Burgauer v. Burgauer (In re Trust of Paul D. Burgauer Revocable Living Trust)
| Decision Date | 15 December 2022 |
| Docket Number | 80466, No. 82067 |
| Parties | In the MATTER OF the Trust of PAUL D. BURGAUER REVOCABLE LIVING TRUST. Steven Burgauer, a Former Trustee of Paul D. Burgauer Marital Trust, Appellant, v. Margaret Burgauer; and Premier Trust, Respondents. Steven Burgauer, Petitioner, v. The Eighth Judicial District Court of the State of Nevada, in and for the County of Clark; and the Honorable Trevor L. Atkin, District Judge, Respondents, and Margaret Burgauer; and Premier Trust, Real Parties in Interest. |
| Court | Nevada Supreme Court |
Howard & Howard Attorneys PLLC and James A. Kohl and Gwen Rutar Mullins, Las Vegas, for Appellant/Petitioner.
Edwards Law Firm and Melissa A. Edwards, Las Vegas, for Respondent/Real Party in Interest Premier Trust.
The Powell Law Firm and Tom W. Stewart, Las Vegas; Hayes Wakayama and Liane K. Wakayama, Dale A. Hayes, Jr., and Jeremy D. Holmes, Las Vegas, for Respondent/Real Party in Interest Margaret Burgauer.
BEFORE THE SUPREME COURT, EN BANC.
These matters concern whether the effects test announced in Calder v. Jones , 465 U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984), applies when determining whether a court has specific personal jurisdiction over a nonresident trustee sued in a trust administration case. We conclude that the effects test applies so long as the underlying claims sound in intentional tort, as they do here. Because the plaintiff in this case failed to provide prima facie evidence of the defendant trustee's minimum contacts with Nevada, and any injury the plaintiff suffered in Nevada was not caused by the trustee's contacts with Nevada, the district court erred in concluding that the trustee was subject to personal jurisdiction in Nevada. Accordingly, as to Docket No. 80466, we reverse the district court's jurisdiction order and remand to the district court to vacate all trust administration orders that, consistent with this opinion, require personal jurisdiction over the trustee and to dismiss the petition's claims against him. Because the district court lacks specific personal jurisdiction to hold the trustee in contempt, we grant the trustee's petition for a writ of prohibition in Docket No. 82067.
In 1987, Paul Burgauer created an estate plan that included the at-issue marital trust. Paul, an Illinois resident, was the settlor of the marital trust. Paul passed away in 2003. His and respondent Margaret Burgauer's son, appellant Steven Burgauer, became the trustee, while Margaret became the beneficiary. 1
Steven moved to Florida in 2012, and the marital trust purchased a home for Margaret in Florida in 2012. Several years later, Steven and Margaret's relationship began to deteriorate, and Margaret moved to Las Vegas to live with another son, James Burgauer. Steven sent an email addressed "Dear Mom" to "undisclosed-recipients," expressing his concern about Margaret's "impaired" judgment and "alcohol and gambling addiction[s]." Steven also claimed that Margaret gave large sums of money to James and effectively allowed James "to invade the Marital Trust illegally which is in exact contravention of [Paul's] intentions." Citing Margaret's spending habits, including, according to Steven, gambling losses and selling securities and incurring capital gains, Steven informed Margaret that he would not make any further distributions from the marital trust to Margaret's accounts and would instead have the trust directly pay Margaret's bills, while approving other individual expenditures on a case-by-case basis.
In January 2017, Margaret informed Steven that she had hired a moving team to remove her personal property from her Florida residence. Steven informed her that the house belonged to the marital trust, and thus his permission was required for anyone to enter the house. He requested a list of the items Margaret wanted removed as well as proof of liability coverage for the movers. In March 2017, the movers arrived hut could not enter the house. Steven emailed Margaret, stating that he and his family "were away on our ten-day-long family vacation" and that the "unannounced and unplanned visit ... made it impossible ... to accommodate your needs."
Also in March 2017, Margaret's attorney, Thomas Burnham, who is licensed in and maintains his office in Michigan, emailed Steven a "Revocation of Power of Attorney" form. Steven replied, identifying several issues he had with the form. He also requested that Burnham no longer communicate with him directly and instead contact specified law firms in either Florida or Illinois. Burnham then sent a letter to Steven's Florida attorney for the trust, Christopher Shipley, to discuss the trust documents. Burnham sent a subsequent letter to Shipley demanding that Steven distribute the net income of the marital trust and make all written disclosures to Margaret regarding the trust.
