Justia Trusts & Estates Opinion Summaries

In 1993, John Houlahan and his wife, Theresa, established the "Theresa M. Houlahan Revocable Trust of 1993" containing the marital home. John was named successor trustee of, and granted certain powers over, the Theresa Trust. Upon the deaths of Theresa and John, the real property was to be distributed to their son, petitioner Thomas Houlahan. Theresa died in 1996. In 1997, John established the "John F. Houlahan 1997 Revocable Trust." John named his daughter (respondent) as successor trustee. In November 2002, John conveyed the real property by deed to himself, as trustee of the John Trust. John died in 2009. Under the terms of the John Trust, "[a]ny interest this trust may have in any real estate" was to be distributed in equal shares to four of his children: petitioner, respondent, John F. Houlahan, Jr., and Terrence B. Houlahan. In 2011, petitioner filed a "Petition for Injunction" seeking, among other things, an order that the property be returned to the Theresa Trust and that respondent, as successor trustee of the John Trust, be enjoined from making any attempt to dispose of the property. In late 2011, petitioner filed a motion for summary judgment, claiming that there was "no genuine issue of material fact" that John's "actions in his capacity as Trustee violated the terms of [the Theresa Trust] and specific provisions of the Uniform Trust Code." Following a hearing, the trial court denied petitioner's motion for summary judgment, finding that there were many disputed factual issues that could not be decided on the pleadings. On appeal, petitioner argued that the trial court erred in granting respondent's motion for summary judgment on the ground that the transfer of the real estate in 2002 effectively terminated the trust and the petitioner's interest in the trust. He asserted that "[w]hen John breached his fiduciary duties, the trust gained an additional asset– a cause of action against John or his estate," and, thus, "[n]either [the petitioner's] beneficial interest nor the trust was terminated by John's conveyance." After its review, the Supreme Court concluded that the Theresa Trust did not terminate in 2002, and neither did the petitioner's interest therein. The trial court's finding, that there were "many disputed issues of material fact" that could not be decided on the pleadings, was not erroneous. Accordingly, the Court affirmed its denial of petitioner's motion for summary judgment and remanded the case for further proceedings.View "In re Theresa Houlahan Trust" on Justia Law

O. Wayne Rollins established ten irrevocable trusts, the Rollins Children's Trust (RCT), and nine Subchapter S-trusts, each for the benefit of his nine grandchildren. Wayne's sons, Gary and Randall, and a close friend of the elder Rollins, Henry Tippie, were named trustees. In 2010, four of the nine beneficiaries of the S-trusts brought suit against the trustees alleging breach of trust and breach of fiduciary duty and seeking, among other things, an accounting of the family entities. The trial court awarded summary judgment to the trustees and refused to order a judicial accounting of the entities which held the trust assets. To this, the trial court noted, in part, that although the trustees failed to provide an accounting of the trust assets, plaintiffs ultimately received a report on trust assets and "complete relief" on their requests through discovery. The Court of Appeals reversed and remanded, concluding: (1) plaintiffs were entitled to an accounting; (2) the trustees could be held to trustee-level fiduciary standards with regard to the family entities; and (3) genuine issues of material fact remained with regard to whether the trustees breached their fiduciary duties in administering the trusts. The issues this case presented to the Supreme Court were: (1) whether the Court of Appeals erred when it ruled that the trial court should have ordered an accounting of the family entities; and (2) whether the Court of Appeals erred when it held that the appellants had trustee-level fiduciary duties. The Court answered 'yes' to both questions presented, and the case remanded for further proceedings. View "Rollins v. Rollins" on Justia Law

The parties in this case separately petitioned the Supreme Court for review of the Court of Civil Appeals' judgment overturning an award of property from the estate of Estelle Haggerty Alexander. The decedent owned 270 acres of property, and died intestate. Following a bench trial, the court divided the six parcels of land that constituted Estelle's estate, finding that the plaintiffs and their ancestors had adversely possessed three parcels by living on the land and engaging in certain activities there but that the heirs of Larenda Jenkins, as holders of legal title, were entitled to the other three, farmed parcels. Holding that the plaintiffs' possession of the land was permissive rather than adverse, the Court of Civil Appeals reversed the circuit court's judgment in part and instructed the circuit court that title to all six parcels should be quieted in the heirs of Larenda Jenkins. After careful consideration of the facts of this case, the Supreme Court reversed and remanded: "[t]he Court of Civil Appeals stated the ore tenus rule in its standard-of-review section, but in its analysis of the evidence did not accord the circuit court's findings the required deference. . . . we conclude that credible evidence was presented to support the circuit court's allotment to the plaintiffs of the three parcels . . .it is a rare case when this Court will overturn a finding by a trial judge who hears an adverse possession case presented ore tenus." View "Stokes, Jr. v. Cottrell" on Justia Law

