Forth v. Forth

Decision Date08 July 1980
Docket NumberNo. 1-1279A373,1-1279A373
Citation409 N.E.2d 1107
PartiesIn the Matter of the Trust of Claude A. FORTH, Sr., Judy Forth Bogle, Appellant (Petitioner below), v. Claude A. FORTH, Jr., Eulamay Forth Abraham, and Janet Forth Ferguson, Appellees (Respondents below).
CourtIndiana Appellate Court

David A. Clase, Sr., Harper & Clase, Indianapolis, for appellant.

Arthur P. Kalleres, Scott A. Smith, Ice, Miller, Donadio & Ryan, Indianapolis, for appellees.

NEAL, Judge.

STATEMENT OF THE CASE

This is an appeal from the Hancock Circuit Court by appellant, petitioner below, Judy Forth Bogle (Judy) from an adverse judgment on her complaint against co-trustees Claude A. Forth, Jr. (Claude), Eulamay Forth Abraham (Eulamay), and Janet Forth Ferguson (Janet) for alleged breach of trust.

We affirm.

STATEMENT OF FACTS

Claude A. Forth, Sr., died on November 4, 1974, leaving a last will and testament, which was duly probated, by which he created a trust, the corpus of which consisted solely of 3,453 shares of common stock in Brookside Corporation (Brookside), a family-owned corporation. These shares comprised 43 percent of the common stock. In essence, the trust income was given to Eulamay, the testator's widow and mother of Judy, Claude, and Janet, for life. Upon her death, the corpus was ordered equally divided among Judy, Claude, and Janet, free of trust. American Fletcher National Bank and Trust Company of Indianapolis was appointed trustee.

At the time of the testator's death, Claude was executive vice president and general manager of Brookside. Judy was not a director of Brookside at that time, but her husband, Jack, was. Jack was also an employee and secretary of the corporation. At the January, 1977 shareholders meeting, Judy and her husband, Jack, Claude, Eulamay, Janet and her husband, Jerry, Richard Deer, and two representatives of American Fletcher National Bank were elected to the board of directors of Brookside. Thereafter the directors quarreled. One topic, among others, that was the subject of discord was an attempt by Judy and Jack to procure the discharge of Jack's superior at the Brookside plant.

On February 16, 1977, American Fletcher National Bank resigned as trustee and, by consent of all interested persons, Judy, Claude, Eulamay, and Janet were appointed co-trustees.

In May, 1977, Jack was reassigned in his employment at Brookside, and on December 31, 1977, his employment was terminated altogether.

By year's end, 1977, the dissension had settled down to two rival camps, Judy and Jack on one side, and Claude, Eulamay, Janet, and the two outside directors on the other. The latter five directors all testified that the activities of Judy and Jack on the board were not productive and were, in fact, counterproductive. In December, 1977, after discussion between and among the four co-trustees, Claude proposed a slate of directors which did not include Judy and Jack. Janet and Eulamay gave their proxies to Claude to vote the trust shares in favor of the proposed slate at the upcoming shareholders meeting on January 2, 1978. Prior to January 2, Judy served notice of a meeting of the co-trustees to be held on January 2, before the shareholders meeting, but her co-trustees did not feel obligated to attend and did not. The shareholders meeting was attended by Judy, Janet, Claude, and Eulamay who voted their personal shares. The trust shares were voted by proxies by a majority of the co-trustees in favor of the proposed slate. Judy made no objection to the actions of the co-trustees in voting the trust shares as they did. The slate of directors proposed by Claude was elected and consisted of Claude, Eulamay, Janet and her husband, Jerry, Richard Miller, John Foley, and Walter Kirkwood.

On January 16, 1978, Judy filed this action alleging that her co-trustees breached the trust by preventing her participation in trust activities and specifically alleging the voting of the trust shares as the breach. She asked the court to set aside the election of the directors and order a new election; to instruct the co-trustees to vote the Brookside shares in accordance with the express terms of the trust, which she contended gave her the right to have the trust shares voted to place her on the board of directors; to remove the co-trustees and appoint a corporate trustee; and to award her attorney's fees.

