• Deed was invalid because no evidence that grantor authorized someone else to sign for her.
    Nov 5, 2021

    Byars v. Byars, Second Dist. Montgomery Nos. 29007 & 29009, 2021-Ohio-3940

    Margaret raised five children in the Dayton area. Margaret’s son Keith was a successful college and professional football player and he paid off Margaret’s mortgage and paid for substantial repairs and improvement to the house. In 2016, Margaret let her one daughter and son in law move into her house and then Margaret moved to a nursing home. After Margaret was in the nursing home, Margaret purportedly signed a quit-claim deed transferring the title to her house to Keith. Keith did not record the deed until several months after Margaret passed away, and Keith did not tell his siblings about the deed until he commenced eviction proceedings against his sister and brother-in-law. The signature on the deed did not match Margaret’s prior signatures.

    The administrator of Margaret’s estate filed a declaratory judgment action against Keith to invalidate the quitclaim deed. The Court found Keith’s testimony about the deed less than credible but found the testimony of the notary to be persuasive. The notary said the deed was already signed when she arrived at the nursing home, and that Keith was already there with Margaret, but also that Margaret appeared to understand what she was doing. The probate court confirmed title belonged to Keith and the Estate appealed.

    The Court of appeals reversed. The Court of Appeals found that it was undisputed that Margaret did not actually sign the deed. The Court of Appeals found that there was credible evidence that Margaret was capable of signing a deed and making the transfer to Keith, and that it was permissible for someone other than the grantor to sign the deed if the grantor knew what she was doing and wanted someone else to sign for her. But the Court of Appeals found there was no evidence that Margaret actually authorized someone else to sign the deed for her. Because there was no evidence that Margaret authorized someone to sign for her, the deed was “not signed by the grantor or at the grantor’s direction” and was therefore invalid. The Court of Appeals remanded the case to probate court to grant title to the estate.

  • For purposes of a name change application, a person can “reside” in a county other than their legal “residence”.
    Nov 1, 2021

    In re Name Change of Davis, Third Dist. Marion No. 9-21-05, 2021-Ohio-3879

    A man was convicted of several crimes that he committed in Hamilton County, Ohio and was sentenced to serve out a prison sentence in Marion County, Ohio. He applied to Marion County Probate Court to change his name, indicating he had resided at the prison for more than one year. The Probate Court denied his application on the basis that he was not a resident of Marion County because his presence was involuntary due to his imprisonment.

    The Court of Appeals reversed the Probate Court. The Court of Appeals found, in a thorough analysis of statutes and case law on the meaning of “reside” and “resident”, that the word “resides” as used in R.C. 2717.01 (the name-change statute) means that a person could “‘reside’ somewhere other than where their legal domicile makes them a “resident.” Thus, the fact that the applicant resided in Marion County prison, even involuntary, still made him a resident for purposes of his name change request.

  • General division has jurisdiction to determine title to property that was improperly transferred by an emergency guardian of the person.
    Oct 22, 2021

    VanDeGrift v. Miller, Second Dist. Miami No. 2021-CA-16, 2021-Ohio-3758

    Michael acquired title to real estate in Piqua in September 2011 from the six co-owners, one of which was Patrick. Each of the six co-owners signed deeds conveying their 1/6 interest in the property to Michael, except for Patrick. Patrick’s deed was signed by Erin, who purported to be signing on Patrick’s behalf as Patrick’s guardian. The probate records show that Erin had applied for emergency guardian of Patrick’s person in August 2011 and that she was appointed emergency guardian for Patrick’s person from August 29, 2011 until November 2011. During the pendency of the emergency guardianship, Erin applied for non-limited guardianship over Patrick, but Erin withdrew the guardianship application before there was a hearing. Erin was never appointed guardian of Patrick’s estate.

    In 2020, Michael filed suit for quiet title in Miami County Common Pleas Court, alleging that he was the sole owner of the Piqua property based on the transfer of title from the prior six co-owners and stating there was confusion about Patrick’s interest in the property. Michael alleged that under R.C. 5301.07(C), there was a conclusive presumption that the deed on behalf of Patrick was valid because it had been recorded for more than four years and was unchallenged. Michael moved for default judgment and the matter was set for hearing in March 2021. Michael admitted the deed from Erin was not valid because she did not have authority over Patrick’s real estate, but because the deed had been unchallenged for four years, he argued it now became conclusively valid under R.C. 5301.07(C).

    The trial court denied the motion for default judgment and denied a subsequent motion for summary judgment. The court stated that the evidence showed Erin did not have a legal right to transfer Patrick’s interest in the real estate and if there was a question about the validity of Erin’s conduct as Patrick’s guardian, only the probate court could hear that question. The case was dismissed for lack of jurisdiction. Michael appealed.

    On appeal Michael argued he could not do anything in probate court because the guardianship matter was closed, and that only the general division could hear his arguments under R.C. 5301.07(C) to determine that because of the passage of time, he now had good and valid title in the Piqua property. The Court of Appeals agreed that the probate court is a court of limited jurisdiction and would not have jurisdiction over a stand-alone quiet title complaint unless it was brought in the context of an estate or guardianship administration. Since the guardianship was previously terminated, the probate court would have no other jurisdiction over the quiet title action The court of appeals reversed the trial court’s dismissal and remanded the case to common pleas for further proceedings.

  • Nursing home loses fraudulent conveyance lawsuit against deceased resident’s power of attorney.
    Oct 21, 2021

    Montefiore Home v. Fields, Eighth Dist. Cuyahoga No. 110183, 2021-Ohio-3734

    Hazel made her goddaughter, Faye, her financial power of attorney. Hazel then entered an assisted living facility. Faye ran errands for Hazel, paid some of her bills, and often withdrew cash from Hazel’s bank account so Hazel could pay for her own needs. Hazel directed her income payments to her nursing home and privately paid for her nursing home costs for a year. Hazel fell behind on her assisted living costs and died owing a balance of $22,000 to her facility. Faye paid $7,000 from her own funds for Hazel’s funeral.

    The nursing home sued Faye individually, alleging, among other things, that she misused the POA and that Hazel fraudulently conveyed Hazel’s assets to Faye so that Hazel could not pay her nursing home bills and her estate would be insolvent. The evidence showed that Faye had transferred approximately $12,000 of Hazel’s money to Faye’s own bank account, and that Faye did not have receipts for many of the transactions that she said she paid at Hazel’s direction. Faye testified that she only spent the money on Hazel and as Hazel directed. Faye testified that Hazel privately paid for many things that the assisted living facility would have provided, like toiletries, groceries, a TV, phone services, and social activities, and that she liked to pay for these things in cash. The trial court held that there was no evidence of fraudulent intent by Faye and ruled in favor of Faye. The nursing home appealed, arguing the trial court decision was against the manifest weight of the evidence.

    The Court of Appeals, in a 2-1 decision, found that the nursing home did not satisfy its burden of showing a fraudulent intent by Hazel, and there was credible evidence from Faye that she had a good faith defense to the fraudulent transfer allegations because she demonstrated a non-fraudulent intent. The dissenting opinion agreed that Faye had no personal liability merely as Hazel’s POA, but because Faye did not have a good enough explanation for the $12,000 of Hazel’s money that she deposited into directly into her own account, that the nursing home met its burden on the fraudulent conveyance argument for that amount.

  • Guardian’s inaccurate list of next of kin at the time he filed his application harmless error and not good grounds to set aside guardianship proceedings.
    Oct 15, 2021

    In re: Guardianship of Steven Baker, 2nd Dist. Montgomery No. 29145, 2021-Ohio-3692

    Steven was living in the Dayton area and was seeking medical care at the VA. People at the VA were concerned that Steven was being financially exploited or was at risk of financial exploitation. Adult Protective Services investigated and filed a petition for appointment of guardian with the probate court. Attorney Sperry filed an application to serve as guardian and indicated he could only find one next of kin, a niece. This niece was Steven’s purported POA and she was accused of exploiting Steven by transferring his house to her name alone. Sperry was appointed guardian in December 2019. Sperry obtained a deed transferring the house from the niece back to Steven.

    Sperry found out that Steven had a brother, Donald, in the Dayton area in February 2020 and talked with Donald and his son at that time but did not update the next of kin form with the Court. In the summer of 2020, Steven moved to a nursing home and Sperry started the process of selling Steven’s residence. The house sale was set to close on February 18, 2021.

    The day before the closing, Steven’s other brother, Harold Bryant filed his own application for guardianship of Steven and tried to prevent the sale of Steven’s house, claiming to be Steven’s power of attorney since 2018 and trying to transfer title of the real estate to himself to stop the sale. Harold argued he was never properly notified of the guardianship and that Sperry failed to do even a minimal search to find next of kin, so Sperry’s appointment as guardian was void.

    The probate court dismissed Harold’s application for guardianship. Harold filed a motion to set aside the guardianship and stop the sale of real estate again, and was joined by Donald and Stevens’ sister, Carolyn. Harold argued again that Sperry failed to notify the next of kin of the guardianship and could have found out about their existence with a simple google search or if he looked at the property records, he would see that Carolyn and Donald lived in Montgomery County and had an interest in Stevens’ real estate at one time. Sperry issued a response denying the lack of notice to the next of kin and sought to terminate all powers of attorney. The probate court agreed with Sperry, found that Donald and Harold had notice of the guardianship no later than June 2020, and that they waited too long to take any action, and that Sperry’s incorrect list of next of kin at the time he filed his guardianship application was harmless. Harold and Donald appealed.

    The Court of Appeals agreed with the probate court, finding that Sperry’s list of next of kin was accurate to the best of his knowledge at the time he filed the guardianship application, and that the guardianship was otherwise warranted at the time. The court of appeals did not discuss the arguments about failure to update the next of kin after the fact. 

  • General division has jurisdiction over trust dispute where trust property is in that county and challenging parties are following rules of the trust.
    Oct 12, 2021

    Wisehart v. Wisehart, 12th Dist. Preble No. CA2021-01-001, 2021-Ohio-3649

    In a multi-state, multi-court, multi-generational family trust dispute, a son sued his father regarding the administration of the grandmother’s trust. The son, together with his siblings, sought to have the son made the current trustee of the grandmother’s trust and to prevent the father, who was serving as the trustee, from selling real estate in Preble County. The son also sought an accounting from the father and alleged breach of fiduciary duty due to mismanagement and lack of communication and information about the trust.

    The father had previously sued the son and his other children in state and federal courts in New Jersey and Colorado regarding other trust property and other trust administration issues in those states. The father, who at one time was a practicing attorney and was representing himself pro se. The father collected income from the farm property in Preble County and tried to sell the property, despite an injunction and the father was found in contempt of court. The father alleged that the Ohio courts did not have jurisdiction over the lawsuit, there was no actual controversy, and the son had no standing because only the deceased grandmother could appoint a trustee.

    The father and son moved for summary judgment and the son prevailed, also receiving an award of $134,374.22 in attorney fees against the father. The father appealed, again arguing a lack of subject matter jurisdiction and lack of controversy, but his appellate brief was “rambling, incoherent, and rife with irrelevant legal concepts and legal authority.” The appeals court pointed out that the son was an income beneficiary and the terms of the trust allowed a majority of income beneficiaries to appoint a successor trustee, which they did. The court also pointed out that the lawsuit involved a dispute over real estate in Preble County and the administration of a trust with property in Preble County, and thus the general division had jurisdiction over that dispute.

  • Sale of real estate in probate land sale for value less than the outstanding mortgage permitted where mortgage holder could not show property was worth more than sale price.
    Oct 6, 2021

    Urban v. Folan, 9th Dist. Summit No. CA No. 29826, 2021-Ohio-3452

    An estate owned a parcel of real estate that was encumbered by a mortgage and was falling behind on mortgage payments. The administrator of the estate filed an appraisal that valued the property at $100,000. Later, the administrator filed a land sale action in probate court to sell the property. During the pendency of the land sale action, the mortgage holder assigned the mortgage to a different entity, PennyMac. PennyMac intervened in the land sale action and also filed a foreclosure complaint. The estate successfully dismissed the foreclosure action and the case returned to probate court. The administrator moved the probate court to accept a valuation of $100,000 for the property and asked the court to approve a private sale of the property for that price, which the Court did. It was undisputed that the administrator did not serve either of those pleadings on PennyMac. PennyMac was not aware the property was sold until it received a check for $91,000 of the proceeds – less than the $126,000 that was owed on the mortgage at the time of the sale.

    PennyMac moved the probate court pursuant to Civ.R. 60(B) to set aside the private sale order, arguing that the administrator undervalued the property and that PennyMac was unfairly denied a right to object to the sale at the price of $100,000 because the Administrator never served it with those documents. PennyMac attached its own form of an appraisal, which was actually a Broker’s Price Opinion, which valued the property at closer to $155,000.

    The probate court found that the administrator definitely failed to properly notify PennyMac of the sale, but that ultimately PennyMac did not have a meritorious defense because the $155,000 value that PennyMac alleged was not credible because it was a BPO, not an actual appraisal. PennyMac appealed.

    The Court of Appeals agreed with the probate court. While PennyMac was unfairly surprised by the result of the sale and not afforded the right to object, PennyMac failed to show that the property was worth more than what it sold for. The Court of Appeals found that the probate court had discretion to find PennyMac’s evidence of value was not credible and pointed out that the BPO was based only on the exterior of the property, only considered three comparable sales relative to 26 comparable sales, and disregarded the six city code violations for the property.

  • Victim of car accident caused by decedent driver barred from collecting against assets of the decedent’s estate but permitted to pursue negligence claim.
    Sep 30, 2021

    Doczi v. Blake, 4th Dist. Meigs No. 20CA3, 2021-Ohio-3433

    Adam and was involved in a car accident with the decedent On November 30, 2016, in which the decedent died and Adam was seriously injured. Adam attempted to present a claim against the decedent’s estate on February 17, 2017 via letter to the estate’s executor, but the letter was vague, didn’t include Adam’s address, and didn’t include specifics about Adam’s claim. The executor asked for more details on the claim, which Adam provided a more than a year later on April 18, 2018.

    Adam filed a lawsuit for negligence against the decedent’s estate and other defendants on November 5, 2018. The parties engaged in discovery for almost a year and the estate filed a motion for summary judgment, arguing that Adam could not recover any damages from the decedent’s estate due to the untimely presentment of his creditor claim (for failure to provide his address and details on the claim according to R.C. 2117.06). Adam argued that his claim was timely presented but even if it was not timely presented, he could still seek recovery from any insurance that the decedent had that covered the accident.

