Meyer v. Schwartz, 80CA1271

• Decision Date: 10 September 1981
• Docket Number: No. 80CA1271,80CA1271
• Citation: 638 P.2d 821
• Parties: Edith Schwartz MEYER, Plaintiff-Appellant, v. Pearl SCHWARTZ, as Personal Representative of the Estate of Martyn Schwartz, Deceased, and Sherwin R. Schwartz and Morton B. Schwartz, as Co-Trustees of the Pearl Schwartz Marital Trust and Martyn Schwartz Family Trust, Defendants-Appellees. . II
• Court: Colorado Court of Appeals

Page 821

638 P.2d 821

Edith Schwartz MEYER, Plaintiff-Appellant, v. Pearl SCHWARTZ, as Personal Representative of the Estate of Martyn Schwartz, Deceased, and Sherwin R. Schwartz and Morton B. Schwartz, as Co-Trustees of the Pearl Schwartz Marital Trust and Martyn Schwartz Family Trust, Defendants-Appellees.

No. 80CA1271.

Colorado Court of Appeals, Div. II.

Sept. 10, 1981.

Rehearing Denied Oct. 8, 1981.

Certiorari Denied Dec. 21, 1981.

Bader & Cox, Gerald L. Bader, Jr., Charles A. Miller, Denver, for plaintiff-appellant.

Fishman & Geman, P. C., Donald T. Trinen, Denver, for defendants-appellees.

STERNBERG, Judge.

In this intra-family dispute, Edith Schwartz Meyer appeals from summary judgment granted in favor of the estate of Martyn Schwartz, her brother. She contends that she was entitled to a trial on the merits of her claims of breach of fiduciary duty and fraudulent concealment. We affirm.

Edith and Martyn were beneficiaries of a family trust which provided that on the death of the income beneficiary, their mother, the assets would be divided equally between them. During the life of the trust, Martyn managed the real estate owned by the trust and Edith was co-trustee.

Their mother died in 1972, and, in 1975, Martyn and Edith entered into an agreement immediately terminating the trust. Significantly, this agreement provided that, on termination of the trust, Edith and Martyn became owners, as tenants in common, of all of the trust properties. This arrangement proved unsatisfactory, and it was agreed that the properties should be divided equally in kind, based on 1972 appraised values used by the Internal Revenue Service to compute taxes on their mother's estate. But it became evident that, using these figures, an equal division could not be accomplished. To achieve the parties' objective, it was necessary for one party to "buy out" the other's share in the Holden Hotel, one of the properties owned by the trust, which had been valued at $180,000 for I.R.S. purposes.

Martyn offered to sell his 1/2 interest in the Holden to Edith or buy her 1/2 interest. She indicated a preference to sell her share. After negotiating for several months, Edith and Martyn entered into an agreement for the distribution of the property. Pursuant to the terms of the 1976 agreement, Martyn purchased Edith's interest in the Holden. He died in 1977, and Martyn's heirs succeeded to his interest in the Holden Hotel.

In 1979, Martyn's heirs contracted to sell the Holden Hotel for $905,000. When Edith discovered the potential sales price she brought this action, alleging fraud and asserting that Martyn knew, or should have known, that the 1972 I.R.S. valuation of the hotel upon which the distribution agreement was based, did not reflect the true value of the property, and that he had a fiduciary duty to disclose its actual value to her. The trial court granted summary judgment in favor of Martyn's beneficiaries.

I.

Although Edith asserts that Martyn breached a fiduciary or confidential duty by not disclosing the true value of the Holden Hotel, the trial court concluded that: "The affidavits and depositions do not, as a matter of law, establish that Martyn had a duty to Edith based upon a fiduciary or confidential relationship which was breached." We agree.

"A fiduciary relationship exists when 'there is special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to interests of one reposing the confidence.' " Breeden v. Dailey, 40 Colo.App. 70, 574 P.2d 508 (1977). Also, "(a) confidential relationship arises when one party has justifiably reposed confidence in another," Page v. Clark, 197 Colo. 306, 592 P.2d 792 (1979), and relaxes the care and vigilance which ordinarily would be used in dealing with a stranger. United Fire & Casualty Co. v. Nissan Motor Corp., 164 Colo. 42, 433 P.2d 769 (1967). The factors which determine existence of a fiduciary or confidential relationship ordinarily involve questions of fact. See Breeden v. Dailey, supra.

As a general rule, issues of fact should not be determined on a motion for summary judgment. Primock v. Hamilton, 168 Colo. 524, 452 P.2d 375 (1969). But, where, as here, the moving party shows by affidavit and deposition specific facts probative of a right to judgment, the non-moving party must demonstrate a genuine issue of material fact for trial. Durnford v. City of Thornton, 29 Colo.App. 349, 483 P.2d 977 (1971). If there is no counter-showing, the trial court has no alternative but to conclude that no facts remain to be determined and, therefore, as a matter of law, summary judgment is proper. Bailey v. Clausen, 192 Colo. 297, 557 P.2d 1207 (1976).

Here, Edith failed to allege facts sufficient to establish the existence of a per se confidential or fiduciary duty. Any per se duty resulting from the trust ceased upon its termination. Edith's contention that the trust continued until final distribution of the assets under the 1976 agreement is without foundation in the record. To the contrary, the terms of the 1975 agreement specified that the trust was immediately revoked on execution of the agreement.

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