Litherland v. Jurgens
| Decision Date | 11 September 2015 |
| Docket Number | No. S-14-818.,S-14-818. |
| Parties | JANICE K. LITHERLAND, APPELLANT, v. GARY MARTIN JURGENS AND VELDA LEE LENNERS, APPELLEES. |
| Court | Nebraska Supreme Court |
1. Motions to Dismiss: Appeal and Error. A district court's grant of a motion to dismiss is reviewed de novo.
2. Motions to Dismiss: Pleadings: Appeal and Error. When reviewing an order dismissing a complaint, an appellate court accepts as true all facts which are well pled and the proper and reasonable inferences of law and fact which may be drawn therefrom, but not the plaintiff's conclusion.
3. Principal and Agent: Fraud: Proof. A prima facie case of fraud is established if the plaintiff shows that the defendant held the principal's power of attorney and that the defendant, using the power of attorney, made a gift to himself or herself.
4. Principal and Agent: Fraud: Proof: Intent. Once it is shown that the defendant used the power of attorney to make a gift to himself or herself, the burden is upon the defendant to establish by clear and convincing evidence that the transaction was made with the clear intent of the donor.
5. Trusts: Agency: Equity. An agent or other fiduciary who deals with the subject matter of the agency so as to make a profit for himself or herself will be held to account in equity as trustee for all profits and advantages acquired by him or her in such dealings.
6. Decedents' Estates: Executors and Administrators. Where the beneficiary seeks to challenge the personal representative's administration of the estate, a special administrator can be appointed to pursue the claims.
7. Conspiracy: Torts. A conspiracy is not a separate and independent tort in itself, but, rather, is dependent upon the existence of an underlying tort.
Appeal from the District Court for Gage County: DANIEL E. BRYAN, JR., Judge. Affirmed.
Lyle J. Koenig, of Koenig Law Firm, for appellant.
J. L. Spray and Patricia L. Vannoy, of Mattson Ricketts Law Firm, for appellees.
Janice K. Litherland appeals from the dismissal of her action against the appellees, Gary Martin Jurgens and Velda Lee Lenners, for unjust enrichment, intentional interference with an inheritance, and conspiracy to commit those acts. Litherland was to receive certain real estate under the terms of the decedent's will, but the property was sold by Jurgens as attorney in fact for the decedent prior to her death. The proceeds from the sale were deposited into the decedent's bank accounts and divided equally among Litherland, Jurgens, and Lenners upon the decedent's death, under a separate provision of the will.
For the reasons stated below, we decline to adopt the tort of intentional interference with an inheritance and affirm the judgment of the district court.
[1,2] A district court's grant of a motion to dismiss is reviewed de novo. Brothers v. Kimball Cty. Hosp., 289 Neb. 879, 857 N.W.2d 789 (2015). When reviewing an order dismissing a complaint, an appellate court accepts as true all facts which are well pled and the proper and reasonable inferences of law and fact which may be drawn therefrom, but not the plaintiff's conclusion. SID No. 1. v. Adamy, 289 Neb. 913, 858 N.W.2d 168 (2015).
Litherland was the daughter of Etta J. Ideus Jurgens (Etta), who died on January 2, 2013, as a resident of Beatrice, Gage County, Nebraska. Jurgens and Lenners were Etta's stepchildren. Each is a beneficiary under Etta's will dated November 4, 2004, which was offered for probate in the county court. Under the terms of the will, Litherland was to receive certain real estate if it was owned by Etta at the time of her death. The will devised all the decedent's savings accounts, certificates, and money deposited in any financial institution to Litherland, Jurgens, and Lenners in equal shares. The will named Jurgens and Lenners as joint personal representatives of the estate.
On February 17, 2006, Etta executed a durable power of attorney appointing Jurgens as her attorney in fact. Jurgens used the durable power of attorney to cause the sale of the real estate that Litherland would have received under the will. The sale proceeds were deposited in the decedent's bank accounts. And upon Etta's death, the bank account was distributed equally among Litherland, Jurgens, and Lenners in accordance with her will.
