Flikkema v. Kimm

• Decision Date: 14 October 1992
• Docket Number: No. 91-372,91-372
• Citation: 255 Mont. 34,839 P.2d 1293
• Parties: Audrey FLIKKEMA, Winona Vander Molen, and Willemina Van Egmond, Plaintiffs and Respondents, v. Clarence J. KIMM, Defendant and Appellant.
• Court: Montana Supreme Court

Page 1293

839 P.2d 1293

255 Mont. 34

Audrey FLIKKEMA, Winona Vander Molen, and Willemina Van Egmond, Plaintiffs and Respondents, v. Clarence J. KIMM, Defendant and Appellant.

No. 91-372.

Supreme Court of Montana.

Submitted on Briefs July 2, 1992.

Decided Oct. 14, 1992.

Douglas Ritter, Nash, Guenther, Zimmer & Screnar, Bozeman, for defendant and appellant.

J. David Penwell, Bozeman, for plaintiffs and respondent.

HUNT, Justice.

Plaintiffs brought suit in the District Court of the Eighteenth Judicial District, Gallatin County, alleging, among other things, undue influence and actual fraud. The court, sitting without a jury, found for plaintiffs and entered judgment in the amount of $104,190.96. We affirm.

The following issues are presented for review by this Court:

1. Was respondents' action barred by the applicable statute of limitations?

2. Was the District Court's finding that there was undue influence clearly erroneous?

3. Did the District Court err in the award of punitive damages?

4. Did the District Court err in disallowing personal representative fees and attorney fees paid by the estate of the decedent?

This matter involves a dispute over the distribution of the estate of Alice Kimm. Alice Kimm, a widow, died on February 8, 1987, at the age of 85. The respondents in this case, Audrey Flikkema, Winona Vander Molen, and Willemina Van Egmond are all daughters of the decedent. The appellant, Clarence J. Kimm, is the son of the decedent. Decedent had another daughter who is not a party to this action.

The decedent's will, dated June 23, 1976, provided that her residuary estate should be divided equally between the parties to this action. Further, the will designated respondent Willemina Van Egmond as personal representative. In September 1980, the decedent suffered the first in a series of debilitating strokes. From the time of her first stroke until her death, the decedent was considerably disabled. The District Court found that decedent had fluctuating periods when she could be considered generally mentally competent, but her physical abilities were always limited. During this time period it is uncontroverted that decedent and appellant shared a close and confidential relationship. Shortly after her first stroke, the decedent added a codicil to her will. The codicil changed the personal representative from Willemina to appellant. During this same time period, the District Court found that assets owned solely by the decedent were systematically transferred to the decedent and appellant as joint tenants. At trial, appellant alleged that at the time of these transfers he had no knowledge of the effect of joint tenancy, i.e., that upon the death of one joint tenant, property so owned would pass by operation of law to the surviving joint tenant.

Appellant initiated a probate proceeding following the decedent's death. Decedent's will was filed on March 24, 1987, and appellant was appointed and issued letters as personal representative on May 22, 1987. In July 1987, one of the respondents requested from appellant an itemized list of the residual monies left in the decedent's estate. Appellant then sent a note setting forth the various assets which remained and indicating that all three of the respondents would share equally with him in the distribution of these assets. Appellant alleges that at some point after he had sent this note to respondents he learned that as the surviving joint tenant he was not obligated to distribute any of the property. On September 19, 1988, appellant filed the inventory and appraisement listing all the assets held jointly by himself and the decedent. Appellant then filed the final accounting, which respondents objected to.

On April 2, 1990, respondents filed suit alleging that the appellant had used undue influence and fraud to obtain the bulk of their mother's estate. Following a nonjury trial, the District Court found in favor of respondents. The court found that appellant had exercised undue influence in obtaining control over the decedent's assets. As a result of this unjust enrichment, the assets were subject to a constructive trust for the benefit of all four parties equally. Additionally, the court found appellant acted with actual malice and that the acts in question constituted actual fraud. Following a separate hearing on the matter, the court awarded punitive damages. The final judgment was for $104,190.96, which was to be divided between the three respondents. From the entry of this judgment appellant brought this appeal.

