Justia Trusts & Estates Opinion Summaries

In 2000, Decedent executed a will that devised his estate to his niece Dana Fink and her brother, Dustin Badgett. In 2009, approximately seven weeks before his death, Decedent signed a quitclaim deed conveying substantial real property to himself and Roberta Williams, Decedent's employee, as joint tenants with right of survivorship. After Decedent's death, Fink challenged the validity of the quitclaim deed, claiming her uncle was not competent to execute the deed. After a bench trial, the district court held that the quitclaim deed was void and had no legal effect. In addition, the court denied Williams' request for reimbursement for the mortgage and tax payments she had paid on the property for the period she held the property under the deed. Williams appealed the reimbursement ruling only. The Supreme Court affirmed, holding that the district court did not err in denying Williams' request for reimbursement of the monies she paid toward the mortgage and taxes on the subject property because Williams failed within the time allotted to present evidence in support of her request for such reimbursement. View "Fink v. Williams" on Justia Law

Decedent's will divided his estate among his wife (Wife) and his sons and left to Wife all of their jointly-owned vehicles and other property. At the time of Decedent's death he and Wife owned a motor home as joint tenants with the right of survivorship. There was an outstanding purchase money security interest on the motor home, and both Decedent and Wife signed the loan document, which specifically provided that each of them was independently obligated for the full amount of the debt. Wife filed a claim against Decedent's Estate for one half the debt on the motor home. The Estate's Personal Representative denied Wife's claim. The district court (1) applied a majority common-law rule from other states providing that Decedent's estate has an equitable duty to pay its aliquot share of debts on such jointly-held property, and (2) held the equitable outcome was to allow Wife's claim against the Estate. The Supreme Court reversed, holding that the district court erred in concluding that Montana law would, as a matter of equity under common law, require Decedent's Estate to pay half of the outstanding security interest in the motor home that became Wife's sole property upon Decedent's death. View "In re Estate of Afrank" on Justia Law

In this dispute over real property, Roslyn Shephard, in her capacity as personal representative of the estates of real property owners (Lessors), terminated the third lease of Lessees based on an alleged violation of the terms of the lease. Shephard then sued Lessees, seeking to invalidate Lessees' third lease due to the fact that she had not signed it on Lessors' behalf. Shephard alternatively sought an order declaring that Lessees had breached the terms of the lease. Lessees counterclaimed, alleging that Shephard had breached the terms of the lease by wrongfully terminating the lease and by failing to provide notice to them of the alleged breach. The district court found in favor of Lessees. The Supreme Court affirmed, holding (1) the district court correctly determined that the lease was valid without Shephard's signature; (2) substantial evidence supported the district court's finding that Lessees had not violated the lease; and (3) the district court correctly determined that the terms of the lease entitled Lessees to notice of their alleged breach and an opportunity to cure. View "Shephard v. Widhalm" on Justia Law

Johnson Farms, Inc. and Floyd Johnson filed a complaint against Ethel Halland alleging (1) in her capacity as secretary of Johnson Farms, Inc., Ethel breached her fiduciary duties by diverting corporate funds to herself and others; and (2) Ethel conferred gifts to herself and other family members in contravention of a written trust agreement. The district court granted Ethel's motion for summary judgment, finding that the complaint was barred by the statute of limitations and that equitable estoppel did not toll the statute of limitations. The district court also awarded Ethel attorneys' fees and costs. The Supreme Court affirmed, holding (1) Johnson's claims were barred by the statute of limitations; and (2) the district court did not err in awarding Ethel attorneys' fees and costs. View "Johnson Farms, Inc. v. Halland" on Justia Law

Louis G. Hannum, Jr. (Louis Jr.) appealed a district court's order removing him for cause as the personal representative of the estate of Louis G. Hannum, Sr. (Louis Sr.). Louis Sr. passed away in 2010, and was survived by his children, Louis Jr., Mike and Mark; and his grandchildren, Monika, Veronica, Michelle, Naomi, Zachary, Esther and Jim. Louis Sr. was predeceased by his daughter, Cheryl Gallagher, who was Esther’s and Jim’s mother. Louis Jr. filed an application for informal probate of will and appointment of personal representative of Louis. Sr.’s estate on September 2, 2010. Notice was sent to Louis Jr., Mike, Mark, Esther and Jim, but not to the remaining grandchildren. Naomi did, however, know of Louis Jr.’s appointment because Naomi was Louis Jr.’s daughter and she was acting as his counsel. It is unclear whether Zachary, Louis Jr.’s son, was aware of these proceedings. Notably, Louis Jr. did not send notice to Louis Sr.’s grandchildren Monika, Veronica and Michelle. In its Order, the District Court concluded that Louis Jr. violated numerous fiduciary duties, and as a result, his removal for cause was appropriate. In its conclusions of law, the District Court determined that Louis Jr. had failed in his duty to administer the probate according to the 2005 Will, a duty imposed by 72-34-101, MCA, when he included the value of certain alleged promissory notes and distributed them between himself and Mark without authority under the 2005 Will. The court additionally found that Louis Jr. failed in his duty to avoid conflicts of interest, in his duty to use ordinary skill and prudence, in his duty to exercise discretionary powers reasonably, and in his duty to file or otherwise deliver to interested parties, within nine months of his appointment, an inventory of estate assets that included a full and true value of the decedent’s interest in every item listed in the inventory. In reaching its decision, the the Supreme Court concluded that the District Court relied on substantial credible evidence. Though the Court disfavors removing a personal representative, the District Court has broad discretion in its decision to remove a personal representative, and the Court concluded that the District Court did not abuse that discretion when it removed Louis Jr. for cause. View "Estate of Hannum" on Justia Law