    The estate also argued that if Adam could not collect any damages from the decedent’s estate, then he could not obtain a judgment against the estate and he could not reach the issue of insurance coverage.

    The trial court granted summary judgment to the estate, finding that Adam’s creditor claim was not properly presented under R.C. 2117.06 and that because Adam could not collect against Adam’s estate assets, any lawsuit against the estate was barred. And because any lawsuit against the estate was barred, there was no way Adam could seek insurance coverage that the decedent may have had. Adam appealed.

    The Fourth District Court of Appeals agreed with the trial court that Adam’s claim against the estate did not strictly comply with the parameters of R.C. 2117.06 and thus Adam could not recover any damages from the decedent’s probate estate. However the Court of Appeals found the trial court went too far in ruling that Adam could not seek recovery from any of the decedent’s insurance and could not proceed to trial against the decedent’s estate for liability. The Court of Appeals clarified that by statute, specifically R.C. 2117.06(G), even if a creditor claim against a probate estate is not timely presented, this does not reduce any other statutes of limitations or periods of repose for wrongful death claims or claims of tort, contract or other miscellaneous actions against a decedent. The probate creditor statute of limitations only limited the source from which a creditor could recover.

  • Jurisdictional priority does not apply in trust dispute where prior action in Probate Court was dismissed prior to filing related action in General Division of Common Pleas.
    Sep 30, 2021

    White v. White, 11th Dist. Lake No. 2020-L-119, 2021-Ohio-3488

    Mrs. White made a trust in 2011 and modified the trust just before she died in 2013 in Ashtabula County. After several years of litigation regarding the validity of the 2013 trust modification in Ashtabula County Probate Court, and criminal fraud charges against one of the sons involved in the 2013 trust modification, the parties challenging the 2013 trust modification dismissed their lawsuit in Ashtabula County and filed a similar complaint in Lake County Common Pleas.

    Eventually, the parties reached a settlement in 2018, and the Lake County Common Pleas Court retained jurisdiction to enforce the settlement. One of the disgruntled beneficiaries of the trust refused to cooperate with the settlement, alleging that she was entitled to certain reports and information about the trust and demanding a formal accounting. The Lake County Court ordered the trustees to provide the information but ruled there was no statutory basis to require a formal accounting. The Lake County court approved the trustees’ final report and the disgruntled beneficiary appealed. 

    On appeal, the disgruntled beneficiary alleged that Lake County Common Pleas Court did not have jurisdiction because the case was a probate matter, only probate courts can order the final accounting of executors and administrators, the related estate administration was pending in Ashtabula County Probate Court, and the trust case was originally filed in Ashtabula County Probate Court.

    The Court of Appeals disagreed. The Court of Appeals found that this was not an estate matter, but rather a trust dispute and trust accounting matter. The probate court did not have exclusive jurisdiction over those actions. The General Division of Common Pleas court and Probate had concurrent jurisdiction, so either court would have subject matter jurisdiction. The Court of Appeals also rejected a ‘jurisdictional priority’ argument, noting that though the case was first filed in Ashtabula Probate, the plaintiffs voluntarily dismissed that case before filing in Lake County, so there were not two simultaneous proceedings that could invoke the jurisdictional priority rule.

  • Common Pleas General Division has concurrent jurisdiction with Probate Court to resolve trust issues, and jurisdictional priority does not apply where prior action in Probate Court was dismissed prior to filing in General Division
    Sep 30, 2021

    White v. White, 11th Dist. Lake No. 2020-L-119, 2021-Ohio-3488

    Mrs. White made a trust in 2011 and modified the trust just before she died in 2013 in Ashtabula County. Several years of litigation regarding the validity of the 2013 trust modification ensued  in Ashtabula County Probate Court, and criminal fraud charges against one of the sons involved in the 2013 trust modification were filed in Lake County. The parties challenging the 2013 trust modification dismissed their lawsuit in Ashtabula County and filed a similar trust dispute complaint in Lake County General Division.

    Eventually, the parties reached a settlement in 2018 in Lake County. One of the disgruntled beneficiaries of the trust refused to cooperate with the settlement, alleging that she was entitled to certain reports and information about the trust and demanding a formal accounting. The Lake County Court ordered the trustees to provide the information and eventually approved the trustees’ final report. The disgruntled beneficiary appealed.

    On appeal, the disgruntled beneficiary alleged that Lake County General Division did not have jurisdiction because the case was a probate matter, only probate courts can order the final accounting of executors and administrators, the related estate administration was pending in Ashtabula County Probate Court, and the trust case was originally filed in Ashtabula County Probate Court. Thus, Ashtabula Probate had priority over the case.

    The Court of Appeals disagreed. The Court of Appeals found that this was not an estate matter, but rather a trust dispute and trust accounting matter. The Ashtabula probate court did not have exclusive jurisdiction over those actions. The General Division and Probate had concurrent jurisdiction, so either court decide on the disputes. The Court of Appeals also rejected a ‘jurisdictional priority’ argument, noting that though the case was first filed in Ashtabula Probate, the plaintiffs voluntarily dismissed that case before filing in Lake County, so there were not two simultaneous proceedings that could invoke the jurisdictional priority rule.

  • Appellate court affirms judgements award for breach of fiduciary duty and attorney fees where trustee-appellant failed to properly certify the court records and transcripts for appeal.
    Sep 20, 2021

    Steffen v. Steffen, 9th Dist. Lorain No. 20CA011637, 2021-Ohio-3277

    Wallace Jr. was trustee of his dad’s trust and made several loans to himself of the trust property. His sister, a trust beneficiary, found out and sued Wallace Jr. for breach of fiduciary duty. The sister obtained a six-figure judgment against Wallace Jr. for breach of trust and then a larger six-figure judgment against him for attorney fees. Wallace Jr. hired an outside court reporting company to make a transcript of the proceedings and submitted four volumes of transcript to the Court of Appeals as part of his appeal of the judgments against him.

    However, Wallace Jr. failed to have the transcript certified according to the rules of the Court of Appeals. Wallace Jr. also did not make sure the trial exhibits were part of the court’s record. Therefore, the Court of Appeals was “required to presume regularity in the trial court’s proceedings” and affirmed the judgments.

  • Guardian of Estate for incompetent adult successfully intervened in divorce action and successfully obtained a constructive trust.
    Sep 17, 2021

    Branscum v. Sullenberger, Second Dist. Champaign No. 2020-CA-23, 2021-Ohio-3250

    Wendy filed for divorce from Scott in Champaign County. Before her marriage to Scott, Wendy acquired real estate from H.H.’s revocable trust. H.H. was later placed under guardianship in Montgomery County. H.H.’s Guardian intervened in Wendy and Scott’s divorce action and asserted an interest in the real property that was subject to division in the divorce. The Guardian was successful in her efforts to order the real estate sold and have the proceeds of the sale of the real estate to be held in a constructive trust for the benefit of H.H., and the proceeds transferred to the Guardianship for division among H.H., Scott and Wendy in Montgomery County probate court.

    Part of the divorce entry required Wendy to cooperate with the Guardian to sell the real estate, move out, and pay taxes and maintenance. The divorce court retained jurisdiction over the sale of the real estate. Wendy refused to cooperate with the Guardian. Wendy did not pay the taxes, attempted to thwart the sale, and otherwise refused to even sign the purchase agreement. Even after the Guardian obtained court orders to force Wendy to cooperate, Wendy still refused, changing the purchase price on the purchase agreement and trying to remove fixtures from the property and causing damage. The Guardian successfully obtained a contempt order against Wendy in the divorce case and obtained an award of her attorney fees incurred in trying to sell the real estate as part of the contempt order.

    Wendy appealed the award of attorney fees, arguing they were not totally related to the contempt finding and that they were just regular fees incurred in trying to sell real estate that should be part of the guardianship. The Court of Appeals disagreed with Wendy, finding that it was undisputed she did not cooperate with the sale of real estate and was properly held in contemp. The Court of Appeals also pointed out that the court award a lump sum for attorney fees and costs as contempt damages, but the total was less than the total fees that the Guardian had presented as related to the sale of the real estate. The Court of Appeals found it was within the court’s discretion to determine the amount of fees that were part of the contempt order. The attorney fees and costs award were affirmed.

  • Father failed to present sufficient evidence to show guardianship over his minor child was intended to be temporary when Father consented in writing to application where guardian would serve until a specific date.
    Sep 15, 2021

    In re Guardianship of T.M.D.-D, Fourth Dist. Washington No. 20CA36, 2021-Ohio-3249

    A nine-month-old minor child’s maternal Aunt applied to be guardian of the minor because the minor’s mother suffered from addiction problems and was in a rehab facility, and the child’s father was a full-time student in Colorado. Mother and Father both consented in writing to the appointment of Aunt as guardian for the minor. On the guardianship application, Aunt indicated that the guardianship was requested for a definite period of time until the minor’s 18th birthday, but the letters of guardianship stated they were for an indefinite period of time. The minor did not have any known or long-term disabilities and the guardianship was requested only because the child was a minor and not residing with his natural parents.

    Approximately 18 months after the guardianship was granted, Father moved the probate court to terminate the guardianship. Father argued that he had commenced juvenile court proceedings about the minor in Ohio around the same time as the guardianship in Ohio and, and that he only consented to the guardianship with the understanding that it would resolve the juvenile court matter by giving temporary custody to Aunt, and the guardianship would end when Father graduated college. (Interestingly, the probate judge is also the juvenile judge in this County). Father also argued that the guardianship letters were for an indefinite period of time, meaning that the guardianship was only temporary.

    The Aunt and the child’s maternal grandmother argued the guardianship was intended to be permanent until the child turned 18. They opposed the termination of the guardianship. Both testified that Father did not say anything about the guardianship ending when he graduated school at the time of the guardianship, and that Father did not try to bring the minor to Colorado at all. There was no dispute that the Father kept in communication with Aunt and the child, but Aunt felt that the child had established a good living situation here in Ohio and the guardianship was working well for everyone. There was also no dispute that Aunt had requested the guardianship to terminate on the child’s 18th birthday, which it otherwise would by operation of law, regardless of what the letters of guardianship stated.

    The probate court agreed with Aunt. The probate court found that while the guardianship letters said they were for an indefinite period of time, it just meant indefinite until the child turns 18. The probate court found that father failed to present any evidence that the Guardian was acting improperly or that there was any change of circumstance to show the guardianship was not in the best interest of the child. Father appealed.

    The Court of Appeals affirmed the probate court.

  • Summary judgment in favor of Agent under POA Instrument was improper where Agent did not show, and court did not analyze, that Agent acted in good faith.
    Aug 17, 2021

    Alibrando v. Miner, Fifth Dist. Licking No. 2021 CA 0010, 2021-Ohio-2827

    Guito made a will in 2013 giving his girlfriend, Connie, $100,000 and the rest of his estate to his two sons. Connie admitted that she knew about the will and its contents. Two years later, Guito named Connie his agent under a power of attorney instrument and opened a joint bank account with her. The POA instrument authorized the agent to sell Guito’s real estate and to place the proceeds of the sale into an account that Guito owned individually or jointly. Shortly before Guito’s death, Connie sold Guito’s real estate and deposited more than $200,000 of proceeds into a bank account owned jointly by Connie and Guito. After Guito died, Connie moved the proceeds into her personal savings account.

    During the administration of Guito’s estate, Guito’s sons found out about the transfer of the real estate and objected to the final accounting because it did not include the proceeds of the real estate. They also filed a complaint for concealment of assets against Connie and alleged she breached her duty of good faith as the agent under the POA instrument when she deposited the proceeds of the sale of the real estate into an account that she owned jointly with Guito shortly before his death.

    The probate court granted summary judgment in favor of Connie, finding that it was undisputed Guito was competent when he executed the POA, and that the POA authorized Connie as the agent to deposit the funds into a joint bank account.

    The Court of Appeals reversed, finding that though the POA authorized the deposit of funds into the checking account, Guito’s sons demonstrated that there were genuine issues of material fact. Specifically, the Court of Appeals said there were questions as to whether Connie breached her duty of good faith to Guito because, for example, depositing the funds into the joint account did not preserve his known estate plan and it was not clear that Guito reasonably expected her to do this.

  • Probate Court has discretion to accept inventory value of real estate based on appraisal later than date of death.
    Aug 16, 2021

    In re: Estate of Clonch, 11th Dist. Trumbull No. 2020-T-0079, 2021-Ohio-2815

    A beneficiary of an estate objected to the value of real estate listed on the estate’s inventory. The beneficiary provided an appraisal that was valued as of the date of death, finding a value of $109,500. This appraisal was done on a “drive by” basis, and the appraiser did not have access to the interior of the property, and the appraiser did not conduct his appraisal analysis until a year after the decedent died.

    The estate administrator’s appraiser evaluated the property almost a year after the decedent’s date of death and found the value to be $58,000 as of that time. The administrator’s appraiser inspected the interior of the property and found the interior was “extremely rough,” had “very unorthodox” modifications, the only heat source was a wood burning stove, and the property “has no evidence of being well maintained.” The appraiser later revised his opinion to note that there were no significant market changes or changes to the condition of the property that would change his opinion about the value as of the decedent’s date of death.

    The beneficiary objected to the administrator’s appraisal, specifically that it was not accurate because it was not valued as of date of death. The probate court found there had been no significant change or improvement to the property between the time the decedent died and the time of the appraisal, and the administrator’s appraisal was more detailed and rationally related to a realistic date of death value. The probate court accepted the administrator’s appraisal and overruled the objection to the inventory.

    The Court of Appeals affirmed the probate court, finding it was in the Court’s discretion to determine the value of the real estate for the inventory purposes and that the evidence supported the probate court’s determination.

  • Entering a settlement at any point in trial waives defects up to that point, even if the settlement is based on a misinterpretation of a jury’s compensatory damage award.
    Aug 5, 2021

    Morris v. Morris, 8th Dist. Cuyahoga No. 109854, 2021-Ohio-2677

    Amy was the sole shareholder of a family business and owed 500 shares of stock issued on 5 certificates of 125 shares each. In 2006, Amy was diagnosed with cancer, so she updated her estate plan. Amy’s estate plan left her personal property under her will to her daughter, Alex, who was in middle school at the time, and everything else to a trust for the benefit of Alex. Amy named her sister April and her mother father and father Bonnie and Jeffrey as Co-Executors of the Estate and co-Successor Trustees of her Trust. Alex had limited access to the trust assets until she turned 25.

