Wisecarver v. Moore

• Decision Date: 08 June 2007
• Docket Number: No. 06-6046.,06-6046.
• Citation: 489 F.3d 747
• Parties: Don WISECARVER, Carol McCamy, and Karen Solomon, Plaintiffs-Appellants, v. Loretta MOORE and Evelyn Page, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

489 F.3d 747

Don WISECARVER, Carol McCamy, and Karen Solomon, Plaintiffs-Appellants, v. Loretta MOORE and Evelyn Page, Defendants-Appellees.

No. 06-6046.

United States Court of Appeals, Sixth Circuit.

Submitted: April 25, 2007.

Decided and Filed: June 8, 2007.

ON BRIEF: John O. Threadgill, The Threadgill Law Firm, Knoxville, TN (briefed), for Appellants. Lanna M. Kilgore, Bowling Green, KY (briefed), for Appellees.

Before: SILER and GILMAN, Circuit Judges; ZATKOFF, District Judge.^*

OPINION

SILER, Circuit Judge.

Don Wisecarver, Carol McCamy, and Karen Solomon (collectively, "Plaintiffs") appeal the district court's order dismissing their complaint for lack of subject matter jurisdiction based on the probate exception to federal diversity jurisdiction. On appeal, Plaintiffs argue that the Supreme Court's recent narrowing of the probate exception in Marshall v. Marshall, 547 U.S. 293, 126 S.Ct. 1735, 164 L.Ed.2d 480 (2006), renders the exception inapplicable to this case. We AFFIRM in part and REVERSE in part.

I.

Plaintiffs are the nephew and nieces of decedent Floyd McCamy, who died testate in Butler County, Kentucky, in 2004. Loretta Moore and Evelyn Page (collectively, "Defendants"), were the primary beneficiaries of McCamy's estate. Moore also served as Executrix of McCamy's estate.

Plaintiffs filed suit in federal district court based on diversity jurisdiction, alleging "breach of fiduciary duty, and confidential relationship, undue influence, fraud, misrepresentation and procuring the execution of a will by undue influence, fraud, conspiracy and procuring and promoting a false will." The substance of Plaintiffs' claims is that the Defendants exerted undue influence on McCamy to procure his signature on testamentary documents, obtained a power of attorney which they used to their benefit, and failed to use good faith in exercising the authority granted by the power of attorney. Plaintiffs allege that they are the intended and rightful beneficiaries of McCamy's will, and as such, are entitled to $543,714.29, the amount Defendants received under the terms of McCamy's will.

Among other relief, Plaintiffs primarily seek to enjoin the Defendants from disposing of the assets they received under McCamy's will, require an accounting of all assets they received during the last two years of McCamy's life, divest Defendants of all property that should be returned to Plaintiffs as heirs, next of kin, and beneficiaries of McCamy's will, and an order declaring McCamy's will invalid.

The district court dismissed Plaintiffs' claims because it concluded that subject matter jurisdiction over Plaintiffs' claims was improper based on the probate exception. Plaintiffs filed a motion for reconsideration under Fed.R.Civ.P. 60(b), arguing that subject matter jurisdiction existed pursuant to Marshall v. Marshall, 547 U.S. 293, 126 S.Ct. 1735, 164 L.Ed.2d 480 (2006), decided less than a month after the district court dismissed their claims. The district court denied the motion.

II.

We review de novo a district court's grant of a motion to dismiss on the basis of subject matter jurisdiction. Nihiser v. Ohio Envtl. Prot. Agency, 269 F.3d 626, 627 (6th Cir.2001). When a defendant moves to dismiss for lack of subject matter jurisdiction "the plaintiff has the burden of proving jurisdiction in order to survive the motion." Moir v. Greater Cleveland Reg'l Transit Auth., 895 F.2d 266, 269 (6th Cir.1990).

III.

It is well-settled that "a federal court has no jurisdiction to probate a will or administer an estate. . . ." Markham v. Allen, 326 U.S. 490, 494, 66 S.Ct. 296, 90 L.Ed. 256 (1946). This exception, known as the probate exception, "is a practical doctrine designed to promote legal certainty and judicial economy by providing a single forum of litigation, and to tap the expertise of probate judges by conferring exclusive jurisdiction on the probate court." Lepard v. NBD Bank, 384 F.3d 232, 237 (6th Cir.2004) (quoting Cenker v. Cenker, 660 F.Supp. 793, 795 (E.D.Mich. 1987)).

The Supreme Court delineated the probate exception's "distinctly limited scope" in Markham:

[W]hile a federal court may not exercise its jurisdiction to disturb or affect the possession of property in the custody of a state court, . . . it may exercise its jurisdiction to adjudicate the rights in such property where the final judgment does not undertake to interfere with the state court's possession save to the extent that the state court is bound by the judgment to recognize the right adjudicated by the federal court.

Markham, 326 U.S. at 494, 66 S.Ct. 296. Recently, the Court noted that after Markham, "[l]ower courts have puzzled over the meaning of the words `interfere with the probate proceedings'. . . ." Marshall, 126 S.Ct. at 1748. This ambiguous language, the Court found, was intended merely to reiterate the general rule that "when one court is exercising in rem jurisdiction over a res, a second court will not assume in rem jurisdiction over the same res." Id. at 1748, 126 S.Ct. 1735. It then clarified:

Thus, the probate exception reserves to the state probate courts the probate or annulment of a will and the administration of a decedent's estate; it also precludes federal courts from endeavoring to dispose of property that is in the custody of a state probate court. But it does not bar federal courts from adjudicating matters outside those confines and otherwise within federal jurisdiction. Id. Thus, it found that the plaintiff's claims for tortious interference with a gift fell outside the exception because the claim sought in personam relief, as opposed to relief seeking to reach the res over which the state court had custody.

Therefore, to the extent that Plaintiffs' claims seek in personam jurisdiction over the Defendants, and do not seek to probate or annul a will, the probate exception does not apply. Turning to the complaint, Plaintiffs allege, in relevant part:

Loretta Moore and Evelyn Page exercised undue influence on Floyd C. McCamy, and procured from Floyd C. McCamy his signature on testamentary documents . . . . The plaintiffs, upon information and belief, allege that the defendants obtained a Power of Attorney from the deceased prior to his death and used that Power of Attorney for their benefit. The defendants . . . failed to use good faith in exercising the authority granted by the power of attorney.

The defendants . . . through the use of their fiduciary and confidential relationship, with Floyd C. McCamy, prior to his death, persuaded him at a time when he was both physically and mentally incompetent, to execute a Will leaving his entire Estate to them even though the bulk of his Estate had come from the family of the plaintiffs and the deceased, Floyd C. McCamy, had stated his intent to leave the Estate to the plaintiffs.

[Defendants] . . . used their relationship with Mr. McCamy and his frail, weak and deteriorating physical and mental condition to create animosity towards the plaintiffs and to exercise dominion and control over McCamy.

[B]y virtue of the confidential and fiduciary relationship and the defendants' dominance over Floyd C. McCamy, defendants procured a Will from him which was not the intent or desire of Floyd C. McCamy and was designed solely for the benefit of the defendants . . . .

[D]efendants . . . manipulated ...