Wilmot v. Wilmot

• Decision Date: 05 December 2002
• Docket Number: No. CV-02-0130-PR.,CV-02-0130-PR.
• Citation: 203 Ariz. 565,58 P.3d 507
• Parties: Connie I. WILMOT, surviving spouse, on her own behalf and on behalf of all who may have a statutory right of recovery, Plaintiff-Appellee, Dr William T. Evans, M.D. and Debra Evans, husband and wife; Emergency Physicians, Inc., an Arizona corporation, Defendants-Appellees, v. Jeffrey WILMOT, Leslie Kumpf, Michelle Lazek, Teresa Balogh, Douglas Wilmot and Dirk Wilmot, as surviving children of decedent, Milton Wilmot, Appellants.
• Court: Arizona Supreme Court

58 P.3d 507

203 Ariz. 565

Connie I. WILMOT, surviving spouse, on her own behalf and on behalf of all who may have a statutory right of recovery, Plaintiff-Appellee, Dr William T. Evans, M.D. and Debra Evans, husband and wife; Emergency Physicians, Inc., an Arizona corporation, Defendants-Appellees, v. Jeffrey WILMOT, Leslie Kumpf, Michelle Lazek, Teresa Balogh, Douglas Wilmot and Dirk Wilmot, as surviving children of decedent, Milton Wilmot, Appellants.

No. CV-02-0130-PR.

Supreme Court of Arizona, En Banc.

December 5, 2002.

Barry L. Entrekin, Phoenix, for Plaintiff-Appellee.

Snell & Wilmer, L.L.P., By Dora Fitzpatrick, Phoenix, for Defendants-Appellees.

Kevin L. Beckwith, P.C., By Kevin L. Beckwith, Phoenix, for Appellants.

OPINION

FELDMAN, Justice.

¶ 1 Several months after Milton Wilmot died, his surviving wife brought a wrongful death action under Arizona's Wrongful Death Act, A.R.S. §§ 12-611 to 12-613. The wife and her attorney knew that decedent had six adult children from a previous marriage, yet they settled the case without obtaining the consent of the children.

¶ 2 Those children challenged the settlement, asserting that by settling without their knowledge and consent the wife breached a fiduciary duty owed to them as statutory beneficiaries. The trial judge denied their motion to set aside an order confirming the settlement, and a majority of the court of appeals affirmed. Wilmot v. Wilmot, No. 1 CA-CV 01-0359 (mem. dec.) (March 21, 2002). We granted review to examine the nature and extent of the statutory plaintiff's fiduciary obligations under the Arizona statutes regulating actions for wrongful death.

FACTS

¶ 3 Milton Wilmot ("Decedent") died in April 1999 while married to Connie Wilmot ("Wilmot"). In February 2000 Wilmot filed a wrongful death action under our statute, which provided in relevant part:

A. An action for wrongful death shall be brought by and in the name of the surviving husband or wife or personal representative of the deceased person for and on behalf of the surviving husband or wife, children or parents, or if none of these survive, on behalf of the decedent's estate.

* * *

C. The amount recovered in an action for wrongful death shall be distributed to the parties provided for in subsection A in proportion to their damages,....

A.R.S. § 12-612(A) and (C) (1973).¹ The action was originally brought as "Connie I. Wilmot, surviving spouse, for and on behalf of herself." (Emphasis added.)

¶ 4 Decedent had six adult children ("the children") who lived on the east coast but had been estranged from him since his divorce from their mother in 1980. Decedent did not attend any of the children's weddings, was not aware of the birth of his grandchildren, and it appears that the children were still unaware of Decedent's death a year after it occurred.

¶ 5 When counsel for Wilmot, Lance Entrekin, learned about the children, he had a telephone conversation with one child, and through individual certified letters mailed to each child in August 2000, he advised the children of the pending action and of their "right to participate as a plaintiff in a lawsuit." He suggested that if they wished to participate they should "immediately hire an Arizona attorney" and informed them that "failure to do so promptly could limit or foreclose your legal rights in this matter." The following month Wilmot filed an amended complaint changing the caption on the pending action to "Connie I. Wilmot, surviving spouse, for and on behalf of all who may have a statutory right of recovery." (Emphasis added.)

¶ 6 The nature and extent of later contact between counsel is disputed, but in August 2000 there was contact between Entrekin and Pennsylvania counsel for at least one of the children (Pennsylvania was the domicile of at least one of the children). By late January 2001, the children had been in touch with an Arizona lawyer, Kevin Beckwith, and he and Entrekin talked on the telephone. With Wilmot's authorization, Entrekin and defense counsel in the tort case agreed on a settlement amount on February 12, 2001. Neither Beckwith nor the children were given prior notice of the amount of the settlement or asked for their consent. Either before or after the actual settlement was reached but on the same day, Entrekin received a letter from Beckwith advising him that contingent fee agreements had been forwarded to the children for their signature. Despite receiving Beckwith's letter, Entrekin moved for confirmation of the settlement, and the tort defendants, who may or may not have known of Beckwith's letter, joined in the motion.