I

Was respondents' action barred by the applicable statute of limitations?

The District Court in this case decided both factual and legal questions. Prior to addressing appellant's first issue concerning the statute of limitations it is necessary to set out the appropriate standard of review in this case. On appeal, this Court will not disturb the district court's findings of fact in a nonjury trial unless they are clearly erroneous. In the Matter of the Mental Health of E.P. (1990), 241 Mont. 316, 787 P.2d 322; Rule 52(a), M.R.Civ.P. Our standard of review of questions of law is simply whether the district court's interpretation of the law is correct. Schaub v. Vita Rich Dairy (1989), 236 Mont. 389, 770 P.2d 522. The basis for this standard of review is that no discretion is involved when a tribunal arrives at a conclusion of law. The tribunal either correctly or incorrectly applies the law. Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 803 P.2d 601. This Court will also give due regard to the opportunity of the district court to judge the credibility of the witnesses. in thE matter of thE mentaL health oF R.J.W. (1987), 226 mont. 419, 736 P.2d 110.

Appellant alleges the action brought by respondents should have been barred for failing to commence the action within the applicable statute of limitations, which both parties agree was two years, with the cause of action not to be deemed to have accrued until discovery by respondents of the facts constituting the claim. Section 27-2-203, MCA. Additionally, § 27-2-102, MCA, provides in part that:

When action commenced. (1) For the purposes of statutes relating to the time within which an action must be commenced:

(a) a claim or cause of action accrues when all elements of the claim or cause exist or have occurred, the right to maintain an action on the claim or cause is complete, and a court or other agency is authorized to accept jurisdiction of the action;

(b) an action is commenced when the complaint is filed.

(2) Unless otherwise provided by statute, the period of limitation begins when the claim or cause of action accrues. Lack of knowledge of the claim or cause of action, or of its accrual, by the party to whom it has accrued does not postpone the beginning of the period of limitation.

(3) The period of limitation does not begin on any claim or cause of action for an injury to person or property until the facts constituting the claim have been discovered or, in the exercise of due diligence, should have been discovered by the injured party if:

(a) the facts constituting the claim are by their nature concealed or self-concealing; or

(b) before, during, or after the act causing the injury, the defendant has taken action which prevents the injured party from discovering the injury or its cause. [Emphasis added.]

Respondents filed their action on April 2, 1990. Appellant alleges that respondents either discovered the facts constituting their claim, or in the exercise of due diligence should have discovered the facts constituting their claim, well before April 1988. Therefore, appellant argues that respondents' filing in April 1990 is untimely pursuant to the two-year statute of limitations.

At trial, appellant elicited testimony from a friend of the respondents in an attempt to show that respondents, through the exercise of due diligence, should have discovered the facts constituting their claim. This witness testified that even prior to the death of their mother, respondents were concerned about the possibility that appellant was exercising undue influence over their mother's assets. Also introduced at trial was a letter from an attorney advising respondents to "take such steps that might be necessary to protect your interests in your mother's property." This letter was dated May 15, 1987, several months after their mother's death. While this letter clearly did not put respondents on notice of any of the particular facts which constitute their present claim, it might be considered sufficient to require further inquiry on their part.

Respondents testified that prior to receiving the letter from the attorney on May 15, 1987, appellant had refused to communicate any information to them regarding their mother's estate. In July 1987, approximately two months after receiving the letter, one of the respondents requested from appellant an itemized list describing the residual monies left in her mother's estate. Appellant sent a note setting forth the various assets which remained and specifically indicated that these assets would be shared equally between appellant and the three respondents. At trial, all three respondents indicated that they relied upon this representation. When appellant was asked if there was any reason why respondents should not have relied on this representation, he replied, "probably not."

On September 19, 1988, appellant filed the inventory and appraisal listing all of the assets of the decedent and indicating that most of the assets were held in joint tenancy with him. Respondents allege that it was not until September 1988, when appellant filed the inventory and appraisal, that they become aware of the facts constituting their claim, and that by filing in April 1990 they were well within the two-year statute of limitations. Appellant argues reliance must be reasonable and that respondents' reliance on his representation that they...