745 S.E.2d 397
S.C. Ct. App.2013Background
- Mr. Lowther died in 2004, survived by eight children; LeGrand Lowther and his brother were named personal representatives.
- LeGrand and Mark served as PRs; LeGrand had undisclosed negotiations with ISI to sell Wellington tract and 40-acre parcel.
- LeGrand also negotiated with beneficiaries to purchase their interests; contracts prepared in October 2005.
- ISI offered to buy Wellington tract only if 40-acre parcel was included, with LeGrand signing contracts as sole seller.
- Closing and distributions occurred December 2005; Amberwinds later purchased the 40-acre parcel, but ISI/Amberwinds did not close the Wellington deal.
- Beneficiaries sued for breach of fiduciary duty; probate court awarded $69,051, circuit court increased to $289,924, and this appeal follows.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a fiduciary duty existed at time of sale negotiations | Turpin argues duty existed during negotiations. | Lowther contends no duty during private negotiations outside estate administration. | Yes, duty existed during negotiations; disclosure required. |
| Whether LeGrand breached fiduciary duty by failing to disclose contracts with ISI | Beneficiaries relied on nondisclosure to their detriment. | LeGrand claims no disclosure obligation as he had an agreement, not a sale. | Yes, breached by failing to disclose; evidence supports breach. |
| Whether breach proximately caused damages | Damages measured by lost value due to nondisclosure. | Damages limited to profits from Amberwinds sale. | Proximate cause shown; damages calculated as loss of value ($299,000). |
| Proper damages calculation and treatment of Echo Tango proceeds | Echo Tango proceeds should be included; Lowther owned 50% equity. | Proceeds not entitlement of beneficiaries; contested ownership. | Echo Tango proceeds should be included; beneficiaries entitled to 50% equity. |
| Waiver/Preservation of damages issue relating to seven beneficiaries | All seven beneficiaries should be compensated; issue preserved. | Issue not preserved for review; Rule 59 not raised. | Issue not preserved; not reviewable on appeal. |
Key Cases Cited
- RFT Mgmt. Co. v. Tinsley & Adams L.L.P., 399 S.C. 322 (2012) (fiduciary duty damages standard in SC)
- Vortex Sports & Entm’t, Inc. v. Ware, 378 S.C. 197 (Ct.App. 2008) (fiduciary duty disclosure duties)
- Pitts v. Jackson Nat’l Life Ins. Co., 352 S.C. 319 (Ct.App. 2002) (duty to disclose arises from fiduciary relationship)
- Moore v. Moore, 360 S.C. 241 (Ct.App. 2004) (silence may constitute breach when duty to disclose exists)