid. No real estate agent was used, in order to avoid the expense of brokerage fees.
She heard testimony that the house was first appraised in August, for $140,000, and that the appraiser didn't factor in the third-floor rooms in his valuation because it was too hot up there. She heard that because the appraisals had to be done within three months of the sale, a reappraisal was needed. And even though work was done to the house after August, the appraiser simply renewed his earlier report without looking at the house again.
Belois heard testimony that in January 2002 the house was marketed to a small group of people who had signed up for information when they attended the estate sale in the summer of 2001. Wells Fargo contacted them, sent out information about the house, and held a small open house for prospective buyers to view the property. Then bids--starting around $150,000--were accepted by mail. She also heard, from neighbor Denise Selchow, whose family had been interested in buying the house, that they did not follow up with the bank when contacted because the person running the estate sale said the house would easily sell for $385,000.
And the judge heard testimony that it was only after Wells Fargo opened the offers, accepted Horty's high bid of $226,001, and entered into a purchase agreement with him that the bank realized it needed a second appraisal. That second appraisal, completed in February but, oddly, dated in December, valued the home at $215,000--considerably higher than the earlier assessment.
As the trial neared its end, Wells Fargo's attorney, George Borer, was contrite. "Some of the things in the sale of this property were not done in the ways they should have been," he conceded. "But in a perfect world the sale of the conservatee's property would be done, and it has been."
Judge Belois, however, was incredulous that Wells Fargo had neglected to comply with the most fundamental of conservatorship laws--the requirement for two appraisals of a property before it can be sold. "How did your client not know that was a requirement?" Belois asked the attorney, her voice acid. "This is a major financial institution that holds itself out to the public as an expert. This is classic black-letter law, and they did not know?"
"No, your honor," Borer responded. "It's a point of embarrassment here today, but I don't think Miss Riske has been harmed. I think harm could come if the court does not approve the sale and we are not able to sell the property for $226,000."
But Judge Belois wondered aloud whether the sale of the property might have been handled differently if the conservator had had both appraisals--so far apart in value--before asking for bids on the house. "That's why we have two," she said. "To get everything known so you can offer the best stewardship on the part of your client for the vulnerable adult the court has placed in your client's care."
As tragic as it seems to be old and alone and have no one to take care of you, in truth, Riske's situation is not at all uncommon. "I'm always amazed at how many people there are in the world who don't have a support network or family," says Mary Watson, president of the Minnesota Association for Guardianship and Conservatorship (MAGIC). "It's common to see conservatorships of that nature."
Anyone who believes there is a need could petition to place someone like Bernadine Riske under conservatorship, Watson explains: A neighbor, a social worker, a doctor or nurse. In Riske's case, the petition for conservatorship was filed by Ellen Swanson, an advocate with Matrix Advocare Network, a private company that manages the healthcare and other needs of patients, many of whom are elderly. Lynne Ploetz, president and CEO of the company, says Matrix was referred to Riske by an employee of Wells Fargo's elder services department who had attended church with Riske.
In Minnesota, conservatorships are divided into two areas: the person and the estate. A conservator of the person is responsible for the conservatee's care, including food, clothing, shelter, health care, and recreational requirements, as well as giving consent for medical and other treatments. A conservator of the estate must pay the conservatee's bills and manage the estate prudently. Before the court appoints either kind of conservator, it conducts a screening process to make sure that the conservatorship is both necessary and the option that is least restrictive to the conservatee's personal rights and freedoms.
Ideally, the conservator appointed is someone the needy individual would be comfortable with, Watson stresses. But in reality, she points out, "if nobody shows up to object to that person or suggest an alternative, then the court by default appoints the conservator."
The conservators, once appointed, must submit annual reports on both the physical well-being of the conservatee as well as deposits to and payments from the estate. But unless someone involved in the process closely reviews each entry in those reports, there isn't always a way to check on how the conservator does his or her job.
"There's very little in terms of a monitoring process in place for once the conservator is appointed," Watson says. "The court almost needs to rely on the public, or the facility where the conservatee is when the conservator isn't doing their job."
Michael Verbrick sees this as a catch-22. "The conservator only gets [the estate] if there's nobody there. If nobody's there watching the conservator, the conservator can do whatever he wants to do. Nobody's checking," Verbrick says. "These are people who are chronically unrepresented. The conservator is supposed to be watching out for the person's best interest. Who's watching the conservator?"
Ultimately Verbrick believes Wells Fargo simply didn't do everything it could to get the most money for Riske's house. "I don't think they're evil. I just think they're lazy," he says. "The standard of care is diligence, prudence, as you would with your own house. The standard of care is, get the best price possible, within reason.