While this dispute was ongoing, Nevada Elder Protective Services received a report of potential elder abuse regarding Margaret, based on her signing "hundreds of blank checks." The report named James as a person of interest, but the name of the party who made the report was redacted.
In March 2018, Margaret filed the underlying petition requesting that the district court (1) assume jurisdiction over the trust, (2) remove Steven as a trustee, (3) appoint a successor trustee, (4) compel an accounting of the trust, (5) impose personal liability on Steven under NRS 165.148, (6) restore the monthly distributions and find Steven's amendments to the trust unenforceable, and (7) compel the production of all trust documents. As to her request to remove Steven as trustee and appoint a successor, Margaret cited "Steven's utter refusal to properly act as a fiduciary of the Marital Trust and his blatant breaches of his duties owed to [her]." She asserted that Steven had "failed to act as a fiduciary" to her because he "has put his personal financial interests above" hers. She also alleged that Steven had (1) defamed her by sending a disparaging and defamatory email to her friends and family, (2) fraudulently interfered with her personal investments, and (3) filed a false report of elder abuse with Nevada authorities. Margaret argued that the district court had jurisdiction over the marital trust under NRS 164.010, which provides that a district court has in rem jurisdiction over a trust domiciled in Nevada and that a trust is domiciled in Nevada "notwithstanding that the trustee neither resides nor conducts business in" Nevada if "[o]ne or more beneficiaries of the trust reside in" Nevada, which she did.
Steven sought dismissal of the petition for lack of personal jurisdiction. He contended that he lacked the minimum contacts necessary for the district court to exercise specific personal jurisdiction over him. Margaret opposed, citing NRS 164.010 and the fact that Steven did not show that another court had assumed jurisdiction over the marital trust. She further asserted that the district court had specific personal jurisdiction over Steven because his tortious conduct satisfied the effects test adopted by the United States Supreme Court in Calder v. Jones , 465 U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984). Margaret contended Steven made sufficient contacts with Nevada by (1) breaching his fiduciary duty in "stripping Margaret of her trust distributions, refusing to provide an accounting, attempting to access Margaret's personal financial accounts without permission, and placing his financial interests above Margaret's"; (2) sending "defamatory statements regarding Margaret to those located within Nevada and other neighboring states"; (3) interfering with a private contract between Margaret and James; (4) attempting to defraud Margaret by filing a lawsuit against her in Illinois: (5) converting Margaret's personal property by locking her out of her Florida home; and (6) using a fraudulent power of attorney to interfere with Margaret's access to bank accounts.
Denying Steven's motion to dismiss, the district court concluded that "Nevada under the statute, specifically NRS 164.010(2)(e), has jurisdiction." It specified that in rem jurisdiction over the marital trust existed under NRS 164.010 because Margaret, as a beneficiary, resided in Nevada. Further, after confirming Steven as trustee even though Margaret never asked the district court to do so, the district court concluded it "thereby acquire[d] in personam jurisdiction over Steven." In exercising personal jurisdiction over Steven, the district court did not conduct a due process analysis.2
After concluding it had jurisdiction, the court temporarily removed Steven as trustee pending an evidentiary hearing and appointed respondent Premier Trust as the temporary trustee of the marital trust. The court also entered a temporary restraining order that prohibited Steven from selling or transferring Margaret's personal property or any of the marital trust's property. Steven appealed from the order temporarily removing him as trustee, and the court of appeals dismissed the appeal for lack of jurisdiction. In re Paul D. Burgauer Revocable living Tr. , No. 78872-COA, 2020 WL 3447743, at *1 (Nev. Ct. App. June 23, 2020). However, the court of appeals "remind[ed] the district court that a determination as to whether Nevada courts can exercise personal jurisdiction over Steven requires the court to assess whether he has sufficient minimum contacts with Nevada." Id. at *2 n.2.
At a later hearing, the district court granted Premier Trust's petition to distribute the trust property on Margaret's behalf. Margaret subsequently filed an ex parte application for an order to show cause, arguing that Steven should be held in contempt for violating the temporary restraining order. The district court granted the order to show cause and, for the first time, conducted a minimum contacts analysis. Applying the effects test, the district court agreed that Margaret presented sufficient evidence to...
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