In re Cracker

• Decision Date: 06 October 2020
• Docket Number: No. COA20-4,COA20-4
• Parties: In the MATTER OF the ESTATE OF Andrew Robert CRACKER
• Court: North Carolina Court of Appeals

850 S.E.2d 506

In the MATTER OF the ESTATE OF Andrew Robert CRACKER

No. COA20-4

Court of Appeals of North Carolina.

Filed: October 6, 2020

Ward and Smith, P.A., by Jenna Fruechtenicht Butler, Wilmington, and Christopher S. Edwards, for Appellant Pennaritta C. Cracker.

Block, Crouch, Keeter, Behm & Sayed, LLP, Wilmington, by Colin J. Tarrant, for Appellee Andrew John Edward Cracker.

COLLINS, Judge.

Pennaritta C. Cracker ("Petitioner") appeals from an order denying her claim to an elective share of the estate of her late husband, Andrew Robert Cracker ("Decedent"). Petitioner argues that the trial court erred because she never signed an express waiver of her elective share right, and a waiver cannot be inferred from the terms of Petitioner and Decedent's separation agreement. We affirm the order.

I. Procedural History and Factual Background

Petitioner and Decedent married in July 1990 and separated in November 2014. On 4 December 2014, Petitioner filed a complaint seeking post-separation support, alimony, equitable distribution, and attorney's fees. Following a settlement conference, Petitioner and Decedent (the "parties") executed a Mediated Settlement Agreement and Consent Judgment ("MSA"), which the trial court entered on 20 August 2015.

The parties stipulated that the MSA memorialized their agreement. The trial court found that the parties had "agreed to resolve all pending issues"; the MSA was "calculated to finally resolve their financial claims against one another"; and that "[t]he parties waive[d] further findings of fact." The MSA ordered Decedent to deed certain real property to Petitioner in exchange for Petitioner's assumption and payment of all debts associated with the property. It also provided that Petitioner and Decedent would have as their "sole and separate property all household furniture and other personal property" at the time in their possession. Additionally, each party "acknowledge[d] sole ownership in the other" of certain personal belongings owned prior to the marriage, inherited during the marriage, or given or loaned to the party by a relative. Petitioner and Decedent each received a vehicle as "sole and separate property." Each party would be responsible for the debts associated with the assets distributed to him or her and for the debts in his or her individual name. Petitioner and Decedent retained bank accounts in their respective names as "sole and separate property," and identified retirement accounts and joint bank accounts were distributed to either Petitioner or Decedent. The MSA specified that the parties had divided all intangible property such as stocks and bonds to their satisfaction, and provided that "neither party shall make any claim against the other for any intangible personal property in the name, possession or control of the other."

Petitioner also "dismisse[d] with prejudice any claim for post-separation support, alimony and attorneys fees associated with said claims." Decedent was required to make payments of $6,900 to Petitioner in September and October of 2015. The MSA required Decedent to maintain a supplemental health insurance policy covering Petitioner at her cost. At the conclusion of the MSA, the parties agreed that it "contains the entire understanding of the parties, and there are no representations, warranties, covenants, or undertakings other than those expressly set forth herein."

On 13 June 2017, Decedent executed his Last Will and Testament ("Will"). He died on 26 January 2018. At the time of Decedent's death, he and Petitioner were still married but remained separated. The Will was admitted to probate on 5 February 2018. Decedent's Will named his son, Andrew John Edward Cracker, as executor of the estate. The Will devised Decedent's entire estate to his two children. The Definitions section of the Will provided, in relevant part:

As of the execution of this Will, I am physically separated from my spouse, Pennaritta Cherry Cracker. She and I have executed a Mediated Settlement Agreement and Consent Judgment on marital property that contains a complete and total waiver of alimony which includes a waiver of any claim for post separation support, alimony and attorney's fees associated with any claims that were raised in our separation. In addition, both Pennaritta C. Cracker and myself have executed a Release of Estate and Inheritance Rights, a copy of which is attached as Exhibit A and incorporated herein by reference to this Will.

No release was attached to the Will.

On 30 July 2018, Petitioner timely filed a claim for an elective share of Decedent's estate under N.C. Gen. Stat. § 30-3.1(a). The executor objected to this claim, arguing that, under N.C. Gen. Stat. § 30-3.6, the claim was barred because Petitioner had waived her elective share right in the terms of the MSA. After a hearing, by written order entered 28 November 2018, the clerk determined that the duly executed MSA waived Petitioner's right to claim any interest in Decedent's property after death.

