Boucek v. Boucek
| Decision Date | 12 July 2013 |
| Docket Number | No. 103,155.,103,155. |
| Citation | 297 Kan. 865,305 P.3d 597 |
| Parties | John D. BOUCEK, Appellant, v. Richard BOUCEK and Diana Peck, as Executors of the Estate of Bernice E. Boucek, Deceased, Sued Individually and as Trustee of the Clarence F. and Bernice E. Boucek Irrevocable Trust, Dated July 15, 1996; and as Successor Co–Trustees of the Revocable Inter Vivos Trust of Bernice E. Boucek, Dated August 3, 2004, Appellees. |
| Court | Kansas Supreme Court |
OPINION TEXT STARTS HERE
Syllabus by the Court
1. When a party seeks to enforce a contractual obligation under a joint, mutual, and contractual will, the party's claim constitutes a demand against the estate; and the relevant statute of limitations is the nonclaim statute, K.S.A. 59–2239.
2. The statute of limitations governing breach of trust and constructive fraud causes of action is K.S.A. 60–513(a)(3). It begins to run at discovery of the breach or the alleged fraudulent act, which in this case was no earlier than the date on which a transfer from the irrevocable trust was made.
3. Courts do not favor revocation of will by implication. A later testamentary document that does not expressly revoke a prior joint, mutual, and contractual will but contains inconsistent provisions operates as revocation of the will and a rescission of the contract by implication only to the extent of the inconsistency.
4. On the record in this case, the plaintiff's breach of contract, breach of trust, and constructive fraud claims are not subject to summary judgment in favor of the defendants.
David R. Klaassen, of Marquette, argued the cause, and Heather R. McCollum, of the same firm, and Larry G. Michel and Karen Q. Couch, of Kennedy Berkley Yarnevich & Williamson, Chartered, of Salina, were with him on the briefs for appellant.
Robert A. Martin, of Norton, Wasserman, Jones & Kelly, L.L.C., of Salina, argued the cause and was on the briefs for appellees.
This trust and estate case began with family intrigue, betrayal, and revenge.
The plaintiff is John D. Boucek; the defendants are his brother and sister, Richard Boucek and Diana Peck. John filed this suit in 2006 against his mother, Bernice Boucek, both individually and in her capacity as trustee for two trusts. Bernice has since died, and Richard and Diana have stepped into her shoes in their capacities as executors for her estate and as successor cotrustees of a 2004 trust.
The district court judge granted summary judgment to Richard and Diana based on res judicata and collateral estoppel.
A panel of our Court of Appeals affirmed the district court judgment as right for the wrong reason. The panel rejected John's argument that Bernice's 2004 actions—designed to disinherit him—constituted a breach of her 1989 joint, mutual, and contractual will (1989 Will) made with the parties' father, Clarence “Frank” Boucek. It instead concluded that an irrevocable 1996 trust (1996 Trust) created by Bernice and Frank implicitly revoked or modified the 1989 Will and that a lack of clarity about the identity of the property owned by the 1996 Trust required a limited remand to the district court for factual findings. The panel also rejected a statute of limitations defense advanced by Richard and Diana on the breach of contract claim, and it upheld the district judge's grant of summary judgment against John on his claims for breach of trust regarding the 1996 Trust and constructive fraud. Boucek v. Boucek, No. 103,155, ––– Kan.App.2d ––––, 2011 WL 2175969 (Kan.App.2011) (unpublished opinion).
This court granted John's petition for review on all issues, and it granted Richard and Diana's cross-petition for review on their affirmative defenses, including the statutes of limitations applicable to John's three causes of action. For the reasons we explain below, we affirm the Court of Appeals decision in part and reverse it in part. We reverse the judgment of the district court and remand the case for further proceedings consistent with this opinion. On the record before us and under the governing law, Richard and Diana are not entitled to summary judgment on any of John's three claims.
In 1989, Bernice and Frank executed a joint, mutual, and contractual will in which they agreed that, after the death of the second of them, all of their property should be distributed to their four children, including John, in equal shares.