    April moved in with Amy and Alex shortly before Amy died in 2010. Alex was only 17 when Amy died. April hired an attorney to administer Amy’s estate. The attorney only listed 125 shares of stock for the business as a probate asset and valued them at $26,048. April bought the shares from the Trust and April assumed complete ownership of the business.

    Alex claimed that she never received any notice or information about her mother’s will or trust until she found a trust document seven years after her mother passed away. It was undisputed that Alex never received any assets from her mother’s estate or trust.

    In Common Pleas court, Alex sued the attorney who helped April with the estate and trust administration for legal malpractice, and sued April, Bonnie and Jeffrey for various claims, including fraud, breach of fiduciary duty, and accounting, among other things. April, Bonnie and Jeffrey filed a counterclaim against April claiming she stole the trust records from Jeffrey’s house. The case went to bifurcated trial, first on liability and compensatory damages, and then later for punitive damages. After denying motions to dismiss, the judge assigned the trial to a visiting judge.

    At trial, the claims against Jeffrey were dismissed by the visiting judge on a directed verdict, but the claims against Bonnie and April and the counterclaim against Alex went to the jury. The jury awarded Alex $62,000 in compensatory damages for the fraud and breach of fiduciary duty against Bonnie and April, and awarded April $1.00 against Alex for Alex taking the records.

    In reviewing the jury’s verdict form, it was not clear to the plaintiff’s the jury was awarding Alex $62,00 for each claim, or $62,000 total. The judge determined – without consulting the jury – that the award was $62,000 in total. That night, before the hearing on punitive damages, the attorneys for the parties negotiated a settlement based on the jury verdict for April and Bonnie to pay Alex $120,000.

    The next day, plaintiff and defense counsel discussed the case with the jury off the record, and the jury stated that they intended to award $62,000 in damages to Alex for each claim, for a total of $310,000. The jury foreperson sent Alex’s attorney an e-mail that he was “sickened” at the thought that the judge interpreted their damages award as only $62,000 and hoped that the parties were able to adjust their settlement.

    Bonnie’s and April’s attorney sought to enforce the $120,000 settlement. Alex’s attorney’s argued the settlement was void because of the mutual mistake about what the jury intended to award as damages and pointed to the e-mail from the juror. The judge also ruled against Alex, finding that she settled the case and there was no settlement agreement in the record and no jurisdiction for the Court to enforce it. Alex appealed.

    On Appeal, Alex argued that either there was no settlement agreement or the settlement agreement was void due to the mistake of the visiting judge’s interpretation of the jury’s damage award. The Court of Appeals affirmed the trial court, finding that it was undisputed that Alex entered into a settlement agreement before the punitive damages phase. The Court of Appeals found that Alex never put the settlement agreement in the record and so it was not clear that the settlement incorporated the jury verdict into the agreement or if it stood alone. The court found that settling a case at any point in a trial results in a waiver of any defects up to that point. The Court of Appeals found that Alex was not even asking the Court to interpret the settlement agreement to determine if it was valid and enforceable, but found that it was clear that Alex agreed to the visiting judge terminating the trial based on a settlement that she entered into, and she did not otherwise object.

  • Court did not abuse it’s discretion in denying request to remove guardian, disqualify counsel, and disclose financial records to Ward’s next of kin
    Aug 2, 2021

    In re Guardianship of Bakhtiar, 9th Dist. Lorain No. 201CA011680, 2021-Ohio-2629.

    In “the most litigated guardianship (or any case) in Lorain County Probate Court history” the son of the ward was dissatisfied with the fees charged by his mother’s guardian and the attorneys hired by the guardian. The guardian sought permission from the probate court to hire attorneys to defend the guardian and the ward in other lawsuits filed by the son and some of his siblings, which the court approved.

    The son claimed the fees were excessive, that the attorneys and guardian had conflicts of interest, and that the attorneys should be required to produce bank statements to him as the ward’s next of kin. The son sought to remove the guardian and disqualify the attorneys. In a detailed, 29-page judgment entry, the probate court denied the son’s motions, finding that the guardian had faithfully carried out his duties, that there was no conflict of interest and that the fees were reasonable and necessary under the circumstances, and the son did not have standing to claim a conflict with the attorneys.

    The court of appeals affirmed the decision of the probate court, finding that the probate court had already limited the son’s involvement in the guardianship to visitation with his mother, not access to her finances, and finding that his motion to compel the attorneys to show cause to justify their attorney fees “defies logic and has no basis in law.”

  • When a settlor of a revocable trust defaulted on a personal guaranty obligation, the settlor’s creditor had the legal right to seize funds from a trust bank account.
    Jul 29, 2021

    Zipkin v. FirstMerit Bank, 8th Dist. Cuyahoga No. 109501, 2021-Ohio-2583.

    Zipkin created a revocable trust in the 1970s to hold real estate. Zipkin had a long relationship with a bank, which changed names through a series of mergers over the years. Zipkin opened personal and trust bank accounts at these banks and financed many of his real estate transactions at these banks. In 2012, Zipkin individually signed as a guarantor for a loan that the bank made to one of Zipkin’s friends. The terms of the personal guaranty provided that the bank had setoff rights to any account that Zipkin held at the bank, individually or jointly, but the bank’s setoff rights did not include “any trust accounts for which setoff would be prohibited by law.”

    Zipkin’s friend eventually defaulted on the loan and the bank exercised its setoff rights in two accounts that Zipkin held at the bank; one in his name individually and one in the name of his revocable trust. Zipkin individually and as trustee sued the bank for breach of contract and other claims, alleging that the bank improperly exercised its setoff rights against Zipkin’s revocable trust account. The trial court agreed with Zipkin, finding that the trust was not a guarantor of the loan and the setoff from the trust account was otherwise prohibited by law, which breached the guarantee agreement. The bank appealed.

    The Court of Appeals, in a 2-1 decision, reversed the trial court, finding that R.C. 5805.06 permitted the bank to exercise its setoff rights in this case. That statute provides, among other things, that a creditor of a settlor of a revocable trust may reach the settlor’s interest in the trust during his/her lifetime. While Zipkin testified that his children were the beneficiaries of the trust, the actual trust instrument provided that Zipkin was the sole trustee and beneficiary during his lifetime, and Zipkin further reserved an unlimited power to revoke the trust or withdraw any or all assets from the trust at any time. The Court of Appeals then determined that there was no evidence that Zipkin’s trust was a spendthrift trust, which could prevent creditors from attaching a beneficiary’s interests and prevent a setoff. The Court of Appeals determined that Zipkin’s trust account was subject to the setoff provision and setoff was not otherwise prohibited by law.

    The dissenting opinion stated she would find the setoff was improper because the trust was not a guarantor of the loan, there was insufficient evidence to show that the setoff was permitted by law, and because the bank provided no notice or legal process before seizing the funds in the trust account. 

  • Where probate settlement agreement involving guardianship, it was improper for party to agreement to seek enforcement of a right under the agreement in common pleas court even after the Ward had passed away.
    Jul 7, 2021

    Hoffman v. Arthur, Fifth Dist. Coschocton No. 2020CA009 & 2020CA0016, 2021-Ohio-2318

    In 2015, Douglas filed a lawsuit against his mother, Sandra, and a man named Phillip Arthur. Douglas alleged that his mother, as Trustee, improperly transferred trust real estate to Phillip and to an LLC for which Phillip was the sole member. Douglas alleged these transfers were invalid under the terms of the trust and were the product of undue influence by Phillip over Sandra. After the lawsuit was filed, Sandra was adjudicated incompetent, and a guardian was appointed.

    Sandra’s Guardian investigated Douglas’s claims and Sandra’s finances. The Guardian filed a counterclaim against Douglas, alleging he improperly withdrew more than $400,000 from Sandra’s accounts, but also joined in the claims of undue influence against Phillip and the LLC.

    The Guardian filed a motion for summary judgment against Douglas and receive a judgment in the amount of $408,162.69 against Douglas, which the guardian reduced to a lien and placed the lien against certain real estate owned by Douglas.

    Sometime later, Douglas, Phillip and the Guardian entered into a settlement agreement resolving all claims among them but specifically excepting the judgment lien against Douglas as valid and unsatisfied. The settlement agreement specifically stated that the Probate Court retained jurisdiction to enforce and interpret the settlement agreement as the sole and exclusive venue for litigation among the parties, and the Probate Court issued a judgment entry incorporating that same language on jurisdiction.

    The Guardian then sold some trust real estate and used that to satisfy the judgment against Douglas. Shortly after that, Sandra died. In her final guardian’s account, the Guardian did not list the debt/lien against Douglas as an asset or as resolved, but simply omitted it, stating “that asset is no longer in existence.” However, the guardian never filed a satisfaction or release of the judgment.

    Douglas applied to administer Sandra’s probate estate and Phillip filed a competing application based on a 2015 will that named Phillip as executor of Sandra’s estate. Douglas argued that Phillip should not be allowed to administer Sandra’s estate because he waived any inheritance rights by or through Sandra, but the Court appointed Phillip as Executor because the 2015 will was otherwise valid on its face.

    Douglas filed a motion for summary judgment in the estate case seeking a judgment that established, among other things, that Douglas had satisfied his judgment lien and debt to Sandra and the Lien should be released by Phillip as Executor. The probate court denied Douglas’s Motion for Summary Judgment.

    The next day, Douglas filed an identical complaint in Common Pleas court against Phillip as Executor and again moved for summary judgment, relying on an affidavit from the Guardian that she had deemed the judgment lien satisfied. The Common Pleas court granted Douglas’s motion and Philip appealed, arguing that the Probate Court had exclusive jurisdiction over the matter per the settlement agreement.

    The Court of Appeals agreed with Phillip and reversed the Common Pleas court’s Entry granting summary judgment to Douglas. The Court of Appeals said it appeared that the settlement agreement and the probate court judgment entry adopting the agreement appeared to make it clear that the probate court retained jurisdiction over this dispute. The Court of Appeals also stated that the probate court had jurisdictional priority over the matter, the claim being first filed there and still pending.

  • Attorney Fees Awarded to Counsel for Removed Guardian of the Person are not Subject to Appeal where not objected to in the probate proceedings.
    Jun 28, 2021

    In re Guardianship of Bakhtiar, 9th Dist. Lorain No. 19 CA011508, 2021-Ohio-2162

    A law firm was representing the guardian of the person in a guardianship, who was also a caregiver for the ward. One of the ward’s sons had a contentious and highly litigious relationship with this guardian of the person, his sister. The guardian of the person was removed as guardian and a successor guardian was appointed. Sometime after, the law firm representing the removed guardian of the person applied for attorney fees that included time for when their client was guardian of the person and after she was removed. The new guardian of the person and the court-appointed attorney for the ward consented to the fees and the probate court approved the fees in their entirety. The ward’s son did not object to the fees when they were submitted nor after they were approved by the Court. Instead, the son appealed the judgment entry granting the fees as an abuse of discretion.

    The court of appeals found that the son failed to timely object to the attorney fee application in the probate court and therefore he did not have standing to appeal the decision.

  • Attorney fees granted against a ward’s son who filed frivolous motions in guardianship proceedings were not improper.
    Jun 28, 2021

    In re Guardianship of Bakhtiar, 9th Dist. Lorain No. 20CA011676, 2021-Ohio-2163

    In a contentious guardianship, the ward’s son filed multiple motions and appeals related to alleged acts and omissions by the guardian and the guardian’s attorneys. The son’s motions and briefs were found to be frivolous. The attorney fees were presented to the court in a formal hearing with a joint expert witness for all of the attorneys. The probate court awarded attorney fees for frivolous conduct against the son and in favor of the guardianship and to some of the attorneys representing the guardians and the ward.

    The ward’s son appealed the award of attorney fees against him, arguing that his conduct was not frivolous and that the joint expert was not properly qualified as an expert. The Court of Appeals found the conduct was frivolous, the fees were proper and properly presented to the probate court by a local attorney whose practice was performed “85-90%” in this particular probate court’s jurisdiction. 

  • Probate court did not abuse discretion in denying minor name change because “custom” is not a sufficient grounds to grant change.
    Jun 23, 2021

    In the Matter of the Change of Name of OBA, 4th Dist. Scioto No. 20CA3920, 2021-Ohio-2212

    Savanna Lore gave birth to  a son, “O.B.L.” in 2017. Caleb Andronis subsequently established paternity and received parenting time with his child. Caleb later filed a petition with probate court to change the child’s surname to Andronis. At a hearing on the name change, Caleb argued that his family spends more time with the child and that during Savanna’s parenting time, the child is mostly with a babysitter. He further argued that it was “customary” for a child to receive the father’s surname and that he wanted to carry on his name. Savanna and her mother (the child’s grandmother) testified that OBL spent time with her family, that she cared for him “99% of the time,” that a name change would confuse the child, and that she “deserved” to give her son her own surname. The probate court determined a name change was no in OBL’s best interest and denied the father’s petition.

     On appeal, Caleb argued the probate court abused its discretion and that the court was openly contemptuous of his testimony, despite the fact that both parents felt they “deserved” to give their son their surname. The appellate court set forth the Willhite factors and notes that it cannot supplant the factual determinations of the probate court – it can only determine whether the probate court abused its discretion. The appellate court noted that “custom” is not sufficient evidence of a name change being in a child’s best interest. The appellate court agreed that the probate court admonished only Caleb for the argument that he “deserves” to give his son his name, when the mother testified similarly. However, that was not sufficient to taint the probate court’s overall ruling and findings under the Willhite factors. The appellate court affirmed the denial of the name change.

  • Beneficiary’s incarceration during estate administration does not create exception to statute of limitations to bring breach of fiduciary duty claims against estate administration 21 years after estate was closed.
    Jun 17, 2021

    Smith v. Smith, 8th Dist. Cuyahoga No. 109899, 2021-Ohio-1955

    Roosevelt died intestate in 1990. One of the beneficiaries of Roosevelt’s estate, his son Andre, was incarcerated for all or part of the time that Roosevelt’s estate was administered by William, that time being 1991-1998. In 2019, Andre sued William alleging that William breached his fiduciary duties to Andre by selling real estate and other estate administration errors. In his Complaint, Andre claimed the statute of limitations was tolled due to his disability in the form of incarceration and drug dependency.

    William filed for summary judgment, arguing that the statute of limitations had long since expired and, at the same time, that the doctrine of laches barred any claims. Andre argued that under the discovery rule, he did not discover William’s wrongdoings with the estate until 2019 so his statute of limitations was tolled. The trial court agreed with William and dismissed Andre’s Complaint.

