In re Estate of LeFevre

• Decision Date: 08 October 2009
• Docket Number: No. 20080234-CA.,20080234-CA.
• Citation: 2009 UT App 286,220 P.3d 476
• Parties: In the matter of the ESTATE OF Harold Alma LeFEVRE and Edith K. LeFevre, deceased. Harold R. LeFevre, Julia Richmond, Jeffrey LeFevre, Daniel LeFevre, Bryce LeFevre, Cynthia C.L. Giles, and Kelly LeFevre, Petitioners, Appellees, and Cross-appellants, v. Leland Stout, Respondent, Appellant, and Cross-appellee.
• Court: Utah Court of Appeals

220 P.3d 476

2009 UT App 286

In the matter of the ESTATE OF Harold Alma LeFEVRE and Edith K. LeFevre, deceased.

Harold R. LeFevre, Julia Richmond, Jeffrey LeFevre, Daniel LeFevre, Bryce LeFevre, Cynthia C.L. Giles, and Kelly LeFevre, Petitioners, Appellees, and Cross-appellants, v. Leland Stout, Respondent, Appellant, and Cross-appellee.

No. 20080234-CA.

Court of Appeals of Utah.

October 8, 2009.

Rehearing Denied November 23, 2009.

Don R. Petersen, Leslie W. Slaugh, and Richard L. Petersen, Provo, for Appellant and Cross-appellee.

Stephen Quesenberry, Provo, for Appellees and Cross-appellants.

Before Associate P.J. THORNE, ORME and McHUGH, JJ.

OPINION

McHUGH, Judge:

¶ 1 Leland Stout appeals from the trial court's judgment in favor of Harold (Hal) R. LeFevre, Julia Richmond, Jeffrey LeFevre, Daniel LeFevre, Bryce LeFevre, Cynthia C.L. Giles, and Kelly LeFevre (collectively, the LeFevre children). Stout contends that the trial court erred by imposing a constructive trust. Stout further argues that the trial court improperly applied a version of the probate code not in effect at the time of the transaction at issue. Finally, Stout claims that the trial court erred in denying his motion for summary judgment. The LeFevre children cross-appeal, arguing that they were entitled to attorney fees. They also contend that the trial court erred in granting Stout a stay pending appeal. We affirm but remand for additional findings consistent with our opinion.

BACKGROUND¹

¶ 2 The LeFevre children are the children of Harold Alma LeFevre and his first wife, Edith K. LeFevre. During their marriage, Harold and Edith purchased a home in Provo, Utah (the Canyon Road home), where they resided together until Edith died in 1987. After Edith's death, Harold married Ellen Stout, who had five children (the Stout children), including Leland Stout, from a prior marriage. Harold and Ellen lived together in the Canyon Road home until Harold died intestate on March 19, 1993. At the time of his death, the Canyon Road home was titled solely in Harold's name.

¶ 3 Following Harold's funeral, the LeFevre children met informally with Ellen to discuss Harold's estate. At the meeting Ellen agreed to discharge all the LeFevre children's debts owed to Harold. Ellen also proposed establishing a trust for Harold's and her estates. Ellen stated that upon her death, the LeFevre children would receive Harold's estate, including the Canyon Road home, and the Stout children would receive Ellen's property and estate. The LeFevre children agreed to Ellen's proposal and consented to her request to live in the Canyon Road home until her death. The LeFevre children also agreed that Hal LeFevre and Leland Stout would serve as successor co-trustees upon Ellen's death. Their agreement was never put into writing.

¶ 4 On April 19, 1993, Ellen met with her attorney to create a trust. The trust Ellen established did not conform with the terms of her oral agreement with the LeFevre children. Rather, Ellen's trust divided the trust estate equally between the Stout children and the LeFevre children without specifying the distribution of particular assets. The trust also deviated from Ellen's agreement with the LeFevre children in that it named Kelly LeFevre, not Hal LeFevre, as a successor co-trustee.² The LeFevre children were never given copies of Ellen's trust, nor were they notified of its terms.

¶ 5 Ellen was subsequently appointed personal representative of Harold's estate, and on July 23, 1993, Ellen transferred the Canyon Road home into her trust. On September 11, 1995, Ellen amended her trust to exclude the LeFevre children as beneficiaries and to distribute the entire trust estate, including the Canyon Road home, to the Stout children. The LeFevre children were not informed of the amendment to Ellen's trust.

¶ 6 In the years following Harold's death, Ellen became increasingly reclusive. Stout assisted Ellen in installing mirrors outside the Canyon Road home so she could see who was at her doorstep without opening the door. She began refusing visits from the LeFevre children. Stout also encouraged Ellen to screen her telephone calls and not to answer calls from the LeFevre children.

¶ 7 Ellen died on October 28, 2004. The Stout children neither informed the LeFevre children of Ellen's death nor published Ellen's obituary. When the LeFevre children learned that Ellen had died, they contacted her attorney and received copies of the trust documents.

