Wilson v. Kane
| Decision Date | 11 May 1993 |
| Docket Number | No. 76587,76587 |
| Citation | 852 P.2d 717 |
| Parties | Linda WILSON, Plaintiff-Appellant, v. Matthew KANE, Jr., Defendant-Appellee. |
| Court | Oklahoma Supreme Court |
The District Court, Osage County, Steven Adams, Judge, gave summary judgment to the defendant Kane on Wilson's (plaintiff's) claim against him, according res judicata effect to two probate orders and to Wilson's failure to object in probate to the decree of distribution or to the personal representative's discharge. The Court of Appeals affirmed the trial court's summary judgment for Kane. Wilson sought certiorari.
ON CERTIORARI PREVIOUSLY GRANTED, THE COURT OF APPEALS' OPINION IS VACATED; THE TRIAL COURT'S SUMMARY JUDGMENT IS REVERSED AND CAUSE REMANDED.
Gary L. Bracken, Ponca City, for plaintiff-appellant.
Jesse J. Worten, III, John M. Keefer, Brewer, Worten, Robinett, Johnson, Worten & King, Bartlesville, for defendant-appellee.
The dispositive question here is whether Linda Wilson's [plaintiff's or Wilson's] claim against Matthew Kane, Jr. [Kane], personal representative of her uncle's estate, for his alleged "conversion" of certain nonprobate assets by mismanagement could have been litigated in probate. 1 We answer this question in the negative. The remedial deficiency of probate procedure to accommodate Wilson's claim prevents the probate adjudications on which Kane relies from having res judicata (also known as claim preclusion) effect. 2
THE ANATOMY OF LITIGATION
Wilson's uncle [the uncle] bought certificates of deposit [certificates] for $130,000.00, payable to Wilson upon his death. He also named Wilson a beneficiary of his will and joint tenant in a checking account. When the uncle died, the certificates were delivered to Kane, the estate's personal representative. Kane allowed them to mature; then he cashed the certificates and deposited the proceeds in the estate's non-interest bearing account. Over a year after her uncle's death, Wilson learned from the bank's president that she was the certificates' POD (payable on death) beneficiary.
When Wilson sought in probate to recover the certificates' proceeds, the estate contested her claim. After a hearing in probate, the judge (1) decreed Wilson to be the owner of the certificates and of a joint checking account and (2) ordered the proceeds from the certificates and from the account to be turned over to her. 3 A second probate order approved a settlement that divides the checking account proceeds between Wilson and her two cousins (beneficiaries under the uncle's will) and made
unappealable the earlier probate order. 4 The certificate proceeds went to Wilson. Her lawyer approved Kane's final account; while sitting in probate the judge issued a decree of distribution and discharged Kane from his duties as the estate's personal representative. 5
WILSON'S CLAIM FOR KANE'S ALLEGED "CONVERSION" OF NONPROBATE
Later Wilson brought this action against Kane. She contends his mismanagement of her certificates (nonprobate assets) cost her not only interest that the certificates could have earned while they languished in the estate's non-interest bearing account but a large attorney's fee as well. 6 The trial court gave summary judgment 7 to Kane, believing that res judicata 8 bars Wilson's claim because it could have been litigated (a) in probate during the dispute over the certificates' ownership or (b) as a challenge to the decree of distribution or to the personal representative's discharge. Wilson appealed; 9 the Court of Appeals affirmed the trial court's summary judgment and we granted certiorari. 10
Wilson contends the doctrine of res judicata does not bar her claim against Kane for converting nonprobate assets and urges that the probate order that discharges him from his duties as the estate's personal representative does not exonerate Kane from liability for mismanagement of the certificates. According to Kane, since only one controversy 11 arises from his dealings with the certificates, any and all recovery to which Wilson might have been entitled could have been litigated in probate during the dispute over the certificates' ownership. Kane believes that his discharge in probate (as personal representative of the uncle's estate) fully absolves him of any responsibility to Wilson.
