Spice v. Estate of Mathews
| Decision Date | 15 October 2019 |
| Docket Number | No. 50915-6-II,50915-6-II |
| Parties | TED SPICE, an individual, Appellant, v. ESTATE OF DORIS MATHEWS, a Washington Estate; DONNA DUBOIS, as Personal Representative of the Estate; MARK DUBOIS, a purported agent of the Estate; DORIS ELAINE MATHEWS LIVING TRUST, a Washington trust, Respondents. |
| Court | Washington Court of Appeals |
WORSWICK, J. — Doris Mathews died in 2009. Doris's daughter, Donna DuBois is the personal representative of Mathews's Estate (the Estate). Donna is married to Mark DuBois.1 Ted Spice began litigating against the Estate in 2010, and has raised a multitude of claims against the Estate and the Duboises. This is the third time we have addressed issues arising from Spice's claims against the Estate. In this case, Spice appeals several procedural decisions of the superior court. He also appeals the trial court orders that dismissed his claims against the Estate and the DuBoises, declared Spice to be a vexatious litigant, and awarded the Estate its attorney fees.
The Estate argues that state courts lack jurisdiction, and that Spice's claims are either barred by bankruptcy discharge, laches, res judicata, and collateral estoppel, or are moot.
We hold that (1) state courts have jurisdiction over Spice's claims; (2) the bankruptcy discharge precludes only those claims against Donna and Mark personally that accrued prior to discharge; (3) laches is inapplicable; (4) neither res judicata nor collateral estoppel prevent consideration of Spice's claims; (5) the trial judge did not violate the appearance of fairness doctrine or the Code of Judicial Conduct by refusing to vacate its prior order; (6) Spice's argument regarding his right to disqualify a judge is moot; (7) Spice raised material questions of fact regarding his claims for waste and fraudulent transfers, but not regarding agents acting beyond their authority or fraudulent misrepresentations; and (8) the trial court should reconsider its orders declaring Spice to be a vexatious litigant and awarding the Estate its attorney fees. We do not reach whether the transfer of Estate assets was fraudulent because this issue is inadequately briefed.
Thus, we affirm in part, reverse in part, and remand for further proceedings.
Mathews died in 2009, designating Donna DuBois as her personal representative and sole heir. Probate began in 2010 under Pierce County Superior Court cause number 10-4-00037-5.Spice, a former business partner of Mathews, brought suit claiming ownership of multiple real properties in Mathews's estate under cause number 10-2-11622-8. Spice and the Estate alleged numerous claims and counterclaims. In 2012, the case proceeded to a jury trial. Instead of rendering special verdicts for each claim and counterclaim, the jury distributed the properties in controversy. The jury allocated ownership of the properties, distributing some properties to the Estate, some properties to Spice, and other properties to both parties jointly with specifically designated percentage ownership. Spice appealed, and in March 2016, we affirmed the trial court's orders. Spice v. DuBois, No. 44101-2-II, slip op. at 1 (Wash. Ct. App. Mar. 1, 2016) (unpublished), http://www.courts.wa.gov/opinions/pdf/D2%2044101-2-II%20Unpublished%20Opinion.pdf (Spice I).
In December 2012, the trial court granted Spice's motion to appoint a property manager for the shared properties. In June 2013, Spice filed another lawsuit against the Estate for creditor claims under cause number 13-2-09887-9. At some point in 2013 or 2014, a water pipe burst at one of the jointly owned properties.
Spice filed two more lawsuits in May 2014 alleging various nonpayments and breaches by the Estate regarding the shared properties. These cases were assigned cause numbers 14-2-08948-7 and 14-2-08947-9. One suit detailed damage from water leaks at two properties and made claims for the Estate's failure to repair that damage. Spice voluntarily dismissed these lawsuits in March 2015.
In November 2014, Donna, as the personal representative, conveyed certain properties jointly owned by Spice and the Estate to herself personally.
Spice amended his 13-2-09887-9 complaint in December 2014 to allege, among other claims, waste and a breach of fiduciary duty by committing waste with regard to co-owned properties. The waste related claims described water leakage and resulting mold or rot in multiple properties. The amended complaint also alleged that Donna, as personal representative, fraudulently conveyed property to herself personally in November 2014. Spice's 13-2-09887-9 case was eventually consolidated with 10-4-00037-5, the probate proceeding.