In 1996, after Frank learned that he had cancer, he and Bernice created and executed an irrevocable trust. The 1996 Trust instrument, like the 1989 Will, references a particular piece of real property, the homestead. The 1996 Trust's distribution provisions are largely similar to those of the 1989 Will, although there are some differences; for example, the couple's two sons are granted life estates rather than fee simple in the homestead. Ownership of the homestead, which appears to be the principal prize at stake in this litigation, was never transferred to the 1996 Trust. The record on appeal is not clear on exactly what other property was transferred to the 1996 Trust.
In 1998, Frank died. A copy of the 1989 Will was filed with Bernice's affidavit more than 6 months after Frank's death. The 1989 Will apparently was never probated.
As the century turned, familial disharmony led to John filing several lawsuits against members of his family, including Bernice, after he was excluded from the family business.
In August 2004, Bernice executed a new, revocable inter vivos trust (2004 Trust) and a new, pour-over will with the express intent to disinherit John. The 2004 Trust instrument provided that, at Bernice's death, all of the 2004 Trust property would be distributed to Richard, Diana, and their sister. No property was to pass to John.
On September 8, 2004, Bernice transferred substantially all of her property, including property that had been in the 1996 Trust, to the 2004 Trust.
John filed this action against Bernice on September 6, 2006. He made three claims: breach of the 1989 Will, i.e., breach of contract; breach of trust regarding the 1996 Trust; and constructive fraud.
In July 2007, Bernice sought summary judgment, and the district judge denied it. The judge reasoned that facts in issue in this case were being litigated in a different action.
Bernice died in January 2008, and a will contest ensued. After trial in Ottawa County, the district judge ruled that the 1996 Trust revoked or superseded the 1989 Will; that the 1989 Will was presumptively revoked; and that the 2004 Will, not the 1989 Will, should be admitted to probate. John appealed these rulings to the Court of Appeals.
In March 2009, Richard and Diana renewed the defense motion for summary judgment in this action. The district judge granted the motion on the basis of “collateral estoppel, res judicata, claim preclusion and/or issue preclusion” applying “because possible controverted facts ha[d] previously been litigated and decided between the parties” in the will contest.
On June 18, 2010, the Court of Appeals ruled on John's appeal in the will contest, affirming the admission of the 2004 Will to probate but otherwise abrogating the findings and conclusions from district court. In re Estate of Boucek, No. 101,767, ––– Kan.App.2d ––––, 2010 WL 2502879 (Kan.App.2010) (unpublished opinion).
On John's appeal from the summary judgment granted by the district judge in this case, a panel of our Court of Appeals disagreed with the district judge's rationale and held that the earlier will contest did not bar John's claims as a matter of law. See In re Estate of Boucek, 2010 WL 2502879, at *1 (). But the panel nevertheless concluded that summary judgment was appropriately granted in favor of Richard and Diana, save a limited remand to settle the factual question of exactly which property was transferred to the 1996 Trust. Boucek, 2011 WL 2175969, at *2–9.
On the breach of contract claim, the panel rejected Richard and Diana's statute of limitations defense:
Boucek, 2011 WL 2175969, at *8.
On the merits of the breach of contract claim, the panel upheld the district judge's summary judgment because, in its view, the 1996 Trust modified or revoked the 1989 Will. Boucek, 2011 WL 2175969, at *6. Bernice's actions disinheriting John in 2004 thus could not have breached her contractual obligations under the 1989 Will.
The Court of Appeals did not address Richard and Diana's statute of limitations defenses to John's breach of trust and constructive fraud claims, but it nevertheless upheld summary judgment in favor of them on those two claims. On the breach of trust claim, the panel relied on language in the 1996 Trust instrument granting broad discretion to the trustee. On the constructive fraud claim, the panel held that John had not come forward with evidence to establish the existence of a necessary “confidential relationship” between himself as beneficiary and Bernice as testator. Boucek, 2011 WL 2175969, at *8–9.
Our discussion and disposition addresses each of the issues raised in John's petition for...
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