Mohseni v. Hartman

• Decision Date: 09 June 2011
• Docket Number: No. 01–10–00078–CV.,01–10–00078–CV.
• Citation: 363 S.W.3d 652
• Parties: Ali Akbar MOHSENI, Appellant, v. Gaye Laurine HARTMAN, Appellee.
• Court: Texas Court of Appeals

363 S.W.3d 652

Ali Akbar MOHSENI, Appellant,

v.Gaye Laurine HARTMAN, Appellee.

No. 01–10–00078–CV.

Court of Appeals of Texas, Houston (1st Dist.).

June 9, 2011.

David Allen Munson, Spring, Javier Marcos Jr., Law Office of Marcos & Associates, P.C., Houston, for Appellant.

James Matthew Marchak, Konor Andrew Cormier, Mehaffy Weber, Houston, for Appellee.

Panel consists of Justices KEYES, HIGLEY, and BLAND.

OPINION

JANE BLAND, Justice.

In this probate dispute, an unsecured estate creditor appeals the trial court's summary judgment in favor of the estate's independent executrix. The creditor sued the executrix, individually, for breach of fiduciary duty, for various negligence and fraud claims, and for conversion. On appeal, the creditor contends that the trial court erred in granting summary judgment on his negligence, gross negligence and negligence per se claims. Specifically, he maintains that the trial court erred in ruling that the independent executrix owed no legal duty to an unsecured estate creditor. We concluded that the trial court properly granted summary judgment and therefore affirm.

Background

Ali Mohseni was an unsecured creditor of Yadollah Mosadegh, the decedent. In August 2005, Mohseni loaned Mosadegh $150,000 in exchange for a promissory note. The note carried an 18% simple interest rate and was payable in monthly installments of $2250. Mosadegh died in November 2005. After Mosadegh's death, Mohseni filed a claim for repayment against the estate in probate court. The trial court approved the claim, but it went unpaid.

The probate court appointed Gaye Laurine Hartman as executrix of the estate in January 2006. In October 2007, Hartman moved to withdraw, and requested appointment of a substitute independent executrix. The motion to withdraw stated that the estate had a value of $800,000, but that it was deeply in debt. The trial court granted the relief, and it replaced Hartman that month.

In April 2009, Mohseni sued Hartman. He alleged that Hartman failed to pay outstanding payroll, sales, and property taxes owed for the Garson Restaurant, a property of the estate. As a result, he alleged, the estate incurred additional penalties and interest. Mohseni claims that, had Hartman not caused the estate to incur these extra costs, then the estate would have had sufficient money to pay his claim against it.

Hartman answered and specially excepted to the allegations in the petition, contending that her duty ran to the estate, not to Mohseni. Hartman then moved for a traditional summary judgment, contending that an independent executor generally does not owe a duty to unsecured creditors of the estate in the payment of estate expenses, and therefore Mohseni's negligence and breach of fiduciary duty claims failed as a matter of law. Hartman further asserted that Mohseni's negligent misrepresentation, common law fraud, and statutory fraud claims lacked merit because Mohseni did not provide evidence that she had made any negligent or false representations to him. Finally, Hartman contended that Mohseni's conversion claim lacked merit because Mohseni did not own, possess, or have the right immediately to possess any estate property.

Mohseni responded to Hartman's motion for summary judgment with an affidavit in which he averred that Hartman was negligent in failing to timely pay the taxes assessed on the Garson Restaurant. In addition, Mohseni alleged, without providing factual support, that Hartman had stolen from the estate and had refused an offer to purchase the restaurant. Finally, Mohseni averred that he had relied on Hartman's statements that she would properly perform her duties as executrix and that this reliance caused him injury. The trial court granted summary judgment.

Discussion

Mohseni contends that the trial court erred in granting summary judgment with respect to his claims of negligence, gross negligence, and negligence per se. Mohseni does not brief his trial court claims for breach of fiduciary duty, negligent misrepresentation, statutory fraud, common law fraud, and conversion. Without briefing on these claims, the trial court's rulings on them stand. Tex.R.App. P. 38.1(i) (stating that brief “must contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record.”); see Franz v. Katy Indep. Sch. Dist., 35 S.W.3d 749, 755 (Tex.App.-Houston [1st Dist.] 2000, no pet.). Accordingly, we confine our discussion to Mohseni's negligence claims.

Standard of Review

We review de novo the trial court's ruling on a motion for summary judgment. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex.2009). In a traditional motion for summary judgment, the movant must establish that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. Tex.R. Civ. P. 166a(c). To determine if the non-movant has raised a fact issue, we review the evidence in the light most favorable to the non-movant, crediting favorable evidence if reasonable jurors could do so and disregarding contrary evidence unless reasonable jurors could not. See Fielding, 289 S.W.3d at 848 (citing City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005)).

