Justia Trusts & Estates Opinion Summaries

A married couple, Richard and Penny, entered into a separate property regime through an antenuptial agreement. Richard had two sons from a prior marriage. Upon his death, his son Bruce was named executor, and Penny was granted a usufruct over certain properties and a share in a partnership interest. After Richard’s death, Bruce, as executor, sought reimbursement from Penny for (1) Richard’s funds used to purchase a townhouse where both were listed as co-owners, (2) costs of improvements made to the townhouse, (3) a $1,000,000 check Richard gave Penny shortly before his death that she deposited into her separate account, and (4) a tax overpayment made by Richard that Penny used to pay her tax liabilities.The Twenty-Fourth Judicial District Court for the Parish of Jefferson denied most of Bruce’s reimbursement claims, finding that the Civil Code did not authorize reimbursement for the initial property purchase price and that Bruce had not met his burden to prove the value of improvements. The Louisiana Court of Appeal, Fifth Circuit affirmed. Bruce then sought review in the Supreme Court of Louisiana.The Supreme Court of Louisiana reversed in part and affirmed in part. The Court held that, although Richard and Penny were equal co-owners for title purposes, Bruce was entitled to claim reimbursement for Richard’s initial purchase price contribution to the townhouse because the Civil Code does not prohibit such reimbursement and principles of equity prevent unjust enrichment. The Court also ruled that the estate was entitled to reimbursement for the $1,000,000 check, finding Penny failed to prove donative intent by clear and convincing evidence, and for the tax overpayment, since it was paid solely from Richard’s funds. The Court affirmed the denial of reimbursement for alleged improvements, finding no manifest error in the lower courts’ factual determination that Bruce had not sufficiently proved the value of improvements. The matter was remanded for further proceedings. View "O'KREPKI VS. O'KREPKI" on Justia Law

The decedent, Herman Stille, executed a will leaving most of his sizable estate to the Floyd County Medical Center (FCMC) to establish a cancer center, provided the hospital remained independent. The will included a contingency: if FCMC lost its independent status and merged with a major healthcare corporation, the estate would instead go to Mayo Clinic for Alzheimer’s research. After Stille’s death, FCMC began planning the cancer center but discovered it was impossible to provide on-site radiation treatment due to regulatory, financial, and logistical constraints. Mayo Clinic, as the contingent beneficiary, argued that the gift to FCMC failed because the hospital could not meet all the specifications in the will, including radiation therapy.The Iowa District Court for Chickasaw County held a bench trial, considering evidence about Stille’s intent and the practicalities faced by FCMC. The court found that FCMC satisfied the main conditions of the gift: it remained independent and could build a cancer center meeting five out of six specified features, except radiation therapy. The court determined that Stille would not have withdrawn his bequest had he known radiation treatment was impossible. Applying Iowa precedent, the district court upheld the bequest to FCMC and ordered the estate’s residual assets to be distributed to FCMC.The Iowa Supreme Court reviewed the case de novo. It focused on whether Mayo Clinic, as a contingent beneficiary, had standing to challenge the bequest. The court found that under the unambiguous terms of the will, Mayo Clinic’s interest was contingent on FCMC losing its independence—a condition that had not occurred. Therefore, Mayo Clinic lacked standing to contest the bequest. The Iowa Supreme Court affirmed the district court’s judgment, holding that a contingent beneficiary whose condition for receiving a gift has not occurred has no standing to challenge the gift. View "In The Matter of The Estate of Stille" on Justia Law

