In re Estate of McLeish

• Decision Date: 16 August 2013
• Docket Number: No. 107,046.,107,046.
• Citation: 49 Kan.App. 246,307 P.3d 221
• Parties: In the Matter of the ESTATE OF Thomas Edwin McLEISH, Deceased.
• Court: Kansas Court of Appeals

49 Kan.App. 246
307 P.3d 221

In the Matter of the ESTATE OF Thomas Edwin McLEISH, Deceased.

No. 107,046.

Court of Appeals of Kansas.

Aug. 16, 2013.

[307 P.3d 224]

Syllabus by the Court

1. Until a divorce decree is put into writing, approved by the court, and filed with the clerk, it has no effect.

2. An oral separation agreement merges into a written journal entry and decree of divorce pursuant to K.S.A. 60–1610(b)(3).

3. When parties have carried on oral negotiations and have subsequently entered into an agreement in writing with respect to the subject matter covered by such negotiations, the written agreement constitutes the contract between them and determines their rights.

4. In the present case, a written separation agreement, agreed to by the parties, memorialized in a journal entry and decree of divorce, approved by the district court, and filed with the clerk constitutes the controlling agreement governing the disposition of the parties' mineral rights.

5. Relief cannot be granted under K.S.A. 60–260(b)(6) if the real reason for granting relief falls under one listed in (b)(1) to (3) and more than a year has gone by since the entry of the judgment.

Robert E. Keeshan and Matthew M. Coleman, of Scott, Quinlan, Willard, Barnes & Keeshan, LLC, of Topeka, for appellant Michelle Lee Stephen, Executor.

Melvin J. Sauer, Jr. and Donald F. Hoffman, of Dreiling, Bieker & Hoffman LLP, of Hays, for appellees Lois M. McLeish, William McLeish, and Edwin I. McLeish.

Before BUSER, P.J., McANANY and POWELL, JJ.

POWELL, J.

In this appeal, we are faced with the unenviable task of imposing a hard lesson—that a party is bound by the contract he or she signs even if it creates (in the eyes of some) an unfair or harsh result. We are also called upon to answer what appears to be a question of first impression—whether, in a divorce proceeding, a prior oral separation agreement, put on the record, assented to by the parties under oath, and approved by the court controls over a subsequent written separation agreement, signed by the parties, approved by the court, and filed with the clerk. Because we hold that an unambiguous written separation agreement incorporated into a journal entry and decree of divorce controls over a prior oral separation agreement placed on the record, we must reverse the district court and remand for further proceedings.

Factual and Procedural History

Thomas Edwin McLeish (Edwin) and Lois McLeish (Lois) were married in 1950 and had two sons: Edwin McLeish (Eddie) and William McLeish (Bill). On August 16, 2006, Lois filed for divorce from Edwin in Ness County, Kansas, case number 2006 DM 19. During the divorce proceedings, attorney John Bird represented Lois and attorney John Lindner represented Edwin. On the eve of their divorce trial, the parties and their respective attorneys participated in several telephone conversations in efforts to resolve their divorce. During the telephone negotiations, Edwin and son Eddie were at John Lindner's office; Lois and son Bill were at John Bird's office. After several telephone conversations, the parties believed they reached an agreement. On May 20, 2008, Lindner announced the parties' agreement to the district court on the record, stating, “[W]e have agreed that the house on Section 19, the home place plus 40 acres, ... [w]ill go to Ed in fee simple subject to a right of first refusal to Lois.... All other land Ed and Lois will hold in a life estate with their children as remaindermen.”

After inquiry by the court, Lindner and Bird confirmed that the remainder and retention

[307 P.3d 225]

of the life estate would include full rights to all mineral income. Lois testified that the couple started with nothing and acquired a significant amount of property during their marriage through inheritance, gift, and purchase. Lois also testified that her primary goal during settlement negotiations was to pass her estate to her sons. Lindner stated the right to continue farming was priceless to Edwin and made up for everything he was giving up. At the conclusion of the hearing, the court found that there had been full and open disclosure between the parties as to all assets and liabilities of the marriage; that they had full knowledge of these assets and liabilities; that each of them was capable of arriving at this agreement; that they had made an independent decision and in doing so arrived at a property settlement agreement which was fair, just, and equitable to each of them.

On May 22, 2008, Bird sent Lindner a proposed journal entry attempting to memorialize the parties' property settlement agreement. The journal entry identified specific tracts of land, “including minerals, will be held by the parties as tenants in common as owners of a joint life estate” with the remainder to go to Eddie and Bill, or their issue, per stirpes.

