Williamson v. Williamson
Decision Date | 20 August 1999 |
Docket Number | No. 22A01-9808-CV-319.,22A01-9808-CV-319. |
Citation | 714 N.E.2d 1270 |
Parties | Robert L. WILLIAMSON, Appellant, v. Donald E. WILLIAMSON, Appellee. |
Court | Indiana Appellate Court |
Richard A. Bierly, Wyatt, Tarrant & Combs, New Albany, Indiana, Attorney for Appellant.
Rodney L. Scott, Ward, Tyler & Scott, New Albany, Indiana, Attorney for Appellee.
This appeal arises out of a dispute between two brothers over their father's estate. When Appellee Donald E. Williamson filed a final accounting and closing statement, his brother, Appellant Robert L. Williamson, objected. The trial court overruled the objection and approved the final accounting. Determining that Robert's conduct was frivolous, unreasonable, and groundless or that Robert had pursued the matter in bad faith, the trial court also entered an award of attorney's fees in Donald's favor. Robert now appeals raising three issues for our review which we consolidate and rephrase as: (1) did the trial court err in approving the final accounting, and (2) did the trial court err in awarding Donald attorney's fees.
We affirm in part and reverse in part.
Robert and Donald are the sole heirs of Claude Williamson who died in December 1993. Claude left a Will that provided in essence that the brothers would share their father's estate equally. On January 14, 1994, the Will was admitted to probate and Donald was appointed as personal representative. The estate was unsupervised. Prior to Claude's death, Donald also had been appointed as his father's guardian. The guardianship was not closed until January 1995. The record shows that at the time of death, Claude's estate was valued at approximately $963,000.00. The estate included a twelve-acre tract of land located at 4418 Charlestown Road. It is the dispute over this property that generated the most heat before the trial court and provides the basis for the primary issues raised in this appeal. The essential facts are these. Donald lives at 4420 Charlestown Road. Although he has the right of ingress and egress, Donald's property is completed surrounded by the 4418 property. On the date of Claude's death, the twelve-acre tract was appraised at $107,500.00 for inheritance tax purposes. In July 1997 Robert obtained two separate appraisals for the tract, one of which valued the property at $175,000.00 and the other at $114,000.00. In December 1997 Donald proceeded to obtain a bank loan securing it with the 4418 property. The purpose of the loan was to obtain funds to pay Robert his distributive share of the estate. Shortly thereafter, Robert delivered a handwritten note to Donald's attorney purporting to offer to purchase the 4418 property for $200,000.00. Donald disregarded the purported offer, assigned a value to the property in the amount of $141,250.00, and executed a deed transferring the property to himself.
On January 14, 1998, Donald filed a closing statement that included a final accounting. The statement showed that disbursements had been made, or were to be made, to both brothers in the approximate amount of $400,000.00. The statement also showed a disbursement to Donald in the amount of $10,000.00 as a guardianship fee. On February 4, 1998, Robert filed a written objection to the closing statement contending, among other things, that (1) Donald unilaterally conveyed all of the real property in the estate to himself without Robert's consent, (2) Donald assigned unrealistically low values to the 4418 Charlestown Road property thus diminishing the amount of Robert's distributive share of the estate, and (3) Donald paid himself a $10,000.00 fee for services as a guardian without court authorization. The matter proceeded to hearing on June 17, 19, and 30, 1998. Thereafter, the trial court entered its judgment approving the closing statement and final accounting. Upon Robert's prior written request the trial court supported its judgment with special findings and conclusions thereon. In a post-hearing motion Donald sought costs and attorney's fees on grounds that Robert's objection to the closing statement and final accounting became frivolous, unreasonable and groundless when his deposition was taken on June 8, 1998. On November 2, 1998, the trial court entered a written order granting the motion and assessing attorney's fees and costs against Robert in the amount of $5,026.55. This appeal followed in due course. Additional facts are set forth below where relevant.
