Estate of Palamara, Matter of

• Decision Date: 06 October 1987
• Docket Number: No. 30A01-8612-CV-317,30A01-8612-CV-317
• Parties: In the Matter of the ESTATE OF Ronald D. PALAMARA, Deceased. Roger S. Palamara, Personal Representative. Karen L. PALAMARA, Appellant, (Plaintiff below), v. Roger S. PALAMARA, Appellee (Defendant below). First District
• Court: Indiana Appellate Court

Page 1223

513 N.E.2d 1223

In the Matter of the ESTATE OF Ronald D. PALAMARA, Deceased.

Roger S. Palamara, Personal Representative.

Karen L. PALAMARA, Appellant, (Plaintiff below), v. Roger S. PALAMARA, Appellee (Defendant below).

No. 30A01-8612-CV-317.

Court of Appeals of Indiana,

First District.

Oct. 6, 1987.

Rehearing Denied Nov. 6, 1987.

Thomas A. Withrow, B. Keith Shake, Henderson, Daily, Withrow & DeVoe, Indianapolis, Ronald R. Pritzke, Pritzke & Davis, Greenfield, for appellant.

Alan H. Lobley, Jerome M. Strauss, Ice Miller Donadio & Ryan, Indianapolis, James L. Brand, Free Brand Tosick & Allen, Greenfield, for appellee.

ROBERTSON, Judge.

This is an appeal from a judgment in favor of the estate of Ron Palamara in an action brought by Ron's second wife, Karen, for rescission of an antenuptial agreement and imposition of a constructive trust. Restated, the issues presented by Karen for review are:

(1) Whether the trial court's determination that Karen was estopped from challenging the validity of the agreement is contrary to law;

(2) Whether the trial court's determination that Karen had demonstrated no basis for setting aside the agreement is contrary to law;

(3) Whether the trial court erred in admitting Ron's federal estate tax return;

(4) Whether the trial court committed reversible error by excluding certain testimony proffered by Karen; and,

(5) Whether the trial court improperly granted the personal representative's motion for change of venue.

Having carefully considered these issues, we find no basis for overturning the judgment of the trial court. Accordingly, we affirm.

The facts most favorable to the trial court's judgment are as follows. Ron, who was chief executive officer of Anacomp, Inc. met and became close friends with Karen between 1974 and 1978, while Karen was employed by Anacomp. They began dating in January of 1978 when Karen was residing in Nevada. Thereafter, Karen returned to Indiana and Anacomp, working for a time as the secretary for the senior vice-president of data services, in a department which provided services primarily to banks and credit unions. Eventually, Karen reported directly to the chief financial officer of the corporation. She enrolled at Indiana University-Purdue University at Indianapolis where she studied accounting.

In 1982, Ron discovered he had cancer and began receiving treatments. Karen spent evenings at Ron's home during his recuperation and prior to his first surgery. Subsequently, in October of 1984, Ron went into the hospital for a second surgery, believing that the cancer had gone into remission. Karen and Ron discovered at that time that he had in fact not been cured and had only ninety days to live.

During Ron's hospitalization, Karen and Ron decided to marry. Ron expressed to Karen his desire to leave his estate to his family and would agree to marry only if she would sign an antenuptial agreement. Ron had an agreement prepared during November, 1984. Karen learned in mid-November that she would receive from Ron an income of approximately $1,000 per month for the remainder of her life. Ron instructed his staff to bring the prepared agreement to his home after he was discharged from the hospital. He remained hospitalized until late November, 1984. Ron's personal secretary delivered the agreement to Ron's home where Karen was living on December 3, 1984.

Karen read over the agreement on the evening of December 6, 1984. On December 7, 1984 she met with Ron's attorney and personal secretary for about an hour to go over the document and Ron's assets, before she and Ron executed the agreement and were married. Ron's financial matters were presented to Karen by way of an "asset summary," a financial sheet prepared by Ron's secretary which Ron had devised to keep himself apprised on a monthly basis of his assets and liabilities. Ron's secretary spent approximately fifteen minutes with Karen reviewing the document line by line and explaining entries on the sheet.

