Van Buren attorney Gentry C. Wahlmeier is accused of charging two developmentally disabled Arkansans nearly $200,000 for basic work that should have taken at most a few hours.
Wahlmeier and his namesake law firm were accused last week in a Crawford County Circuit Court lawsuit of charging “unconscionable” fees to siblings Larry Boatright and Loreva Boatright, both of Alma, for his work in creating two supplemental needs trusts for them.
“Wahlmeier’s conduct is precisely the type of greedy, self-serving behavior that gives lawyers a bad name and seriously injures the reputation of the legal profession in society at large,” the siblings’ attorney, Matthew R. House of James House Swann & Downing of Little Rock, said in the complaint.
The Boatrights’ suit also named their trustee, Citizens Bank & Trust Co. of Van Buren, as a defendant. Wahlmeier insisted that Citizens Bank serve as trustee, the lawsuit says, accusing it of allowing nearly $200,000 of a $700,000 trust to be paid to Wahlmeier.
The bank also received an “excessive” administration fee of $26,483 from the trust, the complaint said.
Citizens Bank & Trust President and CEO Brent Taylor told Arkansas Business the company doesn’t comment on pending litigation.
Wahlmeier didn’t return messages from Arkansas Business. His attorney, M. Jered Medlock of Fort Smith, said he wasn’t interested in commenting, according to Medlock’s office. But in a March 30 filing in a probate proceeding that raised the allegations, Medlock wrote that Wahlmeier “Denies all allegations.”
A trustee’s fiduciary duty is to ensure that the rules of the trust are being followed, that state laws are being followed, and that the beneficiaries aren’t being cheated, said Timothy Russell, president of Estate Planners of Arkansas of North Little Rock.
Russell created a trust in 2016 for the Boatrights’ sister, Barbara Steffen, who died in 2021 at the age of 70.
He said that the special needs trust that Wahlmeier worked on was largely redundant because Steffen had already made provisions for her siblings, the Boatrights. Russell said all the work required of Wahlmeier was getting two or three tax IDs, which are free, and arranging for a trustee to be appointed.
“And so that would have been maybe an hour’s worth of work,” Russell said.
In the 30-page complaint, House criticized the defendants for taking advantage of the vulnerable siblings.
“The very people tasked with protecting Larry and Loreva and acting in their best interests are instead the same people who actually ended up taking advantage of those disabled individuals and lining their pockets” with nearly $225,000, House said in the complaint.
The trust paid Wahlmeier’s firm $197,591 on Dec. 8. At that time, he was representing the Crawford County Library System, which has since raised questions about his billing. The Library System said he recently resigned as its counsel.
Death in the Family
Years before Steffen died, she had met with Russell to create a trust for her siblings in 2016.
Steffen had worked for more than three decades on behalf of disabled people.
Her siblings, Larry Boatright and Loreva Boatright, both have “significant intellectual and other developmental disabilities,” and they rely on government programs for their daily needs, the lawsuit said.
Steffen created the trust to provide after her death for her brother’s and sister’s lifetime needs, “given their disabilities and limited abilities to work and generate income through employment.”
The trust has two other beneficiaries, Steffen’s stepson and her late husband’s grandson. Steffen selected Ameriprise National Trust Bank to serve as the trustee, but after her death, it declined to do so.
The Boatrights were referred to a financial adviser in Van Buren, who then referred the siblings to Wahlmeier.
Becoming an Attorney
Wahlmeier decided to become a lawyer because he “realized he could make a difference in his community,” according to his law firm’s website.
He received his law license in 2018 and began practicing at the Howell Law Firm of Van Buren. In January 2020, the University of Arkansas School of Law at Fayetteville graduate acquired the Howell firm and renamed it the Wahlmeier Law Firm. A year later, he obtained the Capp Law Firm of Ozark.
Wahlmeier’s website touts his experience in areas ranging from criminal and civil litigation to business law, probate and estate planning. “Honor, integrity and hard work make up the foundation” of the law firm, the website says.
Creating the Trusts
The Boatrights hired Wahlmeier in May 2022 “to undertake the very simple task of creating two identical supplemental needs trusts to facilitate their Trust distributions,” the suit said.
The Boatrights thought they were paying Wahlmeier a $6,000 “non-refundable” fee at the rate of $300 an hour to create the documents, according to the signed documents attached as exhibits to the complaint.
The same day that the Boatrights agreed to that document, Wahlmeier had them sign without their knowledge or understanding an attorney/client agreement that set his contingency fee at 33% of the gross value of the Boatrights’ share of the trust’s current value, the lawsuit said.
House said in the complaint that the contingency fee arrangement “makes absolutely no sense in this situation,” because the Boatrights were entitled to their trust distribution.
Wahlmeier then allegedly put “very little work” into creating the documents for Larry Boatright, who is in his 60s, and Loreva Boatright, who is in her 50s, the lawsuit said.
The first page of the documents contains a few sentences of boilerplate language, the second page a signature line, and the next three pages are photocopied excerpts of the trust, the lawsuit said.
House said in a filing that the legal work should have taken an hour or two and cost a couple of hundred dollars. Instead, Wahlmeier “charged a wildly excessive and completely unreasonable attorney’s fee” of nearly $200,000, House said.
House said that Wahlmeier’s fee agreements violate the Arkansas Rules of Professional Conduct, which say fees must be communicated to clients.
As trustee, Citizens Bank & Trust should have been looking out for the Boatrights’ best interest, the lawsuit said. But it paid Wahlmeier’s fee “evidently without questioning its reasonableness or otherwise insisting upon any rationale or documentation justifying such an incredibly large attorney fee,” House said in the filing.
Enter House
Earlier this year, the Boatrights’ caretaker and others who are interested in the siblings’ welfare discovered the fee paid to Wahlmeier. The Boatrights hired House to investigate.
“From my preliminary analysis of the situation, I can honestly say that this is one of the worst cases of two vulnerable, special needs persons being taken advantage of, and neglected, that I have ever seen in 24 years of specializing in estate and trust litigation,” House said in a March 23 email to the defendants, which is attached to the lawsuit as an exhibit. He asked them to return the fees, but as of last week, none of the money has been returned.
House said that Wahlmeier presumably spent some of the Boatrights’ money on a new BMW 430i hardtop convertible and referenced a Feb. 18 Facebook post from Riser Ford Lincoln in Hot Springs that congratulated Wahlmeier and his wife on the purchase.
“If Barbara Steffen was still alive she would undoubtedly be shocked and saddened at what has happened to her disabled siblings and her hard-earned life savings,” House said in the email. “The degree of negligence, breach of fiduciary duties, breach of trust, breach of contract, unjust enrichment, and other wrongful acts involved in this case is rather staggering.”
House is seeking back the money paid to the defendants plus punitive damages, costs and attorneys’ fees.
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