Diller v. Diller

• Decision Date: 06 December 2021
• Docket Number: NO. 10-21-04,10-21-03
• Citation: 182 N.E.3d 370
• Parties: Mary Ann DILLER, Plaintiff-Appellant, v. Phyllis DILLER, Co-Executor, Defendant-Appellant. and Linda Pennucci et al., Defendants-Appellees.
• Court: Ohio Court of Appeals

182 N.E.3d 370

Mary Ann DILLER, Plaintiff-Appellant,

v.Phyllis DILLER, Co-Executor, Defendant-Appellant.andLinda Pennucci et al., Defendants-Appellees.

NO. 10-21-03

NO. 10-21-04

Court of Appeals of Ohio, Third District, Mercer County.

Date of Decision: December 6, 2021

Paul E. Howell, Coldwater, for Appellant, Mary Ann Diller.

Travis J. Faber and John R. Willamowski, Jr., Lima, Allen County, for Appellant, Phyllis Diller.

J. Alan Smith Lima, and Ashley R. Doty, for Appellees.

OPINION

MILLER, J.

{¶1} Plaintiff-appellant, Mary Ann Diller, appeals the March 18, 2021 judgment of the Mercer County Court of Common Pleas, Probate Division. Defendant-appellant, Phyllis Diller, in her capacity as co-executor of the estate of Theodore C. Penno, appeals the same judgment.¹ In this appeal, the court is called upon as the first court to interpret the meaning of the term "devise" as used in Ohio's anti-lapse statute, R.C. 2107.52. In doing so, we find ourselves compelled to interpret the statute precisely as written by the General Assembly even though the legislative enactment abrogates the historical understanding of the anti-lapse statute.

I. Facts & Procedural History

{¶2} On May 15, 2019, Theodore C. Penno died testate at the age of 78. Theodore's will, which he executed on February 10, 1998, provides in relevant part:

ITEM II. I hereby give, devise and bequeath my farm located in Butler Township, Mercer County, Ohio, and any interest that I may have in any farm chattel property to my brother, JOHN PENNO.

ITEM III. All the rest, residue, and remainder of my property, real and personal, of every kind, nature, and description, wheresoever situated, which I may own or have the right to dispose of at the time of my decease, I give, devise, and bequeath equally to my brother, JOHN PENNO and my sister, MARY ANN DILLER, absolutely and in fee simple, share and share alike therein, per stirpes.

* * *

ITEM V. I hereby appoint my niece, LINDA PENNUCCI and my niece, PHYLLIS DILLER, or the survivor of them, as Co-Executors of this my Last Will and Testament.

(Capitalization, boldface, and underlining sic.). Although Mary Ann Diller survived Theodore, John Penno predeceased Theodore on July 18, 2016, leaving defendants-appellees, David Penno and Linda Pennucci, as his only surviving children.

{¶3} On August 27, 2019, Theodore's will was admitted to probate. That same day, Phyllis Diller and Linda were appointed to serve as co-executors of Theodore's estate pursuant to Item V of Theodore's will.

{¶4} On October 23, 2019, Mary Ann filed a complaint for declaratory judgment and for construction of Theodore's will. Mary Ann named Phyllis, Linda, and David as defendants in the action. Phyllis was named as a defendant solely in her capacity as co-executor. Linda was named as a defendant both individually and in her capacity as co-executor. David was named as a defendant solely in his individual capacity. In her complaint, Mary Ann averred that Theodore's will, "construed as a whole and considering its specific language, evidences [Theodore's] intent that the gift to [John] in Item II was to lapse in the event [John] died before [Theodore]." That is, she claimed that Theodore intended for the anti-lapse statute, R.C. 2107.52, not to apply to Item II of his will. Mary Ann argued that because John predeceased Theodore and Theodore did not intend for R.C. 2107.52 to apply to Item II of his will, the gift to John in Item II lapsed. She maintained that the gift to John in Item II of the will fell into the residue of Theodore's estate and that the gift must consequently be distributed pursuant to the residuary clause contained in Item III of the will.

{¶5} Phyllis, David, and Linda then filed their answers to Mary Ann's complaint. In addition, David joined with Linda, in her individual capacity, to file a counterclaim for declaratory judgment. In their counterclaim, David and Linda averred that R.C. 2107.52 applies to Item II of Theodore's will and that the gift to John in Item II of the will should therefore be distributed to them as John's surviving descendants.

{¶6} On December 4, 2019, Mary Ann filed a reply to David and Linda's counterclaim. In her reply, Mary Ann introduced a new argument to support her proffered construction of Theodore's will. Specifically, she asserted that the gift to John in Item II of Theodore's will is not a "devise" as defined in R.C. 2107.52. According to Mary Ann, because the gift to John in Item II of Theodore's will does not qualify as a "devise" within the meaning of R.C. 2107.52(A)(3), R.C. 2107.52(B)(2) cannot be applied to Item II of the will, regardless of whether Theodore intended for it to apply.

