Brenda Sue Gittings and Marc Richmond Gittings v. William H. Deal
84 N.E.3d 749
| Ind. Ct. App. | 2017Background
- Nile D. Richmond and Georgia L. Richmond executed substantially identical revocable trust agreements (Primary Trust, Trust A (QTIP), Trust B) in 1993; trusts became irrevocable at settlor's death and named succession/co‑trustees.
- Upon Nile’s death (Jan. 24, 1995), Georgia (surviving spouse) moved assets from the NDR Primary Trust into NDR Trust A and Trust B; she later (Oct.–Dec. 1995) amended her own GLR Trust to remove Brenda and Marc as beneficiaries and caused West Virginia mineral property to be transferred into the GLR trust.
- Brenda (Nile’s daughter) signed deeds as co‑trustee in Dec. 1995 but did not know she had been eliminated as a beneficiary of the GLR Trust; deeds were recorded years later (2012); William (Georgia’s son) later deeded the West Virginia property to himself (1997) and received substantial royalties beginning 2010.
- Brenda and Marc raised multiple counterclaims in 2013 against William and Georgia’s estate/trusts (breach of trust, fiduciary duty, fraud, conversion, etc.); William moved to docket the NDR Trust and asserted the claims were time‑barred and/or barred by Brenda’s earlier participation/consent.
- The trial court found (1) the trusts were revocable and not part of a binding mutual estate plan; (2) Georgia had authority and discretion in the transfers and beneficiaries’ claims accrued in July 1997 when Brenda learned she’d been disinherited; (3) the counterclaims were barred by statutes of limitations. The Court of Appeals affirmed on statute‑of‑limitations grounds but expressed concern the transfers were improper under statutory fiduciary rules.
Issues
| Issue | Plaintiff's Argument (Gittings) | Defendant's Argument (Deal/William) | Held |
|---|---|---|---|
| Whether the Gittingses’ claims are barred by the statute of limitations | Claims didn’t accrue until 2011 when Brenda learned the extent of loss (transfer to William and royalties) | Claims accrued in 1997 when Brenda discovered she was removed as beneficiary and knew property had been transferred; suit filed 2013 is untimely | Court: Accrual in July 1997; statutes tolled until discovery of amendment but then limitations ran — claims time‑barred; affirmed |
| Whether transfers from NDR Primary Trust → NDR Trust A (funding) were proper and whether Georgia could act alone as sole trustee | Funding and allocations were improper because co‑trustees (Brenda & William) should have been involved after Nile’s death; Georgia exceeded authority | William: Georgia had broad discretionary authority; she acted within trust terms as trustee and spouse | Court of Appeals: Trial court erred in finding Georgia was sole trustee of Primary Trust after Nile’s death — trust language required co‑trustees; Georgia acted improperly in sole allocation (but limitations issue disposes of case) |
| Whether transfer from NDR Trust A → GLR Primary Trust (to benefit Georgia/then William) was proper without court approval and without full disclosure | Transfer required court authorization and full disclosure because Georgia had conflicting interests and beneficiaries lacked material facts | William: Trust language (broad authority, spouse’s decisions controlling) permitted the transfer without court approval | Court of Appeals: Transfer was improper under statutes then in effect because Georgia had an adverse interest and beneficiaries were not given material facts; court approval was required, but claim was time‑barred |
Key Cases Cited
- Goodwine v. Goodwine, 819 N.E.2d 824 (Ind. Ct. App. 2004) (court will not disturb trustee’s discretionary decision absent abuse of discretion)
- Malachowski v. Bank One, Indianapolis, 590 N.E.2d 559 (Ind. 1992) (fiduciary nondisclosure may toll statute of limitations; active concealment not required in trustee/beneficiary relationship)
- Huff v. Huff, 892 N.E.2d 1241 (Ind. Ct. App. 2008) (trustee’s conveyance to self raises disclosure and court‑approval issues; triable factual issues on statute‑of‑limitations/disclosure may preclude summary relief)
- Custom Radio Corp. v. Actuaries & Benefit Consultants, Inc., 998 N.E.2d 263 (Ind. Ct. App. 2013) (Indiana discovery rule: cause of action accrues when plaintiff knows or with diligence could have discovered injury from tortious act)
- Shideler v. Dwyer, 417 N.E.2d 281 (Ind. 1981) (extent of damage need not be known for accrual; only that damage occurred)
- Washington Theatre Co. v. Marion Theatre Corp., 81 N.E.2d 688 (Ind. Ct. App. 1948) (equity presumes bad faith when fiduciary acquires conflicting interest without beneficiary’s knowledge)