    On appeal, the Court found Andre’s blanket claim that his incarceration tolled the statute of limitation was incorrect. The Court found that based on his pleadings, Andre was no longer incarcerated by at least 1998 when the estate was closed, and therefore his statute of limitations commenced no later than 1998. The Court did not consider the laches defense. The case was dismissed.

  • Current trust beneficiaries can sue for accounting of transactions that occurred during time where they were vested but not-yet-current beneficiaries.
    Jun 11, 2021

    Yeager v. U.S. Bank, 1st Dist. Hamilton No. C-200262, 2021-Ohio-1972

    U.S. Bank was Trustee of the Trust where there was a primary beneficiary named Robert. Robert’s three sons were successor beneficiaries upon Robert’s death. At some point in 2011 while Robert was beneficiary, U.S. Bank discovered one or more of its trust officers embezzled funds out of multiple trusts, including the Trust for Robert. It is not clear if U.S. Bank disclosed the embezzlement to Robert. Instead, U.S. Bank returned the embezzled funds to the Trust account later in 2011 and identified the deposit as “Cash Receipt Miscellaneous Receipt Reimb Cash Due to Loss.”

    Robert died in 2017 and his three sons became the beneficiaries of the Trust. In 2018, Robert’s sons sent a letter to U.S. Bank demanding an explanation of the miscellaneous cash reimbursement back in 2011, and later asked U.S. Bank for a full accounting of the Trust. U.S. Bank never provided an accounting or explanation, so Robert’s sons sued the bank in 2018 demanding an accounting. U.S. Bank sought to dismiss the Complaint for lack of standing, arguing that Robert’s sons were not beneficiaries at the time and were not in privity with U.S. Bank.

    Robert’s sons amended their Complaint to add claims for breach of fiduciary duty, conversion and civil theft. U.S. Bank again sought to dismiss the Complaint for lack of standing and lack of privity, arguing that the sons were not beneficiaries of the trust at the time. The trial court granted U.S. Bank’s motion to dismiss pursuant to Civ.R. 12(B)(6), with prejudice.

    The Court of Appeals reversed the trial court. The Court of Appeals found that the sons’ demand for an accounting triggered U.S. Bank’s duty as trustee under R.C. 5808.13 to respond to the beneficiaries’ request for information related to the administration of the trust unless the request is unreasonable. The Court of Appeals found the request for the accounting was reasonable and thus the sons properly stated a claim for an accounting.

    As to the claim that the sons lacked privity, the Court of Appeals disagreed with the trial court. The Court of Appeals found that this was an irrevocable generation skipping trust and the sons’ interest in the trust was vested upon the creation of the trust. Therefore, they were in privity with the trustee and even though they were not primary beneficiaries, their interests were vested. The Court of Appeals rejected the argument that current beneficiaries could not sue for allegedly improper conduct that occurred prior to their becoming current beneficiaries. Thus, the Court found that the sons properly stated a claim for breach of fiduciary duty.

    For the conversion and civil theft claim, the Court of Appeals found that the claims were not properly pled, but could have been pled in another way. Therefore, the dismissal was proper, but the dismissal should have been without prejudice.

  • Spousal elective rights are tolled until the court issues the formal citation to the spouse of spousal rights.
    Jun 1, 2021

    In re Estate of Weitzel, 12th Dist. Warren No. CA2021-01-001, 2021-Ohio-1859

    Joseph married Martine. Joseph had two children from a prior marriage before he met Martine. Joseph died intestate in December 2018. Martine applied to administer Joseph’s estate in August 2019 and was appointed as administrator. The probate court did not issue the citation to surviving spouse as required by R.C. 2106.01(A) after Martine was appointed.

    In October 2020, more than a year after Martine had been appointed administrator of the estate, Joseph’s children filed a motion to bar Martine from exercising her spousal rights under R.C. 2106, arguing that she failed to affirmatively elect to exercise those rights within five months of her appointment as fiduciary. Martine argued, and it was undisputed, that the probate court failed to issue her the citation to the surviving spouse. Accordingly, her spousal election period – five months from the issuance of the citation – never ran, so her rights had not expired, and she asked the court for an extension to make her election. The probate court agreed with Martine and held that it was the court’s duty and the court’s error with regard to the citation to the surviving spouse. The probate court gave Martine 14 days to make an election.

    Joseph’s children appealed the probate court’s decision, but the 12th District sided with Martine. The 12th District found it was the probate court’s statutory obligation to issue the citation and the spousal election period does not run until the citation is properly served on the spouse. While R.C. 2106.01(E) says that the time for a spouse to elect against a will begins to run as soon as the fiduciary is appointed, the court found it inapplicable because Joseph died intestate, and this section had to do with election against a will.

  • Attorney who notarized execution of a contested POA is properly disqualified from representing the proposed ward.
    May 27, 2021

    In re Guardianship of Carney, 8th Dist. Cuyahoga No. 110034, 2021-Ohio-1819

    Attorney who notarized execution of a contested POA is properly disqualified from representing the proposed ward.

    In a power of attorney, James Carney, Jr. nominated his son, James Carney, III to be his guardian. The POA also authorized the son to retain attorneys on his father’s behalf. While the father was in a psychiatric unit, his cousin, Joseph Carney, had the father sign a limited power of attorney nominating Jeanne Carney (Joseph’s wife) as his guardian. Joseph is an attorney and he notarized the limited POA.

    The son applied to be his father’s guardian and Jeanne filed a competing application. The son argued that the limited POA nominated Jeanne was the result of lack of capacity, undue influence and/or improper conduct by Joseph, a lawyer. The guardianship matter involved several disputes over who could retain independent counsel for the potential ward and whether Joseph could serve as the potential ward’s counsel.

    The probate court granted the son’s motion to disqualify Joseph from representing the potential ward. The court based the disqualification in part on the fact that Joseph was a necessary witness regarding the signing of the limited POA. The potential ward – through new counsel – appealed the probate court’s disqualification of Joseph.

    The Eighth District upheld the disqualification. It was not required for the probate court to have a full hearing on the issue and it could be decided on the briefing. The probate court properly found Joseph would be a necessary witness and there was no exception in Prof.Cond. 3.7 permitting Joseph to serve as a lawyer and witness.

  • No hardship exemption for denial of Medicaid benefits, when applicant owned two parcels of real estate that she was unable to sell.
    May 26, 2021

    Cowan v. Ohio Dept. of Jobs & Family Servs., 1st Dist. Hamilton No. C-200025, 2021-Ohio-1798

    Mrs. Cowan was in a nursing home and authorized her nursing home to apply for Medicaid on her behalf. Mrs. Cowan’s application for Medicaid benefits was denied because Mrs. Cowan owned two parcels of real estate that had a combined county auditor valuation of $6,000, which was in excess of the Medicaid resource limit of $2,000. Mrs. Cowan appealed the denial of her Medicaid benefits because she had tried to sell the properties but could not find a buyer, arguing that because she could not find a buyer, the properties should not count as assets. Mrs. Cowan was represented by an attorney for the nursing home.

    ODJFS opposed Mrs. Cowan’s appeal, arguing that the nursing home’s attorney was really representing the nursing home and not Mrs. Cowan, and thus the nursing home was not the real party in interest. The trial court agreed, but alternatively ruled that the real estate value was in excess of the Medicaid asset limit and there was no applicable exemption so the denial of the Medicaid benefits was proper.

    Mrs. Cowan eventually gave away the two parcels and was approved for Medicaid. However, Mrs. Cowan appealed the trial court’s decision anyways. The Court of Appeals found that even though the Nursing Home’s attorney admitted he was hired by the nursing home, he did not indicate that he did not also represent Mrs. Cowan. Therefore, the trial court’s decision to dismiss for lack of standing/not the real party in interest was error. However, the court of appeals ultimately upheld the denial of Mrs. Cowan’s appeal because Ohio’s Medicaid rules for asset limits were clear, bright line rules and no exception to the rule applied.

  • Trust beneficiary does not have standing to challenge prior trust transactions before having vested interest.
    May 20, 2021

    Campbell v. Donald A. Campbell 2001 Trust, 8th Dist. Cuyahoga No. 109585, 2021-Ohio-1731

    Margaret and Donald Campbell created an elaborate estate plan involving multiple trusts, a family limited partnership (FLP), and life insurance. Donald created the Donald Trust, which excluded one of his sons, Allen, as a beneficiary. Margaret created the Margaret Trust that included Allen as a beneficiary. When Donald died, Margaret became the sole trustee and primary beneficiary of the Donald and Margaret trusts and became the managing partner for the FLP. The FLP required equal contributions and equal split of costs from the partners, which was effectively Margaret’s Trust and Donald’s Trust, at the discretion of the managing partner. Margaret utilized funds from primarily her Trust and the FLP to pay for her care from 2010 until her death in 2015.

    After she passed away, her son Allen became the successor trustee and a vested beneficiary in the Margaret Trust. He discovered that his mother used more of the money in her own trust to pay for her care from 2010 to 2015 and thought it was unfair that the Donald Trust did not pay for more of those expenses. Allen alleged that his mother’s conduct in using trust assets and FLP assets to pay for her care diminished his inheritance through the Margaret Trust, and so he sued the successor trustees of the Donald Trust and the Margaret Trust and the beneficiaries of each, to recover funds that he felt were owed to Margaret’s Trust. Allen eventually resigned as executor of Margaret’s estate and as Trustee of Margaret’s Trust. Allen brought three lawsuits about the trust administration during his mother’s lifetime and it culminated in one case that he originally filed in the general division that was transferred to probate. The probate court dismissed all of Allen’s claims for lack of standing and failure to state a claim. 

    Allen appealed the dismissal and alleged the probate court lacked jurisdiction to hear the case because he was seeking money damages due to fraud and because he filed in common please first, argued that he had standing to bring the claims as a beneficiary of the trust, and generally disagreed with the court’s dismissal of his claims.

    The Court of Appeals found that the probate court had exclusive jurisdiction over the trust dispute and concurrent jurisdiction over the related claims. The court found that Allen’s claims of fraud were really against his mother for fraud against herself or her trusts in her lifetime, and there were no specific allegations of fraud against the actual defendants to his case. The court also found that there was no jurisdictional priority in the common pleas court because there were not two related cases in two different courts; rather the common pleas court elected to transfer the case to probate jurisdiction.

    The Court of Appeals agreed with the probate court that Allen lacked standing to challenge his mother’s conduct as trustee and beneficiary because he was not a vested beneficiary at the time of the alleged misconduct and the trusts and the FLP gave his mother discretion to spend as much of the money as she wanted for her benefit. The court found that Margaret’s exclusive authority over all of the assets prevented Allen from claiming an injury in the use of those assets because that was “exclusively her prerogative.” The court added that Allen could not have been damaged by this conduct during Margaret’s lifetime as his interest did not vest until after her death. Nor could the successor trustees and beneficiaries have done any harm to Allen because the conduct preceded their rights and interests in the trusts as well.

  • Responsive pleading that expresses doubts about validity of will does not trigger "no-contest clause".
    May 3, 2021

    In re: Estate of Damschroder, 3rd Dist. Seneca No. 13-20-19, 2021-Ohio-1558

    John died in 2015 and his will left the residue of his estate to his daughter Tina and step-daughter Debra in equal shares. John appointed Tina’s son as the executor of his estate. The Will omitted John’s daughter Lia Ann, who filed a will contest action naming Tina and Debra as necessary parties. In response to the will contest action, Debra prepared a letter and mailed it to the court, stating that this was her answer to the will contest case. In her letter, she said she did not have money to hire an attorney, that she wanted to protect her interests in the estate, and that she had “serious concerns” about John’s legal documents including his Will. Debra also expressed concern about Tina’s role in allegedly having John sign new documents.

    John’s Will had a no-contest clause that stated if any beneficiary of the Will would “directly or indirectly” oppose the probate of the Will, or if any beneficiary or next of kin would “initiate, participate in, either directly or indirectly, or prosecute any legal action whatsoever to contest or set aside” the Will, then that person would be disinherited from the estate.

    The will contest case went to trial and Debra testified, but she was not asked about the validity of the will and did not testify in such a way to contest the will. The jury found the will to be valid. After the trial, the executor of the estate filed a declaratory judgment action asking the court to determine if Debra violated the no contest clause by indirectly or directly challenging the validity of the will based upon (a) filing a response to the will contest action (b) the contents her written letter to the court and (c) her voluntary participation in the will contest trial. The trial court found Debra did not trigger the no contest clause.

    The court of appeals agreed with the trial court. The court of appeals said that filing a response to the will contest action was not a challenge and was a reasonable and necessary thing to do. The court said that the contents of the letter sought to protect Debra’s interest in the estate, not challenge the validity of the Will – even if the letter said there were concerns about the documents. Finally, the court said that her participation in the will contest trial was also reasonable and did not relate to the validity or invalidity of the will.

  • It was abuse of discretion not to hold a hearing on an attorney fee application where the probate court previously authorized the guardian of the person to retained counsel and “to bind the guardianship estate to the same.”
    Apr 30, 2021

    In re: Guardianship of Montgomery, 6th Dist. Erie No. E-20-016, 2021-Ohio-1546

    The probate court appointed an attorney the guardian of the estate of Mr. Montgomery. Subsequently the court appointed the ward’s son, Kevin, guardian of his father’s person, on the condition that Kevin retain counsel. The court signed an order – prepared by Kevin’s counsel, McLoughlin – permitting Kevin to enter a fee agreement and requiring that a fee application be approved before payment from the guardianship to Kevin’s counsel. Later, Kevin dismissed McLoughlin as his counsel and McLoughlin filed an application for $15,353 in fees and costs for representing Kevin from October 2019 through May 2020. The probate court denied the fee application for the following reasons: 1) it had not appointed McLoughlin as counsel; 2) the guardianship had insufficient funds to pay the fee. The guardian of the estate also objected to payment of the invoice.

    McLoughlin appealed. The Sixth District found the probate court abused its discretion. First, the complexities of this guardianship required the court to hold a hearing on the attorney fee application. Also, the probate court did approve an order authorizing Kevin to hire McLoughlin and therefore McLoughlin was entitled to present evidence on the necessity and reasonableness of his services.

