An estate lawyer accused of a "wrongful scheme" to steer money to himself from the estates of the late June M. Farrington and her surviving brother will pay back $410,000 as part of a settlement.
Estate lawyer Stephen M. Newman also resigned as executor and trustee of all of the estates and trusts he set up for the elderly Orchard Park siblings. That means he will not collect any future commissions.
That also means three charities -- the Community Foundation for Greater Buffalo, the Nature Conservancy and the Women & Children's Hospital of Buffalo Foundation -- will receive the millions of dollars in her trust. The amount is about $9 million, according to the charities' attorney.
"Her intent has been fulfilled, and all of those amendments that feathered the nests of others are of no moment," said Daniel C. Oliverio, chairman of the Hodgson Russ law firm, which represents the charities.
In all, the settlement transfers more than $1.6 million to various Farrington trusts from Newman; Nixon Peabody, the law firm for whom he once worked; the Pankauski Law Firm of West Palm Beach, Fla., which has represented Newman; Bank of America, which had been a co-executor of June Farrington's will; and various escrow accounts.
The settlement did not require Newman or anyone else to admit to wrongdoing.
"After years of litigation, this matter was resolved without any admission or finding of wrongdoing on the part of Nixon Peabody, Bank of America or Steve Newman," said Terrence M. Connors, one of Newman's attorneys. "Essentially, Nixon Peabody, Bank of America and Steve returned a portion of the fees and commissions, and the charities and the representatives of the Farringtons agreed to the resolution."
The settlement in Erie County Surrogate's Court last week designates June Farrington's 1999 trust agreement as her estate's controlling document. All of the later trust agreements and amendments that changed how her money would be disbursed are now deemed "inoperative."
June Farrington's 1999 trust -- funded with money she inherited from her father's hand-tool fortune -- left all of her assets to the three charities upon her death. When she died in 2008 at age 84, they counted on sharing her bequest.
But the charities discovered June Farrington's estate had been restructured to eliminate the outright gifts to them. Instead, a perpetual charitable trust had been created, with Newman acting as co-trustee and collecting commissions, to contribute smaller amounts annually to the charities.
A fight over her millions of dollars erupted in Surrogate's Court.
At one hearing in March, 22 lawyers assembled before Erie County Surrogate Barbara Howe to delve into the contested estates.
In court documents, the charities' attorneys accused Newman and Joan Morgante, a caretaker whom he introduced to the Farringtons, of a "wrongful scheme" and "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."
Newman, 67, who catered to wealthy clients from law offices in Amherst and Palm Beach County, Fla., slowly restructured the siblings' estate plans so that he and Morgante would benefit from their estates, the charities' attorneys contended.
A will for Worth Farrington, June's surviving brother, named Morgante as sole beneficiary of his estate -- worth more than $6 million.
After Howe named Public Administrator Acea M. Mosey as co-administrator of June Farrington's estate and also a trustee of other Farrington trusts, Mosey's attorneys delved into how the Farrington estates were changed and where their money was going.
The law firm of Stanley J. Collesano, working for Mosey, helped trace the money, Oliverio said.
"It kept getting worse and worse," Oliverio said of Newman's and Morgante's actions. "The more investigating there was, the worse it got."
The agreement releases the parties from further claims against each other -- with the exception of the state's attorney general.
So while Newman has resolved the dispute with the charities over June Farrington's estate, the agreement does not stop the attorney general from pursuing action against him.
The charities decided against settling for anything less than the full amount to which they were entitled, Oliverio said.
"Most would have settled for less, but not these charities," he said. "They were prepared to do whatever was necessary to recover every single dollar -- and they were successful. They protected their donors' money."
At times, the case revealed bizarre twists.
Morgante, 73, headed to Amherst Town Hall with Worth Farrington in October to get a marriage license so the two could wed.
A town clerk refused to issue the marriage license because Worth Farrington did not know his birth date, address and the name of the person who wanted to marry him, among other simple questions.
Morgante at one time was Worth Farrington's caretaker and lived in a $325,000 townhouse in Amherst that his trust fund paid for.
The scrutiny paid to June Farrington's estate led to the appointment of a guardian for Worth Farrington. Medical records dating back to 2007 revealed a history of dementia as well as Parkinson's disease.
Rocco Lucente II, the attorney who appointed his guardian, said the 86-year-old man does not see well, is hard of hearing and suffers from an ailment that impairs his ability to understand the Surrogate's Court proceedings.
"It became apparent that I would need to undertake action to protect my ward from questionable conduct of certain parties to these proceedings," Lucente said in court papers filed last week in court.
Lucente said the work of Assistant Attorney General William Malovan and Kenneth Peters, a state attorney general investigator, "uncovered further questionable conduct on the part of Stephen M. Newman and caregiver Joan Morgante."
Morgante signed the settlement agreement, but it does not require her to pay money back to the Farrington estates.
The conditions Lucente set for agreeing to the settlement include the return of $1.2 million taken from the Worth L. Farrington 2008 Trust.