Stanton v. Wells Fargo Bank Montana, N.A., DA 06-0139.
| Citation | 2007 MT 22,335 Mont. 384,152 P.3d 115 |
| Decision Date | 30 January 2007 |
| Docket Number | No. DA 06-0139.,DA 06-0139. |
| Parties | Wendell STANTON, Plaintiff and Respondent, v. WELLS FARGO BANK MONTANA, N.A., Defendant and Respondent. In the Matter of the Frances S. Barker Trust Under Agreement. New Life Fellowship of Montana, Inc., d/b/a Trail's End Ranch, Intervenor and Appellant, v. Wendell Stanton, Trustee of the Wendell Stanton Trust Dated 8/7/2000, Account No. 7AJ 006230; and Wells Fargo Bank Montana, N.A., Third-Party Defendants and Respondents. |
| Court | United States State Supreme Court of Montana |
For Respondent Wendell Stanton: Patrick C. Sweeney, Attorney at Law, Billings, Montana.
¶ 1 Respondent Wendell Stanton (Stanton) filed a complaint to compel Wells Fargo Bank, N. A., (Wells Fargo), to distribute the corpus of Frances Scanlan Barker's (Frances) trust to him. Wells Fargo responded by filing a petition for approval of its final accounting and requested that the District Court determine the beneficiary of Frances's trust. New Life Fellowship of Montana, d/b/a Trail's End Ranch (Trail's End), a previous beneficiary to Frances's trust, intervened. Trail's End claimed that Stanton exercised undue influence over Frances and that Wells Fargo breached its fiduciary duty owed to Trail's End. The District Court for the Thirteenth Judicial District, Yellowstone County, granted summary judgment in favor of Stanton and Wells Fargo on the grounds that Trail's End failed to show the existence of undue influence, constructive fraud, and that Wells Fargo owed no fiduciary duty to Trail's End. Trail's End appeals and we affirm.
¶ 2 We address the following issues:
¶ 3 1. Did the District Court properly grant summary judgment in Stanton and Wells Fargo's favor?
¶ 4 2. Did Wells Fargo breach its fiduciary duty?
¶ 5 3. Did Stanton commit fraud in procuring the amendments to Frances's Trust, Will, and stock transfer?
¶ 6 Frances and her husband, Robert Barker (Bob), owned and operated a drug store in Hardin, Montana. Frances and Bob had one daughter, Joanne Barker (Joanne). Joanne married Stanton in 1963. Stanton worked as an accountant and attorney. Frances and Bob had concerns regarding Stanton's ability to manage his finances and provide for Joanne. These concerns prompted Frances and Bob to establish separate revocable trusts for the assets that they accumulated over the years.
¶ 7 On June 16, 1977, Frances executed a Trust Agreement establishing the Frances S. Barker Trust (Trust) and named Norwest Capital Management and Trust Company of Billings as trustee. Wells Fargo later acquired the Trust. The Trust Agreement provided that if Joanne became the beneficiary of the Trust, she could appoint various non-profit charities and blood relatives as beneficiaries, but "specifically excluding her husband." Trust administrators also stated that Frances worked closely with them and they considered her a "hands on" trustor who enjoyed making investment decisions regarding her Trust.
¶ 8 Stanton had incurred IRS liens on Joanne's and his family home that resulted in its foreclosure in 1995. Stanton and Joanne divorced and Frances bought the home for Joanne. Stanton and Joanne continued their relationship despite the divorce. Joanne developed terminal cancer about the same time. On October 18, 1996, Frances met with her attorney, Tom Stusek (Stusek), to change the beneficiary of her Trust because of Joanne's illness. Stusek suggested various charitable organizations as possible beneficiaries, including Trail's End. Frances never met with a representative of Trail's End or had any prior connection to Trail's End. Stusek drafted France's Restated Trust Agreement (1996 Trust Agreement) and included Trail's End as a beneficiary. Joanne died in April, 1997. Before her death, Joanne asked Frances to "take care of Wendell."
¶ 9 Stanton and Frances's relationship warmed following Joanne's death, and she told Rick Rigler (Rigler), the trust officer at the time, that she felt Stanton had "turned himself around." Frances lived in an independent living retirement community at this time, and Stanton visited her daily for lunch and took her on errands. Frances asked Stusek in 1999 to draft her Will that created a testamentary trust for Stanton's benefit in the amount of $200,000. The income from the testamentary trust was to be distributed to Wendell during his lifetime and principle to be distributed to the Barker Family Foundation upon Stanton's death.
