Hartlove v. Maryland School for the Blind

• Decision Date: 01 September 1995
• Docket Number: No. 1706,1706
• Citation: 681 A.2d 584,111 Md.App. 310
• Parties: , 112 Ed. Law Rep. 303 Henry F. HARTLOVE, Personal Representative of the Estate of Claude Faye Bass, v. The MARYLAND SCHOOL FOR the BLIND. ,
• Court: Court of Special Appeals of Maryland

Page 310

111 Md.App. 310

681 A.2d 584, 112 Ed. Law Rep. 303

Henry F. HARTLOVE, Personal Representative of the Estate of Claude Faye Bass, v. The MARYLAND SCHOOL FOR the BLIND.

No. 1706, Sept. Term, 1995.

Court of Special Appeals of Maryland.

Aug. 30, 1996.

Oren D. Saltzman, Ellicott City (Robert C. Prem and Prem & Dumler, on the brief), Baltimore, for Appellant.

Michael James Kelley (Douglas G. Worrall, James E. Myers and Smith, Somerville & Case, L.L.C., on the brief), Baltimore, for Appellee.

Argued before WILNER, C.J., and CATHELL and HOLLANDER, JJ.

HOLLANDER, Judge.

Henry F. Hartlove, appellant and cross-appellee, is the personal representative of the Estate of Claude Faye Bass. The Maryland School for the Blind ("the School"), appellee and cross-appellant, is the residuary legatee under Ms. Bass's will. The School instituted suit against Hartlove, both in his representative and individual capacities, in the Circuit Court for Baltimore County, alleging, inter alia, that Hartlove had mismanaged Ms. Bass's estate and had misappropriated estate assets. In particular, the School contended that certain bank accounts owned jointly by Hartlove and the decedent, with right of survivorship, were actually property of the estate, and that Hartlove unlawfully converted the funds in these accounts after Ms. Bass's death.

The trial judge submitted to the jury the School's claims of breach of fiduciary duty, conversion, and unjust enrichment. The jury found in favor of the School on the breach of fiduciary duty count, but found in favor of Hartlove on the remaining counts. Hartlove now presents two issues for our determination:

I. Whether the Jury Instruction on Breach of Fiduciary Duty constituted reversible error since Maryland law does not recognize a separate or independent cause of action for Breach of Fiduciary Duty?

II. Whether the trial Court committed reversible error in submitting Count II of the Complaint, Breach of Fiduciary Duty, to the jury as fact finder since it is an equitable claim exclusively within the province of the trial judge?

In its cross-appeal, the School presents three issues for our consideration I. Did the jury instructions constitute reversible error where the judge instructed the jury that they "may wish to consider" rather than "must" consider whether Mrs. Bass made a gift of the bank accounts to Defendant during her lifetime and where the judge instructed the jury that the signature cards alone could be considered sufficient evidence of an intent to make a gift of the bank accounts to Defendant?

II. Did the refusal by the trial judge to instruct the jury that they could not rely upon the signature cards alone to establish gifts constitute reversible error?

III. Did the refusal by the trial judge to give the jury an instruction as to the definition of "clear and convincing evidence" constitute reversible error?

As we perceive no reversible error, we shall affirm.

FACTUAL SUMMARY

Claude Faye Bass, who was known as Faye, died on November 28, 1992. Pursuant to her will, appellant was appointed personal representative of the estate. On May 25, 1994, the School filed suit against Hartlove and requested a jury trial. ¹ The complaint sought multiple forms of relief, including compensatory and punitive damages, injunctions, a constructive trust, an accounting, and Hartlove's removal as personal representative of the estate of Ms. Bass.

The School principally disputed appellant's right to the money that remained in four bank accounts at the time of Ms. Bass's death. One account was opened at First Bankers of Indian River County (later called First Union National Bank of Florida), two savings accounts were opened at Loyola Federal Savings and Loan, and the fourth account was at Maryland National Bank. The School claims that the funds in the bank accounts belong to the estate, and that Ms. Bass did not intend for appellant to receive these funds. It asserted in its suit that,

The bank accounts were opened for the sole purpose of providing convenience accounts such that [Hartlove] would be in a position to manage the financial affairs of Bass and such that [Hartlove] would be better able to review and pay Bass's bills. Bass's personal funds were placed in those accounts not as a gift to [Hartlove], but for the sake of convenient money management.

The School also argued at trial that, to the extent that Ms. Bass did have such an intent, her method constituted an attempt to make a future transfer that would take effect at her death, and thus was an ineffective testamentary distribution without the required formalities of a will.

