Smith v. Muchia

• Decision Date: 31 January 2003
• Citation: 854 So.2d 85
• Parties: Bobby SMITH et al. v. Ann MUCHIA, as executrix under the will of C.M. Smith, deceased.
• Court: Alabama Supreme Court

854 So.2d 85

Bobby SMITH et al. v. Ann MUCHIA, as executrix under the will of C.M. Smith, deceased.

1011701.

Supreme Court of Alabama.

January 31, 2003.

S.J. Laurie, Chatom, for appellants.

Edward P. Turner, Jr., of Turner, Onderdonk, Kimbrough & Howell, P.A., Chatom, for appellee Ann Muchia.

Daniel L. McCleave of McCeave & Denson, L.L.C., Mobile, for appellee Marguerite Williams.

MADDOX, Retired Justice.

This case involves the disposition of the estate of C.M. Smith, a resident of Washington County, who died testate. The first question presented is whether the trial judge erred when he ordered the sale of a tract of real estate devised under the will and further ordered that the proceeds of that sale be distributed equally between the brothers and sisters of C.M. Smith, even though C.M. Smith's will appears to provide for a different disposition. The second question presented is what assets of the estate are to be used by the executrix for the payment of debts, claims, and expenses of administration of the estate? We affirm in part, reverse in part, and remand.

Facts and Procedural History

C.M. Smith ("the decedent") died on February 5, 1996. His wife, Iva J. Smith, who was named as executrix in the decedent's will, died soon after on February 19, 1996. On February 5, 1998, Ann Muchia, who was named as successor executrix to Iva Smith, filed a petition to admit the decedent's will to probate.

Portions of the will read as follows:

"ARTICLE I

"I hereby direct my executor hereinafter named to pay all of my just debts, funeral expense and the cost of administering my estate out of my estate as soon after my death as may be practicable.

"ARTICLE II

"I give, devise and bequeath unto my beloved wife, Iva J. Smith, a life estate in the property owned by me and described as follows: ... containing 19.83 acres more or less; together with the use and benefit of said land during her lifetime.

"....

"ARTICLE III

"In the event my wife, Iva J. Smith, should predecease me, and in any event, on the natural expiration of her life estate, the above described land shall pass to the following people: Carl Smith, Myrtie Mills, Gordy Smith, Ann Muchia, Lena Caten, and Lora Reed, all being my brothers and sisters.[¹] This property is to be divided in the following manner:

"CARL SMITH shall be given five (5) acres exactly from that portion of the land on which the mobile home and outbuildings lie, and the said mobile home and outbuildings shall be his own.

"MYRTIE MILLS shall be given an equal interest out of the remainder of the land from that portion of the land that adjoins the property which she currently owns.

"The remainder of the property is to be divided between Gordy Smith, Ann Muchia, Lena Caten and Lora Reed as they see fit, but in equal shares, share and share alike.

"It is my desire that no timber be cut, sold or otherwise disposed of from this property.

"Further, it is my desire that this property not be sold to anyone outside the family."

On August 7, 1998, the probate court ordered that the will be admitted to probate and granted letters testamentary under the will to Muchia. On May 7, 1999, Muchia filed a petition to remove the estate from the probate court to the Circuit Court of Washington County, and on May 11, 1999, the circuit court granted the petition to remove the estate, and, in due course, the proceeding was transferred to the circuit court. On July 14, 1999, Muchia petitioned for the sale of the real property. In the petition, Muchia alleged that there were insufficient funds in the estate to pay the "claims, debts and costs of administration of the estate," and that it was in the best interest of the estate that the property be sold to pay those claims, debts, and costs and that the proceeds remaining after the claims, debts, and costs of administration of the estate were paid should be distributed equally among the "joint owners of the real property." On August 24, 1999, the trial judge held a hearing on the petition.

At the August 24, 1999, hearing, Muchia testified that the only assets of the estate were a tract of real estate of approximately 20 acres, on which was situated a 1969 mobile home with a detached garage, and approximately $1,375, which she realized from the sale of the decedent's automobile. She also testified that at the time of his death, C.M. Smith had a joint bank account with his wife, Iva, in which there was $41,000. She further testified that after C.M. Smith's death a niece who lived in California had come to Alabama and had put Iva in a hospital in Mobile, where Iva died; that the niece had then taken the proceeds of the account to California; and that Muchia had been unable to recover any of those funds. Muchia also testified that the decedent did not have any debts at the time of his death and that the only debts of the estate at the time of the hearing were for the costs and expenses for the administration of the estate. Muchia further testified that of the six brothers and sisters named in the will, only she and Gordy Smith were still living.