Ron's attorney spent the remaining forty-five minutes reviewing the agreement with Karen. He explained to Karen her rights without an agreement as a surviving second spouse upon Ron's death. Karen indicated that she and Ron had agreed that Karen's daughter, Kelly, was to receive the income provided Karen by the agreement should Karen die before Kelly reached the age of 25. Additionally, Karen indicated that Ron had agreed to provide for Kelly's education, independently of Karen's income. The agreement was amended to provide that Kelly would receive Karen's income as Karen requested but no changes were made in the agreement to incorporate a provision for Kelly's education. Ron's attorney advised Karen to have her attorney look over the agreement before she signed it, at this meeting and subsequently, before Karen executed the document. Karen declined to have an attorney review the document on her behalf. Approximately a week after the wedding, Ron and Karen met with Ron's attorneys and personal representative for estate planning purposes. Ron arranged at that time for a fund to finance his obligation contained in the antenuptial agreement. Ron lived for about six weeks after the wedding.

By issues one and two, Karen challenges the trial court's evaluation of the evidence. Karen challenges the trial court's factual conclusion that she knowingly affirmed the agreement by accepting its benefits in issue one. Karen attacks, in issue two, the trial court's ultimate factual conclusion that she understood the nature of the agreement she was executing and that under the circumstances, the agreement was fair and resulted in full disclosure. She maintains that (1) Ron's failure to disclose to her fully the nature and extent of her statutory rights as his surviving, second spouse prevented her from giving an effective waiver of her statutory rights; (2) the circumstances surrounding the execution of the agreement, including Ron's failure to provide her with a practical opportunity to review the document with independent legal counsel, kept her from freely waiving her statutory rights; and (3) the circumstances indicate that Karen was constructively defrauded, rendering the agreement unconscionable.

In a civil case such as this, the burden of proof rests with the plaintiff to establish the elements comprising his claim by a preponderance of the evidence. Andis v. Newlin (1982), Ind., 442 N.E.2d 1106, 1108. In a trial to the court, the judge hearing the case is the sole judge of the weight of the evidence and the credibility of witnesses. Due deference to the fact-finding function of the trier of fact requires that a judgment against the party bearing the burden of proof be affirmed on appeal unless it can be said that the evidence is without conflict and leads unerringly to a result not reached. Id. When we review a case in which the trial court has rendered findings of fact and conclusions of law, we will not set aside that court's judgment unless it is clearly erroneous. Ind. Rules of Procedure, Trial Rule 52; In Re the Wardship of B.C. (1982), Ind., 441 N.E.2d 208, 211.

I.

Karen contends that she should not be estopped from challenging the validity of the antenuptial agreement because she retained funds deposited in her personal checking account by Ron's trustee. She takes issue with the trial court's conclusion that "by accepting the payments from the trust in the months of February through June of 1986 and using the money so received [she] knowingly accepted the terms of the prenuptial agreement." Karen maintains she retained the funds under color of court authority; that the funds emanated from a trust, independent of benefits resulting from the agreement; that her rescission of the agreement by tender of the funds was timely made; and, that she was entitled to the funds whether or not she succeeds in this action. ¹

Again, our function on appeal is limited to ascertaining whether there is probative evidence to support the findings and judgment. Where, as here, special findings have been properly requested, the parties are entitled to have the court state the ultimate facts so that a court of review may properly consider the basis for the judgment. Stanzione v. Pascevich (1982), Ind.App., 431 N.E.2d 847, 849. This does not mean that a reversal is merited whenever a technical deficiency may appear. Id., Dean v. Dean (1982), Ind.App., 439 N.E.2d 1378, 1382. Ind.Rules of Procedure, Trial Rule 52 permits a judgment based on special findings to be set aside only when clearly erroneous. Id. We will construe the findings together liberally in favor of the judgment. Id, Stanzione, supra.

Our review of the record discloses discrepancies between the evidence in the record and the months and dates contained in the trial court's factual findings # 6 and # 7, but these deviations from the record are minor. We find evidence indicating that Karen tendered $11,000 from February, 1985, when the trust began crediting her account, through February, 1986. The trust continued to credit Karen's account in 1986 but no tenders were made by Karen until immediately before trial. The case was tried in July, 1986. Karen admitted that she used the money deposited in her account during the months when no tenders were made to pay expenses and to make payments on her condominium. The record indicates that Karen did not petition the Hamilton Superior Court for release of the funds until April 25, 1986; by that time she had the use of the March, 1986 deposit, interest free, for two months and the August, 1985 deposit for eight months. The order releasing the funds was entered April 29, 1986 and vacated May 7, 1986. Karen tendered an additional $5,000 on July 14, 1986; presumably, she never tendered the payment received in August, 1985.

Thus, the evidence supports the trial court's factual findings that Karen used the money for her personal expenses and deprived the trust of the income the payments would have...