The Clerk made the following relevant findings of fact:¹

5. That the Decedent and [Petitioner] entered into a Mediated Settlement Agreement and Consent Judgment on August 20, 2015, wherein the parties settled issues of equitable distribution and alimony and the same is referenced in Decedent's Last Will and Testament;

....

1. That the distribution of assets between the Decedent and [Petitioner] under the Mediated Settlement Agreement and Consent Judgment stated that the parties shall have this property as his or her "sole and separate property."

2. That by execution of the Mediated Settlement Agreement and Consent Judgment both parties expressly waived any future claims "against the other for any intangible personal property in the name, possession or control of the other."

3. That the Mediated Settlement Agreement and Consent Judgment further states that "Each party hereby transfers, assigns and relinquishes unto the other party any and all right, title or interest he or she may have in the furnishings or other personal property presently in the possession of the other party, except as otherwise designated herein."

The clerk thus denied Petitioner's claim for an elective share. Petitioner timely appealed this order to superior court.

After a hearing, by written order entered 26 June 2019, the court concluded that the clerk's decision was correct based on "the Separation Agreement as well as the language of the Will, indicating clearly that Decedent's intent was for his estate to pass only to his children and to exclude Petitioner[;]" the clerk's findings of fact were supported by sufficient evidence; the conclusions of law were supported by the findings of fact; and the denial of Petitioner's claim was consistent with the conclusions of law and applicable law. The superior court thus affirmed the clerk's order. Petitioner timely appealed to this Court.

II. Discussion

A. Waiver of Elective Share

Petitioner argues that she is statutorily entitled to an elective share of Decedent's estate because she did not waive this entitlement in a signed writing as required by N.C. Gen. Stat. § 30-3.6(a).

On appeal of a probate matter decided by the clerk, the superior court reviews the clerk's order to determine "(1) [w]hether the findings of fact are supported by the evidence[,] (2) [w]hether the conclusions of law are supported by the findings of facts[, and] (3) [w]hether the order or judgment is consistent with the conclusions of law and applicable law." N.C. Gen. Stat. § 1-301.3(d) (2019). This Court applies the same standard of review as the superior court. In re Williams , 208 N.C. App. 148, 151, 701 S.E.2d 399, 401 (2010) ; In re Estate of Pate , 119 N.C. App. 400, 403, 459 S.E.2d 1, 2-3 (1995). The determination of a party's entitlement to an elective share, as a decision that "require[es] the exercise of judgment" and "the application of legal principles," In re Estate of Helms , 127 N.C. App. 505, 510, 491 S.E.2d 672, 675 (1997), is a conclusion of law. The interpretation of a contract is also a conclusion of law. In re Estate of Sharpe , 258 N.C. App. 601, 605, 814 S.E.2d 595, 598 (2018). We review conclusions of law de novo. In re Estate of Johnson , 264 N.C.App. 27, 824 S.E.2d 857, 861 (2019).

By default, "[t]he surviving spouse of a decedent who dies domiciled in this State has a right to claim an ‘elective share’ " in the decedent's estate. N.C. Gen. Stat. § 30-3.1(a) (2019). This statutory right "may be waived, wholly or partially, before or after marriage, with or without consideration, by a written waiver signed by the surviving spouse ...." N.C. Gen. Stat. § 30-3.6(a) (2019).

"The statutory law of this state permits a married couple to execute a separation agreement ‘not inconsistent with public policy which shall be legal, valid, and binding in all respects.’ " Sedberry v. Johnson , 62 N.C. App. 425, 429, 302 S.E.2d 924, 927 (1983) (quoting N.C. Gen. Stat. § 52-10.1 ). Such agreements are construed according to "the same rules which govern the interpretation of contracts generally." Lane v. Scarborough , 284 N.C. 407, 409, 200 S.E.2d 622, 624 (1973). As with contracts more broadly, in interpreting a marital agreement, "the primary purpose is to ascertain the intention of the parties at the moment of its execution." Id. at 409-10, 200 S.E.2d at 624. A contract "encompasses not only its express provisions but also all such implied provisions as are necessary to effect the intention of the parties unless express terms prevent such inclusion." Id. at 410, 200 S.E.2d at 624-25 (citing 4 Williston, Contracts § 601B (3d ed. 1961)). "The court will be prepared to imply a term if there arises from the language of the contract itself, and the circumstances under which it is entered into, an inference that the parties must have intended [the] stipulation in question." Id. at 410, 200 S.E.2d at 624-25 (quoting 1 Chitty, Contracts § 693 (23d ed. A.G. Guest 1968)).

In Lane , our Supreme Court concluded that a...