¶ 7 On March 12, 2001, following a hearing, the trial judge granted the joint motion by Wilmot and the tort defendants to confirm the settlement. Beckwith, who had not appeared in the action but was mailed a copy of the motion, was not given notice of the hearing. The following day Beckwith filed the children's opposition to the motion to confirm and a motion to set aside the court ruling enforcing the settlement. Wilmot argued that the opposition was not timely filed. The trial judge denied the motion to set aside and dismissed the case with prejudice, thus foreclosing any claim the children may have wanted to assert. The court of appeals affirmed. Wilmot, mem. dec. at ¶ 23.

DISCUSSION

¶ 8 The facts present questions about the right of a statutory plaintiff to compromise a wrongful death action, the obligations statutory plaintiff's counsel may owe to other beneficiaries, and the rights of statutory beneficiaries known to the plaintiff as well as their obligations to act. Each of the questions will be considered in turn.

¶ 9 The children contend that when there are statutory beneficiaries other than the named plaintiff, Arizona's statutory scheme imposes fiduciary duties on the plaintiff. They argue that Wilmot breached the duty owed to them when she settled the claim without their consent. In the court of appeals the children argued that the trial judge should have set aside the judgment under Rule 60 of the Arizona Rules of Civil Procedure allowing relief from a final judgment "for any other reason [than those earlier enumerated in the rule] justifying relief...." Rule 60(c)(6), Ariz.R.Civ.P. The court held, however, that the settlement was properly made without procuring the children's consent because the children had never objected to settlement or indicated that they wished to participate in the action. Wilmot, mem. dec. at ¶¶ 17-18. Further, any failure to give the children proper notice of the hearing on the motion to confirm was harmless; "if there was error in this case, it was of no effect" because the trial judge later heard argument on the motion to set aside and determined there was no hardship or injustice to the children. Id. at ¶ 22.

¶ 10 We are not bound "by the trial court's conclusions of law nor by findings that combine both fact and law." Scottsdale Princess Partnership v. Maricopa County, 185 Ariz. 368, 372, 916 P.2d 1084, 1088 (App. 1995). Questions of law are reviewed de novo. Gemstar Ltd. v. Ernst & Young, 185 Ariz. 493, 499, 917 P.2d 222, 228 (1996). Similarly, questions of statutory construction are issues of law reviewed de novo. Zamora v. Reinstein, 185 Ariz. 272, 275, 915 P.2d 1227, 1230 (1996). We first turn to the operation of the statute.

A. Operation of the statute

¶ 11 The text of the wrongful death statute contemplates that claims by all statutory beneficiaries be consolidated in a single action. The statute provides the action is to be brought by a designated plaintiff "for and on behalf of the surviving husband or wife, children or parents...." A.R.S. § 12-612(A) (emphasis added). "A wrongful death action... is one action for damages with one plaintiff and one judgment." Begay v. City of Tucson, 148 Ariz. 505, 508, 715 P.2d 758, 761 (1986); see also Nunez v. Nunez, 25 Ariz. App. 558, 562, 545 P.2d 69, 73 (1976) ("there is `one action' for damages occasioned by a wrongful death. There is also but one plaintiff, one of the persons designated by statute....").

¶ 12 Thus, the statutory plaintiff represents all other beneficiaries who have a "legal right ... to be compensated for their loss resulting from the victim's death." Summerfield v. Superior Court, 144 Ariz. 467, 476, 698 P.2d 712, 721 (1985) (emphasis in original); A.R.S. § 12-612(A). Following a successful action, there is "one judgment, the proceeds of which are held by the statutory plaintiff as trustee for the persons on whose behalf the suit was brought." Nunez, 25 Ariz.App. at 562, 545 P.2d at 73 (emphasis added). The statute then provides that damages will be "distributed to the parties provided for in subsection A in proportion to their damages...." A.R.S. § 12-612(C).

B. Fiduciary duty of the statutory plaintiff

¶ 13 Although an action could be brought by a personal representative with no stake in the outcome, in most instances, as in the present case, the plaintiff is the surviving spouse or child and is also a beneficiary, thus conducting the action and receiving the proceeds as both litigant beneficiary and trustee. Id.; see also In re Milliman's Estate, 101 Ariz. 54, 63, 415 P.2d 877, 886 (1966). Thus, fiduciary duties are clearly owed to the other beneficiaries, both in conducting and settling the action and making distribution of proceeds to each of the other beneficiaries at the conclusion.

¶ 14 The present question concerns the extent of the fiduciary duties that arise before a judgment is obtained. The plain language of A.R.S. § 12-612(A) tells us that the named plaintiff is acting "for and on behalf of" all statutory beneficiaries. And, as noted, we have held that the plaintiff acts as the representative of all the statutory beneficiaries. Summerfield, 144 Ariz. at 476, 698 P.2d at 721. Wilmot represented herself as such by the new caption of the amended complaint, "Connie I. Wilmot, surviving spouse, for and on behalf of all who may have a statutory right...