When a trial court has made special findings of fact pursuant to Ind. Trial Rule 52, as it did in this case, our standard of review is two-tiered. First we determine whether the evidence supports the findings, and second whether the findings support the judgment. Bloodgood v. Bloodgood, 679 N.E.2d 953, 956 (Ind.Ct.App.1997). We "shall not set aside the findings or judgment unless clearly erroneous." T.R. 52(A); Breeden v. Breeden, 678 N.E.2d 423, 425 (Ind.Ct. App.1997). The trial court's findings of fact are clearly erroneous if the record lacks any evidence or reasonable inferences to support them. Id. A judgment is clearly erroneous when it is unsupported by the findings of fact and conclusions relying on those findings. DeHaan v. DeHaan, 572 N.E.2d 1315, 1320 (Ind.Ct.App.1991), trans. denied. In reviewing the trial court's entry of special findings, we neither reweigh evidence nor reassess witness credibility. Bloodgood, 679 N.E.2d at 956. Rather, we must accept the ultimate facts as stated by the trial court if there is evidence to sustain them. Yates-Cobb v. Hays, 681 N.E.2d 729, 733 (Ind.Ct.App. 1997).
Robert first complains that by conveying the Charlestown Road property to himself and by assigning a value to the property in the amount of $141,250.00, Donald engaged in inappropriate self dealing and breached his fiduciary duty. Thus, according to Robert, the trial court abused its discretion by approving the distribution. A personal representative is regarded as a trustee appointed by law for the benefit of and the protection of creditors and distributees. Fall v. Miller, 462 N.E.2d 1059, 1061 (Ind.Ct.App. 1984). In some jurisdictions purchases of estate assets by personal representatives at their own sales are merely voidable. See generally 31 Am Jur 2d, Executors and Administrators § 831 at 415 (1989). However in this jurisdiction, in the absence of a family settlement or agreement, such purchases are void. "[I]t has been the settled law of Indiana since its beginning, that a probate personal representative of the deceased is a trustee of the estate assets and will not be permitted to purchase the property himself as an individual from himself as the personal representative." Matter of Estate of Garwood, 272 Ind. 519, 400 N.E.2d 758, 764 (1980) ( ); but cf. Matter of Estate of Hensley, 413 N.E.2d 315, 317 (Ind. Ct.App.1980) ( ). The policy behind the prohibition on the transfer of estate property by the personal representative to himself or herself is to eliminate any hint of impropriety or fraud. As the court in Garwood explained:
[I]t matters not that there was no fraud contemplated and no injury done. The rule is not intended to be remedial of actual wrong, but preventive of the possibility of it. . . . [I]t matters not how innocent and bona fide and free from suggestion of fault the transaction may be, nor how harmless or even beneficial the interference of the trustee may have been, the trustee can never, by his own act, shake off the equity of the cestui que trust to have the benefit of all that he does in the scope of the trust. . . .
400 N.E.2d at 764 (quoting Potter v. Smith, 36 Ind. 231, 239-240 (1871) (emphasis omitted).)
In this case the trial court entered findings indicating that Robert's purported offer to purchase the Charlestown Road property was not sincere and that his interest in the property was motivated only by his desire to increase his cash distribution from the estate. The trial court also entered findings indicating that the appraisal of the property in the amount of $175,000.00 was based on its highest and best use as a commercial or residential development. However, the appraisal did not take into account the limitations of the property, namely: the lack of sewers, soil limitations, and septic problems. Thus, the $141,250.00 figure that Donald assigned to the Charlestown Road property more accurately reflected its true value. We reject Robert's contention that there was no evidence to support the trial court's findings. We also reject Robert's argument that his purported offer to purchase the Charlestown Road property was made in earnest. The evidence of record supports the view that Robert had no desire actually to own the property. Rather, he was simply posturing in an attempt to increase his share of the estate and to impede Donald's ownership of the property. Apparently the animosity between the brothers is intense. Further, we disagree with Robert's inference that Donald engaged in some form of impropriety by conveying the Charleston Road property to himself. The record does not support such a notion.
Nonetheless the trial court's judgment is clearly erroneous. Based on its findings the trial court concluded that Donald's conveyance of the property to himself was "the only rational way to distribute said property in light of its location and interdependence upon Donald E. Williamson's property at 4420 Charlestown Road, in light of the 30 plus years of residency of Donald E. Williamson at or near the property, and in light of the fact that joint ownership was not feasible in light of the breakdown of the relationship between Donald Williamson and Robert Williamson." R. at 213...
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