  • Debtor of an Estate lacks standing to file exceptions to final account and a probate court’s order dismissing exceptions to an account is not a final appealable order.
    Apr 22, 2021

    In re: Estate of Abraitis, 8th Dist. Cuyahoga No. 109810, 2021-Ohio-1408

    Through a long history of removal of fiduciary, investigation, and associated appeals, the probate court ordered Catherine Brady (“Brady”) and her former client, Sarunas, jointly and severally, to pay $104,485 in attorney fees and costs to the Estate of Vlada Abraitis. In the interim, Sarunas died and Brady became the Executrix of his estate. She was removed from this role as well, in part because of the conflict: Sarunas and Brady, jointly, were debtors of Vlada’s Estate. Brady filed exceptions to the final account of Sarunas’s Estate, which were dismissed for lack of standing (2020-Ohio-4222). Subsequently, the Executor of Vlada Estate – i.e., the creditor to whom Brady owned money – filed a final account. Brady asserted exceptions to the that account. When her exceptions were dismissed, Brady appealed that decision, but did not appeal the order approving the final account.

    The 8th District again dismissed for lack of final appealable order and commented that again, Brady lacked standing. An order that denies exceptions to an account or inventory is not a final appealable order and does not affect a substantial right, so no interlocutory appeal is allowed. Even if the order was final, Brady lacks standing. She – as a debtor to the Vlada Estate – is not a “person interested” in the Vlada Estate. She has not “direct pecuniary interest” in the account or the Vlada Estate.

  • Creditor claim served on attorney for fiduciary is not properly presented under R.C. 2117.06
    Apr 1, 2021

    Stafford Law Co., L.P.A. v. Estate of Coleman, 8th Dist. Cuyahoga No. 109377,  2021-Ohio-1097

    Attorney provided legal services to decedent in her lifetime. Attorney filed notice of claim in the probate court within six months after the decedent’s death and certified service of the notice of the claim to the fiduciary in care of his attorney at his attorney’s address within six months of the decedent’s date of death. The fiduciary rejected the claim saying it was not properly presented to him as fiduciary and that service on his agent, his attorney, was not sufficient service under 2117.06.

    After litigation in common pleas and in probate court, the probate court issued an entry stating that the attorneys’ creditor claim was timely presented against the estate, but that the claim was rejected by the fiduciary so the probate court had no jurisdiction to enforce the claim. The attorney then was granted summary judgment in the common pleas court on the argument that the probate court determined the claim was properly presented.

    The court of appeals reversed, finding that the probate court’s entry about proper presentment was void because the court lacked jurisdiction after the claim was rejected by the fiduciary. The court of appeals also reversed on the grounds that presentment of a creditor claim must actually be made upon the fiduciary and that service in care of the fiduciary’s attorney was not sufficient under 2117.06.

  • Order appointing a master commissioner to investigate a fiduciary’s conduct during decedent’s lifetime is not a final appealable order.
    Mar 31, 2021

    In re Estate of Durkin, 9th Dist. Summit C.A. No. 29532, 2021-Ohio-1076

    In an estate administration, there were allegations that the fiduciary had acted improperly toward the decedent during her lifetime as her power of attorney. The probate judge appointed a special master commissioner to investigate the fiduciary’s conduct as power of attorney to determine if any additional assets should be included in the estate. The fiduciary appealed the order appointing the master commissioner.

    The court of appeals dismissed the appeal for lack of a final order. The court of appeals ruled that the appointment of the master commissioner does not remove the fiduciary and therefore does not affect a substantial right. The master commissioner’s findings may lead to the fiduciary’s removal, but it was premature to argue that and therefore not appealable.

    One judge dissented, arguing that the appointment of the master commissioner was to review the fiduciary’s conduct and justify his removal. Therefore, a substantial right was affected and an interlocutory appeal would be allowed.

  • Jury verdict reversed because admitted character evidence against defendant was prejudicial and prejudice outweighed probative value
    Mar 31, 2021

    Erzurum v. Erzurum, 7th Dist. Mahoning No. 20 MA 0012, 2021-Ohio-1162

    Mom and dad transferred to high-revenue rental properties to Son in 2018 and 2019. Later, Mom and Dad sued Son to undo the real estate transfers, alleging undue influence and duress by Son on Parents. Parents were in their 90s and had physical ailments. Parents alleged that Son had a deceitful past, including allegations of Medicare fraud, two bankruptcies, and a secretive move to Turkey without telling his parents. Son claimed that he was never charged with a crime, that bankruptcies were necessary and one was at his parents’ request, that they transferred the real estate to him as part of a long-established plan and to induce him to stop practicing medicine, and that his parents were suing him in retaliation for his refusal to falsify the income tax records for the rental properties.

    The case proceeded to a seven-day jury trial. Despite Son’s objections, the Court permitted Mom and Dad and their counsel to discuss the Medicare fraud claim from 2003, the bankruptcy from 2004, the move to Turkey from 2005 to 2012, and the 2012 bankruptcy. The jury found in favor of Mom and Dad to undo the real estate transfers.

    The Court of Appeals said that the two arguments presented by Mom and Dad and Son were diametrically opposed, and thus the entire case turned on witness credibility. The Court of Appeals found that the character evidence against son from his prior mistakes was more prejudicial than probative. The Court of Appeals made the highly rare decision of reversing the jury’s verdict and remanding the case for a new trial.

  • Denial of application to administer estate affirmed where conflict existed between named fiduciary and next of kin.
    Mar 30, 2021

    In re Estate of Wilson, 9th Dist. Summit C.A. No. 29738, 2021-Ohio-1056

    The probate court denied the application to administer an estate filed by the executor nominated under the decedent’s will after the applicant’s brother, who was a next of kin of the decedent but not a beneficiary under the will, filed a will contest action against the applicant and other litigation. The denied executor appealed.

    The Court of Appeals ruled that the probate court has discretion to appoint a fiduciary of an estate and the appellant failed to show an abuse of discretion. It was undisputed that there was conflict between the applicant and the objector, and it was undisputed that there was litigation. The court did not find it material that the challenged will and the prior will were pour-over wills with a trust as the sole beneficiary.

    The Court of Appeals also rejected the appellant’s argument that the objector did not have standing to object to his appoint as a fiduciary because he was not a beneficiary under the challenged will or a prior will. The Court reasoned that all next of kin are entitled to notice of a fiduciary’s application and thus have standing to object to the appointment.

  • Probate court abused discretion in approving final account without setting it for a hearing and denying motion to reopen estate.
    Mar 19, 2021

    In re Estate of Cornell, 6th Dist. Williams No. WM-200-005, 2021-Ohio-877

    After Alfred Cornell’s death, two wills were presented for probate: a will dated in 2001, which left the probate assets to a trust, and a will dated in 2015, which appointed Alfred’s son, Galen, as the fiduciary. The probate court accepted the 2015 will for probate and appointed Galen as Executor. The co-trustees – as beneficiaries of the 2001 will – filed a will contest. The will contest ended in a settlement reinstating the 2001 will and appointing Thompson Smith as executor as of March 2019.

    In June 2019, Brian Kaiser, the attorney who represented Galen for his stint as executor, wrote to Smith requesting his attorney fees for estate administration in the amount of $6,305.80. On October 22, 2019, the estate filed and the probate court immediately approved attorney fees, executor fees, accepted a statement in lieu of final account, and discharged Smith as Executor. On October 29, 2019, Smith wrote to Kaiser denying the claim for his attorney fees.

    In February 2019, Kaiser and Galen each moved to reopen the estate to address Kaiser’s attorney fee claim and Galen’s concern that the fees paid to Smith and his attorney were inflated due to the a piece of real estate titled to the trust having been included in the probate inventory. The probate court denied the reopening of the estate. Galen appealed.

    The Estate argued Galen was not a beneficiary and had no standing to appeal or to object to the fiduciary and accounting fees. Furthermore, the Estate argued that Attorney Kaiser did not file suit within 2 months of the October 29, 2019 “rejection,” therefore R.C. 2117.12 barred his claim. The appellate court held it was an abuse of discretion not to reopen the estate.

    The 2001 will poured into a trust, of which Galen was a beneficiary; therefore, he was an “interested party” with standing to object to the expenses of the estate. Galen, as a next of kin, was entitled to a copy of the estate inventory pursuant to the local rule, but had not received one – and therefore did not have the opportunity to object to the inclusion of the real estate. Further, the probate court was required by R.C. 2109.32 to set the final account for a hearing at least 30 days after the filing of the account. The probate court approved the filings immediately, so no one had a chance to object to it.

    With regard to Kaiser’s claim for attorney fees, the appellate court noted that the 6-month deadline to file claims under R.C. 2117.06 does not apply to claims for attorney fees which were incurred as estate administration. Such fees did not exist or accrue before death. While Kaiser did not file a suit on the claim within two months of the October 29, 2019 “rejection” letter (as required by R.C. 2117.12), Smith had been relieved of his role as executor on October 22. Smith had no authority to accept or reject the claim – therefore, the claim was still pending and the estate had to be reopened to address it.

  • Where a nursing home unsuccessfully petitioned to remove a guardian, and the probate court ordered the nursing home to pay a GAL’s attorney fees, the probate court’s order is affirmed.
    Mar 15, 2021

    Progressive Macedonia, L.L.C. v. Shepherd, 11th Dist. Trumbull No. 2020-T-0036, 2021-Ohio-792

    A nursing home (NH) petitioned the probate court to remove the guardian of one of the NH’s residents. The NH alleged that the guardian had allowed the resident-ward’s Medicaid to lapse, so the NH was not being paid. The probate court assigned a guardian ad litem (GAL) to review the matter. The GAL determined that the removal petition was not “well-founded” and payment to the NH was rectified by a retroactive Medicaid application. The Court ordered that the GAL “shall be entitled to compensation and expenses for serving as GAL...” and a dispute arose over whether the NH had standing to seek removal – but, the ward died before the Court could issue rulings. The GAL then filed a motion for its fees, and a magistrate issued an order that the NH must pay the GAL’s legal fees. The same day, the Court adopted the magistrate’s order. The NH appealed the Court’s order, but did not object to the Magistrate’s order, regarding payment of the GAL’s fees and costs.

    The court of appeals upheld the order for the nursing home to pay the GAL’s attorney fees. The NH made a variety of technical and procedural arguments in its own defense, including that the NH lacked standing in the first place and therefore the magistrate’s decision and judgment entry were void. The court of appeals agreed that guardianship proceedings are in rem and are typically limited to the guardian, the ward and the court; therefore, the probate court probably erred in entertaining the NH’s motion to remove. However, the NH invited this error by bringing the claim in the first place and vigorously asserting its rights. Thus, the court of appeals found that other “interested parties” could seek to remove a guardian in certain circumstances, and in this case any error was voidable by the court, but not void ab initio.  

  • A guardian’s testimony can be sufficient to grant a divorce between the ward and the ward’s spouse where the record shows the ward is not able to testify.
    Mar 11, 2021

    McMillan v. McMillan, 8th Dist. Cuyahoga No. 109048, 2021-Ohio-698

    James and Tonya married in 2004. In February 2017, James left the marital home and moved in with his daughter, Ms. Hood. On March 10, 2017, Tonya applied to be guardian of James and Ms. Hood later filed a competing application to be her father’s guardian. On March 14, 2017, James (through a lawyer) filed a petition for divorce from Tonya, alleging incompatibility and gross neglect.

    In June 2017, the probate court appointed Ms. Hood as James’s guardian, in part because of the conflict of interest between James and Tonya due to the pending divorce.

    In the divorce trial, Tonya testified that James attempted to reconcile in June 2017 by coming back to the marital home and that James did not want a divorce. Ms. Hood testified that James filed the divorce petition of his own volition and that the June 2017 incident was not an attempt at reconciliation, but rather James had wandered, gotten lost, and appeared at his prior residence. James did not testify in the divorce trial; neither party attempted to call him. The domestic relations court found James was not competent based on the probate court record and that although there was not evidence of gross neglect or incompatibility, the record was clear that James and Tonya had lived separate and apart for more than one year. The domestic relations court granted the divorce over Tonya’s objections.

    Tonya appealed the divorce asserting that granting the divorce solely on the testimony of a spouse’s guardian was improper. The appellate court affirmed and distinguished this case from Boyd v. Edwards, 4 Ohio App.3d 142 (8th Dist.1982), where the guardian filed the petition and the court thwarted attempts to allow the ward to testify. In James’s matter, he filed his own petition for divorce and there was no evidence before the domestic relations court that James was competent or able to testify or express his wishes. There was no error in granting the divorce based on living separate and apart for one year and based on the testimony of the guardian.

  • Determination of heirs of estate is final appealable order and failure to allow opposing party to appear and present evidence contrary to claimed heirs is a violation of due process.
    Mar 5, 2021

    Froelich v. Rogers, 2d Dist. Montgomery No. 28916, 2021-Ohio-604.

    Steven died intestate, survived by his brother Darryl and, allegedly, two minor children that Steven fathered out of wedlock. After Steven’s death, the local child support agency filed a paternity complaint against Steven and DNA evidence showed that the Steven was likely the father of the two minor children. The juvenile court entered an order of paternity but denied child support due to Steven’s death. A third party applied to administer the estate and petitioned the probate court to determine Steven’s heirs, naming Darryl and the two minor children as potential heirs. Darryl argued that determinations of paternity after the decedent’s death are invalid for purposes of inheritance. The administrator provided the probate court with the juvenile court order. The probate court determined that the minor children had established Steven as their father and there was no evidence to the contrary. The probate court ordered the minors as Steven’s only heirs without a hearing.

     The court of appeals reversed, finding that Darryl had a potential property interest in the estate and the hall mark of due process is the right to notice and a hearing before a party can be deprived of a property right. Because there was no hearing, Darryl was denied procedural due process (no notice, no hearing) and this was a violation of his constitutional rights.

     Darryl also appealed the effect of the post-mortem parentage determination, but the court of appeals declined to address issue and remanded the case to probate court.

  • Admission of will to probate is not a final appealable order even when there is a dispute about whether the will is valid on its face.
    Mar 4, 2021

    In re Estate of Brown, 11th Dist. Trumbull No. 2020-T-0049, 2021-Ohio-655.

    Donald Brown died and one of his children filed his 2003 will for probate. Later that day, a different child filed a 2019 will for probate, but the witness signatures were handwritten in print, not cursive. The probate court set the 2019 will for a hearing on whether it was sufficient on its face. After a hearing that included testimony from the witnesses to the will confirming their printed names, the probate court concluded the 2019 will was sufficient on its face and accepted the will for probate. The proponents of the 2003 will appealed the decision.

    The court of appeals dismissed the appeal for lack of a final appealable order. The court of appeals reasoned that the real dispute was over the validity of the 2019 will and the order admitting it to probate merely determined the will appeared valid on its face. The 2003 proponents had other remedies, such as opposing the fiduciary’s appointment in the 2019 will and filing a will contest.

