In re Estate of Meyer

• Decision Date: 15 May 2001
• Docket Number: No. 45A03-0005-CV-162.,45A03-0005-CV-162.
• Citation: 747 N.E.2d 1159
• Parties: In the Matter of the ESTATE OF Harold G. MEYER. Janet Cleland, Beth Garrigus, Tim Cleland, Gary Cleland, Dianne Carlsson and Tamara Cleland, and Bank One, as Personal Representative of the Estate of Harold G. Meyer and as Successor Trustee of the Trust Created by Harold G. Meyer dated March 25, 1985, Appellants, v. Scot L. Burke, and Kathy A. Burke, Individually and as Beneficiaries of Trust No. P-3680, Bank Calumet, and Peoples Bank, as Successor Trustee of The Harold G. Meyer Trust Dated February 6, 2000, No. P-3680, Appellees.
• Court: Indiana Appellate Court

747 N.E.2d 1159

In the Matter of the ESTATE OF Harold G. MEYER.

Janet Cleland, Beth Garrigus, Tim Cleland, Gary Cleland, Dianne Carlsson and Tamara Cleland, and Bank One, as Personal Representative of the Estate of Harold G. Meyer and as Successor Trustee of the Trust Created by Harold G. Meyer dated March 25, 1985, Appellants, v. Scot L. Burke, and Kathy A. Burke, Individually and as Beneficiaries of Trust No. P-3680, Bank Calumet, and Peoples Bank, as Successor Trustee of The Harold G. Meyer Trust Dated February 6, 2000, No. P-3680, Appellees.

No. 45A03-0005-CV-162.

Court of Appeals of Indiana.

May 15, 2001.

Joseph E. Costanza, Kathryn D. Schmidt, Burke Costanza & Cuppy LLP, Merrillville, IN, David A. Baker, Julie K. Kwon, Peggy A. Zemanick, McDermott, Will & Emery, Chicago, IL, Attorneys for Appellants.

Robert E. Stochel, Hoffman & Stochel, Crown Point, IN, Attorney for Scot L. Burke & Kathy A. Burke.

David C. Jensen, Alyssa Stamatakos, Scott B. Cockrum, Eichhorn & Eichhorn, Hammond, IN, Attorneys for Bank Calumet.

OPINION

MATHIAS, Judge.

This is a consolidated appeal regarding the estate of Harold G. Meyer, who died on March 30, 1997. Janet Cleland and her children Beth Garrigus, Tim Cleland, Gary Cleland, Dianne Carlsson, and Tamara Cleland ("the Clelands") brought this appeal challenging the creation of a 1990 inter vivos trust benefiting Meyer's grandniece, Kathy Burke, and her husband Scot, who also served as Meyer's attorney on unrelated matters. Bank Calumet, the trustee, was joined as a party in the consolidated appeal. The Clelands raise several issues, which we restate as the following three:

I. Whether the trial court erred in granting summary judgment in favor of the Burkes on the issue of Meyer's capacity to create the Trust;

II. Whether the trial court erred in granting summary judgment in favor of the Burkes on the issue of Scot's alleged undue influence; and

III. Whether the trial court erred on several evidentiary rulings and in granting summary judgment in favor of Bank Calumet on the issue of the transfer of stock to the Trust.

We reverse the grant of summary judgment on the issue of capacity, and affirm the trial court on the remaining issues.¹

Facts and Procedural History

For several decades, Meyer operated a heating and air conditioning business in Hammond. In 1951, Meyer's son-in-law Harvey Cleland began working with him and later shared office space to operate a plumbing and electrical business. In 1985, the business and personal relationship between Meyer and Harvey deteriorated over Meyer's allegations, ultimately unsubstantiated, that Harvey had stolen a check from him. Harvey decided to move his business to a new location, and attorney Scot Burke represented Meyer in proceedings to obtain a temporary restraining order related to the move. In the midst of this controversy, Meyer executed a trust on March 25, 1985 and a Will on April 1 of the same year. His Will gave the residue of his estate to the 1985 Trust, which was to benefit Janet Cleland, his daughter and Harvey's wife, during her life, and her descendants after her death.

A month later, Meyer brought a declaratory judgment action against Janet over some securities that he believed he owned. The court eventually granted Janet's motion for summary judgment. Scot represented Meyer in that proceeding and also represented him in the 1989 dissolution of his second marriage to Mary Meyer, Janet's mother.

On February 6, 1990, Meyer executed another trust (the "1990 Trust"), funded with 38,120 shares of Bank Calumet stock, which provided for complete distribution to Scot and Kathy Burke upon Meyer's death. Meyer died on March 30, 1997, and an autopsy concluded that, during his life, Meyer had suffered from Alzheimer's disease and at least five strokes.

Meyer's Will was admitted to probate on April 8, 1997. On June 27, 1997, the Clelands filed a motion to discover assets, alleging that Meyer was incapacitated by dementia and subjected to undue influence by Scot when he executed the 1990 Trust. The Clelands also contended in the trial court that the 1990 Trust was a nullity because of invalid stock transfers. After a flurry of pleadings from all parties, the trial court granted the motions for summary judgment filed by both Bank Calumet and the Burkes. The Clelands appeal those rulings, and both Bank Calumet and the Burkes cross-appeal on related issues.