A decedent, James, established a Panamanian private interest foundation (PIF) called the Harris 6 Foundation and, shortly before marrying Nancy, transferred twelve Arizona properties into the PIF. He created the PIF to protect his assets in anticipation of marriage without a prenuptial agreement. At his death, the PIF still held several properties. The foundation was structured so that, upon James’s death, its assets would pass to several named beneficiaries, none of whom was Nancy.After James’s death, Nancy sought to claim an elective share of his estate under Iowa Code section 633.238, which allows a surviving spouse to claim a portion of certain property, including assets held in a revocable trust. The guardian ad litem for a minor beneficiary asked the Iowa District Court for Polk County for a declaratory judgment that the PIF’s assets were not subject to Nancy’s statutory share. The district court found that the PIF, as a separate juridical entity under Panamanian law, was not a revocable trust and that its assets were not included in the categories subject to Iowa’s elective share statute. The Iowa Court of Appeals affirmed, relying on In re Estate of Myers, which limits the elective share to property specifically listed in the statute.The Supreme Court of Iowa reviewed the statutory language and the nature of the PIF, finding that the statute’s list of property subject to the elective share is exclusive and does not extend to property held by a nontrust entity like a PIF. The court held that a Panamanian PIF is not a trust under Iowa law, and its assets are not included in the surviving spouse’s elective share under section 633.238(1)(d)(1). The decision of the Court of Appeals and the judgment of the district court were affirmed. View "In the Matter of the Estate of Ibeling" on Justia Law

Barbara Tanzer, an elderly woman, and her husband moved through several states, ultimately leasing an apartment in Alabama to allow her husband to receive medical treatment. Shortly after their arrival, the Alabama Department of Human Resources (DHR) petitioned for protective services, alleging Barbara was unable to care for herself and at risk of exploitation. DHR cited Barbara’s physical and cognitive limitations and alleged suspicious financial activity by a third party using a power of attorney. Barbara was evaluated twice by medical professionals, who found she did not suffer from significant cognitive impairment and retained capacity for medical decision-making, though she required physical assistance. Barbara asserted that her presence in Alabama was temporary and that she remained domiciled elsewhere.After DHR’s petition, the Jefferson Probate Court issued emergency protective orders, froze Barbara’s assets, and ultimately appointed a permanent conservator for her estate. Throughout the proceedings, Barbara maintained that the court lacked personal jurisdiction, as she did not reside in Alabama, had no family or assets there, and was only temporarily present for her husband’s medical care. She sold her Georgia property, purchased a condominium in Massachusetts, and notified the probate court of her permanent move out of Alabama.The Supreme Court of Alabama reviewed the case and determined that the probate court lacked personal jurisdiction under the Alabama Uniform Adult Guardianship and Protective Proceedings Act. The Court found that Alabama was neither Barbara’s home state nor a significant-connection state at the time the petition was filed, and none of the statutory bases for jurisdiction applied. Consequently, the Supreme Court of Alabama reversed the probate court’s order appointing a conservator and remanded the case for further proceedings. View "Tanzer v. Alabama Department of Human Resources" on Justia Law

Two grandchildren of Edward and Betty Stewart brought suit against their uncle following the administration of two family trusts. The trusts, governed by Illinois law, were originally structured to provide for Edward and Betty’s children, including the grandchildren’s mother. After their mother’s death in 2017, Betty amended the trusts to designate her son Bruce as sole beneficiary. The grandchildren made repeated requests for information about the trusts, which were denied on the grounds that they were not beneficiaries. After Betty’s death in 2023, and confirmation that they had been excluded, the grandchildren sued Bruce, alleging undue influence, lack of capacity, breach of trust, and tortious interference with inheritance.The case was first heard by the Mobile Circuit Court. Bruce moved for summary judgment, asserting that the claims were time-barred and that certain claims were not recognized under Alabama law. The plaintiffs responded that Illinois law governed and that the statute of limitations should be tolled due to Bruce’s concealment of their removal as beneficiaries. After considering arguments from both parties, the circuit court granted summary judgment for Bruce, finding all claims time-barred, prompting the appeal.Upon review, the Supreme Court of Alabama found that the plaintiffs’ attorney had filed appellate briefs rife with invalid, inaccurate, and non-existent legal citations, many generated by artificial intelligence. The Court determined these briefs were grossly deficient and failed to comply with the Alabama Rules of Appellate Procedure. As a result, the Supreme Court of Alabama dismissed the appeal, denied the plaintiffs’ motion to file supplemental briefs, imposed sanctions on plaintiffs’ counsel, and granted counsel’s motion to withdraw. The main holding is that an appeal supported by fabricated or grossly deficient legal authorities does not meet minimum procedural standards and will be dismissed. View "Ibach v. Stewart" on Justia Law