Glacier Kitchens, Inc., CR Weaver Trust, and the Estate of Grace Weaver (collectively "Defendants") appealed the denial of their motion to set aside the default judgments issued against them in district court. Weaver filed a complaint against Plaintiff Mountain West Bank (MWB) alleging breach of contract, unfair trade practices, and a violation of the implied covenant of good faith and fair dealing. MWB filed its answer and counterclaim for judicial foreclosure. MWB attempted to serve the Defendants at the residence of Weaver by personally serving Weaver’s daughter Elizabeth Weaver (Elizabeth). Elizabeth bore no relationship to the Defendants, other than she is Weaver’s daughter. Weaver filed a pro se answer to MWB’s counterclaim as it related to him. The Defendants failed to file an answer or otherwise appear. As a result, MWB applied for entries of default against them. Weaver filed a pro se motion to set aside the judgments against Defendants. In his motion, Weaver noted that Elizabeth was not legally qualified to accept service on behalf of the Defendants. MWB objected and argued that Weaver had failed to explain why Elizabeth was not authorized to accept service on behalf of the Defendants. MWB additionally contended that Weaver, as a non-attorney, could not appear on behalf of the Defendants. The Supreme Court dismissed Weaver's appeal without prejudice due to the fact that as a pro se appellant, Weaver was unable to bring an appeal on behalf of the Defendants. Defendants through counsel made a motion to set aside the default judgments arguing MWB's alleged faulty service. The Defendants' motion to set aside the default judgments was deemed denied pursuant to M. R. Civ. P. 60(c) (2009) when the District Court failed to rule on them within 60 days. It is from that denial that the Defendants appealed. Upon review, the Supreme Court concluded that the district court erred when it failed to set aside the default judgments issued against Defendants due to the problem with service. Accordingly, the Court reversed the district court and remanded the case for further proceedings. View "Mtn. West v. Glacier Kitchens, Inc." on Justia Law

In 1976 Cecilia Kincaid Bates, grantor, and co-trustees George Kincaid and Richard Peterson entered into a trust agreement establishing the Cecilia Kincaid Gift Trust for George. George was Cecilia's son and died in 2009. In 2010 the co-trustees filed a final account, petition for settlement, distribution, and termination of the trust. When distributing the proceeds of the trust, the district court determined that Jennifer, George's child who was born and given up for adoption after the trust was established, should be included in the trust distribution. The trustees appealed. The Supreme Court reversed, holding that, under the plain language of the trust, Jennifer was not a descendant of George because she was adopted and was therefore regarded as the lawful blood descendant of the adopting parent or parents. Remanded. View "In re Kincaid Gift Trust" on Justia Law

Lila Clavin (Lila) and Robert Gilbert founded Pastimes and executed an operating agreement (Agreement) that provided that Pastimes would terminate upon the death of a member unless at least two members remained who agreed to continue the business. After Lila died in 2000, Gilbert and Tim Clavin, Lila's son, could not agree on the value of Lila's share of Pastimes at the time of her death. This disagreement led Tim and Gilbert to conclude that Gilbert should continue to operate Pastimes. Gilbert filed a complaint for declaratory relief on behalf of Pastimes in 2005, requesting a date-of-death valuation for Lila's interest in 2005. The district court valued the Estate's interest at the date of trial rather than at the time of Lila's death. The Supreme Court affirmed in relevant part, holding that the district court properly valued the Estate's interest at the date of trial rather than at the time of Lila's death because Gilbert's and Tim's agreement and Gilbert's continued operation of Pastimes constituted a fully executed oral agreement that modified the dissolution provision of the Agreement. View "Pastimes v. Clavin" on Justia Law

Marjorie Ward established a trust that devised $100,000 to her stepdaughter, Joan, and provided that the trust residue be distributed in equal shares to Ward's sons, Jack and James. Ward also instructed that before Jack would receive any distributions from the trust, his share would be decreased, and Joan's increased, by any amount he owed Joan. After Ward died, the district court concluded Jack's share would be reduced by $298,356, the amount he owed Joan on the date of Ward's death. The Supreme Court affirmed, holding (1) the district court complied with the requirements of Mont. R. Civ. P. 52(a) by orally stating its findings of fact and conclusions of law; and (2) the district court did not err in ordering that Jack's share of the trust be reduced by the amount he owed his stepsister, pursuant to Ward's instructions contained in the trust, even though that debt was previously discharged in bankruptcy proceedings. View "Ward v. Ward" on Justia Law

After Decedent died, Decedent's wife moved to admit his will to probate. Decedent's son, Bruce, filed an objection, alleging that Decedent lacked testamentary capacity to enter into the will, and that another of Decedent's sons, Neil, exerted undue influence over Decedent. Bruce further sought to set aside a cattle sale and options agreement and lease-cattle agreement, alleging that Decedent's lack of capacity to contract voided the agreements and that the agreements were the product of Neil's undue influence over Decedent. The district court granted the Estate's motion to dismiss, concluding that Bruce lacked standing to contest the will and agreements. The Supreme Court reversed, holding (1) Bruce's allegations that a previous will existed that devised to him a larger portion of Decedent's estate than did the disputed will created a sufficient basis for Bruce to establish standing to contest the will; and (2) Bruce possessed standing to challenge the validity of the agreements to the extent that they concerned real property. Remanded with instructions for the district court to vacate its order to dismiss and to permit the parties to engage in discovery. View "In re Estate of Glennie" on Justia Law