  • In application for minor’s change of name, failure to perfect service on parent when address is known to the applicant precludes order approving the name change.
    Mar 4, 2021

    Decot v. Biggerstaff (In re Biggerstaff), 5th Dist. Perry No. 20 CA 00012, 2021-Ohio-591

    Mother and Father had were divorced and father moved to California. Mother later applied to probate court to change the last name of their minor daughter to mother’s last name. Mother listed Father’s last known address on her application, but never perfected service on Father. Instead, mother selected publication as her service method and followed the rules for publication. After the publication period was complete, the probate court granted the application without hearing. Father later found out and appealed.

    The court of appeals reversed the name change because the father’s address was known but service was not perfected. Service by publication is not proper when the last known address is known unless and until the applicant can prove failure or refusal of service.

  • Where probate court did not enter a finding of mental illness, appellate court dismissed appeal of temporary order for lack of jurisdiction.
    Feb 26, 2021

    In re: Pena, 6th Dist. Erie No. E-19-060, 2021-Ohio-531

    On September 27, 2019, based on affidavits from a doctor pursuant to R.C. 5122.11 and R.C. 5122.111, Erie County Probate Court ordered the appellant to be held at the hospital due to mental illness. The following day, appellant was admitted to a hospital in Lucas County. On October 1, doctors submitted affidavits to Lucas County Probate Court to have the appellant hospitalized due to mental illness. Lucas County granted the order to hospitalize appellant.

    By law, the probate must have a hearing within 5 days of an order to hospitalize a person. Erie County never held such a hearing based on their September 27 order. Lucas County held a hearing on October 3, at which time the magistrate ordered that the appellant be hospitalized not longer than 90 days. Appellant filed objections to the magistrate’s decision and the court scheduled a hearing before the judge on October 24. At this hearing, a doctor testified that the appellant no longer required hospitalization. Based on the testimony, Lucas County Probate Court found a lack of clear and convincing evidence of mental illness.

    Appellant appealed only the September 27, 2019 order of Erie County Probate Court. She made no appeal of any order issued by Lucas County Probate Court. Generally, a person in appellant’s position can appeal a finding of mental illness because of the stigma such a finding may carry.

    The appellate court dismissed this appeal for lack of jurisdiction. The Sixth District found that Erie County Probate had issued only a temporary order, and because Erie County had no hearing within the five days required, that case was dismissed. There was no finding of mental illness for appeal.

  • Estate planning attorney found liable for legal malpractice for failed Medicaid plan due to failure to fund the trust, improper document execution and poor communication between drafting attorney and clients.
    Feb 25, 2021

    McGraw v. Jarvis, 10th Dist. Franklin No. 19AP-538, 2021-Ohio-522 

    Please note: This case has complicated set of facts and procedural nuance that resulted in cross-appeals. We recommend a full and careful reading of the opinion. A Reminger blog is forthcoming about this nuanced matter.

  • Where a party’s will contest is dismissed for failure to join necessary parties, that party cannot later object to the settlement of a properly-filed will contest, in which he did not assert his own claim.
    Feb 24, 2021

    Lehmann, et. al. v. Westhoeffer, et. al., 5th Dist. Tuscarawas No. 2020 AP 01 0001, 2021-Ohio-529

    On the day of her death, Kies executed a last will and testament that Westhoeffer, her friend of 30+ years and neighbor assisted her in preparing. The will had only 1 witness. The will left Kies’s entire estate to Westhoeffer and made her the executor. After a hearing, the will was admitted under R.C. 2107.24, the non-conforming will statute. Kies’s heirs-at-law included 31 cousins. Lehmann, an heir-at-law filed a pro-se will contest that failed to name all next-of-kin. Two other groups of cousins, represented by counsel, also filed will contests. Then, Lehmann amended his complaint without leave of court and named thirty “plaintiffs” other than himself, but did not issue proper service to all parties. Over his objections, the probate court dismissed Lehmann’s will contest for failure to properly add necessary parties. Lehmann did not appeal. The probate court proceeded to trial on the two will contest cases filed by other next-of-kin.

    After the court empaneled a jury, the parties settled the two will contests. Lehmann participated in settlement discussions and agreed with the settlement. Nonetheless, Lehmann filed motions to stay the settlement. Ultimately, the probate court approved a final accounting that distributed the estate pursuant to the settlement terms. Lehmann received and cashed his distribution pursuant to the final account. Lehmann then filed a “motion for summary judgment” alleging fraud, undue influence, lack of capacity, and the application of the voiding statute because Westhoeffer was involved in the preparation of the will. The probate court denied this “motion for summary judgment,” terminated the litigation, and closed the estate. Lehmann appealed on his own behalf and on behalf of eight others.

    The appellate court affirmed the probate court. Frist, the appellate court notes that Lehmann cannot sue on behalf of others as he is not a licensed attorney. Next, with regard to all of Lehmann’s assignments of error, the appellate court found that Lehmann never properly contested the will. His complaint was dismissed for not including the proper parties; Lehmann did not appeal that decision nor amend his complaint. Finally, Lehmann participated in settlement discussions and received his funds pursuant to the settlement.

  • Summary judgment in favor of defendant in will contest alleging undue influence and lack of capacity was proper where the only evidence of lack of capacity and susceptibility was an affidavit by one of the plaintiffs.
    Feb 23, 2021

    Allerton v. Burns, 5th Dist. Licking No. 2020CA00042, 2021-Ohio-500

    The decedent, Ona, created a will in 2014 benefiting some of her children and grandchildren, and made her daughter Deborah, the defendant, the residuary beneficiary. Ona created a new will in 2019 that gave additional cash gifts to grandchildren, but left the residue portion to Deborah unchanged. Deborah’s sister Julia contested the 2019 Will alleging undue influence and lack of capacity based on a recollection that Ona had a stroke in 2013 and her doctor said the stroke affected the portion of Ona’s brain responsible for making decisions “about finances.” There was no other evidence of how the stroke made Ona susceptible to undue influence, and Julia admitted that Ona was strong willed. The probate court granted summary judgment in favor of Deborah.

    On appeal, Julia argued there were genuine issues of material fact about the validity of the 2019 will and Ona’s susceptibility to undue influence. The court of appeals disagreed, finding that though there was opportunity for Deborah to exert undue influence—Ona lived with her before 2013 until her death in 2019—there was no evidence that Ona was susceptible to undue influence, or that the 2019 Will showed a result of undue influence. As compared to the 2013 Will, Deborah could have received less than under the 2013 will, or at least Deborah did not receive any greater portion.

  • Probate court does not have exclusive subject matter jurisdiction to recover assets fraudulently taken from the decedent in his lifetime.
    Feb 22, 2021

    Love v. Love, 4th Dist. Jackson No. 20CA4, 2021-Ohio-558

    The executor of an estate brought money damage claims in common pleas court for fraud, unjust enrichment, conversion and theft against the defendant. The complaint alleged the defendant fraudulently opened a joint bank account with the decedent four days after the decedent was diagnosed with dementia and the decedent was unable to identify the year, month, date, town, county, or hospital where he was and could not write a sentence or draw a clock. The executor also alleged that a lifetime transfer of real estate by the decedent to the defendant that happened two weeks after the dementia diagnosis was fraudulent and the defendant was unjustly enriched. The defendant moved to dismiss the case, citing among other reasons that this was a probate matter and the common pleas court lacked subject matter jurisdiction. The common pleas court found it did not have subject matter jurisdiction to undo the real estate transfer because the result would be for the real estate to become a probate asset, but retained jurisdiction over the remaining claims because they sought money damages and not declaratory relief.

    Defendant moved for summary judgment citing the lack of medical evidence on the date of the asset transfers, but the motion was denied. Extensive testimony by family members at trial described the decedent as incontinent, confused and failing in health at and around the time of the asset changes and transfers, and that Defendant told his siblings “I’ve got all the money and there is nothing you can do about it.” The testimony was uncontroverted that the decedent lived on the defendant’s property and was dependent on the defendant for basic care and transportation. The defendant denied all of this or minimized the descriptions as isolated incidents and moved for a directed verdict before the case was sent to the jury. The motion was denied. The jury returned a verdict in favor of the estate and against the defendant in the amount of $419,310.

    On appeal, the defendant argued the common pleas court lacked subject matter jurisdiction and that there was no medical evidence of the decedent’s condition on the exact days of the asset changes and transfers. The court of appeals acknowledged potential for probate court jurisdiction, but held that the because the estate sought money damages rather than declaratory relief, the common pleas court had subject matter jurisdiction. The court also found there were genuine issues of fact regarding the decedent’s susceptibility to undue influence and fraud and, even though there was no expert medical evidence, the medical records and the and lay testimony about the decedent’s health around the dates of the assets transfers was sufficient evidence for a jury to believe there was fraud or undue influence.

  • It is not error to instruct jury on testamentary rather than contractual capacity, or to withhold instructions on the presumption of undue influence when the defendant presents credible evidence to rebut such presumption.
    Feb 16, 2021

    Filo v. Filo, 12th Dist. Madison Nos. CA2020-01-003, CA2020-03-009, 2021-Ohio-413

    After Tammy learned that her father, Elmer, disinherited her by executing a power of appointment prior to his death, she filed a declaratory judgment action against her brother, Terry, raising claims of undue influence and incapacity. Tammy sought shelter under the presumption of undue influence because Terry and Elmer held a fiduciary relationship. Ultimately, the jury found that Elmer had capacity, and his execution of the power of appointment was free from undue influence.

    On appeal, Tammy argued the probate court erred by giving instruction on testamentary capacity rather than capacity to contract, and by excluding the presumption of undue influence. With respect to capacity, the appellate court found the testamentary capacity test required the jury to make additional and specific determinations before finding capacity, and thus the end result was the same regardless of which test was provided. Finally, there was no err in the undue influence instruction because the probate court properly excluded the relevant law based on evidence produced at trial, which the court found highly creditable to rebut such presumption. 

    For more analysis, see our e-newsletter dated February 26, 2021.

  • Supreme Court issues civil penalty for the unauthorized practice of law in holding oneself out as a lawyer and preparing estate planning documents.
    Feb 4, 2021

    Disciplinary Counsel v. Schwab, 2021-Ohio-283 (Supreme Court of Ohio)

    In Ohio, only the Supreme Court can determine whether or not any particular action in the unauthorized practice of law (“UPL”). In this instance, a woman held herself out as a non-lawyer. She prepared legal documents for a church, on which she identified herself as a lawyer. She then met with a man and his wife and prepared living wills, healthcare powers of attorney, and last wills and testaments with self-proving affidavits. She identified herself as a lawyer on these documents as well.

    The Board of UPL found all of these actions amounted to UPL. The Supreme Court accepted the findings. The Court issued a permanent injunction for Ms. Schwab to cease the UPL. The Board of UPL further recommended, and the Supreme Court ordered, a fine of $5,000 for each of the two acts of UPL.

  • Administrative appeal process with regard to health insurance coverage does not make a claim for a medical bill contingent under R.C.2117.37; claim still must be presented in six months.
    Jan 20, 2021

    In re: Estate of Seiler, 9th Dist. Summit No. 29756, 2021-Ohio-115

    Mr. Seiler died in May 2018 after Summa hospital treated him for approximately 6 days. Summa submitted an invoice of $341,000 to Seiler’s health insurance carrier, Western Reserve (“WR”). WR denied the claim and Summa began an administrative review and appeal process. In April 2019, Summa had exhausted its administrative appeals and WR had not paid the invoice. In June 2019 – more than 1 year after Seiler passed – Summa opened Seiler’s estate and served itself with a creditor claim for $341,000 of hospital charges.

    At probate court, Summa argued its claim to be contingent under R.C. 2117.37. Summa claimed that because the appeal process had only ended in April 2019, Summa had no claim until then. Thus, they claimed, the June 2019 filing was timely. The probate court agreed and allowed the claim.

    On appeal, the Ninth District reversed. The appellate court stated that a claim is contingent only when the liability is not triggered until a later and uncertain event. In this case Summa knew they had a claim against the Estate, the only question was what amount – if any – WR would pay as insurance coverage. Summa’s claim was not contingent and needed to be presented within 6 months of the date of death.

    For more analysis, see our blog post.

  • Court finds term “agricultural use value” in trust ambiguous and, based on extrinsic evidence, determines it does not mean the property tax valuation of “current agricultural use value.”
    Jan 20, 2021

    Nichols v. Bixler, 5th Dist. Stark No. 2020CA00037, 2021-Ohio-129

    Jo Bixler’s trust provided that his son, Jeffrey, had the option to purchase the family farm “based on the agricultural use value” of the property. After Jo’s passing, Jeffrey argued that this amount should be the auditor’s “current agriculture use value” (“CAUV”). CAUV is a value set by the Ohio Department of Taxation; county auditor’s tax farm land at CAUV. Generally, CAUV is 60-70% less than fair market value.

    In the probate court, the judge found that the language of Jo’s trust was ambiguous with regard to the term “agricultural use value.” As a result, the judge took extrinsic evidence on the topic, including the attorney who advised Jo. The attorney testified that he and Jo reviewed numerous valuations for farm land, including CAUV, auction values, and certified farm appraisal values. The attorney was adamant that Jo intended the value to be what a farmer would pay another farmer for this land to use it for farming. The probate court found, based on this extrinsic evidence, that Jo intended the higher value – not CAUV. The probate court then heard expert testimony on this value and set the price at $1.8 Million.

    On appeal, the Fifth District agreed that the term was ambiguous and it was proper to hear extrinsic evidence. The appellate court affirmed the interpretation of “agricultural use value” and the setting of the price at $1.8 Million.

  • Estate may file action to void fraudulent conveyances where the defendant transferred assets to avoid a judgment owed to the Estate.
    Jan 15, 2021

    Mancz v. McHenry, 2nd Dist. Greene No. 2019-CA-74, 2021-Ohio-82

    In 2009, an estate fiduciary brought a concealment of assets complaint against the decedent’s daughter related to misuse of the daughter’s authority under the decedent’s power of attorney during the decedent’s lifetime, as well as post-death improper transfers of assets. The estate fiduciary was awarded judgment against the defendant and sought to collect against the defendant. The defendant failed to satisfy the judgment and the evidence showed the defendant transferred real estate and other assets to her husband in attempt to avoid collection of the judgment against her. The estate fiduciary brought a second lawsuit to void the transfers of assets to the husband as fraudulent conveyances and received a jury verdict and judgment. The defendant appealed, raising thirteen separate arguments. The court of appeals affirmed the finding of fraudulent conveyance against the wife and ordered the real estate transfer void and the other assets paid to the estate.