Robert Crawford was admitted to a hospital in August 2018 in critical condition. The next day, his daughter Carol obtained a general power of attorney (POA) allegedly signed by Robert and notarized by Lindsay, though Robert’s condition raised questions about the validity of the POA. Carol attempted to use the POA to access Robert’s bank accounts; one bank and a hospital refused to honor it, but First Security Bank (FSB) allowed significant withdrawals, despite having prior instructions from Robert to prohibit such transactions unless he appeared in person. Robert died intestate in September 2018, and Dasie Mae Richmond was appointed administratrix of his estate.Dasie filed suit in the Quitman County Chancery Court in August 2021 against FSB, Carol, and Lindsay, alleging improper procurement of the POA, conversion, conspiracy, negligence, and breach of contract. After initial discovery, proceedings were stayed due to Carol’s indictment and plea related to exploitation of a vulnerable person. Lindsay filed a motion for summary judgment, which was denied. Later, Lindsay moved to dismiss for failure to prosecute under Rule 41(b), with FSB and Carol joining. The chancery court granted dismissal as to Lindsay only, citing ongoing restitution by Carol and unresolved issues with FSB, but denied the motion as to FSB and Carol.The Supreme Court of Mississippi reviewed only FSB’s appeal of the denial of dismissal. The Court held that the facts justifying dismissal for Lindsay applied equally to FSB and found no sound basis in the record for treating FSB differently. The Supreme Court of Mississippi concluded that the chancery court abused its discretion in denying the Rule 41(b) dismissal as to FSB. The Supreme Court reversed the lower court’s decision and rendered judgment dismissing the claims against FSB. View "First Security Bank v. Richmond" on Justia Law

A group of trustees managing an ERISA-regulated pension plan invested in six classes of residential mortgage-backed securities (RMBSs), some issued as notes under indenture agreements and others as trust certificates. The trustees alleged that companies servicing the underlying mortgages mismanaged the loans, acted in self-interest, and failed to protect investors’ interests, in violation of their fiduciary duties under ERISA. The investments included three classes of notes and three classes of trust certificates, each backed by pools of residential mortgages.The United States District Court for the Southern District of New York considered cross-motions for summary judgment on whether the underlying mortgages constituted plan assets under ERISA. The district court ruled that only the RMBSs themselves, not the mortgages behind them, were plan assets as defined by the Department of Labor’s regulation. Consequently, it granted summary judgment to all defendants, holding that the servicers did not owe ERISA fiduciary duties regarding the mortgages, and denied the trustees’ cross-motion.On appeal, the United States Court of Appeals for the Second Circuit reviewed the district court’s summary judgment ruling de novo. The Second Circuit agreed that the notes issued under indenture agreements were not equity interests and did not confer plan asset status on the underlying mortgages. However, it found that the trust certificates were beneficial interests in the trusts and thus qualified as equity interests under the Department of Labor’s regulation. As a result, the court affirmed the district court’s judgment in part (regarding the notes), vacated in part (regarding the trust certificates), and remanded for further proceedings, including determination of whether the servicers acted as fiduciaries with respect to the trust certificates. View "Powell v. Ocwen Fin. Corp." on Justia Law

