Van Hoof v. Van Hoof
| Citation | 997 So.2d 278 |
| Decision Date | 07 December 2007 |
| Docket Number | 1051432.,1051221 |
| Parties | Rowena S. VAN HOOF v. Gaynell M. VAN HOOF, individually and as executrix of the estate of Rowena A. Van Hoof, deceased. Gaynell M. Van Hoof, individually and as executrix of the estate of Rowena A. Van Hoof, deceased v. Robert E. Burton, Burton & Associates, and Cadaret, Grant & Company, Inc. |
| Court | Supreme Court of Alabama |
Joseph D. Thetford of Thetford & Thetford, LLC, Mobile, for appellee/cross-appellant Gaynell M. Van Hoof.
Oakley W. Melton, Jr., and J. Flynn Mozingo of Melton, Espy & Williams, P.C., Montgomery, for appellees Robert E. Burton, Burton & Associates, and Cadaret, Grant & Company, Inc.
Rowena S. Van Hoof ("Mrs. Van Hoof") appeals from a judgment entered by the Mobile Circuit Court in favor of Gaynell M. Van Hoof ("Gaynell"), one of her daughters, following a bench trial (appeal no. 1051221). Gaynell cross-appeals from a summary judgment entered by the Mobile Circuit Court in favor of Robert E. Burton, Burton & Associates,1 and Cadaret, Grant & Company, Inc. ("Cadaret") (appeal no. 1051432). In the appeal, we affirm the judgment; in the cross-appeal, we affirm the judgment in part and we reverse it in part.
Mrs. Van Hoof and her husband had four children: James, Lynda, Rowena, and Gaynell. In August 1983, after 40 years of marriage, Mrs. Van Hoof's husband died, leaving a substantial estate. After Mr. Van Hoof's death, Mrs. Van Hoof hired Robert E. Burton, a financial advisor with Burton & Associates, to provide her with investment advice and services.
In 1995, Mrs. Van Hoof, with Burton's assistance, opened an investment account that has been known throughout this litigation as "the Scudder account."2 The account was opened solely in the name of Mrs. Van Hoof's daughter, Rowena, who lived with her;3 it was funded with $100,000.
On nine separate occasions, spanning most of the time during which the account existed, Rowena withdrew funds from the Scudder account for her personal use. These withdrawals totaled $52,900.4 On some occasions, Rowena asked Burton to assist her in withdrawing funds from the account; on other occasions, she obtained the funds without Burton's assistance. In a January 1997 letter to Burton in which she requested a withdrawal from the Scudder account, Rowena referred to the Scudder account as "my account." On a separate occasion, Rowena asked Burton to advise her as to whether she should withdraw funds from the Scudder account or from a different account in order to "buy" certain retirement benefits made available through her employer. Burton advised her to take money from the Scudder account to purchase the additional retirement benefits.
In 2000, Rowena was diagnosed with cancer. She died on November 1, 2002. At the time of her death, in addition to whatever interest she had in the assets held in the Scudder account, Rowena owned an individual retirement account ("the Lord Abbett IRA"), which she had funded personally, but as to which she had failed to name a beneficiary.
On or around October 22, 2002, about a week and a half before Rowena's death, Mrs. Van Hoof met with Burton at her house. Burton brought with him a chart showing the history of withdrawals from, and interest accruals in, the Scudder account. Mrs. Van Hoof directed Burton to liquidate the Scudder account. Later that day, Burton requested a check from the Scudder account in the amount of $100,000, the maximum amount that could be requested without a signature guaranty. The next day, he ordered a check for the remainder of the funds in the Scudder account, $1,042.63. The checks, which were mailed to Mrs. Van Hoof's house, were made payable to Rowena.