WILSON'S CLAIM FOR KANE'S ALLEGED CONVERSION OF NONPROBATE
ASSETS BY MISMANAGEMENT LIES DEHORS THE
Wilson's claim for alleged conversion of nonprobate assets by mismanagement, Wilson's claim for alleged conversion of nonprobate assets (later adjudged as her property) does not fit within probate's statutorily limited framework. 20 The relief she seeks (interest and other out-of-pocket losses) is for Kane's alleged mismanagement of her personal property, not of that which belongs to the estate. Demands for a money judgment for one's dealings with assets dehors the estate are not within the limited arsenal of special remedies affordable in probate. 21
pressed for the first time in this action, is fit for the district court's process of ordinary judicature, but not for resolution in probate. 12 A probate proceeding moves along a procedural track vastly different from that followed by a regular "action" upon a claim. The latter is governed by the Pleading Code 13 and is regulated by the rules of practice applicable to the ordinary process of adjudication. Before the Judicial Article of the Oklahoma Constitution 14 and the provisions of § 91.1 15 became effective on January 13, 1969, the remedial track for probate had its point of inception in the since-defunct county court. 16 Although probate now begins and ends in district court, interdocket remedial boundaries survive. Probate is a special
statutory proceeding. 17 Its mainstream 18 issues, procedural stages, and special statutory remedies remain the same as they were before 1969. The law confines them to: (1) ascertaining whether decedent died testate or intestate, and if testate, (2) what testamentary disposition, if any, may be admitted to probate, (3) the administration of the estate's assets and (4) the final account and distribution. 19
Under the doctrine of res judicata, 22 a final judgment on the merits of an action bars the parties from relitigating not only the adjudicated claim but also any theories or issues that were actually decided or could have been decided in that action. 23 For probate adjudications the effect of res judicata is circumscribed by the reality of our interdocket boundaries 24 and by the statutes that narrowly craft probate as a special remedy. Where, as here, the claim sought to be litigated lay dehors probate and could not have been accommodated by its restricted framework, res judicata effect may not be accorded to the earlier orders in probate. In short, Wilson's claim survives as a viable demand and the summary judgment for Kane cannot stand.
WILSON'S FAILURE TO CHALLENGE IN PROBATE EITHER THE DECREE
OF DISTRIBUTION OR KANE'S DISCHARGE AS PERSONAL
REPRESENTATIVE DOES NOT BAR HER CLAIM AGAINST HIM FOR
Had Wilson attempted to cast her demand for alleged conversion of nonprobate assets as an objection to the decree of distribution or to the personal representative's discharge, as Kane urges she should have done, the court below would have been compelled to declare her claim irremediable in probate. It would have been indeed an act of supererogation for Wilson to have pressed a demand for which no redress was affordable.
A personal representative is responsible for the faithful administration of the estate's property 25 and may be surcharged for mismanagement of estate assets. 26 Sitting in probate a judge can require a personal representative to account, in his fiduciary capacity, only for funds and property coming into his hands which are assets of the estate. 27
Wilson does not seek to hold the personal representative liable for wrongful administration or mismanagement of the estate's assets. 28 Rather, the redress sought here is for alleged mismanagement of her nonprobate assets. She has no quarrel with the decree of distribution; her demand may not be viewed as a collateral attack on that decree. Since Wilson's claim against Kane is litigable solely dehors probate, she had no duty to call it to the attention of the judge in probate by interposing a challenge to the final decree or to Kane's discharge.
Wilson's claim cannot be barred for her failure to make an irremediable demand. Her claim for Kane's alleged conversion of nonprobate assets by mismanagement clearly was not litigable in probate. Interdocket boundaries and narrowly drawn statutory remedies limit the remedial range of probate. They require that Wilson be allowed to press her claim in an ordinary action dehors probate. Neither res judicata nor issue preclusion bars this action. Summary judgment for Kane cannot stand.
ON CERTIORARI PREVIOUSLY GRANTED, THE COURT OF APPEALS' OPINION IS VACATED; THE TRIAL COURT'S SUMMARY JUDGMENT IS REVERSED AND CAUSE REMANDED.
I dissent because I believe the majority has failed to give effect to the changes in the jurisdiction of district courts brought about by the court reform amendments to the Oklahoma Constitution in 1967. Okla. Const. Art. 7 § 7(a) provides in material part:,
The District Court shall have unlimited original jurisdiction of all justiciable matters, except as otherwise provided in this Article
. . . . .
Although the district court was acting within its probate docket, I think it inescapable that it had jurisdiction in the probate proceeding to...
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