  • Probate court has jurisdiction to review separation agreement to determine whether asset titled jointly was the sole asset of the estate of the deceased ex-spouse
    Dec 31, 2020

    Szokan v. Stevens, 11th Dist. Lake No. 2020-L-020, 2020-Ohio-7001

    During their marriage, Donald and Delores purchased numerous savings bonds, each listing both spouses as a co-owner. Donald and Delores divorced in 2002 and their separate agreement did not address the savings bonds. The “separation agreement stated that the spouses had “effected, to their mutual satisfaction, a division of all property…” and that upon the execution of the agreement “each party shall deliver to the other party…all items or property to which he or she is entitled….” From 2002 until Delores’s death in 2017, Delores retained exclusive possession of the bonds. Delores’s will left all of her assets to her sister but did not specifically list the bonds.

     In the probate court, Delores’s sister was appointed her executrix and filed an action to declare ownership of the bonds. Donald claimed the he and Delores had an oral agreement that the survivor would keep the bonds. The probate court granted summary judgment to the executrix finding that the agreement requires the spouses to separate their property at that time and because Delores kept the bonds, she was their sole owner.

     On appeal, Donald argue the probate court lacked jurisdiction to interpret a separation agreement and, in the alternative, interpreted it incorrectly and failed to honor his oral contract with Delores. The appellate court held that the probate court had jurisdiction to determine whether the bonds were assets of the estate and in reaching that conclusion it can interpret a separation agreement. The court further agreed that the separation agreement was clear and intended to divide all marital assets in 2002. There could be no oral modification of the agreement, so any oral contract was unenforceable. The bonds belonged to Delores and must distribute pursuant to her will.

  • Probate court may vacate order authorizing payment of attorney fees, and demand counsel return the fees, if the order was a product of a clerical mistake
    Dec 31, 2020

    In re: Guardianship of Rhinehart, 11th Dist. Portage No. 2020-P-0047, 2020-Ohio-7005

    Joseph was appointed guardian of the person and estate of Robin. Joseph retained counsel to represent him as the guardian. The probate court also appointed a limited guardian over the ward to manage a divorce action on behalf of the ward. The limited guardian was represented by separate counsel. In November 2019, Joseph (through his lawyer) filed an application for authority to expend funds (“ATE”), which included invoices for his attorney and the divorce attorney as well as other expenses and an ongoing budget for the ward. The probate court approved the application. In December 2019, Joseph filed another ATE, listing thereon an invoice of his guardianship counsel. The probate court scheduled a hearing on this ATE, and ultimately denied the expenditures in the December 2019 ATE related to attorney fees. Joseph’s attorney moved to withdraw from the case sometime thereafter. Probate court subsequently ordered Joseph’s counsel to repay the attorney fees the court had approved in the November 2019 ATE, effectively vacating its prior order allowing the fees, sua sponte.

    Joseph’s former counsel appealed, arguing that the approval of the November 2019 was a final judgment and the court could not, sua sponte, vacate it. Rather, any vacation or modification of the order would require a motion under Civ.R. 60(B). The appellate court found that the probate court’s initial granting of the November 2019 ATE was done “inadvertently” and “without due consideration.” As such, even though it was a final order, the probate court had the discretion to modify or vacate it as a clerical mistake under Civ.R. 60(B).

  • There is no implied “exoneration” of an agent under Ohio Uniform Power of Attorney Act and an explicit exoneration clause will not excuse egregious abuse of authority
    Dec 29, 2020

    In re Estate of Baughman, 5th Dist. Licking No. 19CA0123, 2020-Ohio-6928

    An estate fiduciary filed suit under Ohio’s Uniform Power of Attorney Act to review the conduct of the decedent’s son, who served as her agent under a financial power of attorney (“Agent”) during her life. After a hearing, the trial court ordered the agent to repay the estate damages over $302,000 for abusing his authority under the power of attorney during the decedent’s lifetime. While the permits a power of attorney instrument to exonerate an Agent (R.C. 1337.35), the document in this case did not contain such a clause. The Agent nonetheless argued for exoneration based on the broad language of the document and his relationship with his mother. The lower and appellate court held that no such clause appeared in the document, nor was one implied. The Court of Appeals found that even if a power of attorney contains exoneration language, it is not an absolute defense where there is “evidence in the record to support a finding that appellant's conduct ‘falls outside the scope of any such clause.’”

  • A challenge to lifetime gifts and beneficiary designations is not subject to the will contest statute of limitations
    Dec 28, 2020

    Estate of Welch vs. Taylor, 12th Dist. Clinton No. CA2020-03-004, 2020-Ohio-6909

    The next-of-kin of a decedent filed suit in the general division of common pleas court alleging that an interloper took over $500,000 from decedent’s estate by convincing decedent to execute beneficiary designations and make gifts. The general division dismissed the complaint for “lack of jurisdiction,” but did not transfer the matter to the probate division. The plaintiffs then filed suit in probate, more than 3 months after the will was admitted to probate, and after the court approved the final probate account. The interloper moved for stay of discovery and for summary judgment immediately, which the probate court granted. The probate court held the lawsuit was really an attempt to contest the validity of the will and it was thus untimely and barred, and that the case was barred by res judicata because it was dismissed by the common pleas court.

    The Court of Appeals reversed, finding that this was not a will contest but rather a challenge to the lifetime gifts and beneficiary changes. The assets, if recovered, would belong to the probate estate. The Court further reasoned that Civ.R. 56(F) permits discovery and it was an abuse of discretion to deny discovery and to grant summary judgment. Thus, the plaintiffs stated a claim for which relief could be granted even if there was no will contest, because if the plaintiffs were successful in undoing the beneficiary designations, those assets may revert to prior beneficiaries.

  • Child support arrearages are an asset of the obligee’s estate and subject to Medicaid Estate Recovery
    Dec 28, 2020

    In re: Estate of Anderson, 3rd Dist. Shelby No. 17-20-03, 2020-Ohio-6924

    The decedent, Betty was the payee for certain child support payments during her lifetime. When she died, there was a balance of child support arrearage owed to Betty but unpaid. The fiduciary of Betty’s estate included on the inventory the child support arrearages that Chris owed to Betty for the time period that Betty cared for Chris's daughter, Emily. Emily, who is now over the age of 18, filed exceptions to the inventory arguing that child support should not be an asset of Betty's estate but should pay to Emily directly and outside of probate court. The trial court found that Chris owed the support to Betty and there were judgments against Chris in favor of Betty to pay the support. The probate court found that the child support orders were to pay to Betty and the reason for the support paid to Betty was because Betty was providing care to Chris’s children. The probate court denied Emily’s exceptions to the inventory and the Court of Appeals affirmed, finding that the child support arrearages were properly an asset of Betty's estate.

    Interestingly, the estate fiduciary for Betty’s estate was special counsel for Medicaid Estate Recover (MER). On appeal, MER argued that “estate” under the applicable MER statute, included probate and non-probate assets, and thus the MER could recover the child support arrearages even if they were not an asset of Betty’s Estate because it was an asset payable to Betty in her lifetime. The court of appeals agreed with this argument.

  • Probate court has authority to order a removed trustee to pay money damages for his breaches of fiduciary duty
    Dec 24, 2020

    Zarlenga v. Zarlenga, 7th Dist. Mahoning No. 2019MA89, 2020-Ohio-6947

    Two brothers, Daniel and Carmine, served as co-trustees of trusts that owned family businesses. Daniel served as president of the family businesses and Carmine lived out-of-state. The businesses and the trusts entered loan agreements requiring the companies to make payments to the trusts. Daniel allowed the companies to default and then, as a co-trustee, failed to serve default notices on the company. Daniel also used trust funds to pay into the companies and to rent himself a condo and purchase a home. Carmine sued Daniel for an accounting and sought his removal. After a hearing, the probate court found Daniel breached his fiduciary duties and ordered him to repay over $2.7 million in damages, which included amounts owed by the family businesses for having defaulted on notes on which Daniel never sought payment. The appellate court affirmed the removal and the calculation of damages finding the that the probate court has statutory authority to “compel a trustee to redress a breach of trust by paying money…”  

  • In will contest, evidence of lack of capacity and undue influence is limited to time close to the execution of the last will and testament
    Dec 23, 2020

    Ayer v. Morenz-Harbinger, 1st Dist. Hamilton Nos. C-190687, C-190716, 2020-Ohio-6861

    Ruth’s will was signed in 2014, and Ruth had a stroke in 2017, which required around-the-clock care after that. Ruth’s will left almost everything to her niece, Debbie. Ruth’s nephews, who were omitted as beneficiaries, claimed Ruth’s will was the product of undue influence and lack of capacity. The nephews pointed to Ruth’s incapacity in 2017 and to Debbie’s control of Ruth’s care and frequent communication before then as signs of undue influence. Probate Court and Court of Appeals agree that evidence of lack of capacity and undue influence is limited to the time close to the execution of the will, and later incapacity or even undue influence doesn’t matter. The plaintiffs’ evidence of undue influence was too far removed from the execution of the will.   

  • Indigent parents are entitled to court-appointed counsel in probate cases considering termination of parental rights
    Dec 22, 2020

    In re: Adoption of Y.E.F., slip opinion, 2020-Ohio-6785 (Supreme Court of Ohio)

    R.C. 2151.352 provides an indigent parent the right to counsel in juvenile court cases that may result in the termination of parental rights. The same right had not previously been extended to parents whose rights may be terminated in an adoption through probate court proceedings. In this case, a mother of twin boys placed her children with her sister and brother-in-law for temporary care after the boys’ father left the mother and emptied their joint bank accounts. Eventually, the sister sought to adopt the boys, alleging that the biological parents had de minimums contact and provided no support in the prior year. At probate court, the mother raised issues of equal protection and due process via  a letter from legal aid society, and requested counsel noting that she did not know how to cross-examine the witnesses herself. Her request was denied. The probate court allowed the adoption and the appellate court affirmed.

    Ohio’s Supreme Court reversed, reasoning that R.C. 2151.352, which allows appointed counsel in juvenile proceedings, was unconstitutionally under inclusive under the equal protection clauses of the Ohio and United States’ Constitutions. Going forward, indigent parents are entitled to counsel in adoption proceedings in Ohio. The decision was 5-2.

  • In a guardianship, the probate court lack subject matter jurisdiction to approve a settlement after the death of the ward
    Dec 10, 2020

    In re: Guardianship of Lieber, 8th Dist. Cuyahoga No. 109646, 2020-Ohio-5625

    The probate court placed Mr. Lieber under guardianship in 2016. Mr. Lieber’s daughter brought suit against him, alleging that prior to his guardianship, Mr. Lieber mismanaged funds that he held in a trust for her benefit. In October 2019, the parties reached an agreement to resolve the dispute, subject to probate court’s approval of the settlement. Mr. Lieber died 3 days before the probate court hearing to approve the proposed settlement. The probate court dismissed the application to approve the settlement finding that after the ward’s death, its jurisdiction was only to approve a final account and determine attorney fees, if any. The appellate court affirmed, holding that after the death of the ward, the probate court lacks subject matter jurisdiction to approve a settlement of a claim in a guardianship.

  • Credit Union not entitled to “self-help” to reverse account improperly distributed to an estate
    Nov 25, 2020

    Moyer v. Abbey Credit Union, 2nd Dist. Montgomery No 28759, 2020-Ohio-5410

    Executor went to Credit Union (“CU”) to close decedent’s account and the CU releases the account to the Executor. Executor deposits the funds in a savings account at the same CU. Later, the CU realizes that the funds were actually pay-on-death to someone, and not estate property. CU initiates a chargeback and pulls the money out of the estate savings account. Executor sues the CU in probate court for breach of contract for, among other things, trying to get the money back. Probate Court granted judgment on the pleadings for the estate. On appeal, the Second District largely agreed that the bank was not entitled to chargeback/self-help and it was just coincidence that it was able to accomplish the chargeback. But the appellate reversed on the judgment on the pleadings standard because the estate did not allege that it was actually entitled to the funds, nor that it detrimentally relied on the funds such that it was harmed by the chargeback.

  • Estate is not obligated to honor a check the decedent wrote before death, but the recipient did not cash
    Nov 25, 2020

    Jacobsen v. Resnick, 8th Dist. Cuyahoga No. 108169, 2020-Ohio-5424

    A son claimed that his mother made two gifts to him near the end of her life: a check for $24,000 and jewelry, including rings and a watch. The rings were specifically bequeathed in mother’s last will and testament. At the time of the gifts, the son was serving as his mother’s agent under a power of attorney. The son attempted to negotiate the check after his mother’s death, but it was rejected or canceled. The son filed a claim against the estate, which the estate rejected. The remaining beneficiaries filed an action to declare that the alleged gifts of the check and jewelry were the product of a breach of son’s fiduciary duty or were invalid as a result of undue influence or lack of capacity. The probate court granted summary judgment in favor of the beneficiaries finding no genuine issues of material fact finding that 1) the estate had the right to stop payment of the check; and, 2) as a result of the power of attorney, the gifts were presumed invalid and the only evidence the son presented to create an issue of fact were self-serving affidavits of himself and his fiancée. The probate court further agreed with the beneficiaries that the gifts to the son were the product of his undue influence.

     The appellate court agreed. Case law previously ruled that an uncashed check is not a completed gift. The donor still retains control and the ability to stop payment on the check. The son’s offered affidavits were self-serving, and his fiancée did not aver that she witnessed the mother deliver the allegedly gifted jewelry.

  • Assets of irrevocable inter vivos trust are a completed gift making the assets the separate property of the recipient-spouse upon divorce
    Nov 25, 2020

    Dayal v. Lakshmipathy, 6th Dist. Wood No. ED-19-049, 2020-Ohio-5441

    A husband created an irrevocable trust for the benefit of his wife, in part to take advantage of the estate and gift tax exemption of $5 million. In a later divorce action, the trial court determined that assets of an irrevocable trust are marital and thus divisible between the spouses. On appeal, the Sixth District reversed, finding the irrevocable trust was separate property for the wife. It was a completed gift and even if done for estate planning or tax reasons, the husband relinquished all rights to the property in the irrevocable trust, so he made it separate property, not marital.