¶ 10 Stanton continued to spend a considerable amount of time with Frances and drove her to California several times to visit her brothers. After Stanton and Frances returned from one of their trips to California, Frances told Stanton that she had spoken with her two brothers and that they approved of her making Stanton the beneficiary of her Trust. Frances told her Trust administrator in February, 2000, that she was transferring legal work from her current attorney, Stusek, to Stanton and that Stanton would be her accountant. She also left a message on Stusek's answering machine stating that she no longer required his representation. Shortly after, on April 20, 2000, Frances had Stanton revise her 1996 Trust Agreement to provide that the Trust income should be used for her care and that income and principal distributions should be made to Stanton as he requested. Then, upon her death, the corpus of the Trust would go to Stanton and the Trust would be terminated. The Amendment to Trust Agreement (2000 Trust Agreement) terminated gifts to all previous beneficiaries including Trail's End. Rigler stated that he believed that Frances had "complete control of her faculties" at this point.
¶ 11 Frances asked Stanton on June 6, 2000, to draft her amended Will. The amended Will named Stanton as the sole beneficiary. Two months later, Frances directed Wells Fargo to transfer stocks worth approximately $532,500 to Stanton. Frances was 90 years old by this time, but several friends stated that she was in good mental and physical health and described her as strong-willed. Although Frances made dramatic changes both to her Will and to the 1996 Trust Agreement, close friends acknowledged that Frances treated Stanton as her last living relative. Frances's brothers approved of Frances's decisions regarding the disposition of her assets. Stanton also saw Frances on a daily basis and she referred to him as her son-in-law.
¶ 12 Frances asked Bruce Haswell (Haswell), the Trust administrator, in September, 2001, to put her in touch with a new attorney. Frances apparently felt that Stanton was becoming "greedy" and she wanted him out of her Will. An attorney contacted Frances at Haswell's behest. Frances, once again changing course, told the attorney she did not remember suggesting any changes to her documents. Stusek contacted Wells Fargo in May, 2002, to express his concern that Stanton was exercising undue influence over Frances. Stusek stated that a couple of Frances's friends had contacted him regarding their concerns that Frances did not return their phone calls.
¶ 13 Frances signed a power of attorney on September 4, 2002, appointing Stanton as her attorney in fact. Frances broke her hip at the end of the month, and moved into a nursing home after being discharged from the hospital. Frances's health deteriorated in the nursing home, and by August, 2003, Dr. Glenda Wickstrom verified in a letter that Frances suffered from advancing Alzheimer's dementia and was unable to manage her own affairs. Dr. Wickstrom recommended that Stanton be appointed her guardian with power of attorney.
¶ 14 Frances died in November, 2003, and Stanton requested a final distribution of the Trust. Wells Fargo refused and Stanton filed a complaint against Wells Fargo to compel Wells Fargo to distribute the corpus and the income of the Trust, and to compel a final accounting and termination of the Trust. Wells Fargo filed a petition for a declaratory judgment authorizing and directing the distribution of the Trust assets and for a determination of the validity of Frances's 2000 Will and the 2000 stock gift to Stanton. The District Court consolidated the cases.
¶ 15 Trail's End intervened in the action as a beneficiary under Frances's 1996 Trust Agreement. Trail's End alleges that Wells Fargo had breached its fiduciary duty to Trail's End as a beneficiary. Trail's End also alleges that Stanton had a fiduciary relationship as Frances's attorney and exercised undue influence over Frances or committed constructive fraud in procuring the Trust amendment, Frances's Will, and stock gift.
¶ 16 The District Court determined that Trail's End had failed to show the existence of undue influence or constructive fraud and also determined that Wells Fargo owed no fiduciary duty to Trail's End. The District Court granted summary judgment in favor of Stanton and Wells Fargo and directed Wells Fargo to distribute the remaining assets of the Trust to Stanton. This appeal followed.
¶ 17 We review de novo a district court's grant of summary judgment using the standard established by M.R. Civ. P. 56. The moving party must establish the absence of a genuine issue of material fact and entitlement to judgment as a matter of law. Gliko v. Permann, 2006 MT 30, ¶ 12, 331 Mont. 112, ¶ 12, 130 P.3d 155, ¶ 12. Once a moving party has met its burden, the opposing party must present substantial evidence essential to one or more elements of its case in order to raise a genuine issue of material fact. Gliko, ¶ 12. We review a district court's conclusions of law to determine whether they are correct. Gliko, ¶ 13.
¶ 18 Did the District Court properly grant summary judgment in Wells Fargo and...
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