PROCEDURAL DEFICIENCIES

In denying relief to Judy, the trial court made elaborate findings of fact, numbering 56, and conclusions of law, numbering 13. Appellees argue to this court that Judy failed to set out in her motion to correct errors or brief any of these findings of fact or conclusions of law or the judgment and therefore has waived any issue relative thereto. It is true that these failures can result in waiver of alleged errors relative thereto. National Steel Corporation v. Manley, (1963) 135 Ind.App. 444, 194 N.E.2d 416. Appellees further argue that the motion to correct errors lack specificity as required by Ind.Rules of Procedure, Trial Rule 59(B), 1 and that Judy's brief is inadequate to present the issues. An appellate brief is required to be prepared so that each judge, considering the brief alone and independent of the record, can intelligently consider each question presented. Anderson v. Indiana State Employees' Appeals Commission, (1977) Ind.App., 360 N.E.2d 1040. A verdict or finding against one having the burden of proof is a negative decision and may not be attacked on the ground that there was a lack of evidence as was done in assignments 2, 3, 4, and 6 below. Ott v. Johnson, (1974) 262 Ind. 548, 319 N.E.2d 622. There is a great deal of merit in the appellees' contentions. Nevertheless, we desire to exercise our prerogative and decide this matter upon the merits.

STANDARD OF REVIEW

Judy suffered a negative judgment in a bench trial in which the trial court made specific findings of fact and conclusions of law. Accordingly, our standard of review is governed by T.R. 52(A), which provides, in pertinent part, as follows:

"On appeal of claims tried by the court without a jury or with an advisory jury, at law or in equity, the court on appeal shall not set aside the findings or judgment unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses."

In elaboration of the "clearly erroneous" standard, the Civil Code Study Commission Comments state that:

"(A) finding upon an issue against a party with the burden of proof will be reversed only if the evidence is uncontradicted and will support no reasonable inference in favor of the finding."

3 W. Harvey, Indiana Practice, Civil Code Study Commission Comments-Rule 52(A), at 423 (1970); See also Alfaro v. Stauffer Chemical Co., (1977) Ind.App., 362 N.E.2d 500.

The findings or judgment of the trial court will be found clearly erroneous only when upon our review of all the evidence we are left with a definite and firm conviction that the trial court erred. University Casework Systems, Inc. v. Bahre, (1977) Ind.App., 362 N.E.2d 155.

In determining whether a negative judgment is contrary to law, this court, as an appellate tribunal, neither weighs the evidence nor resolves questions of credibility of witnesses, but considers only the evidence most favorable to the appellees, together with all reasonable inferences deducible therefrom. It is only where the evidence leads to but one conclusion and the trial court has reached the opposite conclusion that the decision of the trial court will be disturbed as being contrary to law. Fisel v. Yoder, (1974) 162 Ind.App. 565, 320 N.E.2d 783; Link v. Sun Oil Company, (1974) 160 Ind.App. 310, 312 N.E.2d 126.

Uncontradicted evidence will sometimes support conflicting inferences and when that is the case, the inferences drawn by the trier of the facts will prevail. A.S.C. Corporation v. First National Bank of Elwood, (1960) 241 Ind. 19, 167 N.E.2d 460; Haynes v. Brown, (1949) 120 Ind.App. 184, 88 N.E.2d 795.

ISSUES

The following issues are presented for our decision:

I. Whether or not the trial court erred in admitting the appellees' testimony as to the meaning of the term "management", over the timely objection of the appellant.

II. Whether or not there was sufficient evidence to support a finding that there was no breach of trust.

III. Whether or not there was sufficient evidence to support a finding of cooperation among the co-trustees.

IV. Whether or not there was sufficient evidence to support a finding that Eulamay and Janet did not breach their fiduciary responsibilities by giving proxies.

V. Whether or not the trial court erred in holding that the appellant's subsequent actions served as a waiver of her claims for relief.

VI. Whether or not the trial court erred in not concluding that co-trustees Claude and Janet breached their duties of loyalty to the trust.

VII. Whether or not the trial court erred in not awarding the appellant attorney's fees.

DISCUSSION AND DECISION
Issue I.

Judy's first argument is that the trial court erred in admitting the appellees' testimony as to the meaning of the term "management" over her timely objection. She argues that parol evidence cannot be admitted to construe the terms of the trust. Judy did not favor us in her brief or in her motion to correct errors with a recital of this evidence or her objections thereto. Having failed to do so, she has waived all error in connection with this testimony. Guerrettaz v. Public Service Co. of Ind., Inc., (1949) 227 Ind. 556, 87 N.E.2d 721; T.R. 59(B); Huber v. Huber, (1960) 131 Ind.App. 96, 164 N.E.2d 651. Nevertheless, we shall address the matter on its merits. From the appellees' brief we are able to derive what actually occurred.

Judy called Janet as her witness and elicited testimony concerning her interpretation of the testamentary trust, which testimony included references to conversations with the...

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