In re Estate of Etmund
297 Neb. 455
| Neb. | 2017Background
- Testator Cora H. Etmund died leaving a will appointing Cheryl A. Brown as personal representative and directing Brown to give the current farm tenant, Norris Talcott, the first opportunity to buy the real estate “under commercially reasonable terms and conditions as he and [my] personal representative may agree.”
- Brown obtained an agricultural-use appraisal valuing the property at $785,859, then entered a contract to sell to Talcott for $900,000.
- Devisees (petitioners) hired a different appraiser who valued the property at $1,457,000 based on highest-and-best-use (residential development with interim agriculture) and filed to restrain closing and to remove Brown under Neb. Rev. Stat. § 30-2454.
- The county court temporarily restrained closing, allowed petitioners to investigate, held hearings on appraisal credibility, and denied the petition to remove Brown and related replacement-co-representative requests.
- On appeal, the Nebraska Supreme Court reviewed whether “commercially reasonable” required highest-and-best-use valuation and whether Brown’s selection of an agricultural appraiser justified removal; the court affirmed the county court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether “commercially reasonable terms” in the will required valuing land at highest-and-best-use (development) | "Commercially reasonable" requires highest-and-best-use (residential development) valuation, so $900k is unreasonably low | Language must be read in context; testator gave tenant the first opportunity and gave PR broad discretion; commercially reasonable here relates to negotiation with tenant and agricultural use | Court held phrase unambiguous in context; did not require highest-and-best-use and Brown complied with will's instruction |
| Whether Brown should be removed for hiring an appraiser who did not value development potential | Brown’s appraiser admitted not qualified to appraise development, so his appraisal was inadequate and shows mismanagement | Appraiser was a licensed general certified appraiser experienced with local farms; PR may rely on qualified advisors and need not independently investigate | Court held Brown’s appraiser was qualified and disinterested; PR acted reasonably and no cause for removal |
| Whether the $900,000 sale was commercially reasonable given competing appraisals | Petitioners’ appraisal shows sale price far below fair market value, jeopardizing estate | County court weighed credibility of appraisers and found Brown’s appraiser more credible | As factfinder, county court’s credibility determination was not clearly erroneous; $900k was commercially reasonable |
| Standard of review for will interpretation and probate factual findings | N/A (procedural) | N/A | Court applied de novo review to legal interpretation and clearly-erroneous standard to factual findings; affirmed county court |
Key Cases Cited
- In re Estate of Nemetz, 273 Neb. 918 (applicable for highest-and-best-use discussion)
- In re Estate of Shell, 290 Neb. 791 (will interpretation principles)
- In re Estate of Webb, 20 Neb. App. 12 (probate removal precedent cited by petitioners)
- Chadron Energy Corp. v. First Nat. Bank, 236 Neb. 173 (question of commercial reasonableness is factual)
- Reeves v. Associates Financial Services Co., Inc., 197 Neb. 107 (precedent relied on by petitioners)
- In re Estate of Ritter, 227 Neb. 641 (cardinal rule on testator intent)
- Eicher v. Mid America Fin. Invest. Corp., 275 Neb. 462 (appellate review of credibility in bench trial)