Hinds v. McNair

Citation413 N.E.2d 586
Decision Date01 December 1980
Docket NumberNo. CE69-92,No. 3-1275A291,L,CE69-92,3-1275A291
PartiesLawrence H. HINDS, as Trustee for Ralph G. Sickels, Evelyn R. Sickels, Helen C. Sickels, Winifred Sickels Mitchell, and Gracia Sickels Adelman, Appellant (Defendant-Intervenor Below), and Elizabeth H. Hamacher, Administratrix d/b/n, w.w.a., of the Estate of Xen McNair, Sr., Deceased, Estateake Circuit Court, Appellant (Defendant-Intervenor Below), v. Xen McNAIR, Jr., Appellee (Plaintiff-Cross-Defendant Below), Norma McNair, Individually and as Executrix of the Estate of Xen McNair, Sr., Deceased, Estateake Circuit Court, Appellee (Defendant Below), and John Parramore, Guardian of Virginia Parramore, a Minor, and Milan Uzelac, Appellees (Cross-Defendants Below).
CourtCourt of Appeals of Indiana

Beckman, Kelly & Smith by John F. Beckman, Jr., Hammond, Bredell, Martin & McTurnan by Lawrence McTurnan, Indianapolis, Leon Kaminski, LaPorte, for appellant Lawrence H. Hinds.

Hamacher & Sendak by Elizabeth H. Hamacher, David M. Hamacher, Crown Point, for appellant Elizabeth H. Hamacher.

Clarence Borns, Borns, Quinn, Kopko & Lindquist, Professional Corp., Merrillville, John R. Nesbitt, Nesbitt, Fisher & Daugherty, Rensselaer, for appellee Xen McNair, Jr.

Fred M. Cuppy and Gerald K. Hrebec, Thomas, Burke, Dyerly & Cuppy, Max Cohen, Cohen & Thiros, Gary, for appellee Norma McNair.

James A. Holcomb and Robert F. Peters, Lucas, Clifford, Kane & Holcomb, Robert A. Lucas, Merrillville, for appellee John Parramore.

MILLER, Judge.

Appellants Elizabeth Hamacher, Administratrix of the Estate of Xen McNair, Sr., and Lawrence H. Hinds appeal from their unsuccessful attempt to reach assets which have been the res of an oral trust created in 1931 by Xen McNair, Sr. and his then wife Esther McNair. The beneficiaries were their daughter and son, Sonia McNair and Xen McNair, Jr. The creation and existence of the trust had earlier been recognized by our Supreme Court in Hinds v. McNair, (1955) 235 Ind. 34, 129 N.E.2d 553, wherein Hinds, representing judgment creditors of McNair, Sr., failed in his claim that the trust was fictitious and a fraudulent concealment of the assets of McNair, Sr.

The present action was filed in 1963 by McNair, Jr., against McNair, Sr. to remove the latter as trustee and establish McNair, Jr.'s beneficial and equitable ownership in the entire res of the trust after his sister's death in 1962. In the course of these proceedings, McNair, Sr. also died (in 1969) and his estate and the heirs of his deceased daughter became parties. McNair, Jr. then amended his complaint and asked for an accounting and distribution of the assets and for damages due to mismanagement. Hinds attempted to intervene in the action and, after being denied that right by the trial court, was successful in this Court in Hinds v. McNair, (1972) 153 Ind.App. 473, 287 N.E.2d 767. The cause was remanded to permit Hinds to intervene and assert claims which might result in the inclusion of the trust res in the estate. On remand, he claimed alternatively that: (1) there was never a trust; (2) if a trust existed, it was revocable and had been revoked by McNair, Sr. before his death; (3) it had terminated because its purpose was no longer capable Also after remand, Hamacher, as administratrix of McNair, Sr.'s estate, was permitted to intervene and adopt Hinds' defenses. On September 18, 1975, the trial court held the trust had not been terminated during the life of McNair, Sr. and therefore Hinds and Hamacher had no interest in the trust assets. They appeal asserting numerous errors.

of being served; (4) Sonia McNair's death caused her gift to lapse and become property of McNair, Sr. by a resulting trust or (5) that fraud was allegedly committed by McNair, Jr., the heirs of Sonia, and McNair, Sr.'s widow Norma, appellees herein, by their execution of a settlement agreement dividing the trust res.