On July 15, 2008, Lindner responded to Bird's proposed journal entry, stating:

“[O]ur understanding of the agreement on the minerals is that the parties would each own half of the minerals unconditionally in fee simple. I thought that was clear from the fact that they were delt [ sic ] with separately in negotiations and the agreement as read into the record provided that the oil and gas would be divided evenly between the parties and each would be responsible for their own share of all taxes thereon.”

Lindner suggested the language concerning the minerals should read: “Each will own 50% of the minerals to be divided by mineral deed and on the producing minerals, followed by a division order.” On August 21, 2008, Lindner sent Bird a letter enclosing a draft journal entry that Lindner signed and indicated that Edwin had a copy and approved it.

On September 9, 2008, Bird sent Lindner a letter enclosing the executed journal entry which Bird and Lois signed, indicating: “Now that we have the parties' agreement reduced to writing, could you please provide me with an accounting for the oil proceeds that your client has received since May 20, 2008?” Additionally, on September 9, 2008, Bird sent Judge Bruce T. Gatterman a letter enclosing the executed journal entry, advising: “The final Journal Entry in this matter is just awaiting the Respondent's signature and it should be coming to you shortly.”

On September 16, 2008, the district court executed the journal entry, which was “Approved by:” John T. Bird, Lois M. McLeish, John M. Lindner, and Thomas Edwin McLeish. The journal entry stated:

“[T]he parties announce to the Court that they have reached a full and complete agreement resolving all issues in this case which they announce to the Court and which the Court finds to be valid, just and equitable and approves the same to be incorporated into this divorce decree as follows:

“Mineral Interests:

....

“Petitioner shall hereafter be the sole and separate owner of 50% of the mineral interests and Respondent shall hereafter be the sole and separate owner of 50% of the mineral interests. These interests shall be divided by mineral deed and by division order as well as any other document reasonably necessary to divide the interests of the parties effective May 20, 2008.”

On January 26, 2009, Edwin executed an attested Last Will and Testament. The Will specifically disinherited his sons, Eddie and Bill, left his entire estate to Michelle Lee Stephen (Michelle), and appointed Michelle as Executor of his Estate. Edwin died on December 2, 2009.

On January 13, 2010, Michelle filed a Petition for Probate of Will and Issuance of Letters Testamentary. Eddie subsequently filed a Petition for Appointment of Special Administrator on February 9, 2010, contesting the validity of Edwin's Will and alleging

[307 P.3d 226]

incapacity and undue influence of Michelle. Lois, Bill, and Eddie all filed Petitions for Allowance and Classification of Demand, claiming they had valid demands against the Estate pursuant to the property settlement agreement reached in 2006 DM 19. Other motions were also filed which are not relevant to the discussion here.

On July 27, 2010, the district court held a hearing on the written defenses to the Petition for Probate of Will and Issuance of Letters Testamentary. The court found Edwin had the capacity to execute his Will and that he was not unduly influenced by Michelle and admitted Edwin's Will to probate. On October 19, 2010, the court issued Letters Testamentary to Michelle.

On April 22, 2011, the court held a hearing on Lois', Bill's, and Eddie's Petitions and admitted, over Michelle's objection, Bird's deposition, the transcript from the divorce hearing, and Lindner's notes from the oral pronouncement of the parties' settlement agreement. Further, the court heard argument from counsel and testimony from Eddie, Lois, and Lindner. The district court determined that the parties' oral proffer was their settlement agreement.

On September 14, 2011, the district court issued a memorandum decision and order concerning the pending claims of Eddie, Lois, Bill, and Michelle. The court concluded the oral property settlement agreement reached in Lois and Edwin's divorce case was ambiguous as a matter of law. The court determined Lois and Edwin's oral property settlement agreement created a joint life estate, as tenants in common, and included their interests in the oil, gas, and other minerals owned by them in their life estate, with the remainder equally to Eddie and Bill. The court directed Lois' counsel to prepare a journal entry incorporating the decision and setting forth the oral agreement of the parties reflecting ownership of the mineral interest.

On October 18, 2011, the district court entered the parties' journal entry allowing Lois', Bill's, and Eddie's (the Appellees) Petitions for Allowance and Classification of Demand and Lois and Bill's Petition to Terminate Life Estate and Joint Tenancy based on the oral property settlement reached in Lois and Edwin's divorce case.

On November 7, 2011, Executor Michelle appealed.

On January 6, 2012, Michelle...