Estate of Burgess v. Peterson

• Decision Date: 25 July 1995
• Docket Number: No. 94-3043,94-3043
• Citation: 537 N.W.2d 115,196 Wis.2d 55
• Parties: The ESTATE OF Martha BURGESS and Gerald Larson, Plaintiffs-Appellants, d ] v. Carl PETERSON, an individual, and Peterson Law Offices, a sole proprietorship, Defendants, Estate of Ralph Grundman, as Personal Representative of the Estate of Martha Burgess, and Edna Grundman, as personal representative of the Estate of Martha Burgess, Defendants-Respondents, Old Republic Surety Company, a Wisconsin corporation, and State Surety Company, a foreign corporation, Defendants-Third Party Plaintiffs-Respondents, Glenyce Roberta Peterson, Third Party Defendant.
• Court: Wisconsin Court of Appeals

Page 115

537 N.W.2d 115

196 Wis.2d 55

The ESTATE OF Martha BURGESS and Gerald Larson, Plaintiffs-Appellants, ^d] v. Carl PETERSON, an individual, and Peterson Law Offices, a

sole proprietorship, Defendants,

Estate of Ralph Grundman, as Personal Representative of the

Estate of Martha Burgess, and Edna Grundman, as

personal representative of the Estate of

Martha Burgess, Defendants-Respondents,

Old Republic Surety Company, a Wisconsin corporation, and

State Surety Company, a foreign corporation,

Defendants-Third Party Plaintiffs-Respondents,

Glenyce Roberta Peterson, Third Party Defendant.

No. 94-3043.

Court of Appeals of Wisconsin.

Submitted on Briefs June 12, 1995.

Opinion Released July 25, 1995.

Opinion Filed July 25, 1995.

On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Michael J. Neitzke of Novitzke, Gust & Sempf, Amery.

On behalf of the defendants-third party plaintiffs-respondents, the cause was submitted on the brief of Bruce Gillman of Tomlinson, Gillman & Rikkers, S.C., Madison.

On behalf of the defendants-respondents, the cause was submitted on the brief of Kristina M. Bourget of Kelly & Ryberg, S.C., Eau Claire.

Before CANE, P.J., and LaROCQUE and MYSE, JJ.

CANE, Presiding Judge.

The Estate of Martha Burgess and Gerald Larson (the estate) appeal a judgment dismissing their claims against the personal representatives, Ralph and Edna Grundman. The estate asserts that the trial court erred by: (1) admitting the testimony of the Grundmans' expert witnesses; (2) improperly instructing the jury by failing to include a list of duties charged to a personal representative by statute; (3) admitting evidence of the financial consequences of the bonds covering the Grundmans; (4) including information of the possible financial consequences to the Grundmans in the jury instructions; (5) refusing to admit evidence of the Grundmans' current financial situation into evidence; (6) instructing the jury that, if a personal representative used reasonable care in selecting an attorney to assist them in probating an estate, the personal representative could only be found negligent in limited circumstances; (7) not including the name of the judge who ordered the probate bonds in the caption of the case as required by statute; (8) striking the testimony of several of its experts after trial; and (9) granting the Grundmans' motion to dismiss. Because we conclude that the trial court did not commit reversible error, the judgment is affirmed.

BACKGROUND

Carl Peterson was a well-known and respected attorney. Martha Burgess was one of his clients. Sometime in 1985, Burgess gave Peterson power of attorney over her affairs. From that point until her death, Peterson handled and managed all of Burgess' assets and investments and paid her bills and expenses. On July 10, 1990, Burgess died leaving an estate valued at $1,600,000. At the request of the estate's personal representative, Peterson assisted in handling the probate of the estate. Before his connection with the estate was ultimately severed, Peterson embezzled over $400,000. ¹

In her will, Burgess nominated her brother, Ralph Grundman, to be the personal representative of her estate. The trial court approved Ralph's nomination and his bond in the amount of $1,000,000 by State Surety Company in 1990. Shortly thereafter, Ralph engaged Peterson to aid in the probate of the Burgess estate. This required Peterson to inventory and liquidate estate assets, pay the estate's expenses, pay whatever taxes were due, file the required tax forms, compute and pay distributions and assist in all other legal tasks necessary to complete the probate of the estate.

During Ralph's tenure as personal representative, his wife, Edna, would usually accompany him when he visited Peterson's law office. Edna sometimes sat in on her husband's conferences with Peterson, while other times she remained in the waiting room. During these visits, Ralph discussed the Burgess estate with Peterson. Also, during his term as personal representative, Ralph signed a number of large checks payable to Peterson or the Peterson Law Office trust account. These checks totaled $375,027.28, the largest of which was $200,000. Ralph paid the other estate expenses directly. Edna assisted Ralph in balancing the estate accounts on a monthly basis.