Negligence

Mohseni contends that the summary judgment against him on his negligence claims is improper because Hartman, as the independent executrix, owed him, an unsecured creditor, a legal duty to exercise reasonable care in her administration of the estate, under both the common law and the Probate Code. In addition, he maintains that public policy supports this position.

A negligence cause of action has three elements: (1) a legal duty owed by one person to another, (2) a breach of that duty, and (3) damages proximately caused by the breach. D. Houston, Inc. v. Love, 92 S.W.3d 450, 454 (Tex.2002). The threshold inquiry in a negligence case is duty. Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex.1995); Mathis v. RKL Design/Build, 189 S.W.3d 839, 844 (Tex.App.-Houston [1st Dist.] 2006, no pet.). The existence of duty is a question of law for the court to decide from the facts surrounding the occurrence at issue. Van Horn v. Chambers, 970 S.W.2d 542, 544 (Tex.1998); Siegler, 899 S.W.2d at 197; Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 525 (Tex.1990). “The nonexistence of a duty ends the inquiry into whether negligence liability may be imposed.” Van Horn, 970 S.W.2d at 544. Generally, no duty exists to take action to prevent harm to others absent certain special relationships or circumstances. Torrington Co. v. Stutzman, 46 S.W.3d 829, 837 (Tex.2000).

Hartman moved for a traditional summary judgment solely on the existence of a duty. We thus do not consider whether Mohseni has adduced evidence of breach of duty, causation, or damages. See McConnell v. Southside Indep. Sch. Dist., 858 S.W.2d 337, 341 (Tex.1993) (holding that a summary judgment motion must stand or fall on the grounds expressly presented in the motion); Tex.R. Civ. P. 166a(c) (“The motion for summary judgment shall state the specific grounds therefor.”).

A. Duty of Care of Independent Executor

The Texas Probate Code defines an “independent executor” as “the personal representative of an estate under independent administration as provided in Section 145 of this Code.” Tex. Prob.Code Ann. § 3(q). The purpose of section 145—and of independent administration itself—is to free an independent executor from the expense and control of judicial supervision except where the Probate Code otherwise provides. Corpus Christi Bank & Trust v. Alice Nat'l Bank, 444 S.W.2d 632, 634–35 (Tex.1969); Bunting v. Pearson, 430 S.W.2d 470, 473 (Tex.1968); Rowland v. Moore, 141 Tex. 469, 174 S.W.2d 248, 249–50 (1943); Eastland v. Eastland, 273 S.W.3d 815, 821 (Tex.App.-Houston [14th Dist.] 2008, no pet.).

This “administration” that the executor performs refers to the management of the estate of a decedent. The estate of a decedent immediately vests in the devisees, legatees, and heirs at law of the estate, subject to payment of decedent's debts. Tex. Prob.Code Ann. § 37. As trustee of the property of the estate, an executor is subject to the fiduciary standards applicable to all trustees. Human Soc'y of Austin & Travis Cnty. v. Austin Nat'l Bank, 531 S.W.2d 574, 577 (Tex.1975). Thus, the duties of an executor to an estate are those of a trustee. Geeslin v. McElhenney, 788 S.W.2d 683, 684–85 (Tex.App.-Austin 1990, no writ). Section 230 of the Texas Probate Code codifies the common law concept that the executor has a fiduciary duty to exercise reasonable care in the administration of the estate property. Tex. Prob.Code Ann. § 230 (“The executor or administrator shall take care of the property of the estate of his testator or intestate as a prudent man would take of his own property.”); see also Restatement (Third) of Trusts § 77 (2007) (stating that trustee has duty to administer the trust as a prudent person would).

An independent executor's fiduciary duty runs to the estate's beneficiaries, and it arises from his status as trustee of the estate's property. Human Soc'y of Austin, 531 S.W.2d at 577; see also Huie v. DeShazo, 922 S.W.2d 920, 922–23 (Tex.1996) (holding that relationship between executor and estate's beneficiaries is one that gives rise to fiduciary duty as matter of law). Thus, the independent executor owes a legal duty of care to the estate and its beneficiaries. See Frost Nat'l Bank of San Antonio v. Kayton, 526 S.W.2d 654, 660–61 (Tex.Civ.App.-San Antonio 1975, writ ref'd n.r.e.) (holding that former temporary administratrix of estate owed legal duty of care under Section 230 of Probate Code to estate in negligence action brought by permanent administrator); see also Lawyers Sur. Corp. v. Snell, 617 S.W.2d 750, 752 (Tex.Civ.App.-Houston [14th Dist.] 1981, no writ) (holding that former temporary administratrix of estate did not owe legal duty of care under Section...