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Treble damages upheld in stepmother’s conversion of safe deposit box funds

June 20, 2017

The Indiana Court of Appeals has affirmed a determination that a northern Indiana woman illegally converted the funds in the safe deposit box her husband shared with his adult children and that the children are entitled to treble damages.

Prior to Harold Silberman’s death in 2013, his wife, Cynthia Clark-Silberman, reviewed his estate planning documents and was “crushed” to discover she would only receive a one-third share of his estate. Silberman’s children from his first marriage, Richard Silberman and Susan Wang, were also to receive one-third of the estate.

Additionally, Clark-Silberman raised concerns about serving as co-trustee and co-personal representative with her stepson. Two of Clark-Silberman’s friends, one of whom was a disbarred California attorney, prepared an “amended” trust that made Clark-Silberman the sole successor trustee and an “amended” will that bequeathed all of the proceeds of Harold Silberman’s ticket brokering business to Clark-Silberman.

Then, when PNC Bank would not allow Clark-Silberman to access her husband’s safe deposit box, which was also in the name of her stepchildren, she had her friends prepare a document naming her as the sole attorney-in-fact, despite the fact that Wang and Richard Silberman had earlier been named as co-attorneys-in-fact with her. She then took the document to her husband, who was hospitalized, and he signed it.

Clark-Silberman was then able to access the box, and she removed $46,182 in cash and a gold watch intended for her stepchildren.  She then returned to the bank and removed gold coins and an engraved pen set. She later testified the money was used to pay her living expenses and the rest was put in her safe deposit box at another bank.

When Harold Silberman was transferred to a rehabilitation facility a few months before his death, Clark-Silberman had him sign the documents prepared by her friends. Then, after their father’s death, Richard Silberman and Wang filed a petition to set aside trust amendments and petition for damages, alleging undue influence and breach of fiduciary duties, among other things.

During trial, Harold Silberman’s attorney, Irv Rosenberg, said Harold had never mentioned the documents prepared by his wife’s friends. Further, Geoff Newman, Harold Silberman’s business partner, said in December 2012, Harold had told him his estate plan was to distribute one-third to his wife and children. Additionally, a clinical neuropsychologist testified that he had never treated someone with Harold Silberman’s condition who didn’t suffer from cognitive impairments.

The St. Joseph Probate Court determined Clark-Silberman had converted the funds in the safe deposit box and exerted control over them without permission. It awarded $138,546 in damages, equal to the amount she removed from the box. On appeal in Cynthia Clark-Silberman v. Richard M. Silberman and Susan A. Wang, 71A05-1607-TR-1740, Clark-Silberman challenged the determination she had converted the money and that her stepchildren were entitled to treble damages.

But the Indiana Court of Appeals affirmed those determinations Tuesday, with Judge James Kirsch writing in a unanimous opinion that, similar to the circumstances in Midland-Guardian Co. v. United Consumers Club, Inc., 499 N.E.2d 792 (Ind. Ct. App. 1986), “the $46,182 were funds, in a determinate amount, that were placed in a separate and identified location for safekeeping, to be accessed by Harold or the others owners of the safe deposit box, or returned to Harold’s estate at the appropriate time.”

“Only through falsely representing to PNC that she was Harold’s sole attorney-in-fact, did Cynthia successfully access and remove the funds,” Kirsch wrote.

Thus, the funds were capable of being identified as special chattel, and pursuant to Indiana Code 34-24-3-1, the award of treble damages was not erroneous.

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