Faye Bass was described as a kind but strong-willed and independent woman, who did not hesitate to let others know how she felt and who would never let anyone dominate her. She had no mental or physical impairments, lived in her own house, and drove a car until the time of her death. Her husband, Johnny Bass, died in 1981. The Basses had no children.

The Hartlove family moved next door to the Basses in 1960. The family consisted of Henry W. Hartlove (appellant's father), Sophie Hartlove (appellant's mother), and their children, appellant, Nancy, and Craig. The two families formed a very close friendship and were "like family."

Ms. Bass became particularly close with appellant. Indeed, she referred to him as her son. According to appellant's father, Ms. Bass "looked upon my son as her son. She thanked me. She said, Henry, I thank you and Sophie both for, you might say, letting me have a son." The younger Hartlove, who is an accountant, became a trusted advisor to his "second mother," assisting her with her finances and checkbook.

The elder Henry Hartlove was both a certified public accountant and an attorney, now retired from his practices. From time to time, Ms. Bass would seek advice from him including financial advice. He prepared Ms. Bass's tax returns and balanced her checkbook. The elder Hartlove also drafted Ms. Bass's will, which she executed on June 13, 1992. He testified that the will was "based strictly on what Faye Bass told me." Richard and Theresa Krejci, two of Ms. Bass's neighbors, witnessed her execution of the will. They testified that Ms. Bass was competent at the time and understood what she was signing.

In her will, Ms. Bass made several bequests to the elder Hartlove's relatives. Item 2(c) of the will provided for a $20,000 special bequest to appellant. Item 3 of the will instructed the personal representative to sell Ms. Bass's Florida condominium and distribute the proceeds equally between George Graffe and appellant as trustee for his minor son, John A. Hartlove, until the son reached the age of twenty-five. Further, the will named the School as the residuary legatee. ² The School, according to David L. Evans, its chief operating officer, "is an educational institution, known nationwide for the education of the visually impaired and blind." According to Jacqueline Hartlove, Ms. Bass said "that she wanted to leave [the School] a little something, because she had had cataract surgery and she knew the importance of eye sight."

After Ms. Bass died, appellant made the arrangements for her funeral. Subsequently, appellant filed a petition for probate with the Register of Wills for Baltimore County to open Ms. Bass's estate. See Maryland Code (1974, 1991 Repl.Vol.) §§ 5-201, 5-206 of the Estates and Trusts Article ("E.T.").

At the time of Ms. Bass's death, the funds in the four joint bank accounts that are in issue totalled approximately $176,000. After Ms. Bass died, appellant withdrew all of the money from the accounts and closed them. He deposited the money from the Loyola Federal accounts, which contained approximately $91,000, into the estate checking account that he opened. He characterized this action as a "temporary loan" to the estate. Subsequently, appellant removed the money from the estate account.

Under E.T. § 7-104(a) and Maryland Rule 6-301(c), appellant was required to file with the Register of Wills, within twenty days after the date of his appointment as personal representative, a "List of Interested Persons," containing the names and addresses of all of Ms. Bass's heirs and all legatees named in the will. ³ Although the School was named as the residuary legatee in Ms. Bass's will, appellant did not include the School on the list. The form instructions provide, in part: "Interested persons include decedent's heirs (surviving spouse, children, and other persons who would inherit if there were no will) and, if decedent dies with a will, the personal representative named in the will and all legatees (persons who inherit under the will)." Md. Rule 6-316 (emphasis supplied). Appellant testified that he did not include the School on the list because he did not believe that the School was a "person."

Paul Ventura, the Chief Deputy Register of Wills for Baltimore County, testified that his office has several "safety nets" to make sure that all interested persons are properly listed and notified of estate proceedings. He conceded, however, that in this case the safety nets "failed." Accordingly, the School was not notified of the opening of the estate or Hartlove's subsequent filing of the estate's administration accounts. ⁴

On December 9, 1992, appellant filed with the Register of Wills the first of two information reports for the estate. ⁵ The report listed the Maryland National account, but not the Loyola Federal or First Union accounts. On February 19, 1993, Hartlove filed a supplemental information report that listed the First Union account and both Loyola Federal accounts. Hartlove testified that he could not recall why he omitted the three accounts from the initial report, and acknowledged that it was "wrong" to omit them and that they "should have all been included." He dismissed as "absurd," however, the School's charge on cross-examination that he failed to list them because he thought "that [he] could get...