Connecticut Attorney General's Office
Attorney General Successfully Challenges Questionable Agreement To Sell Greenwich Home, Secures At Least $300,000 More For Charities
July 17, 2009
Probate Judge Daniel F. Caruso voided an agreement under which Mona Lee Johnson of Greenwich granted her neighbor Mark L. Lovallo and her long time accountant, David Alfano, an option to buy her home for $500,000 after her death. In fact, the home was estimated to be worth more than twice as much -- about $1.2 million -- when she died in 2005.
Johnson signed the agreement at Lovallo's urging a month before she died when she was in the hospital.
Johnson's will divides most of her estate among eight charities whose shares would have diminished significantly -- by at least $300,000 -- if the house sold for only $500,000. As a result, Blumenthal, whose office enforces state charity laws, challenged the sales option agreement in Greenwich Probate Court.
Judge Caruso earlier this month found in favor of Blumenthal, ruling the house must be sold for fair market value.
"The net result in this long legal battle is at least $300,000 more for good causes, particularly educational institutions, for a total of about $1.5 million or more," Blumenthal said. "I fought successfully to stop this suspect agreement denying hundreds of thousands of dollars to charities intended to benefit from the home's sale.
"In charity law, the donor's wishes are paramount, and this extraordinarily generous donor sought to benefit charities, not these two men. This donor never wished to sell her home at a bargain basement price, less than half its estimated value at the time, significantly slashing proceeds to charities named in her will.
"Ill and infirm -- this woman supposedly signed papers while hospitalized and in the last month of her life -- raising grave doubt the agreement reflected her true wishes. This decision restores moneys rightfully belonging charities -- as well as charitable intentions.
"My office will continue to carefully monitor estates, intervening when appropriate to assure that the wishes of the deceased are respected and realized."
Because real estate values have fallen since Johnson's death, it's unlikely the home's fair market value is still the $1.2 million estimated in 2005. In the current market, Blumenthal's office expects the house to fetch at least $800,000, hopefully more. In addition, Johnson's estate includes about $700,000 in stocks and cash, making its total expected value at least $1.5 million.
If the sale agreement had not been voided by the court and the home had sold for $500,000, the estate's total value would have been about $300,000 less, approximately $1.2 million.
After expenses, all but $100,000 of the at least $1.5 million estate will be divided among eight charities: Weimaraner Foundation Fund, AKC Canine Health Foundation, Perot Library, Greenwich Library, Cornell University Veterinarian School, University of Pennsylvania Veterinarian School, Tufts Veterinarian School, and the Embroiders Guild.
The house has been unoccupied since Johnson's death.