In re Gene Wild Revocable Trust
| Decision Date | 09 December 2009 |
| Docket Number | No. SD 29684.,No. SD 29430.,SD 29430.,SD 29684. |
| Citation | 299 S.W.3d 767 |
| Parties | In the Matter of: GENE WILD REVOCABLE TRUST. Cottey College, Respondent/Cross-Appellant, v. The School of the Ozarks, Inc., d/b/a College of the Ozarks, et al., Appellants/Cross-Respondents. |
| Court | Missouri Court of Appeals |
Virginia L. Fry, Evelyn Gwin Mangan & David L. Schenberg, Husch, Blackwell, Sanders, L.L.P., Springfield, for Appellant.
Todd W. Ruskamp and Clayton T. Norkey, Shook, Hardy & Bacon, L.L.P., Kansas City, for Respondent.
This matter involves consolidated appeals by Appellant/Cross-Respondent The School of the Ozarks, d/b/a College of the Ozarks ("C of O") and Respondent/Cross-Appellant Cottey College ("Cottey").1 In short, C of O challenges the Probate Division's ("the probate court") finding that two trust instruments properly amended a trust created by Shirley Gene Wild ("Grantor"), and that Grantor had the requisite "mental" or "testamentary" capacity to validly execute the aforementioned amendments. C of O also challenges the probate court's denial of its motion for summary judgment seeking to reform a charitable remainder annuity trust ("CRAT") created in one of Grantor's trust instruments. Cottey's cross-appeal challenges the probate court's award of attorney's fees and costs and its determination of the payment source of these costs and attorney's fees awarded. We affirm.
As best we discern the record, Grantor created the The Gene Wild Revocable Trust (generally "the Trust") on July 10, 1990.2 The fourteen-page Trust provided, in part pertinent to our review, that after payment of taxes and administration expenses, five percent of the residue of the Trust was to be distributed outright to Abou Ben Adhem Temple, and the balance was to be divided equally between two CRATs. The beneficiaries of these CRATs were Missouri Southern Foundation ("MSF") and C of O.3 Grantor named herself as "Trustee" and Brother was named as "Successor Trustee" although Grantor had not discussed the details of her property disposition with Brother.
On October 7, 1991, Grantor amended the Trust ("the First Amendment") with a two-page amendment. The First Amendment, inter alia, removed the Abou Ben Adhem Temple as a beneficiary of the Trust thereby augmenting the shares of the two CRATs. Thereafter, on September 24, 1996, Grantor again amended the Trust ("the Second Amendment"). The two-page Second Amendment added "Disclaimer Rights" to be granted to any beneficiary or to Grantor and referenced a change in the name of her family's company. On August 20, 1997, Grantor amended the Trust for the third time ("the Third Amendment"). The three-page Third Amendment specified that the CRAT funds allocated to MSF were to be used "for the exclusive benefit of the Missouri Southern State College School of Business" and also set out that any references in the Trust to School of the Ozarks should be considered a reference to C of O. Then on May 6, 1998, Grantor amended the trust for a fourth time ("the Fourth Amendment"). The three-page Fourth Amendment deleted MSF as the beneficiary of one of the CRATs and inserted C of O as the beneficiary of both CRATs.
In August of 2002, Grantor met with a different attorney than the one who had previously prepared her estate planning documents. After correspondence and several meetings, on November 21, 2002, Grantor executed the "Restated Revocable Trust Agreement of Shirley Gene Wild ..." (the "Restated Trust"). The sixteen-page Restated Trust referenced the original Trust as well as the four amendments and set out that Grantor "does desire to restate said Trust and all amendments thereto in order to create a Restated Revocable Trust Estate for the purposes and uses hereinafter set forth...." The Restated Trust neither expressly revoked nor supplanted Grantor's prior Trust. It did, inter alia, remove Brother as Successor Trustee and created a small annuity for his benefit. The Restated Trust also created a single CRAT in favor of C of O and named Cottey a contingent remainder beneficiary.4
Grantor had a total right knee replacement on January 3, 2003, and a total left knee replacement on July 18, 2003. In 2004 she was diagnosed with cervical cancer and in July of that year she underwent extensive surgery in an effort to eradicate the cancer. Subsequent to the time of her knee replacement surgeries and throughout her cervical cancer treatment, numerous medical personnel and other lay witnesses noted Grantor showed signs of increasing forgetfulness and varying degrees of dementia.