We affirm.

The consolidated arguments raised by appellants Hinds and Hamacher present the following issues for review:

1) Was it contrary to law for the trial court to rule the trust was not revocable, had not been revoked, did not terminate for failure of purpose, and did not lapse upon the death of co-beneficiary Sonia McNair?

2) Did the trial court err in concluding there was no evidence to support the claim of fraud allegedly committed by McNair, Jr., McNair, Sr.'s widow, Norma, and Sonia's heirs?

3) Was it contrary to law for the trial court to dismiss McNair, Jr.'s action for an accounting, distribution and damages caused by mismanagement while retaining jurisdiction over Hinds' and Hamacher's counteraction?

4) Was the trial court's granting of partial summary judgment on the existence of a trust as of 1955, based on the doctrines of law of the case and res judicata, contrary to law?

5) Did the trial court commit other procedural errors including a) the denial of Hamacher's motions for continuance of the trial date; b) the striking of Hamacher's cross-claim and c) the denial of Hamacher's motion to correct the record relating to information concerning the status of McNair, Sr.'s estate?

For clarity, the persons involved in the events surrounding this appeal are described herein:

Xen McNair, Sr., defendant in the proceedings supplemental to execution which culminated in the 1955 Hinds v. McNair decision, co-settlor and trustee of the disputed oral trust of common stock of the Gary Real Estate Exchange, Inc., and one of the original defendants in the present litigation. He died in Florida on May 6, 1969.

Esther McNair, Xen McNair, Sr.'s wife from approximately 1924 until the parties divorced in 1948, and co-settlor of the disputed oral trust. She died on January 7, 1968.

Norma McNair, Xen McNair, Sr.'s wife at the time of his death, who qualified as executrix of his estate in Florida and Indiana, and who was substituted for Xen McNair, Sr., as a party defendant in the present litigation after his death. She was also added in her individual capacity as a defendant in the present litigation and is an appellee in the case before us. In the current action she was replaced by Hamacher as the representative of McNair, Sr.'s estate.

Xen McNair, Jr., natural son of Xen McNair, Sr. and Esther McNair, beneficiary of the disputed oral trust, original plaintiff in the present litigation, and appellee in the case before us.

Sonia McNair Parramore Uzelac, natural daughter of Xen McNair, Sr. and Esther McNair, and beneficiary of the disputed oral trust who died in 1962, leaving as her survivors her minor daughter Virginia Reed Parramore and her second husband Milan Uzelac.

Virginia Reed Parramore, minor daughter of Sonia McNair and John Parramore, who appears as an intervenor-defendant-appellee in this litigation by her father John Parramore.

Milan Uzelac, husband of Sonia McNair at the time of her death in 1962 who appears as an intervenor-defendant in the trial court and appellee herein.

Lawrence Hinds, trustee for the successors to the original 1943 judgment against Xen McNair, Sr., which gave rise to the 1955 Hinds v. McNair case, and who appears as intervenor-defendant-appellant in the case before us.

Elizabeth Hamacher, Administratrix, d/b/n, w/w/a of the Estate of Xen McNair, Sr., in Lake County, Indiana, who represented the interests of the estate in the trial court and appears as an intervenor-defendant-appellant in the case before us.

Jo Ann Gray, adopted daughter of Xen McNair, Sr., named as a devisee in Xen McNair, Sr.'s will, and not a party to this action.