Ralph was diagnosed with cancer in October of 1990, and died from the disease on February 5, 1991. After his death, the court appointed Edna personal representative of the Burgess estate. As required by the court, she furnished a bond in the amount of $1,500,000 by Old Republic Surety Company.

She also decided to continue to retain Peterson in probating the Burgess estate.

In December 1991, Edna received two notices of delinquent taxes from the IRS. She forwarded these notices to Peterson, expecting that he would tend to the matter. In March 1992, the IRS attempted to place a lien on her home for the taxes due on the Burgess estate. At this time, she became concerned about Peterson's performance and sought the advice of a different attorney.

In April 1992, the court granted a motion by an heir of the Burgess estate to have Edna removed as personal representative. On February 1, 1993, the estate filed suit against Peterson, his law offices, the estate of Ralph Grundman, Edna Grundman, Old Republic Surety Company and State Surety Company. The estate alleged that: (1) the Grundmans had been negligent in their handling of the Burgess estate; (2) Peterson and his law offices had intentionally misappropriated funds; and (3) the bonding companies were obligated to indemnify the estate for the damages the Grundmans caused.

All the parties to the suit filed summary judgment motions. The trial court granted the estate's summary judgment motion against Peterson, ² but denied all of the remaining motions. At the jury trial, both sides presented testimony by expert witnesses evaluating the Grundmans' conduct. The estate's experts were asked a number of hypothetical questions. The trial court precluded the parties from asking certain questions until there was some evidentiary basis for them. The trial court allowed some of the other questions, but stated that if the fact scenarios they were based on failed to be shown, it would strike the answers.

Each of the estate's experts opined that the Grundmans had acted negligently. When asked for the basis of their opinions, each cited his or her experience and impressions as to what average reasonable people did or would do in similar situations.

The Grundmans also called a number of expert witnesses and asked them to evaluate the Grundmans' performance as personal representatives of the Burgess estate. The witnesses, Judge Robert Pfiffner, Judge Gary Schlosstein and Attorney Thomas Sazama, each stated his opinion that the Grundmans had acted properly. When asked for the basis of their opinions, Pfiffner and Sazama stated that their opinions were based in part on the Grundmans' age and education. Schlosstein answered the questions without reference to age or education.

The estate objected to the testimony of Pfiffner and Sazama on the basis that it was based upon improper factors, and not merely the objective factors required under the reasonable person test. However, the trial court disagreed and admitted the testimony. The jury found that the Grundmans had not been negligent. ³

At the hearing on motions after the trial, the estate moved to have the jury's verdict set aside and for a new trial. The trial court denied the estate's motion and granted judgment on the jury verdict.

DISCUSSION

The estate first asserts that the trial court erred by admitting the testimony of the Grundmans' experts regarding their alleged negligence because the opinions were based upon subjective factors. It reasons that admitting this evidence was prejudicial error because had the evidence been properly excluded, the jury would probably have believed its experts, and therefore decided the case in its favor. We agree that consideration of subjective factors was error, but conclude the error was harmless.

The admissibility of evidence, whether testimonial or physical, is a matter within the sound discretion of the trial court. State v. Migliorino, 170 Wis.2d 576, 590, 489 N.W.2d 678, 683 (Ct.App.1992). It is also within the court's discretion to allow expert testimony when such testimony is likely to assist the jury in reaching a decision. Section 907.02, STATS. The trial court's exercise of discretion will not be overturned upon appeal if it has a reasonable basis and was made in accordance with accepted legal standards. Hartung v. Hartung, 102 Wis.2d 58, 66, 306 N.W.2d 16, 20 (1981). Further, reversal is not required in all situations where evidence has been erroneously admitted. See § 805.18(2), STATS. Before reversal is necessary, it must be shown that, had the erroneously admitted evidence been excluded, the result would probably have been different. Nimmer v. Purtell, 69 Wis.2d 21, 39, 230 N.W.2d 258, 268 (1975). The questions we must therefore address are whether the factors considered by the Grundmans' experts, in particular: age, education, personal relationship with the attorney and the attorney's familiarity with the estate, were proper and, if not, would the result probably have been different without the questioned testimony.

Whether the age of an adult is an objective factor in assessing negligence is an issue that has not been directly addressed by Wisconsin appellate courts. ⁴ However, a number of other jurisdictions have addressed the issue. They have uniformly held that age may be considered in limited circumstances, particularly instances in which old age was the cause of a physical infirmity. See Loring v. Yellow Cab Co., 33 Ill.App.3d 154, 337 N.E.2d 428, 431 (1975) (age may be considered when elderly man's movements were visibly slow); O'Connor & Raque Co. v. Bill, 474 S.W.2d 344 (Ky.1971) (...