On February 4, 2014, Litherland filed a complaint against Jurgens and Lenners in Gage County District Court alleging three theories of recovery: unjust enrichment, intentional interference with an inheritance, and conspiracy. The first claim was against Jurgens for improperly using the power of attorney to unjustly enrich himself by selling the real estate. Litherland requested that the court create a constructive trust regarding the proceeds of the sale. The second claim was against Jurgens for the tort of intentional interference with an inheritance. The third claim was against both Jurgens and Lenners for conspiracy to commit the acts alleged in the first and second claims.
Jurgens and Lenners moved to dismiss Litherland's complaint pursuant to Neb. Ct. R. Pldg. § 6-1112(b)(1) and (6), alleging that the district court lacked jurisdiction andthat Litherland failed to state a claim for which relief may be granted.
On July 10, 2014, the district court dismissed Litherland's unjust enrichment claim. The court concluded that because the claim was related to the decedent's estate, it should have been brought in the probate court. At the time this action was commenced, a probate proceeding concerning Etta's estate was pending in the county court for Gage County and, therefore, the probate court had acquired jurisdiction over the decedent's estate. The district court found that Litherland's claim against Jurgens for improperly using the power of attorney to unjustly enrich himself and her request for a constructive trust over the proceeds from the sale of the real estate were both related to Etta's estate. The district court concluded that Litherland could petition the probate court to impose a constructive trust on the proceeds of the sale of the real estate if the probate court found that Jurgens had improperly used the power of attorney to redirect estate property to himself or Lenners. As a result, the district court found that Litherland should bring the claim in the probate court to determine whether the sale of real estate was a proper use of the power of attorney that constituted "a valid ademption" of the anticipated devise.
The district court sustained Jurgens and Lenners' motion to dismiss based upon § 6-1112(b)(1) as to Litherland's first claim, because of the judicial administration rule. The court stated:
Because both courts have subject matter jurisdiction, if [the probate court] either terminates its jurisdiction or feels for whatever reason it does not want to exercise such equity jurisdiction and formally waives its jurisdiction to hear and decide this issue, within thirty (30) days from filing of this order, [Litherland] may within fifteen (15) days of the [probate court's] waiver or termination of jurisdiction order, re-file her complaint in the District Court . . . .
Regarding Litherland's claim for intentional interference with an inheritance, the district court assumed for purposes of its decision that Nebraska recognized the tort as a cause of action, but held that the claim failed for two reasons. First, Litherland failed to show that probate remedies were inadequate. It stated,
Second, Litherland failed to allege that Jurgens and Lenners were aware of the contents of the will prior to the sale of the real estate. As a result, the district court found that Litherland did not allege tortious conduct which intentionally interfered with the inheritance. Because the court found that Litherland did not state a cause of action for an underlying tort, the court also dismissed her conspiracy claim. The court did not give Litherland an opportunity to amend her pleadings as to the second and third claims. Litherland timely appealed.
Litherland assigns, consolidated and restated, that the district court erred in (1) requiring that remedies in probate court be exhausted in order to sustain a claim for intentional interference with an inheritance, (2) finding that Litherland was required to plead that Jurgens and Lenners were aware of the terms of the will to show intent, and (3) refusing to allow Litherland to amend her pleadings. Litherland's assignments of error relate only to the district court's dismissal of her claims for interference with an inheritance and conspiracy. No appeal was taken from the dismissal of Litherland's action for unjust enrichment.
The question is whether Nebraska recognizes a cause of action for the tort of intentional interference with an inheritance.For the reasons set forth, we decline to adopt the tort as a cause of action that is permitted in Nebraska.
The Restatement defines the tort as follows: "One who by fraud, duress or other tortious means intentionally prevents another from receiving from a third person an inheritance or gift that he would otherwise have received is subject to liability to the other for loss of the inheritance or gift." Restatement (Second) of Torts § 774B at 58 (1979).
There is a jurisdictional split between the states that recognize intentional interference with an inheritance as a cause of action and those that do not. The U.S. Supreme Court has referred to the tort as "widely recognized." See Marshall v. Marshall, 547 U.S. 293, 312, 126 S. Ct. 1735, 164 L. Ed. 2d 480 (2006). However, even among those states that recognize this tort, most have held that a...
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