In August of 2004, Grantor was discharged from the hospital following recuperation from her cervical cancer treatments and went to live at the Sarcoxie Nursing Center ("SNC") as Brother could no longer care for her at home due to the fact that she had colostomy and urostomy bags. Around this time, Brother contacted his own attorney at Grantor's urging and told him Grantor wanted to make some changes to the Trust. Brother conveyed her desired changes to the attorney and provided him with copies of the Trust and the four prior amendments.5 The attorney then mailed Grantor a proposed copy of a fifth amendment to the Trust ("the Fifth Amendment"). On September 9, 2004, the attorney visited Grantor at SNC whereupon she executed this Fifth Amendment. Specifically referencing the Trust and the prior amendments, the Fifth Amendment appointed Grantor and Brother as Co-Trustees whereby "[e]ach trustee is vested with all rights, powers and duties of the [t]rustee and may act individually and without the remaining [t]rustee." This Fifth Amendment also provided for two equal CRATs: one to benefit Cottey and the other to benefit C of O.
The following month, on October 14, 2004, Grantor signed a sixth amendment to the Trust ("the Sixth Amendment"). This Sixth Amendment essentially made no substantive changes to the distribution of the Trust residue as it pertained to either C of O or Cottey but provided for changes to the distribution of certain tangible personal properties and real estate.
Grantor passed away on June 19, 2005.
On February 1, 2006, Cottey filed its "Petition" requesting declaratory relief and a determination as to whether the Fifth and Sixth Amendments were effective and enforceable contending it was entitled to share equally in the residue of the Trust with C of O. The following day C of O brought a declaratory judgment action against Cottey.6 This latter action by C of O was treated by the probate court as a counterclaim to the petition filed by Cottey.
On August 1, 2007, C of O filed a "Motion for Summary Judgment" on Counts I and III of its own counterclaim. On September 7, 2007, Cottey filed its "Motion for Partial Summary Judgment" in which it asserted that it was entitled to a judgment as a matter of law on C of O's Count I.
In its order of October 15, 2007, the probate court granted Cottey's motion for partial summary judgment as to C of O's Count I and found that "[a]lthough the [Fifth Amendment] makes no reference to the [Restated Trust], the absence of such a reference does not negate the express intent of [Grantor] to ratify and then amend the prior version...." The probate court determined the Fifth Amendment operated as a valid amendment to the Restated Trust. Likewise, the probate court determined the Sixth Amendment "effectively amended the terms of the Trust as they existed on the date of execution of that document, which were set forth in the Original Trust Agreement as amended by the First, Second, Third, Fourth, and Fifth Amendments." The probate court then denied C of O's motion for summary judgment relating to its own Count I and took the remainder of its motion, which was directed at its Count III, under advisement. The probate court ordered the parties to proceed to trial on C of O's Count II relating to Grantor's mental capacity to create any amendments to the Trust and set out that if C of O "is unsuccessful ... then Count III of their [c]ounterclaim is moot."
A three day trial was held in February of 2008 chiefly on Count II of C of O's counterclaim regarding its contention that Grantor lacked the requisite mental capacity to execute the Fifth and Sixth Amendments to the Trust. In its Findings and Judgment entered on September 16, 2008, the probate court, inter alia, determined Grantor had the necessary "mental" or "testamentary" capacity to execute the Fifth and Sixth Amendments to her Trust such that these amendments were to be enforced over any contrary provisions of the Restated Trust. The probate court further awarded "reasonable attorneys' fees and costs" to Cottey, Brother, the guardian ad litem for one of the potential beneficiaries, and Ms. Cunningham, a prior named successor trustee, out of the funds of the Trust prior to the funding and distribution of the CRATs in favor of Cottey and C of O.
On October 10, 2008, C of O filed a "Motion to Set Aside Judgment, Reconsideration and to Reopen Case for Additional Evidence," in which it asserted the Judgment entered by the probate court was not final because it failed to rule on a Motion to Dismiss previously filed by Brother; it did not dispose of C of O's request for attorney's fees; it did not award "a sum certain for attorney's fees for the parties to whom fees were awarded;" and it failed to dispose of C of O's Count III, which it had previously taken under advisement. This motion was overruled by the probate court on October 14, 2008. C of O then appealed the matter to this Court and this Court entered an order requesting a final judgment be entered by the probate court. On February 25, 2009, the probate court entered its Amended Judgment in which, inter alia, it cleared up the deficiencies in the previously entered Judgment by specifically denying Brother's motion to dismiss; overruling C of O's motion for summary judgment on its Count III; awarding attorney's fees be paid to C of O and...
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