In re Estate of Lakin, 310 Neb. 271

Background

Decedent Charles E. Lakin died in March 2016 with an estate (~$170M) and a revocable trust naming the Charles E. Lakin Foundation as primary beneficiary; Thomas Pribil (longtime employee) and William Kilzer (grandson) were appointed copersonal representatives and cotrustees.
In 1984 Lakin and Pribil executed a written instrument titled “Promissory Note” providing $1.2M (plus $50,000/year thereafter) payable on Pribil’s 60th birthday or at Lakin’s death; instrument described the amounts as additional compensation for Pribil’s employment (deferred wages).
After Lakin’s death, Pribil (with Kilzer’s consent and without court approval) caused payment of approximately $6.946M to himself in September 2016 by liquidating trust securities; Pribil did not file a claim in the probate proceedings.
The Foundation sued in probate and trust actions seeking removal, surcharge, accounting, and to compel distribution; the county court granted summary judgment to Pribil and Kilzer, finding no fiduciary breach and that payment was permitted.
The Nebraska Supreme Court held the payment was barred because Pribil failed to present a claim under the probate nonclaim statute, and it found genuine issues of material fact remained on the Foundation’s breach-of-fiduciary-duty claims; the grant of summary judgment was reversed and remanded.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Nature of the 1984 instrument: promissory note vs. deferred compensation	Foundation: instrument should be treated as a promissory note (not deferred comp).	Pribil: instrument is deferred compensation for services rendered.	Court: substance controls; instrument is deferred compensation (deferred wages).
Statute of limitations	Foundation: demand date triggered in 2007 (Pribil’s 60th) so 5‑yr limitations bar applied before payment.	Defs: limitations did not accrue until work completed / decedent’s death.	Court: limitations did not run until Pribil ceased working for Lakin (death), so SOL did not bar payment.
Requirement to present a claim in probate before payment	Foundation: debt arose during Lakin’s life (deferred wages) and required a timely probate claim; none was filed, so claim is barred.	Defs: payments were wages/admin expenses after death or otherwise authorized by personal representatives/trustee powers, so no claim was required.	Court: debt was for wages earned during Lakin’s life; probate nonclaim statute required a claim; Pribil failed to present one and the estate payment was barred.
Breach of fiduciary duty / summary judgment	Foundation: paying a barred claim, failing to notify beneficiary, liquidating trust assets, and paying without court approval breached fiduciary duties; removal/surcharge warranted.	Defs: they acted within trustee/PR discretion, followed counsel/accountant advice, and complied with trust directions.	Court: genuine issues of material fact exist on fiduciary-duty claims; summary judgment for defendants improper; matter remanded.

Key Cases Cited

Sundermann v. Hy‑Vee, 306 Neb. 749, 947 N.W.2d 492 (2020) (summary judgment standards)
Marcovitz v. Rogers, 276 Neb. 199, 752 N.W.2d 605 (2008) (equity looks to substance over form in characterizing a written instrument)
Dooling v. Dooling, 303 Neb. 494, 930 N.W.2d 481 (2019) (discussion of deferred compensation concept)
Weiss v. Weiss, 179 Neb. 714, 140 N.W.2d 15 (1966) (limitations on deferred compensation claims)
J.R. Simplot Co. v. Jelinek, 275 Neb. 548, 748 N.W.2d 17 (2008) (mere notice to personal representative is not a statutory claim presentation)
In re Estate of Muncillo, 280 Neb. 669, 789 N.W.2d 37 (2010) (orders denying appointment of a special administrator are final and appealable)
Hearst‑Argyle Prop. v. Entrex Comm. Servs., 279 Neb. 468, 778 N.W.2d 465 (2010) (defective notice of appeal not fatal where no party was misled)
In re Estate of Feuerhelm, 215 Neb. 872, 341 N.W.2d 342 (1983) (requirements for adequate claim presentation under probate statutes)