On December 10, 1999, the heirs of Carl Smith, a specific devisee in the will—Bobby Smith, Rachel Carpenter, Helen Loper, and Ethel Virginia Smith (hereinafter referred to as "the heirs of Carl Smith")— answered the petition and objected to the sale of the land. They stated:

"[U]nder the terms of the Last Will and Testament, Carl Smith was devised five (5) acres of the lands owned by C.M. Smith, deceased, to be located `exactly from that portion of the land on which the mobile home and outbuildings lie, and the said mobile home and outbuildings shall be his own.' That a general sale of said real property involving the five (5) acres devised to Carl Smith would not take into account the value of said five (5) acres as opposed to the remaining property devised to other devisees under said Last Will and Testament to allow for a fair and proper distribution of the payment of the proceeds after payment of all debts, claims and costs of administration. [The heirs of Carl Smith] would further allege that said five (5) acres have not been delineated by survey nor appraised."

In addition, the heirs of Carl Smith filed a counterclaim seeking a judgment declaring that under the will they are entitled to have the five acres of land on which the mobile home and outbuildings lie set aside for them.

On March 21, 2000, Marguerete Williams, a descendant of Lena Caten and a niece of the decedent's, filed an answer to Muchia's petition for the sale of the real property. In her answer, Williams alleged that the language of the will concerning the property was "inexact and subject to interpretation." Williams requested that the court set a hearing so that "the terms of the Last Will and Testament of C.M. Smith, deceased, can be fully and fairly discerned, and that this Honorable Court may then order such relief as may be just and proper." On August 9, 2000, Williams filed a "response to petition for sale of real property," alleging that the estate did not have adequate cash to pay its obligations and that the real property could not be equitably divided and that the "only equitable means by which this Court can follow the intention of C.M. Smith is to order the sale of the only asset of the Estate, payment of expenses and division of the proceeds." She offered to purchase the real property for $60,000, and she requested that Muchia file an inventory of the estate. On August 31, 2000, the trial judge ordered that a hearing be held on November 21, 2000. At the November 21 hearing, Rachel Carpenter, a daughter of Carl Smith and one of the heirs, testified that her father had lived on the property with C.M. Smith for approximately 10 years.

On January 23, 2001, the heirs of Carl Smith filed a proposed settlement with the court, pursuant to which the timber from the entire tract of real property would be sold to pay the debts and expenses of the estate and the balance of the proceeds from the sale of the timber would be divided "among the heirs of C.M. Smith, per stirpes and not per capita, as if he died intestate." As part of the settlement, the heirs of Carl Smith would be deeded a five-acre tract containing the mobile home and outbuildings, according to a proposed survey. On February 5, 2001, Williams filed a motion opposing the proposed settlement.

The trial court did not accept the settlement, and the case was set for a bench trial on August 21, 2001.

At that trial, John Russell Wilson, a real estate appraiser and broker testified that he had appraised the real estate in two parcels. One parcel contained 5 acres and the improvements, i.e., the mobile home and the outbuildings, which the heirs of Carl Smith "surveyed out of the twenty acre parcel," and the second parcel consisted of the remaining land, approximately 15 acres. Wilson valued the 5-acre parcel at $40,000 and the 15-acre parcel at $18,000, as of August 15, 2001. Neither appraisal included the value of the timber on the land. Under cross-examination, Wilson testified that he did not know how the composition of the 5-acre tract had been decided, but that that tract was in the middle of the property, and he did not consider the irregular shape of the remaining 15-acre tract in his appraisal of that tract.

Robert Nelson, a consulting forester, testified that the timber on the entire 20 acres was worth $41,916. Nelson had valued the land and the timber in 1999, and his original appraisal, dated April 28, 1999, estimated the total value of the 20 acres to be $74,366. Of that figure, $51,766 was allocated to the timber and $22,600 to the "bare land." As Nelson stated in the original appraisal, his original appraisal of the land did not include the value of the mobile home and unattached garage, and he testified that he estimated that there was more timber per acre on the 15-acre parcel than on the 5-acre parcel.

Judge Thomas Baxter, district judge of Washington County,...