When Champlin developer Duane Engels died in 2005, he had every reason to rest in peace. His hard work developing houses and apartment buildings left a substantial fortune that was sure to keep his widow, Beverly, comfortable until her dying day.

But according to a recent lawsuit filed by her court-appointed conservator, the couple's three children allegedly stripped $24 million from her estate as she slipped deeper into dementia, leaving the 79-year-old resident of a Rogers memory-care facility destitute unless something is done to recoup the funds.

The lawsuit, filed in Hennepin County District Court by a professional conservatorship firm called Fiduciary Foundation, lists her three children as defendants: Troy D. Engels of Monticello, Todd M. Engels of Pequot Lakes, and Sheri J. Brinker of Edina. It focuses nearly all of the allegations on Troy Engels, however.

None of the parties to the lawsuit or their attorneys would comment on the case. Each filed replies in court denying any wrongdoing.

Although they are co-defendants, Todd Engels and Brinker say in court filings that they support the conservator's efforts to investigate their brother's handling of the estate and restoration of any assets wrongfully taken from their mother. Troy Engels objected to the lawsuit, arguing in court papers that the allegations are false and that the suit is a waste of money.

Hennepin County District Judge Jamie Anderson ruled last month that the lawsuit could proceed.

"Though the cost of pursuing the Civil Action is high, when compared to the $24,000,000 that might have been misappropriated, the Civil Action may be reasonable," Anderson wrote.

She rejected Troy Engels' argument that the lawsuit is not in the best interest of his mother because any assets returned to her estate ultimately would be distributed back to him and his siblings when she dies.

"It is common knowledge that a child cannot legally steal from a parent simply because they will inherit [the] parent's assets eventually anyway," she wrote.

The suit accuses Troy Engels of systematically looting his mother's estate of assets and cash, going so far as to take the diamonds from her wedding ring and replacing them with fake stones. To cover his tracks, the suit alleges, he paid hush money to his siblings, had his employees shred his mother's financial records, and claimed that a safe containing his business records was stolen from his home — the only item he claims was taken in a burglary. The suit also alleges that Troy Engels persuaded his mother to resign from Engels Construction and sell him the company's stock for $2 million, then never paid her.

"Troy has used the Engels Construction Inc. checking account as his personal spending account," the suit says. It says he used company money to pay child support, gamble, fund his retirement and personal accounts, build a $692,500 cabin in Nisswa, and for dining, traveling, boating, and myriad large-ticket purchases. The suit lists a series of property transfers and loans to the three children and notes that a codicil in Beverly Engels' will states that any loans would be forgiven at her death.

"This goes against Beverly's original intent to treat each of her children, the Defendants, equally," the suit says.

Fiduciary Foundation argues in court filings that the transfers from Beverly Engels' estate could have "potentially catastrophic tax issues."

Troy Engels argued that the conservator lacks standing to pursue the claims. He accused Fiduciary Foundation of having a conflict of interest because the firm gets paid with Beverly Engels' assets. He also objected to the legal fees that have been spent thus far in a case that's estimated to cost as much as $250,000.

Todd Engels and Brinker support the conservator's decision to sue for an accounting and possible restoration of their mother's estate. Brinker said in her court filings that she suspects that her brother Troy "improperly took or received property and assets" that belonged to her mother and Engels Construction.

Dan Browning • 612-673-4493