{¶7} Because the parties agreed that the trial court could resolve the competing claims without conducting an evidentiary hearing, the trial court promptly set a briefing schedule. On January 17, 2020, Mary Ann filed a memorandum in support of her claims for declaratory judgment and construction of Theodore's will. In her memorandum in support, Mary Ann further developed the two separate lines of argument first set forth in her complaint and reply. With respect to her contention that the gift to John in Item II of Theodore's will does not constitute a "devise," Mary Ann clarified that she was arguing that the gift to John was a "primary devise," which does not meet R.C. 2107.52(A)(3) ’s definition of "devise." The parties then exchanged responses and reply memoranda. Notably, in her response, Phyllis fully endorsed the arguments in Mary Ann's original memorandum in support.

{¶8} On May 21, 2020, oral arguments were held before a magistrate. On December 7, 2020, the magistrate issued a decision declining to adopt Mary Ann and Phyllis's interpretation of R.C. 2107.52 and their construction of Theodore's will. The magistrate concluded that R.C. 2107.52 applies to the gift to John in Item II of Theodore's will and that Theodore's will does not contain any expression of a contrary intent. Accordingly, the magistrate recommended that the gift to John in Item II of Theodore's will be distributed in equal shares to David and Linda.

{¶9} After being granted extensions to file objections, Mary Ann and Phyllis each filed objections to the magistrate's decision on December 28, 2020. The trial court heard oral arguments on Mary Ann's and Phyllis's objections on March 11, 2021. On March 18, 2021, the trial court, in a judgment entry consisting mostly of its own de novo analysis, rejected Mary Ann's and Phyllis's arguments. The trial court concluded that R.C. 2107.52 applies to the gift to John in Item II of Theodore's will and that "a substitute gift is created in Item II" in favor of David and Linda. Accordingly, the trial court ordered that David and Linda "shall take title to the farm chattels and real estate as tenants in common."

II. Assignments of Error

{¶10} On April 7, 2021, Mary Ann filed a notice of appeal. She raises the following assignments of error for our review:

1. The trial court erred by misinterpreting Ohio's Anti-Lapse Statute's definition of "devise" in R.C. 2107.52(A)(3) and thereby concluding that the Statute applied to the testamentary gift which would have otherwise lapsed under Item II of the testator's will. (See trial court's "Judgment Entry", pp. 3 and 4).

2. The trial court erred by misconstruing the Anti-Lapse Statute's "contrary intent" provision of R.C. 2107.52(B)(2) and failing to follow Ohio common law to ascertain whether it appeared in the will itself that the testator never intended any substitute gift under Item II. (See trial court's "Judgment Entry", pp. 2 and 3).

{¶11} On April 8, 2021, Phyllis filed a separate notice of appeal. She raises the following assignments of error for our review:

1. The Trial Court erred by applying Ohio's Anti-Lapse Statute ( R.C. § 2107.52 ) to Item II of the Last Will and Testament of Theodore C. Penno.

2. The Trial Court erred in finding that prior versions of Ohio's Anti-Lapse Statute ( R.C. § 2107.52 ) apply to Item II of the Last Will and Testament of Theodore C. Penno.

3. The Trial Court erred by applying facts outside of the four corners of the will to determine the intent of the testator.

{¶12} Mary Ann's assignments of error and Phyllis's assignments of error overlap in many respects. For ease of discussion, we first address Phyllis's second assignment of error. We then address Mary Ann's and Phyllis's first assignments of error together. Finally, if necessary, we will consider Mary Ann's second assignment of error and Phyllis's third assignment of error together.

III. Discussion

A. Phyllis's Second Assignment of Error: Which version of R.C. 2107.52 applies in this case?

{¶13} In her second assignment of error, Phyllis argues that the trial court did not apply the appropriate version of R.C. 2107.52 when determining whether the gift to John in Item II of Theodore's will lapsed. Specifically, Phyllis argues that the 2019 version of R.C. 2107.52 —the version in effect at the time of Theodore's death—controls in effectuating the provisions of Theodore's will, but that the trial court erroneously applied the 1992 version of R.C. 2107.52 —the version that was in effect when Theodore executed his will.

i. The Common-Law Rule of Lapse & the History of Ohio's Anti-lapse Statutes

{¶14} At common law, a devise² given to a person who predeceases the testator is said to "lapse." The common-law rule of lapse rests on the proposition that because "[a] donative transfer cannot be made to a deceased person" and "probate transfers take place at the decedent's death, [probate transfers] cannot be made to an individual who fails to survive the decedent." Restatement of the Law 3d, Property, Wills & Donative Transfers, Section 1.2, Comment a (1999). A lapsed devise does not become part of a predeceased devisee's estate, to be distributed among the predeceased devisee's heirs or beneficiaries. Instead, depending on the circumstances, the lapsed devise either falls into the residue of the...