In 1987, Joseph Bagley purchased a cancer and dread-disease policy through his friend and insurance agent, Jackie McPhail. The policy was issued by American Heritage Life Insurance Company. McPhail worked as an independent insurance broker, and she was a registered agent with American Heritage at the time the policy was written. The policy indicated that Bagley purchased coverage concerning cancer and dread disease, a home-recovery rider, and a hospital intensive-care rider. Bagley also had an option to purchase life insurance; however, McPhail testified that Bagley did not purchase life insurance under this policy because he had purchased a separate life-insurance policy. In 2008, Bagley was diagnosed with cancer. Bagley contacted McPhail to file a claim under the policy and to "change the beneficiary" of the policy from his estate to Michael and Betty Strait. McPhail testified that she had ceased writing policies for American Heritage; however, she still retained the authority to service Bagley's policy, and she acquired his written consent to receive information regarding his policy from the insurance company. While Bagley was in the hospital, McPhail presented an American Heritage change-of-beneficiary form, which Bagley ultimately signed. The signature was witnessed by Bagley's physician, a nurse, and McPhail. Bagley orally communicated that he wished for the beneficiary to be changed from his estate to the Straits. At the time that Bagley signed the form, the Straits had yet to be listed as beneficiaries on the form. McPhail met with the Straits after the form was signed to confirm their correct legal names to be placed on the change-of-beneficiary form at a later time. McPhail provided that she did not fully complete the form because she was attempting to contact American Heritage to confirm the correct procedure for completing the process; however, American Heritage's office was closed because of Hurricane Fay, and McPhail never succeeded in speaking with American Heritage regarding the matter. Bagley's physician, who witnessed Bagley signing the form, later communicated to Betty Strait that his attorney advised that the form could not be used because the Straits' names were not listed on the form prior to Bagley's signature. Betty Strait relayed this to McPhail, who then attempted to contact American Heritage's legal department. McPhail called the company on multiple occasions, but she never received a return phone call. Soon thereafter, Bagley passed away, and the form was never completed. The estate was probated and the Straits did not contest the passage of the policy proceeds to the estate at the time that the estate was being settled. The executor of Bagley's will, William Kinstley, petitioned for the approval of the estate's final accounting, which included the policy proceeds. The Straits initiated legal action against McPhail and American Heritage in Hinds County Circuit Court, arguing that Bagley intended for them to receive the proceeds from the cancer policy. The Straits alleged breach of contract, tortious breach of contract, negligence and gross negligence, breach of fiduciary duties and the duty of good faith and fair dealing, bad-faith refusal to pay benefits and to promptly and adequately investigate the claim, misrepresentation and/or failure to procure, promissory and/or equitable estoppel, and they sought a claim for declaratory relief. McPhail filed a motion to dismiss, which was granted by the circuit court. The circuit court found that the issue had been previously litigated and resolved in chancery court, and that no appeal had been taken from the chancery court judgment. Likewise, the circuit court granted American Heritage's motion for summary judgment, finding that there were no genuine issues of material fact to be resolved. The Court of Appeals reversed the judgment and remanded the case, finding that genuine issues of material fact did exist and that res judicata and collateral estoppel did not bar the Straits' claims. Because the Straits failed to raise any issues upon which relief may be granted, the circuit court's grant of McPhail's motion to dismiss was proper. However, the circuit court erred in granting the motion to dismiss based on res judicata and collateral estoppel. Furthermore, the circuit court properly granted American Heritage's motion for summary judgment: the Straits were never eligible to be third-party beneficiaries under the policy, and they have failed to show any equitable entitlement to reimbursement. For those reasons, the Supreme Court reversed the judgment of the Court of Appeals and reinstated the circuit court's judgment. View "Strait v. McPhail " on Justia Law

Dora Gaaskjolen was an eighty-seven year-old widow who suffered from a traumatic head injury and other physical ailments. Dora’s grandson, Shane, an attorney, filed a petition for appointment of temporary conservator, and the circuit court ordered Dacotah Bank to be Dora’s temporary conservator. Shane subsequently moved for Dacotah to be Dora’s permanent conservator, but Dora moved to set aside the appointment of Dacotah as temporary conservator and, instead, nominated her daughter Audrey to be her conservator. Ultimately, the circuit court granted Shane’s motion for Dacotah to be Dora’s permanent conservator and denied Dora’s motion, finding that it was in the best interests of Dora that Dacotah be appointed as her conservator. The Supreme Court affirmed, holding that the circuit court’s finding and conservator appointment had support in the record.View "In re Conservatorship of Gaaskjolen" on Justia Law