Summary Judgment Standard of Review

On appeal the standard of review of a summary judgment motion is the same as that used in the trial court: summary judgment is appropriate only where the evidence shows there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Butler v. City of Peru, 733 N.E.2d 912, 915 (Ind.2000) (citing Ind. Trial Rule 56(C)). All facts and reasonable inferences drawn from those facts are construed in favor of the nonmoving party. Id. The review of a summary judgment motion is limited to those materials designated to the trial court. Id. (citing T.R. 56(H)). We must carefully review decisions on summary judgment motions to ensure that the parties were not improperly denied their day in court. Id.

I. Incapacity

The Clelands contend that the trial court erred in granting the Burkes' motion for summary judgment because their designated evidence creates a genuine issue of material fact as to Meyer's capacity to execute the 1990 trust. They rely primarily on the affidavit of Dr. Daniel Luchins, a geriatric psychiatrist who examined Meyer in February of 1997 and reviewed Meyer's medical records dating back to 1985. The records showed that Meyer had complained of sharp head pain as early as 1986. In 1988, he complained of lethargy, tiredness, decreased mental activity, forgetfulness, occasional dizziness, progressive mental loss, and excessive sleep patterns. Meyer was prescribed Hydergine, a standard medication used to treat dementia, during the same year. A 1993 CT scan showed brain atrophy, and a 1994 CT scan suggested vascular dementia and nonfocal brain changes. Upon his examination in 1997, Dr. Luchins reported that Meyer "demonstrated clinically reliable symptoms of advanced Alzheimer's Disease, including an infantile grasp reflex, which returns to Alzheimer's patients in the late stages of the disease." R. at 353. Meyer's autopsy revealed that he had Alzheimer's disease and the neuropathic forensic examination conducted after death showed that Meyer had suffered from several strokes. Dr. Luchins opined that some of Meyer's symptoms from 1986 to 1988 were consistent with stroke damage. Dr. Luchins' affidavit concluded:

15. Based on the foregoing medical records and my examination of Mr. Meyer, it is my opinion that Mr. Meyer suffered from Alzheimer's Disease for years prior to his death and also was affected for years by the cumulative impact of several strokes. He demonstrated symptoms of these conditions at least as early as 1988, but onset was probably earlier. As a consequence of these conditions, at least as early as February, 1990, Mr. Meyer would have been susceptible to undue influence, would have lacked the ability to comprehend the nature and effect of various property transactions, including but not limited to, the creation of trusts, the transfer of assets to trusts and persons, and the negotiation, consummation and terms of contracts, and would have lacked the ability to exercise free and voluntary will with respect to the same.

R. at 354.

A. Motion to Strike

The Burkes orally moved to strike Dr. Luchins' affidavit pursuant to Evidence Rule 702. The trial court denied the motion to strike, reasoning that Dr. Luchins qualified as an expert witness and stated an admissible expert opinion under Evidence Rule 702 based on his review of Meyer's medical records and a personal examination of Meyer. R. at 2456. The Burkes contend that this ruling is erroneous, but offer no precedent under Indiana Evidence Rule 702 in support.²

A trial court has broad discretion in refusing to grant a motion to strike. Rausch v. Reinhold, 716 N.E.2d 993, 999 (Ind.Ct.App.1999), trans. denied. The trial court's decision will not be reversed unless prejudicial error is clearly shown. Id. at 999-1000. We agree with the trial court that the affidavit was admissible under Rule 702. See generally Rogers ex rel. Rogers v. Cosco, 737 N.E.2d 1158, 1168 (Ind.Ct.App.2000)

(observing that under Rule 702 "the court must determine whether the reasoning or methodology underlying the expert testimony is scientifically valid and whether it can be applied to the facts at issue").

The Burkes also posit that Dr. Luchins may not make the conclusions of fact and conclusions of law stated in paragraph 15 because he did not provide sufficient foundation and background to support the legal and factual conclusions contained therein. As recounted above, the affidavit details Meyer's medical records before his death, Luchins' personal examination of Meyer, and the records from the autopsy and post-mortem brain examination. There was a sufficient basis for Dr. Luchins' affidavit and the trial court did not abuse its discretion in denying the Burkes' motion to strike.

B. Summary Judgment

The trial court granted the Burkes' motion for summary on the basis that Dr. Luchins' affidavit, although admissible, was not entitled to much weight.

[T]o say with any medical certainty that on February 6, 1990 (the date of the execution of the Burke trust) that [Meyer] was incapacitated is highly improbable. Dr. Luchins' opinion is to be considered with other affidavits, including those submitted by Burke. It is apparent to this Court that proceeding further would only cause undue delay in bringing this estate administration to a conclusion by the needless presentation of cumulative evidence, contrary to T.R. [sic] 403.

R. at 2456.

Although the trial court was understandably concerned about this case dragging on for months or...