"The conservator, to me, seems obsessed with the fact that he performed duties with a nominally sufficient standard of care," he continues. "But close enough ain't good enough." Wells Fargo certainly didn't seem particularly eager to cast a wide net for potential buyers in order to drive the home's price up, Verbrick says, which is especially troubling considering the amount of time it took for the bank to put the house up for sale.
For example, he posits, if the conservator had cleaned the house by May 2001 (instead of late July), then put it up for sale in June, it likely would have sold by late summer or early fall, and the matter would have been taken care of a year ago. Riske's estate would have gotten the money, and invested it, perhaps earning as much as $9,000 in interest over the past year. Instead, the delay cost her that interest, and she's had to pay another year's worth of taxes and fees to keep up the house--perhaps another $3,000, Verbrick estimates.
"That's a $12,000 oops," he exclaims.
On July 31, Judge Belois ruled that Wells Fargo could sell Riske's house, but not under the terms of the January 2002 purchase agreement with Horty. She found that the sale did not comply with the law, which demands that in order to sell conservatorship real estate, there must be two appraisals or reappraisals by two disinterested parties within three months of the sale. As a result, the judge ordered the bank to get two new, independent appraisals for the home and put it back on the market.
What would have happened if Verbrick hadn't lived across the street from Riske? What would have happened if he hadn't pursued the case or found Riske's distant relatives? What are the chances that, without Verbrick's complaint, the court would have caught the mistake on its own?
"Zero. Absolutely," Verbrick declares. "It's people like Bernadine's case, where there isn't anybody to look out for them. There's no one to raise these issues.
"It's just a weird happenstance," he continues. "I needed a weed whacker one day. And I happened to be a lawyer and took a run at them."
In the immediate future, it appears that Riske's house on Colfax will be put up for sale again. According to Judge Belois's order, Wells Fargo "shall obtain new appraisals, from appraisers other than those above named, and otherwise comply with all statutory requirements prior to commencing a sale process for the subject property."
Verbrick is still waiting to see whether Horty might appeal the decision. But in the meantime he believes Wells Fargo plans to ask the court to name the appraisers. And, he adds, the bank's lawyer informed him that it intends to use the services of a real estate broker this time.
"I hope they do a good job of marketing it," Verbrick concludes. "And sell it for a big fat price." After all, her care is costing upward of $80,000 a year.
As long as Riske lives--or until she regains the capacity to take care of herself and the conservatorship ends--her conservators will be responsible for taking care of her, and managing her estate. Once she dies, however, the court will sign off on the conservators' work and excuse them from their duties. If Riske has a will, her estate will be parceled out according to it. If not, it goes to next of kin in an order prescribed by state law--and, presumably, will eventually go to Riske's remaining relatives.
Today Bernadine Riske lives at Hillcrest, a quiet, lodgelike facility set back from Interstate 394 by rolling grass and bubbling fountains. It's about as far as you could get from the old Victorian on Colfax Avenue South. She likely has no idea that there has been any kind of dispute over her house, her money, the life she once led. She probably doesn't remember the weed whacker.
According to an April 23 status report from the conservator responsible for her health and comfort, Riske is "generally, pleasantly confused and happy."
"She is very talkative. Is able to recall stories from her childhood and work as a writer, but does become repetitive. Can hold a conversation about any topic," states the report, which is based on 14 two-hour visits over the first year of the conservatorship. "She requires a secured unit with a structured recreation program related to cognitive impairment. Has attempted to leave unit when she believes she has an appointment."
But despite Riske's current state, there are elements in her court file that suggest she probably would very much have cared about what is happening to her money. Back in March 2001, before Riske was placed under conservatorship, a court visitor conducted an interview with Riske at Hillcrest. The visitor read Riske the petition for the conservatorship and posed a number of questions to probe her understanding of the proceedings. Many of her responses, though a little fuzzy, highlighted her concern about money.
"I worked for Internal Revenue U.S. Federal Civil Service from 1951 till 1976," Riske is quoted as saying in the visitor's report. "I get a good pension and made good wages for that time; probably not as much as you make. I was always a saver. I didn't waste any money. I bought and paid for my apartment building. I paid it off in less than ten years.
"I worry that all these various legal entities are trying to get my money taken away," she added. Though she seemed largely unconcerned about the particulars of the conservatorship, she did have one complaint: "One problem that I have is that I do not have any cash for daily expenses. I am destitute. I do not have any money for an ice cream cone or a bar of candy. I'm completely broke."
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