BACKGROUND

The events giving rise to the current dispute span over fifty years including litigation beginning twenty-five years ago. The original Hinds v. McNair decision in 1955 was the culmination of proceedings supplemental to execution brought by Hinds, representing creditors to enforce a judgment of approximately $160,000 against McNair, Sr. The proceedings supplemental action centered primarily on whether McNair, Sr. owned certain assets, including shares of stock of Gary Real Estate Exchange, Inc. and real property titled in the name of that corporation, or whether he held them as trustee pursuant to an oral trust created in 1931 for the benefit of his son and daughter, McNair, Jr. and Sonia. During the ensuing jury trial, substantial evidence was heard concerning ownership of the stock and real property including testimony of McNair, Sr. describing in detail the terms of the trust. The resulting jury verdict in favor of McNair, Sr. was subsequently appealed and affirmed by the Indiana Supreme Court. It concluded:

"Looking at the evidence most favorable to the appellee, McNair, in view of the verdict in his favor, there are here all the elements necessary to create a trust, with the legal title in McNair and the beneficial interest in the children of McNair and wife. The appellants alleged and raised the issue of fraudulent concealment of assets of McNair by a fictitious trust in this case. The jury found in the negative and against appellants on all issues including that of fraudulent concealment, even if we assume he originally owned stock which became the trust res. Therefore, the attack on the alleged trust fails and it stands unimpeached." (Emphasis in original)

Hinds v. McNair, 235 Ind. at 53, 129 N.E.2d at 564. Thus, Hinds failed in his attempt to reach the assets of McNair, Sr., and the judgment against the latter remained unsatisfied.

McNair, Jr. initiated the second phase of this case in 1963 by filing a complaint seeking removal of McNair, Sr. as trustee due to alleged mismanagement of the trust assets. After McNair, Sr. died in 1969 leaving a will, which distributed his estate without regard to the terms of the trust, 1 McNair, Jr. amended his complaint substituting McNair, Sr.'s widow, Norma McNair, individually and as Executrix of McNair, Sr.'s estate, and requested an accounting and distribution of the assets in addition to damages allegedly...

To continue reading

Request your trial
41 cases
  • U.S. v. Smith, 3:94-CV-188RM.
    • United States
    • U.S. District Court — Northern District of Indiana
    • 8 Octubre 1996
    ... ... Meyer v. Northern Indiana Bank and Trust Co., 490 N.E.2d 400 (Ind.Ct.App.1986); Hinds v. McNair, 413 N.E.2d 586 (Ind.Ct.App.1980). Under Indiana law, though, a court has equitable powers to invalidate a trust agreement when improperly ... ...
  • Gash v. Kohm
    • United States
    • Indiana Appellate Court
    • 18 Abril 1985
    ... ... Indiana Tri-City Plaza Bowl, Inc. v. Glueck's Estate (1981), Ind.App., 422 N.E.2d 670, 673, trans. denied; Hinds v. McNair (1980), Ind.App., 413 N.E.2d 586, 609. As in Hinds, Gash has failed to show how he was prejudiced by the denial of his motion. Although ... ...
  • U.S. v. Templeton
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • 22 Julio 1992
    ... ... Meyer v. Northern Indiana Bank and Trust Co., 490 N.E.2d 400 (Ind.App.1986); Hinds v. McNair, 413 N.E.2d 586 (Ind.App.1980). Under Indiana law, though, a court has equitable powers to invalidate a trust agreement when improperly ... ...
  • Lisak v. Mercantile Bancorp, Inc.
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • 25 Noviembre 1987
    ...has done since 1978. As settlor with a reversionary interest, Arthur had a property right in the corpus of the trust. Hinds v. McNair, 413 N.E.2d 586, 597-99 (Ind.App.1980). The grant of summary judgment in the Bank's favor on grounds of issue preclusion therefore must be vacated, to the ex......
  • Request a trial to view additional results
1 books & journal articles
  • When Beneficiaries Predecease: an Empirical Analysis
    • United States
    • Emory University School of Law Emory Law Journal No. 72-2, 2022
    • Invalid date
    ...Byrom, 47 So.3d 791, 794-96 (Ala. 2010) (holding that the lapse statute for wills fails to apply to living trusts); Hinds v. McNair, 413 N.E.2d 586, 595-99 (Ind. Ct. App. 1980) (concerning an irrevocable trust but citing revocable trusts cases from other states as authority). But see Dollar......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT