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In the Matter of the Estate of Deanna Bess George, Deceased v. Elaine Nalee

November 17, 2011

IN THE MATTER OF THE ESTATE OF DEANNA BESS GEORGE, DECEASED: TERRANCE POLAND, APPELLANT (PETITIONER),
v.
ELAINE NALEE, PERSONAL REPRESENTATIVE OF THE PROBATE ESTATE OF DEANNA BESS GEORGE, DECEASED, APPELLEE (RESPONDENT). TERRANCE POLAND,
APPELLANT (PLAINTIFF),
v.
THE ESTATE OF DEANNA BESS GEORGE AND ELAINE NALEE, IN HER CAPACITY AS PERSONAL REPRESENTATIVE OF THE ESTATE OF DEANNA B. GEORGE, AND AS SUCCESSOR TRUSTEE OF THE DEANNA BESS GEORGE REVOCABLE TRUST DATED APRIL 3, 2008, APPELLEES (DEFENDANTS).



Appeal from the District Court of Sheridan County The Honorable John G. Fenn, Judge

The opinion of the court was delivered by: Hill, Justice.

Before KITE, C.J., and GOLDEN, HILL, VOIGT, and BURKE, JJ.

NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.

[¶1] Deanna Bess George (the Decedent) executed a pour-over will and a revocable inter vivos Trust for the intended purpose of disinheriting her surviving spouse, Terrance Poland (Poland), and thereby effectively destroying his elective share under Wyo. Stat. Ann. § 2-5-101 (LexisNexis 2011) as to the property transferred to the Trust. The district court concluded that the assets transferred to the revocable inter vivos Trust were not subject to the elective share of the surviving spouse. We affirm the district court's entry of summary judgment in favor of the Decedent's estate.

[¶2] In the related civil action, Case No. S-11-0087, Poland seeks $125,000.00 from the Trust as a creditor for work performed during the marriage on a commercial building solely owned by the Decedent and transferred to the Trust. The district court granted summary judgment for the Trust and dismissed the complaint with prejudice concluding that the claim was time barred under Wyo. Stat. Ann. § 4-10-507 (LexisNexis 2011). We affirm.

FACTS

[¶3] The Decedent and Poland were married in May of 1985. They did not have any children. The Decedent died on November 3, 2009. In 2003, along with her brother and sister, the Decedent inherited significant real and personal property from her parents. She held this property in her own name and never conveyed any interest in the property to Poland in any way during the marriage.

[¶4] In 2008, the Decedent transferred her inherited property to her own revocable inter vivos Trust, the Deanna B. George Trust. The Decedent became the trustee and her sister, Elaine George Nalee (Nalee), was named the successor trustee.

[¶5] It is also of note that on February 23, 2009, the Decedent initiated an action for dissolution of her marriage to Poland. The divorce action was dismissed as moot on April 16, 2010.

[¶6] The Decedent's father had employed a similar trust to provide for his wife and three children. A spendthrift provision in the father's trust protected the trust assets until the death of the Decedent's parents. Although the Decedent and Poland were married at the time of the creation of her father's trust in 1989, the father's trust did not mention or provide for Poland.

[¶7] In 2004, the Decedent signed a one-page holographic will that, if proven valid, would have entitled Poland to all of her property including the inherited property that Decedent had received in 2003. On April 3, 2008, the Decedent executed the pour-over will and a revocable inter vivos Trust with the intended result that the property held in the Trust would not pass to Poland upon her death. These documents are the centerpiece of this matter. The probate matter was initiated by Poland's filing of the 2004 holographic will "In the Matter of the Estate of Deanna Bess George, Deceased," Probate No. PR 2010-4, Sheridan County District Court.

[¶8] The 2008 Trust Agreement did provide for Poland in that it expressly states that Poland would receive the jointly-held property accumulated during the marriage and specifically excluded the jointly owned property from the Trust. Nevertheless, Poland now also claims the elective share provided by § 2-5-101 of the Wyoming Probate Code against the property transferred to and held in the Trust. The district court granted summary judgment to the estate concluding that such property was not subject to the elective share.

ISSUES

[¶9] As to the probate matter, Poland states the issues:

Can a revocable inter vivos trust with testamentary provisions be used by one party to a marriage to defeat the elective share of the surviving spouse under the Wyoming Probate Code?

Does the probate jurisdiction of the District Court, having been invoked by the filing of a will and trust, extend to legal and equitable matters concerning the trust?

In the civil action, Poland states the issue as follows:

After the admission of a will with incorporated trust into probate in a district court in Wyoming, are the jurisdictional and procedural statutes of the Uniform Probate Code subordinate to those of the Uniform Trust Code?

STANDARD OF REVIEW

[¶10] The Court reviews summary judgment on a de novo basis. Because summary judgment involves a purely legal determination, we undertake de novo review of the trial court's summary judgment decision. Glenn v. Union Pac. R.R. Co., 2008 WY 16, ¶ 6, 176 P.3d 640, 642 (Wyo. 2008). W.R.C.P. 56(e) provides in pertinent part:

When a motion for summary judgment is made and supported as provided in this rule an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party. [Emphasis added.]

W.R.C.P. 56(b) requires the moving party to demonstrate that there is no genuine issue of any material fact and that he is entitled to judgment as a matter of law. The Court will not disturb a summary judgment where the party opposing the motion neither files an affidavit pursuant to W.R.C.P. 56(f), nor files a motion pursuant to W.R.C.P. 6(b) requesting the enlargement of time to file the affidavits. Dudley v. East Ridge Dev. Co., 694 P.2d 113, 116-17 (Wyo. 1985). We will affirm a grant of summary judgment if it can be sustained on any legal ground appearing in the record. Platt v. Creighton, 2007 WY 18, ¶ 7, 150 P.3d 1194, 1198-99 (Wyo. 2007).

[¶11] In reviewing the entry of summary judgment, we have said that we are to examine it in the same light as the district judge and treat it as though it was originally before this Court acting upon the same materials in the record, taking into consideration all the documents presented to the district court. Fegler v. Brodie, 574 P.2d 751 (Wyo. 1978). We have also said that summary judgment will be upheld where the appellant has not properly made all materials upon which he relied to oppose the summary judgment a part of the record. Toltec Watershed Improvement Dist. v. Johnston, 717 P.2d 808 (Wyo. 1986).

[¶12] With regard to the review of the trust language, we have stated that a trust agreement is governed by the plain language contained in the four corners of the document. In re Estate of Lohrie, 950 P.2d 1030 (Wyo. 1997). In Lohrie we noted that we have construed and given effect to revocable trusts after the death of the settlor made them irrevocable. Id. at 1033 (citing First Nat'l Bank & Trust Co. v. Brimmer, 504 P.2d 1367 (Wyo. 1973); Hronek v. Saint Joseph's Children's Home, 866 P.2d 1305, 1307 (Wyo. 1994)).

[¶13] In First Nat'l Bank & Trust Co., 504 P.2d at 1369 we said that in construing a trust agreement, the intention of the settlor must govern and, if possible, be ascertained from the trust agreement. We also said that:

The clearly expressed intention of the settlor should be zealously guarded by the courts, particularly when the trust instrument reveals a careful and painstaking expression of the use and purposes to which the settlor's financial accumulations shall be devoted. A settlor must have assurance that his solemn arrangements and instructions will not be subject to the whim or suggested expediency of others after his death.

Id., 504 P.2d at 1371.

The Trust Agreement

[¶14] The April 3, 2008 Trust Agreement at Section 5.4(a) states Decedent's intention with regard to Poland and the property that she had inherited from her parents:

Trustor's Intention as to Trustor's Separate Property.

The Trustor acknowledges that the Trustor is married to Terrance Poland at the time the Trustor establishes the Deanna B. George Trust under this written Agreement as originally dated April 3, 2008. The Trustor, however, declares and states that the Trustor expressly intends that all property and interests in property which are owned by the Deanna B. George Trust, or which becomes a part of the Deanna B. George Trust following the death of the Trustor, whether through conveyance, assignment, or transfer during the lifetime of the Trustor, or through probate administration, or by contractual beneficiary designation or otherwise following the death of the Trustor, are and shall be deemed to be the sole and separate property or interests in property of the Trustor or solely and separately attributed to the Trustor, as property or interests in property which the Trustor has received from the Trustor's parents or other blood-relations by gift, inheritance, or death--related transfers or conveyances, or otherwise has acquired with the intent of having such property become, be, and remain the sole and separate property of the Trustor and to be so held under and subject to this Agreement; and, that all such property and interests in property are not, and shall not be, and shall not be characterized as, and shall not be deemed to be marital property of the Trustor with reference or respect to the Trustor's marriage to Terrance Poland, or any dissolution of such marriage. The Trustor further declares and states that the Trustor and the said Terrance Poland own other property, which they have titled in their joint names with spousal rights of survivorship between the two of them, and with the intention that such jointly owned survivorship property is not to be owned by or held subject to the Deanna B. George Trust under this Agreement, either as originally made and dated April 3, 2008, or as thereafter ever amended or restated. Therefore, the Trustor declares and states that the Trustor intentionally does not make any gift or other disposition of any property or interest in property whatsoever unto the said Terrance Poland under or from the Deanna B. George Trust under this Agreement, either as originally made and dated April 3, 2008, or as thereafter ever amended or restated; and, further declares and states that the said Terrance Poland does not have and shall not obtain or ever have any interest whatsoever, including but not being limited to any resulting, constructive, remainder, or any other beneficial interest in, under, or with regard to the Deanna B. George Trust under this written Agreement as originally dated April 3, 2008, or as thereafter ever amended or restated." [Emphasis in original.]

[¶15] Simply stated, the Decedent went to great lengths to affirm her intention that Poland would not receive any interest in the solely owned property that she had inherited from her parents, but that Poland would receive the jointly owned property accumulated during the marriage. The Decedent emphasizes in a painstaking manner, that Poland "does not have and shall not obtain or ever have any interest whatsoever" in the property transferred to the Trust.

[¶16] In the "Declaration of Trust" the Decedent also declares that the trustee and any successor trustee are "vested with legal title" to all of the property which was included in the Trust estate. The Decedent transferred and delivered to the Trust all real and personal property by specific description. On April 3, 2008, a quitclaim deed was executed by the Decedent, as grantor, "dealing in and with her own sole and separate property," in favor of the Trust. An assignment and transfer of stock was also executed at the same time, as well as a "Restated Specific Gift List," which did not include Poland. Therefore, the vast majority of the Decedent's property was transferred to the Deanna B. George Trust in 2008. On June 4, 2009, the Decedent executed an amendment to the Trust Agreement designating Nalee as the current trustee of the Trust.

[ΒΆ17] As a practical matter, Decedent's property passed by virtue of the transfers to the Trust in 2008 and upon her death by virtue of the pour-over will or by the use of joint tenancy. In essence, the Decedent's property passed through the use of "will substitutes." "A 'will substitute' is an arrangement that shifts the rights to property outside of probate to the donee at the donor's death." See 2 Restatement (Third) of Property: Wills & Other Donative ...


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