This action stems from a dispute between plaintiff James Robert Malloy and Swain R. Thompson, regarding assets of Robert L. Chamblee (Decedent). The complaint alleged that Thompson, with the assistance of Merrill Lynch, Pierce, Fenner & Smith, Inc., acted to disrupt Decedent's estate plan and divert Decedent's assets from Malloy to Thompson. Malloy characterized his claims against Merrill Lynch as: (1) intentional interference with inheritance; (2) aiding and abetting intentional interference with inheritance; (3) and civil conspiracy. Merrill Lynch moved to dismiss and compel arbitration arguing that its only connection to this dispute was through its contractual duties under the client relationship agreements (CRAs) entered into between Decedent and Merrill Lynch, which contained mandatory arbitration clauses. Merrill Lynch argued that although Malloy was a non-signatory to the agreements, any duty, if any, owed by Merrill Lynch to Malloy derives from the CRAs, and therefore, he is bound by the arbitration clauses. The circuit court denied the motion and found that while non-signatories may be bound to an arbitration agreement under common law principles of contract and agency law, none of those principles applied in this case, and therefore, there was no basis to compel Malloy to arbitrate. Merrill Lynch appealed. The Supreme Court affirmed the circuit court's denial of Merrill Lynch's motion to dismiss and compel arbitration. Finding no reversible error, the Supreme Court affirmed the circuit court's decision. View "Malloy v. Thompson" on Justia Law

Delores Williams, the personal representative of the Estate of Edward Murry, and Matthew Whitaker, Jr., the personal representative of the Estate of Annie Mae Murry (PRs), brought a declaratory judgment action to determine whether a GEICO motor vehicle insurance policy issued to the Murrys provided $15,000 or $100,000 in liability proceeds for bodily injury for an accident in which both of the Murrys were killed. The circuit court concluded coverage was limited to the statutory minimum of $15,000 based on a family step-down provision in the policy that reduced coverage for bodily injury to family members from the stated policy coverage of $100,000 to the statutory minimum amount mandated by South Carolina law during the policy period. The PRs appealed, contending the step-down provision was ambiguous and/or violative of public policy. The Supreme Court affirmed in part and reversed in part. The Court agreed with the circuit court that GEICO's policy is not ambiguous, but concluded the family step-down provision, which reduced the coverage under the liability policy from the stated policy amount to the statutory minimum, was violative of public policy and was, therefore, void. "The provision not only conflicte[d] with the mandates set forth in section 38-77-142, but its enforcement would be injurious to the public welfare." View "Williams v. GEICO" on Justia Law

In this family dispute over the inheritance of money and property, the trial court dismissed all of Plaintiff Arthur Fry’s claims and some of the claims of Plaintiffs Mary Ellison, Susan Sleeper, and David Fry. The jury returned verdicts in favor of Mary, David and Susan on three of their claims that J.D. Fry committed frauds and other wrongs that resulted in J.D.’s pecuniary gain. J.D. Fry died after suit was filed but before trial, and the trial court substituted J.D.’s wife, Linda Fry, in her capacity as trustee of J.D.’s trust. The Supreme Court reversed the judgment on the jury verdicts for Mary, Susan and David, holding that Susan and David’s claims were time-barred by the statute of limitations and that Mary’s claims were barred because the trial court erred in substituting Linda upon J.D.’s death. The Court affirmed the trial court’s dismissal of Plaintiffs’ other claims. View "Ellison v. Fry" on Justia Law

Brian Hover, son of decedent Margaret Dever Hover Gurnham and the Personal Representative of her Estate, appealed the circuit court's order confirming the probate court's grant of summary judgment in favor of Beach First National Bank to enforce a deficiency judgment against the Estate. Hover argued the Bank's claim (which arose following a foreclosure action) was untimely and, thus, barred by section 62-3-8031 of the South Carolina Probate Code (Probate Code). Upon review, the Supreme Court agreed that the Bank's claim was barred because it was presented outside the time limits of the applicable statute.View "Beach First National Bank v. Estate of Gurnham" on Justia Law

Ada Greenblatt died testate and without issue. Ada’s will did not provide instructions on how to distribute her residuary estate, which consisted primarily of real property and personal property, including a mizrah - an ornamental religious print - valued at $100. Ada’s brother, Owen Greenblatt, who was designated as a personal representative of Ada’s estate, selected the mizrah. When the personal representatives petitioned the probate court for an order completing settlement of the estate, Mark Levine, a residuary beneficiary of the estate, opposed the petition, claiming that Owen breached his fiduciary duty to the estate by taking the mizrah. The court entered a judgment completing settlement of the estate, finding that the distribution of the personal property was not improper. The Supreme Court affirmed, holding that the distribution scheme and Owen’s selection of the mizrah was not an abuse of the personal representatives’ discretion, and thus did not violate the fiduciary duty of impartiality.View "Estate of Greenblatt" on Justia Law