109 N.E.3d 963
Ind.2018Background
- Nile and Georgia Richmond executed mirrored inter vivos trust agreements (NDR and GLR), each creating a Primary Trust, Trust A, and Trust B; original Trust B distributions were to be one-third Brenda, one-third William, one-third to grandchildren.
- After Nile died (1995), Georgia (surviving spouse) as co‑trustee caused distributions and executed deeds that transferred certain undivided one-half land/mineral interests from NDR Trust A to Georgia as trustee under the GLR Trust; Brenda signed some documents in 1995 without receiving the GLR amendment.
- Georgia amended the GLR Trust to remove Brenda and her son Marc as beneficiaries; upon Georgia’s death (1997), William became sole beneficiary of the GLR Trust and received the disputed property; Brenda received accountings reflecting distributions from NDR Trust B and later was provided the amended GLR Trust (July 14, 1997).
- No claims were filed until after the transferred West Virginia property began producing significant oil-and-gas revenue (circa 2010–2012); William then recorded the deeds and sought court approval in 2013 of the transfers and a declaration that Brenda had consented and was time‑barred from relief.
- The Gittingses asserted defenses and ten counterclaims (breach of trust, fiduciary breach, fraud, conversion, etc.); trial court ruled for William (finding transfers proper and counterclaims time‑barred); Court of Appeals affirmed on limitations grounds but found transfers improper; Indiana Supreme Court granted transfer.
Issues
| Issue | Plaintiff's Argument (Gittingses) | Defendant's Argument (Deal) | Held |
|---|---|---|---|
| Whether the Gittingses’ responses are barred by statutes of limitations | Their defensive assertions are not subject to limitations because they function as defenses; alternatively, fraudulent concealment tolled any limitations | Statutes of limitations and nonclaim statutes bar the Gittingses’ affirmative claims; their defenses that seek affirmative relief are time‑barred | Statutes of limitations apply to the extent claims seek affirmative relief but do not bar defenses that diminish or defeat William’s declaratory relief |
| Whether fraudulent concealment tolled the limitations periods | William actively or fiduciarily concealed the causes of action until discovery in 2011, so tolling applies | No concealment: Brenda had the amended GLR Trust, deeds, and accounting by July 14, 1997, and thus knew or should have known the injury earlier | No tolling; fraudulent concealment did not apply because the causes of action were not concealed by mid‑July 1997 |
| Whether Georgia validly amended the GLR Trust to make William sole beneficiary | Amendment was improper as part of a mutual estate plan or implied single trust constraining settlors | Each trust was separate; the GLR trust permitted Georgia, as sole surviving settlor/trustee, to amend her trust | Amendment valid: GLR Trust language allowed Georgia (as sole remaining settlor/trustee) to amend and remove Brenda and Marc |
| Whether transfers from NDR Trust A to GLR Primary Trust were proper and subject to court approval | Transfers were improper because they violated NDR trust terms, occurred without disclosure of material facts, and required court authorization given conflicts | Transfers were proper under the NDR agreement and Trust Code (and William claims later statutory amendment should apply) | Transfers were improper: (1) transfers created a conflict of interest requiring court authorization under the Trust Code in effect then; (2) Georgia failed to disclose material facts to Brenda; (3) consent defenses fail because Brenda lacked material facts and Georgia had adverse interest — William is not entitled to court approval |
Key Cases Cited
- Robinson v. Glass, 94 Ind. 211 (1884) (distinguishes pure defenses from counterclaims subject to limitations)
- Wehling v. Citizens Nat’l Bank, 586 N.E.2d 840 (Ind. 1992) (accrual rule: cause of action accrues when claimant knew or with diligence could have discovered the injury)
- Oil Supply Co. v. Hires Parts Serv., Inc., 726 N.E.2d 246 (Ind. 2000) (standards for reviewing findings and conclusions under Trial Rule 52)
- Good v. Clinton Circuit Court, 503 N.E.2d 1218 (Ind. 1987) (look to facts alleged and relief sought to determine whether claim functions as defense or action)
- Cooper Indus., LLC v. City of South Bend, 899 N.E.2d 1274 (Ind. 2009) (accrual of causes of action generally a question of law)
- Alldredge v. Good Samaritan Home, Inc., 9 N.E.3d 1257 (Ind. 2014) (party alleging fraudulent concealment bears burden to prove tolling)
- Care Group Heart Hosp., LLC v. Sawyer, 93 N.E.3d 745 (Ind. 2018) (requirements for incorporation by reference in contracts)
- Crivaro v. Rader, 469 N.E.2d 1184 (Ind. Ct. App. 1984) (limitations do not bar defensive claims arising from same transaction)
- Guy v. Schuldt, 138 N.E.2d 891 (Ind. 1956) (fraudulent concealment principles and duty to disclose under certain relationships)
- Lyons v. Richmond Cmty. Sch. Corp., 19 N.E.3d 254 (Ind. 2014) (tolling and questions of fact regarding concealment)