132 A.3d 1178
Me.2016Background
- Elizabeth S. Haynes created a trust (1911, amended 1918). Paragraph 1 directed net income to her two daughters (or their "issue"); paragraph 2 directed principal, 21 years after certain deaths, to persons who would inherit under Maine intestacy law "then in force."
- Hope Manchester Wheeler (daughter) died in 1955; Fiduciary sought a judicial construction in 1957 whether "issue" in paragraph 1 included adopted descendants. The Maine Supreme Judicial Court held "issue" excluded adopted children for paragraph 1 in Fiduciary Trust Co. v. Brown.
- The trust terminated on December 26, 2013. Under 2013 Maine intestacy law, adopted children inherit as biological children (18-A M.R.S. § 2-109(1)).
- Fiduciary filed to determine distribution of principal under paragraph 2; by its reading, adopted descendants (Honora Haynes) would share in principal. Manchester H. Wheeler Jr. (biological descendant) argued Brown’s res judicata effect precluded applying paragraph 2 to include adopted heirs.
- The Superior Court granted summary judgment for Fiduciary, ruling Brown construed only paragraph 1 and did not preclude applying paragraph 2’s reference to intestacy law in effect at termination. Wheeler appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether claim preclusion bars relitigation of who may inherit principal under paragraph 2 | Wheeler: Brown already determined settlor did not intend to benefit adopted descendants, so paragraph 2 must exclude them | Fiduciary: Brown construed only the word "issue" in paragraph 1; paragraph 2 refers to future intestacy law and was not decided | Claim preclusion inapplicable — Brown did not and could not decide paragraph 2 (contingency not yet arisen) |
| Whether issue (collateral estoppel) precludes relitigation of settlor intent regarding adopted heirs | Wheeler: The same core intent question was decided in Brown and should bind now | Fiduciary: Settlor intent as to paragraph 2 is a question of law tied to unambiguous textual reference to future intestacy law, not a relitigated factual issue | Issue preclusion inapplicable — prior decision resolved a legal interpretation of paragraph 1, not the unambiguous paragraph 2 governed by later statutes |
| Proper method to determine beneficiaries of principal distribution | Wheeler: Use Brown’s logic to exclude adopted descendants from receiving principal | Fiduciary: Apply Maine intestacy law in force at termination (2013), which treats adopted children as heirs | Court: Apply paragraph 2 literally — beneficiaries determined by intestacy law in force at termination (2013), so adopted children inherit like biological children |
| Whether summary judgment was proper given the trust language and prior litigation | Wheeler: Dispute over intent creates material issue precluding summary judgment | Fiduciary: Paragraph 2 is unambiguous and no material factual dispute exists | Summary judgment affirmed — paragraph 2 unambiguous; no genuine issue of material fact; res judicata does not bar application of 2013 intestacy law |
Key Cases Cited
- Fiduciary Trust Co. v. Brown, 152 Me. 360, 131 A.2d 191 (1957) (interpreted "issue" in trust income provision and excluded adopted children for paragraph 1)
- Brady v. Cumberland Cty., 126 A.3d 1145 (Me. 2015) (standard of review for summary judgment)
- In re M.M., 86 A.3d 622 (Me. 2014) (elements of claim preclusion)
- Portland Water Dist. v. Town of Standish, 940 A.2d 1097 (Me. 2008) (elements of issue preclusion/collateral estoppel)
- White v. Fleet Bank of Me., 875 A.2d 680 (Me. 2005) (settlor intent from unambiguous will language is a question of law)
- In re Pike Family Trusts, 38 A.3d 329 (Me. 2012) (will interpretation principles; read instrument as a whole)