Burton went to Mrs. Van Hoof's house after the checks arrived. While he was there, Mrs. Van Hoof forged Rowena's endorsement on the $100,000 check from the Scudder account and then placed her own signature on the check, above a notation that the check was "for deposit only to Lord Abbett." The funds represented by the check funded a new account for Mrs. Van Hoof with an entity referred to in the record as "Lord Abbett."5
During this time, Burton also provided Mrs. Van Hoof with a beneficiary-designation form related to Rowena's Lord Abbett IRA (which, as noted, had been funded by Rowena but as to which no beneficiary had been named). Mrs. Van Hoof listed herself on the form as the beneficiary of Rowena's Lord Abbett IRA and forged Rowena's signature on the form. Neither Mrs. Van Hoof nor Burton discussed the transactions relating to the Lord Abbett IRA and the Scudder account with Rowena, despite the fact that she was lucid and alert until October 31, 2002, the day before she died.6
After Rowena's death, Gaynell was appointed executrix of Rowena's estate. Gaynell was also the sole beneficiary under Rowena's will. On October 21, 2003, Gaynell filed the present lawsuit in her individual capacity and in her capacity as executrix of Rowena's estate. She alleged that both the Lord Abbett IRA and the Scudder account belonged to Rowena's estate and that the funds in those accounts had been wrongly transferred from Rowena or Rowena's estate.7 After two amendments, Gaynell's complaint named the following individuals and entities as defendants: (1) Lord Abbett Funds, Lord Abbett All Value Fund, Lord Abbett Bond-Debenture Fund, Inc., and Lord Abbett U.S. Government & Government Sponsored Enterprises Money Market Fund, Inc. (referred to hereinafter collectively as "Lord Abbett"); (2) Scudder Investments, Scudder Distributors, Inc., Scudder Investments Service Company, and Scudder Strategic Income Fund-A (collectively referred to herein as "Scudder");8 (3) State Street Bank & Trust ("State Street"); (4) Burton; (5) Burton & Associates; (6) Cadaret;9 and (7) numerous fictitiously named defendants. Her complaint, also following amendment, included 13 counts: (1) breach of contract; (2) negligence; (3) wantonness; (4) fraud; (5) conversion of the Lord Abbett IRA; (6) conversion of the Scudder account; (7) payment of an instrument over an unauthorized signature; (8) breach of fiduciary duty; (9) conspiracy; (10) negligent or wanton hiring and supervision of Burton; (11) violation of Ala.Code 1975, § 8-6-17(a), with regard to the Scudder account; (12) violation of Ala.Code 1975, § 8-6-17(a), with regard to the Lord Abbett IRA; and (13) money had and received with regard to the Lord Abbett IRA.10
Following the filing of the complaint, on December 30, 2003, Mrs. Van Hoof wrote to Lord Abbett, stating, in pertinent part:
Lord Abbett complied with this request. Thereafter, Gaynell requested that the Lord Abbett IRA be retitled in her name. Lord Abbett and State Street did so on October 29, 2004.
On August 13, 2004, Mrs. Van Hoof filed a motion to intervene in Gaynell's action. Her complaint in intervention alleged that she was the rightful owner of the proceeds of the Scudder account. She sought a declaratory judgment as to the ownership of those funds. On August 18, 2004, Lord Abbett and State Street filed a motion to interplead the funds derived from the Scudder account into the court. They also filed an answer to Gaynell's complaint and a counterclaim against Gaynell seeking indemnification for defending the action against them. On October 15, 2004, the trial court granted Mrs. Van Hoof's motion to intervene and Lord Abbett and State Street's motion to interplead the funds derived from the Scudder account.
On April 5, 2005, Lord Abbett and State Street filed a motion for a summary judgment in which they argued that they were "disinterested stakeholders" in a dispute that was, in essence, between mother and daughter. They asserted that the funds in the Lord Abbett IRA had already been returned to Rowena's estate and that the funds from the Scudder account, which was the only other account in dispute, had been interpleaded into the court and were awaiting determination by the court as to proper ownership. Therefore, they argued, there was no basis for the court to hold that Gaynell was entitled to recover damages against them.
On April 19, 2005, Cadaret, Burton, and Burton & Associates filed a motion for a summary judgment. In addition to incorporating Lord Abbett and State Street's summary-judgment argument, they argued that, under Ala.Code 1975, § 6-5-462, the tort claims alleged in the complaint did not survive Rowena's death.11 They also argued that Gaynell could not pursue her individual claims because, at the time of the alleged acts or omissions giving rise to the complaint, she had no interest in or right to Rowena's property but was merely a beneficiary under Rowena's will. They argued that Rowena's estate was entitled to pursue only its breach-of-contract claim but could seek as damages for that claim only the amount of the funds that had already been paid into court. They argued that Gaynell could also pursue an equitable remedy on behalf of the estate, but, again, the remedy would be limited to the funds deposited in the court representing the Scudder account.
On May 24, 2005, Gaynell responded to both summary-judgment motions. As to Lord Abbett and State Street's motion, she argued that the two were not "disinterested stakeholders" but were, in fact, active wrongdoers. She asserted that her recovery of the interpleaded funds and her recovery of the Lord Abbett IRA would...
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