Bayliss v. Clason
| Decision Date | 14 August 2018 |
| Docket Number | No. A-17-270.,A-17-270. |
| Citation | 26 Neb.App. 195,918 N.W.2d 612 |
| Parties | Susan J. BAYLISS, Personal Representative of the Estate of Ruth E. Clason, deceased, appellee, v. Steven E. CLASON, Personal Representative of the Estate of F.W. Eugene Clason, deceased, appellant, and David W. Pederson, Special Fiduciary of the Clason Living Trust Dated March 31, 2008, and Any Amendments Thereto, et al., appellees. |
| Court | Nebraska Court of Appeals |
Siegfried H. Brauer, of Brauer Law Office, for appellant.
David W. Rowe, of Kinsey, Rowe, Becker & Kistler, L.L.P., Lincoln, for appellee Susan J. Bayliss.
Roger L. Benjamin, P.C., Oxford, for appellees Jim L. Clason and Lee A. Clason.
Damien J. Wright, of Welch Law Firm, P.C., Omaha, for appellees Deshane Nelson et al.
Steven E. Clason, personal representative of the estate of F.W. Eugene Clason (Eugene), deceased, appeals from the order of the district court for Furnas County, which granted summary judgment in favor of Susan J. Bayliss (Susan), personal representative of the estate of Ruth E. Clason, deceased. For the reasons that follow, we affirm.
Eugene and Ruth are the parents of eight adult children, including Susan, Steven, Jim L. Clason, Lee A. Clason, and Bonnie S. Wright. These five children are the beneficiaries of the Clason Living Trust created by Eugene and Ruth in 2008 (the 2008 Trust); Eugene and Ruth’s other three children were specifically disinherited under the terms of the 2008 Trust. A second trust was created by Ruth in 2011 after Eugene’s death, which trust was entitled the "Ruth E. Clason Living Trust" (the 2011 Trust). The beneficiaries of the 2011 Trust are the five children identified above, plus, per stirpes, the children of the three disinherited children. The present appeal involves a dispute over whether certain quitclaim deeds signed by Eugene and Ruth in 2008, but not recorded until 2013 after the death of both Eugene and Ruth, were delivered and became part of the 2008 Trust or are void, thus making the real estate part of Ruth’s estate and subject to the terms of the 2011 Trust.
Before their deaths, Eugene and Ruth retained attorney Allen Daubman to develop an estate plan for them. On March 31, 2008, Eugene and Ruth executed the trust agreement for the 2008 Trust. Eugene and Ruth were named in the trust agreement as the initial trustees, with Steven and Susan named as successor cotrustees. As noted previously, the five children identified above were named as trust beneficiaries, and among other things, the 2008 Trust provided for specific distributions of real estate to these five children. The 2008 Trust provided that the three disinherited children "and the descendants of each of them" were "specifically and intentionally exclude[d]" from "receiving any part of the Trust Estate." In terms of "Initial Trust Property," the 2008 Trust provided: Also on March 31, Eugene and Ruth signed 14 quitclaim deeds governing certain real property owned by them (five from Ruth as grantor to Eugene and Ruth, husband and wife, as grantees; one from Eugene as grantor to Eugene and Ruth, husband and wife, as grantees; and eight from Eugene and Ruth, husband and wife, as grantors to Eugene and Ruth, trustees of the 2008 Trust, as grantees). Daubman specifically informed Eugene and Ruth that to fund the 2008 Trust, the deeds would need to be recorded.
On July 28, 2008, Eugene and Ruth, as husband and wife, individually executed a "Nebraska Deed of Trust" pledging the real estate as collateral for a loan.
Eugene died on May 16, 2010. After Eugene’s death, Ruth retained Daubman to represent her as the personal representative of Eugene’s estate. She later retained attorney Ward Urbom to replace Daubman when he withdrew, and subsequently, she retained attorney Jerrod Gregg to replace Urbom.
On September 24, 2010, Ruth executed an amendment to the 2008 Trust, appointing Lee to serve as her cotrustee and further appointing Susan as cotrustee with Lee if he was unwilling to serve as sole trustee. In a separate proceeding from the present declaratory judgment, the district court determined that the amendment was not the result of undue influence by Susan and/or Lee.
On July 13, 2011, Ruth signed documents to execute a will and the 2011 Trust. The 2011 Trust documents prepared by Gregg were intended to, but did not, recreate the terms of the 2008 Trust. Although Gregg testified about various provisions of the 2011 Trust in his deposition, a copy of the 2011 Trust is not in the record on appeal.
