In Re Kapp Estate
357306
| Mich. Ct. App. | May 26, 2022Background
- Janet and Milan Kapp left four daughters; long-running intra-family litigation produced competing factions (Kapusta/Penta v. Lorrie/Sandy). Kapusta (an attorney) was appointed personal representative (PR) of both estates in December 2018.
- As PR and individually, Kapusta pursued multiple lawsuits against Lorrie and guardian/conservator Thomas Fraser; some claims were dismissed or resolved by settlement; a 2019 suit by Kapusta was dismissed on res judicata grounds and that dismissal was affirmed on appeal.
- Kapusta’s original first annual accounts (filed Feb 2020) disclosed nearly $80,000 in attorney fees for the estates, though known estate assets totaled about $3,008; she stated fiduciary fees as $0. No written fee agreements, time records, notices, or loan documentation were attached.
- Kapusta amended the accounts in Aug 2020, removing the listed attorney fees and marking fee fields “TBD,” but still provided no supporting documentation or the MCR 5.313 notice/fee agreements to interested persons.
- Lorrie and Sandy petitioned to remove Kapusta as PR, arguing breach of fiduciary duty, mismanagement, failure to comply with MCR 5.313, deficient accountings, and exposure of the estates to excessive liabilities. After a multi-day evidentiary hearing the probate court found Kapusta noncredible, in breach, and removed her, appointing Lorrie as successor PR. The Court of Appeals affirmed.
Issues
| Issue | Kapusta's Argument | Lorrie/Sandy's Argument | Held |
|---|---|---|---|
| Whether removal of the PR was an abuse of discretion | Removal was improper; she paid fees personally and did not harm heirs | Kapusta breached fiduciary duties, mismanaged estates, provided deficient accounts, and violated MCR 5.313 | Affirmed: removal was within court’s discretion; factual findings not clearly erroneous |
| Compliance with MCR 5.313 (fee agreements, notice, time records) | Payment of fees from her own funds and amendments cured issues | Failed to provide written fee agreements, mandatory 5.313 notices, time records; accepted/paid fees without court approval | Held Kapusta violated MCR 5.313; violations supported removal |
| Adequacy and effect of accountings (original vs amended) | Amended accounts supersede originals; fiduciary fees TBD so no harm | Original accounts revealed concrete fees; amended accounts obfuscated and lacked required attachments; misleading and deprived interested persons of rights to object | Held accounts were deficient and inconsistent; supported finding of breach and mismanagement |
| Res judicata defense to 2020 removal petitions | Earlier (2019) denial of removal precludes later petitions | New facts (2020 accounts, amended accounts, appellate decisions) arose after 2019 denial | Held res judicata inapplicable because the 2020 petitions relied on developments that postdated the 2019 proceedings |
Key Cases Cited
- In re Kramek Estate, 268 Mich. App. 565 (Mich. Ct. App. 2005) (probate-court removal of a personal representative reviewed for abuse of discretion)
- In re Temple Marital Trust, 278 Mich. App. 122 (Mich. Ct. App. 2008) (standard for abuse of discretion and clear-error review of probate-fact findings)
- McTaggart v. Lindsey, 202 Mich. App. 612 (Mich. Ct. App. 1993) (describing duties of a personal representative as fiduciary charged with settling and distributing an estate)
- Seifeddine v. Jaber, 327 Mich. App. 514 (Mich. Ct. App. 2019) (arguments not meaningfully addressed on appeal are considered abandoned)