  • Probate courts must provide analysis before denying the application to transfer structured settlement payments
    Nov 25, 2020

    In re: Transfer of Structured Settlement of P. Anderson, 2nd Dist. Champaign No. 2020-CA-15, 2020-Ohio-5408

    Under the Ohio Structured Settlement Transfer Act (“OSSTA,” R.C. 2323.58, et. seq.), a transfer company must apply to probate court for approval to transfer (or “buy out”) a structured settlement. Here, a twenty-eight-year-old gentleman receives $1,500/month as part of a structured settlement. The payments are to continue for the next several decades, totaling approximately $260,000. Stone Street Originations, LLC offered him a $29,000 immediate cash payment in exchange for the rest of his monthly payments. Champaign County Probate Court’s local rule provides a prohibition on these types of transfers if the transferor receives less than 50% of the future value. Based on this local rule, probate court denies the transfer. Stone Street appealed and the court of appeals reversed, finding the probate court cannot use “a blanket policy that affects all [persons] regardless of their situation.” The OSSTA provides a list of factors for the court to consider including the best interests of the transferor, and the Probate Court must provide some analysis, even though this situation “appears unconscionable.” 

  • Court will not vacate arbitration awards in trust disputes, absent the presence of statutory grounds applicable to all arbitration decisions
    Sep 29, 2020

    Hughes v. Hughes, 10th Dist. Franklin No. 19AP-329, 2020-Ohio-4653

    The parties were co-trustees of their mother’s trust. They submitted their disputes to an arbitration and the arbitrator found that appellant committed a material breach of trust and suspended him as trustee. The suspended trustee sued to vacate that arbitration award. R.C. 2711.10 provides situations in which a court can vacate an arbitration award, such as fraud, partiality, misconduct in refusing to hear pertinent evidence, and an arbitrator exceeding his or her authority. The trial court found that the appellant merely disagreed with the arbitrator’s decision but offered no statutory grounds under R.C. 2711.10 to support vacation of the award. The appellate court affirmed.

  • After the death of the ward, the guardian has no authority to recover funds removed from the guardianship
    Sep 17, 2020

    In re: Guardianship of Siman, 8th Dist. Cuyahoga No. 109586, 2020-Ohio-4472

    After the filing of competing applications between Dana and Pamela, three siblings agreed that Pamela should be appointed Guardian of their 82-year-old father. The father passed and the probate court appointed Dana the Executor of his state. Using this authority, Dana withdrew $15,000 from the guardianship account, prior to Pamela’s filing of a final account in the guardianship. Pamela moved the probate court to order the return of the funds to the guardianship, which the probate court granted. The appellate court reversed, finding that even though the funds were removed, Pamela can still complete a final account. The probate court’s jurisdiction – except for approval of the final account and determination of fees – terminated at the death of the ward.

  • Trustee did not breach his duties where two trusts had been fully administered and the beneficiary had received accountings of the third trust for seven years before he brought suit
    Jun 18, 2020

    Goddard v. Goddard, 8th Dist. Cuyahoga No. 109085, 2020-Ohio-3372

    A son sued his father claiming that father was trustee of three trusts of which son was the beneficiary. The son claimed his father had failed to administer the trusts properly, failed to make distributions to him, and failed to keep him informed. As part of his summary judgment motion, the father provided evidence that two of the trusts had been fully administered and that the son had received necessary information and distributions for his benefit from the third. The father further argued that if the son had any claim, he would have known about it as of 2012 and therefore the statute of limitations had passed. The probate court granted summary judgment if favor of the father. The appellate court affirmed, finding that the son admitted he had received the assets of two of the trusts. As to the third trust, the son knew or should have known as of a March 2012 email that funds used to pay his insurance premiums and medical bills were paid for from the third trust, of which he admitted he received a full accounting.

  • Trustees removed for continuing to administer a trust ten years after its termination date
    Apr 22, 2020

    Doran v. Doran, 1st Dist. Hamilton Nos. C-190296, C-190298, 2020-Ohio-1583

    A family trust provided that it terminated in 2009. A decade later, the cotrustees still had not terminated the trust and distributed its assets. The probate court further found that the cotrustees had not communicated with the beneficiaries about the trust assets until they had to obtain counsel to enforce their rights to information. The probate court removed the trustees finding it to be in the best interest of the beneficiaries. The appellate court upheld the removal finding the probate court had ample evidence to remove the trustees and that a formal hearing is not required where the trustees had ample opportunity to defend themselves.

  • An in terrorem clause will be enforced against a beneficiary who unsuccessfully challenged trust amendments
    Mar 31, 2020

    Foelsch v. Farson, 5th Dist. Knox No. 19CA000036, 2020-Ohio-1259

    After several amendments to her estate plan, Josephine’s final trust amendment left gifts of $60,000 to two of her children in lieu of real estate she left to other children. Josephine’s trust contained a “no contest” or in terrorem clause stating that anyone challenging the trust shall be treated as predeceased. Anne, one of the children left $60,000, filed a trust contest action, which was dismissed on summary judgment. The trustees successfully moved for the in terrorem clause to be enforced against Anne. The appellate court agreed with the enforcement of the in terrorem clause, finding that the clause applied even though it was found in the trust body and Anne challenged a later trust amendment. In Ohio, there is no basis for a “good faith exception” to an in terrorem clause.

  • Even without a lease agreement, and estate may collect damages for rent based on unjust enrichment.
    Oct 18, 2019

    Estate of Neal v. White, 1st Dist. Hamilton No. C-180579, 2019-Ohio-4280

    After Daniel Neal died in 2017, his girlfriend continued to live in the home. The Administratrix, daughter of the decedent, sought to have the girlfriend evicted. The trial court granted the eviction and restored the property possession to the Estate. The Estate further sought damages for unpaid rent on the basis of quasi-contract and unjust enrichment. because the girlfriend did not have a formal lease agreement with the decedent or the Estate. The trial court denied damages and the Estate appealed.

     The appellate court reversed, finding that the Estate had presented evidence of all the elements of unjust enrichment, including expert testimony on the value of the benefit conferred on the girlfriend. The appellate court remanded. In January 2020, the Estate won a judgment of $4,579 plus interests and costs. 

  • Once a party is on notice of a pending guardianship application, transfers of the proposed ward’s assets are invalid as to person on notice.
    Jul 10, 2019

    In re: Estate of Gravis v. Coffee, 9th Dist. Summit No. 28815, 2019-Ohio-2806

    On June 8, 2015, Vanessa filed to be the guardian of the person and estate of William Gravis. On June 17, 2015, Jacki also filed an application. On August 20, 2015, the probate court determined Gravis to be incompetent, appointed Vanessa the guardian of the person, and requested a local attorney file an application for guardian of the estate. On November 25, the probate court appointed the local attorney as guardian on the estate.

    On November 13, 2015, while the application for guardianship of the estate was still pending, Gravis executed transfer on death designation affidavits (“TODDA”) for real estate to pass to Michael and Thomas Coffee. At that point, Gravis had been served notice of the pending application, Vanessa was guardian of the person, and Gravis’s attorney knew that she had been so appointed. After Gravis’s death, his estate brought a declaratory judgment action against the Coffees arguing that the TODDAs were invalid. The probate court granted summary judgment in favor of the estate, invalidating the TODDAs.

    The probate court based its findings on two statutes. First, under R.C. 2111.04(D), “from the service of notice until the hearing, no sale, gift, conveyance, or encumbrance of the property of an alleged incompetent shall be valid as to persons having notice of the proceeding.” Gravis and his counsel had notice of the application at the time he signed the TODDAs, therefore the TODDAs are invalid as a matter of law. Next, under R.C. 2111.50(D), the probate court found that as of the court’s finding that Gravis was incompetent, the probate court became his superior guardian and the probate court had not approved the TODDAs.

    The Coffees appealed, asserting that the probate court incorrectly found the appointment of the guardian of the person to be an “irrebuttable presumption of incompetence” with regard to the TODDAs. The appellate court disagreed, finding that the probate court did not argue there was an irrebuttable presumption, but rather relied on the statutes cited above. As the Coffees did not address those statutes in their appeal, the appellate court affirmed.

  • "A poor relationship between beneficiaries or executors can support an award of higher attorney fees in a probate case."
    Jun 27, 2019

    In re: Estate of Schwenker, 10th Dist. Franklin No. 18AP-320, 2019-Ohio-2581

    A father named his two children, William and Diana, as co-executors of his estate. They, in turn, retained counsel. Throughout the administration, the co-executors did not get along and oftentimes refused to cooperate with their attorney.

    At the completion of the administration, counsel submitted a fee application for $73,995 for work done from September 2015 through June 2017. William objected to the fees. After a hearing with competing expert testimony, a magistrate approved the fees with some adjustments. William objected. The probate court overruled most of William’s objections, and awarded fees of approximately $68,000. The probate court further agreed to allow counsel to withdraw after the final account, which the co-executor’s refused to sign. William (but not Diana) appealed the probate court’s approval of the attorney fees as being unreasonable and against the weight of the evidence.

    The appellate court notes that the determination of fees rests within the sound discretion of the trial court, and the court will not overturn the award unless they are so low or so high so as to shock the conscience. The appellate court found no abuse of discretion and ample evidence to support the fees, holding that the “poor relationship between beneficiaries or executors can support an award of higher attorney fees in a probate case.”

  • Persons Interested in the Welfare of an Incompetent May Have the Right to Intervene in a Guardianship Proceeding
    Mar 7, 2019

    In Re: Guardianship of Bakhtiar, 2019-Ohio-581. 

    The Ninth District Court of Appeals in the matter of In Re: Guardianship of Bakhtiar made an important ruling that allows persons interested in the welfare of another to intervene in guardianship proceedings if the intervening party can demonstrate an interest relating to the property or transaction that is the subject of the action.  Without the right of intervention in order to have a say in the guardianship proceeding, an interested party would have to file a guardianship application.

  • Son who signed mother’s contract as her agent under a power of attorney is not personally responsible for nonpayment of that contract.
    Feb 10, 2019

    Pristine Senior Living v. Mistler, 12th Dist. Butler No. CA2019-05-083, 2020-Ohio-416

    Ronald Mistler executed an admission agreement on behalf of his mother, serving as her agent under a power of attorney. Mistler’s mother could not sign the agreement due to dementia and Mistler clearly signed with a designation indicating he was “POA.” A section of the admission agreement required the parties thereto to arbitrate any disputes. At an arbitration, the arbitrator awarded the nursing facility $119,000 with a judgment entered against Mistler and his mother, jointly and severally. The award was subsequently confirmed by the trial court. Subsequently, Mistler filed a motion under Civ.R. 60(B) to set aside the order confirming the award, arguing that the order must be set aside as against him because he signed only as a POA and not individually. The lower court vacated the judgment confirming the award against Mistler and dismissed him from the case. The nursing facility appealed. The appellate court affirmed finding, as the trial court did, that “equity mandated, and justice required, granting Mistler relief… and dismissing him from the case.”

  • In divorce action, where spouse had not listed assets on his father’s estate inventory, only probate court had jurisdiction to determine those assets would pass to spouse through his father’s estate.
    Feb 10, 2019

    When his parents died, John, an only child, inherited $500,000, most of which passed to him outside of probate. John did probate his father’s estate to transfer title to motor vehicles but did not disclose to his probate attorney some cash and jewelry found in his father’s home, which therefore were not listed on the estate inventory. John deposited the jewelry and cash in a safe deposit box held joint with his wife and deposited the remainder in a joint savings account, segregated from the couple’s marital funds. John’s wife eventually emptied the savings account and the safe deposit box and filed for divorce. In the divorce action, John alleged the funds, the cash, and the jewelry were his separate property as having inherited it from his father. The lower court ordered John’s wife to return the funds from the joint savings account, including monies she spent for her own needs. As to the jewelry and cash, however, the court found that those assets belonged to John’s father’s estate, and not to John individually, and only probate court can determine which assets pass to a beneficiary pursuant to a will. The appellate court affirmed finding that the divorce court did not have jurisdiction over the cash and the jewelry; John would have to bring those claims in the probate court.

  • May 17, 2017

    Collins v. Hearty Investment Trust, 9th Dist. Case No. 27964, 2017-Ohio-1270.

  • Karras v. Karras, 2d Dist. Case No. 26841, 2016-Ohio-8079.

  • Brown v. Ralston, 7th Dist. Case No. 14 BE 0051, 2016-Ohio-4916.

  • In re: Ball, 7th Dist. Case No. 15 BE 0004, 2016-Ohio-4917.

  • Nolan v. Hinzey, 7th Dist. Case Nos. 15 BE 0047, 0048, 2016-Ohio-4657.

  • Steiner v. Martin, 9th Dist. No. 15AP0039, 2016-Ohio-5281.

  • Guardianship of Edema Cardine Carpenter, Third Appellate District, Marion County, 2016-Ohio-3389.

  • In re: Guardianship of Terese Sweeney, 8th Dist. Case No. 103285, 2016-Ohio-3260.

  • Gehrke v. Senkiw, 2d Dist. Case No. 26829, 2016-Ohio-2657.

  • Fugate-Walton v. Walton, 5th Dist. Case No. 15CAE 07 0053, 2016-Ohio-1175.

  • Estate of Bohl, 12th Dist. Case Nos: CA-2015-01-005, CA-2015-01-006, 2016-Ohio-637.

  • Cincinnati Bar Assoc. v. Roberston, Ohio Supreme Court Case No. 2014-068, 2016-Ohio-654.

  • Huntington v. Riversource, 7th Dist. Case No. 2012 CI 00038, 2015-Ohio-5600.

  • In re: Guardianship of Mull, 7th Dist. Case No. 15 BE 11, 2015-Ohio-5440.

  • In re: Guardianship of Fred Van Dyke, 2d District Case No. 26465, 2015-Ohio-4202.

  • Estate of Dombroski v. Dombroski, 7th Dist. Case No. 14-HA-3, 2014-Ohio-5827.

  • Cartwright v. Batner, 2d Dist. Case No. 25938, 2014-Ohio-2995.

  • In Re: Estate of Ross, 11th Dist. Case No. 2015-T0009, 2015-Ohio-4030.

  • Wilson v. Lawrence, 8th Dist. Case No. 102585, 2015-Ohio-4677

  • Huth v. Kus, 5th Dist. Case Nos. 2014 AP 10 0041, 2014 AP 10 0052, 2015-Ohio-3457.

  • Castillo v. Ott, 6th Dist. Case No. L-14-1248, 2015-Ohio-90528.

  • Bayes v. Dornon, 2d District Case No. 2014-CA-129, 2015-Ohio-3053.

  • In Re: Estate of Cannon, 6th Dist. Case No. L-14-1069, 2015-Ohio-390.

  • In Re: Estate of Yeager, 11th Dist. Case Nos. 2014-T0107, 2014-T-0108, 2015-Ohio-2458.

  • Graham v. Boerger, 2nd District Case No. 2014-CA-17, 2015-Ohio-3261.

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