The Estate moved for summary judgment dismissal of Spice's claims. In October 2015, the trial court dismissed Spice's claims, ruling that there was no evidence the Estate was managing the property when the alleged waste occurred and that the Estate did not owe fiduciary duties to Spice.3 Spice appealed.
On December 12, 2017 we issued our opinion on that appeal.4 (Spice II). We held that there was a quasi-fiduciary relationship between Spice and the Estate regarding the properties, and a material question of fact existed as to whether the Estate had breached this duty regarding waste. The record on appeal shows that, as of December 2018, the trial court had not yet resolved the remanded Spice II issues.
This current proceeding is an amalgamation of issues arising from or related to past probate proceedings, separate federal bankruptcy proceedings, and various orders within the probate proceedings of the Estate. It involves the Duboises' personal bankruptcy proceedings, motions regarding Donna's non-intervention powers to sell Estate properties, and Spice's new, amended complaint that was dismissed on summary judgment.
Donna and Mark filed for chapter 11 bankruptcy in September 2013. In January 2016, their bankruptcy was converted to a chapter 7 proceeding. Donna and Mark created schedules of their assets and liabilities, which included Donna's full or partial interests in the Estate properties. It does not appear, from the portions of the schedules in our record on appeal, that Spice is listed as a creditor of the Duboises. A bankruptcy trustee was appointed to liquidate the Duboises' assets to pay debts. The bankruptcy trustee found potential buyers for properties, including those co-owned with Spice.
The potential buyers for one property were Bryan and Jennifer S. Bartelson. The contract for the sale of the property noted that the sale was contingent on the resolution of the Estate's probate proceedings and the approval of the bankruptcy court.
The bankruptcy court ordered a discharge of Donna's and Mark's debts on May 3, 2016. Then, in January 2017, the bankruptcy trustee filed a complaint against Spice in bankruptcy courtto determine his interests in the properties and to sell those properties in which Spice had an interest.6 In response, Spice filed an answer and counterclaims in May 2017. Spice alleged breach of contract, conversion, unjust enrichment, fraudulent inducement, tortious interference with existing business contracts, tortious interference with existing business relationships, violations of the Consumer Protection Act, embezzlement and alienation of Mathews's property, negligent misrepresentation, breach of fiduciary duty, noncompliance with 11 U.S.C. § 363(h)(4), and violations of the Fraudulent Transfers Act. Spice's breach of fiduciary claim stated, "Defendants have allowed waste of properties belonging to the Estate." Clerk's Papers (CP) at 1812. The bankruptcy trustee moved for summary judgment to determine property interests and to sell certain property.
The bankruptcy court scheduled a status conference for September 2017, noting that "[t]he sales of the properties involved will be held in abeyance until further Order of the Court." CP at 1379-80. In August 2018, the bankruptcy court denied the trustee's motion for summary judgment. The bankruptcy court declined to address Spice's counterclaims, stating that "whatever the merits of the waste claims, their need to be resolved is not a detriment to [Spice] that would arise from the sale of his property." CP at 2033.
The Estate moved in superior court to transfer title of the properties to Donna personally, which the court denied in January 2014. The Estate again moved to transfer the Estate property to Donna personally, and the trial court denied the motion in February 2014. Nonetheless, in November 2014, Donna, as personal representative of the Estate, transferred properties to Donna, personally.
In January 2015, the trial court vacated Donna's November 2014 transfers, removed Donna's non-intervention powers, and prohibited further conveyances without court authorization.7
On March 12, 2015, Donna again transferred the properties. This time, Donna transferred the properties from herself personally to herself as personal representative of the Estate. Spice alleges he did not discover this transfer until February 2017.
In February 2017, the Estate moved to allow the transfer of Estate assets to Donna personally, and to restore her non-intervention powers. In March, Spice moved to stay proceedings pending the outcome of Spice II.
On March 31, 2017, Judge Kirkendoll issued an order that restored Donna's non-intervention powers, allowed the transfer of all the Estate's assets to Donna as an individual, and denied Spice's motion to stay. At the end of the hearing regarding the restoration of Donna's powers, Judge Kirkendoll referred to her judicial assistant as "Ms. Bartelson." Verbatim Reportsof Proceedings (VRP) (Mar. 31, 2017) at 16. Spice's attorney recognized the last name as someone Spice had been in prior litigation with as a neighboring property...
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