¶ 8 In February 2005, the LeFevre children filed a Petition to Set Aside Personal Representative's Transfers from Decedent's Estate, arguing that Ellen had improperly transferred the Canyon Road home to her personal trust. After trial, the district court concluded that the Stout children were unjustly enriched when Ellen modified the terms and conditions of her trust without the consent of the LeFevre children. The trial court then placed the Canyon Road home into a constructive trust for the benefit of the LeFevre children. It also entered judgment voiding Ellen's trust and declaring the LeFevre children the lawful owners of the Canyon Road home. This appeal followed.

ISSUES AND STANDARDS OF REVIEW

¶ 9 On appeal, Stout argues that the trial court erred in finding a constructive trust. Specifically, Stout claims Ellen was not in a confidential relationship with the LeFevre children that would support the trial court's imposition of a constructive trust. "When an appellant is essentially challenging the legal sufficiency of the evidence, a clearly erroneous standard of appellate review applies." Hi-Country Estates Homeowners Ass'n v. Bagley & Co., 2008 UT App 105, ¶ 10, 182 P.3d 417 (internal quotation marks omitted), cert. denied, 199 P.3d 970 (Utah 2008). However, we review the trial court's determination regarding the legal requirements of a constructive trust for correctness. See Flake v. Flake, 2003 UT 17, ¶ 8, 71 P.3d 589 ("The validity of [a] trust is an issue of law, which we review for correctness.").

¶ 10 Stout also contends that the LeFevre children were entitled to only the value of the Canyon Road home at the time of the wrongful transfer. "The availability of a remedy is a legal conclusion that we review for correctness. However, a trial court is accorded considerable latitude and discretion in applying and formulating an equitable remedy, and [the court] will not be overturned unless it [has] abused its discretion." Ockey v. Lehmer, 2008 UT 37, ¶ 42, 189 P.3d 51 (alterations in original) (footnote and internal quotation marks omitted).

¶ 11 Stout next argues that it was improper for the trial court to enter judgment based on a theory of constructive trust because the LeFevre children did not plead a constructive trust. "Whether an issue was properly before the trial court presents a question of law, which we review for correctness." Lee v. Sanders, 2002 UT App 281, ¶ 6, 55 P.3d 1127.

¶ 12 Finally, Stout claims that the trial court erred in denying his motion for summary judgment because the statute of limitations barred the LeFevre children's claims. "An appellate court reviews a trial court's legal conclusions and ultimate grant or denial of summary judgment for correctness, and views the facts and all reasonable inferences drawn therefrom in the light most favorable to the nonmoving party." Orvis v. Johnson, 2008 UT 2, ¶ 6, 177 P.3d 600 (citation and internal quotation marks omitted). We review the trial court's application of a statute of limitations for correctness. See Russell Packard Dev., Inc. v. Carson, 2005 UT 14, ¶ 18, 108 P.3d 741.

¶ 13 On cross-appeal, the LeFevre children argue that the trial court erred in failing to award them attorney fees and costs. "Whether attorney fees are recoverable in an action is a question of law, which we review for correctness." Valcarce v. Fitzgerald, 961 P.2d 305, 315 (Utah 1998).

¶ 14 The LeFevre children also challenge the trial court's grant of a stay pending appeal pursuant to rule 62(d) of the Utah Rules of Civil Procedure. "The trial court's interpretation of the rules of civil procedure presents a question of law which we review for correctness." Nunley v. Westates Casing Servs., Inc., 1999 UT 100, ¶ 42, 989 P.2d 1077.

ANALYSIS

I. Constructive Trust

¶ 15 On appeal, Stout claims that the trial court erred by placing the Canyon Road home in a constructive trust. First, Stout reasons that the trial court's imposition of a constructive trust was premised on the parties' agreement to create a trust. Stout argues that because the evidence does not support the finding of a confidential relationship between Ellen and the LeFevre children, there can be no constructive trust. While we agree with Stout that a confidential relationship is required to establish some types of constructive trusts, it is not a necessary element in all constructive trusts. The Utah Supreme Court has acknowledged that there is no single definition of a constructive trust. See Parks v. Zions First Nat'l Bank, 673 P.2d 590, 597 (Utah 1983). Indeed, "[t]he forms and varieties of [constructive] trusts . . . are practically without limit." Id. (first alteration and omission in original) (internal quotation marks omitted).

A. Constructive Trusts Can Arise at Law.

¶ 16 Constructive trusts are addressed in the Restatement (Second) of Trusts to the extent that they arise at law from an attempt to create an express trust. See id.; Restatement of Restitution § 160 cmt. a (1937) ("Constructive trusts are not dealt with in the Restatement of Trusts, except in so far as they arise out of express trusts or attempts to create express trusts."). For example, section 44 of the Restatement (Second) of Trusts describes one situation where a constructive trust may arise. This section reads, in pertinent part:

(1) Where the owner of an interest in land transfers it inter vivos to another in trust for the transferor, but no memorandum properly evidencing the intention to create a...