Ruth entered into a written crop share lease with Lee as the tenant on March 13, 2012. The lease was executed by Ruth, as the personal representative of Eugene’s estate, and Ruth, an individual, as lessor. The lease was for real property at issue in this appeal.
Ruth died on January 12, 2013. On the date of her death, she was the record owner of 17 tracts of land (corresponding to the land represented in the 14 original quitclaim deeds). Eugene and Ruth personally paid the 2008 through 2011 real estate taxes on this property. Ruth reported all income and deducted all expenses generated by this property on her individual income tax returns for 2010, 2011, and 2012.
Steven recorded the quitclaim deeds with the Furnas County register of deeds on May 17, 2013.
On May 26, 2015, Susan, as the personal representative of Ruth’s estate, filed a complaint for declaratory judgment in the district court, naming various interested parties, including Steven both individually and as the personal representative of Eugene’s estate, as defendants. In the body of the complaint, Susan described Steven in his capacity both as the "duly appointed" personal representative of Eugene’s estate and as an interested party by virtue of his "possible status as a beneficiary of the 2008 Trust and the 2011 Trust." Susan alleged that on the date of Ruth’s death, Ruth was the record owner of (or owned a one-half interest in) certain tracts of real property; that the 2008 Trust claimed title to this real property, adverse to Susan as the personal representative, based on the 14 quitclaim deeds dated March 31, 2008, and recorded on May 17, 2013; that the 2008 Trust had no interest in the land; that Eugene and Ruth had never authorized the recording of the 14 quitclaim deeds; and that such recording, if "left outstanding," would "totally deprive [Susan as the personal representative] of one-half ownership of said property." Susan sought a declaration that the 14 quitclaim deeds recorded on May 17, 2013, were not valid transfers of an interest in the real estate and asked the court to void the deeds.
On May 26, 2015, Susan, as the personal representative of Ruth’s estate, filed a praecipe requesting that the clerk of the district court issue a summons for Steven both personally and in his capacity as the personal representative of Eugene’s estate for personal service of the complaint by the Furnas County sheriff upon Steven at his residence. The clerk issued a summons on May 26 directed to "Steven Clason PR Est Eugene Clason." On June 1, the sheriff filed a return of service showing that the complaint and summons were personally handed to Steven at his residence.
On June 26, 2015, Steven, as the personal representative of Eugene’s estate, filed a motion to dismiss the complaint, alleging that it failed to state a claim upon which relief could be granted, that it failed to join one or more necessary parties, and that Susan did not have standing to bring the claim. The bill of exceptions in this case does not include a transcription of the hearing held on Steven’s motion, and a notation from the court reporter indicates that no record was made of the hearing held on July 29. On August 12, the district court entered an order, denying Steven’s motion, but finding that Susan in her individual capacity was a necessary party. The court granted Susan as the personal representative 10 days to amend the complaint and granted an additional 10 days thereafter for all of the defendants to answer or plead if they had not already filed an answer.
On August 14, 2015, Susan, as the personal representative of Ruth’s estate, filed an amended complaint, adding herself in her individual capacity as a defendant. As before, she named Steven as a defendant both in his capacity as the personal representative of Eugene’s estate and in his individual capacity and described him in the body of the complaint as the appointed personal representative of Eugene’s estate and as an interested party by virtue of being a possible beneficiary of the two trusts. The certificate of service for the amended complaint indicates that a copy was provided electronically to Steven, both individually and as the personal representative, to his attorney at the attorney’s email address.
On August 17, 2015, Susan, as the personal representative of Ruth’s estate, filed a praecipe asking the clerk of the district court to issue an "alias summons" for "Defendant, Steven E. Clason, personally " for personal service by the sheriff upon Steven at his residence. The clerk issued the second summons on August 18, which was again directed to "Steven Clason PR Est Eugene Clason." The sheriff filed a return of service on August 25, showing that the amended complaint and summons were personally handed to Steven at his residence.
On January 5, 2016, Susan, as the personal representative of Ruth’s estate, filed a motion for summary judgment. She asserted that there was no genuine issue of material fact and that she was entitled to judgment as a matter of law and asked the court to "declare that the Qui[t] Claim Deeds filed by and between F.W. Eugene Clason, Ruth E. Clason, F.W....
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