The decedent died intestate in January 2018, survived by his spouse and two adult children from a prior marriage. The spouse successfully petitioned to be appointed personal representative of the estate. After several years of inactivity in the probate proceedings, the spouse’s attorney withdrew due to her lack of cooperation. The decedent’s son then petitioned to have the spouse removed as personal representative, alleging breach of fiduciary duty. The District Court granted the petition, replaced the spouse with the son as personal representative, and found the spouse liable for any damages resulting from her breach of duty.Subsequently, the son petitioned the District Court for determination of heirs, adjudication of intestacy, approval of final account, and distribution of the estate, alleging the spouse had improperly transferred funds to herself. The son proposed that the spouse receive certain assets already in her possession, and that the remainder of the estate be divided between the two children. Notice was sent to the spouse, but she did not appear or object. The District Court distributed the estate according to the son’s proposal and discharged him as personal representative. Over a year later, the spouse, with new counsel, moved under Montana Rule of Civil Procedure 60(b) to set aside the decree, arguing lack of proper notice and improper distribution. The District Court denied the motion, finding she had not demonstrated grounds for relief under Rule 60(b).The Supreme Court of the State of Montana reviewed the case and affirmed the District Court’s order. The Supreme Court held that the District Court did not abuse its discretion in denying the spouse’s Rule 60(b) motion because proper notice was given, the spouse was not entitled to relitigate issues via Rule 60(b) that should have been raised on direct appeal, and her arguments did not establish the specific grounds required for relief. View "Estate of: Lea" on Justia Law

A man designated his sister as the beneficiary of his employer-issued life insurance policies, amounting to $150,000, with instructions that she distribute the proceeds to his three daughters. The man, suffering from declining health, relied on his sister to manage his finances, legal affairs, and healthcare decisions, creating a fiduciary relationship. After his death, the sister claimed the insurance proceeds for herself, contrary to the instructions. The daughters sought a constructive trust over the proceeds, claiming the sister was to hold the funds in trust for them, while the sister denied any fiduciary breach and asserted entitlement under the policy.The Allen Superior Court, after a bench trial, found no undue influence or fraud in the beneficiary designation but concluded that the sister breached her fiduciary duty by failing to distribute the proceeds as instructed. The court imposed a constructive trust in favor of the daughters, finding by clear and convincing evidence that the deceased intended for them to receive the insurance money. The sister appealed, arguing that the Employee Retirement Income Security Act of 1974 (ERISA) preempted such state-law remedies and that the evidence did not meet the required standard. The Indiana Court of Appeals twice reversed the trial court, holding that ERISA preempted the remedy, but the Indiana Supreme Court remanded for application of the correct standard of proof without reaching the preemption issue.The Indiana Supreme Court, upon further review, held that the sister waived her ERISA preemption argument by not raising it in the trial court. The court affirmed the trial court's imposition of a constructive trust, concluding that the findings of a fiduciary relationship and breach of duty were supported by clear and convincing evidence. Accordingly, the Indiana Supreme Court affirmed the trial court’s judgment in favor of the daughters. View "Geels v. Flottemesch" on Justia Law

After the death of Paul A. Knapp, his son Lance, as personal representative of Paul’s estate, sought to probate Paul’s 2010 will, which primarily left property to his first wife and, if she predeceased him, to his children and grandchildren. Paul’s widow, Barbara, filed claims against the estate, specifically for a share of the marital residence’s proceeds and a statutory maintenance fund. These claims were based on a premarital agreement executed before Barbara and Paul’s marriage, as well as a purported subsequent oral agreement that Barbara would receive 40% of the marital residence due to her financial contributions to its remodel and refinancing.The County Court for Dodge County reviewed the case after Lance, as personal representative, disallowed Barbara’s claims. At trial, evidence showed that while Barbara contributed funds to remodel the residence and participated in refinancing, title to the home remained solely in Paul’s name. The premarital agreement referred to certain rights in a non-existent “Article 9.4” and generally maintained that separate property would remain separate unless jointly titled. The county court found the agreement unambiguous, concluded there was no evidence of a mutual mistake justifying reformation, and determined that Barbara was not entitled to proceeds from the marital residence or a maintenance fund. The court also found insufficient evidence of an enforceable oral contract for transfer of the property.On appeal, the Nebraska Supreme Court affirmed the county court’s decision. The Supreme Court held that the premarital agreement was unambiguous and did not entitle Barbara to the claimed property interests, nor was reformation appropriate. Additionally, the Court found that Barbara had not proven the existence or terms of an enforceable oral contract by clear and convincing evidence. The disallowance of Barbara’s claims was affirmed. View "In re Estate of Knapp" on Justia Law