*1
THE
IN THE MATTER OF
GUARDIANSHIP
OF
AND CONSERVATORSHIP
ELIZABETH SAYLOR,
Allеged Incapacitated
Appellant.
Person and
No. 04-183.
July 13,
on Briefs
2005.
Submitted
September
Decided
2005.
Rehearing
Denied October
2005.
JUSTICE NELSON delivered *2 (Elizabeth) and Saylor appeals from the Order Elizabeth ¶1 Court, County, Judicial District Teton Judgment of the Ninth (Tim) as Saylor that Tim be removed dismissing petition her property. of Elizabeth’s Montana conservator for further consistent part proceedings affirm in and remand We ¶2 with this Opinion. following aрpeal: issue on We address by holding err that Tim had not breached Did the District Court
¶4 his property? of Elizabeth’s Montana fiduciary duties as conservator PROCEDURAL BACKGROUND FACTUAL AND Tim, 25, 1999, stepson, Elizabeth’s By dated October petition for guardian to a and conservator appoint asked the District Court matter, and, hearing appoint on the to pending Elizabeth §72-5-317, District pursuant to MCA.The temporary guardian for her temporary guardian by Order issued Tim Elizabeth’s appointed Court thereafter, and Deane Sadler day. Shortly Elizabeth on the same Tim’s (Deane), brother, objections filеd Elizabeth’s both written guardian. appointment temporary as dated agreement, into a settlement eventually The entered parties of a 11, 2000, they agreed to the establishment
July by which In for Elizabeth. conservatorships two limited guardianship and her limited Deane serve as agreed would particular, parties §72-5-321, pursuant to specified and duties as guardian, of her portion as the conservator of that MCA, and also serve would Tim, Montana. for his located outside the State of assets which were The property. of her Montana serve as the conservator part, would the same by Order issued on agreement approved District Court day. continued, however, centering now parties Conflict between failure to claimed to be Tim’s and Deane around what Elizabeth financial related to his administration documents
disclose certain in the This conflict eventuated Montana estate. Elizabeth’s of the Montana Removal of Conservator ‘Petition for aforementioned of Successor Saylor Appointment Property of Elizabeth Fiduciary Duty,” Breach of Cоmplaint Conservator Elizabeth, estate, July and Deane1 caused to be filed on 2002. her alleged keep and Deane that Tim had failed to Elizabeth Elizabeth reasonably concerning informed his administration of Elizabeth’s in violation of response request, Montana estate in to her reasonable 125, MCA, by him imposed upon 72-34-124 and duties § § 72-5-423, Tim had his duties They alleged MCA. further breached interest, conservatorship solely to administer Elizabeth’s §72- 34-103, MCA; in administering to avoid a conflict of interest §72-34-105, MCA; take under the conservatorship, steps reasonable prеserve circumstances to take and control of and to keep 72-34-107, MCA; conservatorship property, to make § 72-34-108, MCA; property productive, and to § 72-34-114(1) (2), properly pursuant administer the estate § 72-5-423, MCA, MCA all duties which likewise made upon response petition July incumbent him. Tim filed a to the on 2002. The Court hearing petition conducted a
September and dismissed it Order dated November 2003. This appeal followed. will introduce further they facts as become relevant
discussion.
STANDARD OF REVIEW
of law de novo. Matter
We review a trial court’s determinations
of
Cоnservatorship
323,
444,
(1995),
326,
271 Mont.
P.2d
896
of Kovatch
typically
findings
446.
a trial
fact
review
court’s
of
to determine
Kovatch,
findings
clearly
whether
those
erroneous.
conservatorships by holding that an be Clark 237 Mont. and verifiable. Matter Estate complete, of of 179, 184, 299, 772 P.2d 302.
DISCUSSION that Tim. had not by holding Did the District Court err Elizabeth’s fiduciary breached his duties as conservator of property Montana ? argument that Elizabeth has failed We first address Tim’s
¶12 assert Tim claims grounds removing for him as conservator. proper of a argued according to the standard for removal that she has not conservator, §72-5-414,MCA, alleging despite set forth at breaches disagree. of the aforementioned duties. We part MCA, reads, may ‘The court 72-5-414, part: in relevant Section ¶13 remove added). The statute good (emphasis cause” conservator specific purpose for the “good itself does not define cause” removal, interpret phrase conservator nor have we had occasion in our expressly previous opinions. that, 72-5-423, MCA, “[i]nthe exercise of his provides [1] Section fiduciary and shall observe a conservator is to act as a
powers, Cosner, MT Redies v. applicable of care to trustees.’Tn standards 697, 37, 315, 37, interpreted we 309 Mont. 48 P.3d ¶ ¶ ¶ MCA, §72-5-423, to trustees” in phrase applicable “standards of care Chapter in Title of trustees” as set forth meaning as “duties 72-5-423, interpreted We also Part Montana Code Annotated. Conservators are thus MCA, these duties on conservators. imposing as the same duties as trustees. under 72-33-618(2)(a) (d), MCA, specific four through provides Section Section 72-33- may court remove a trustee.
grounds on which a may court 618(2)(e), MCA, in the alternative that the provides then added). Thus, the good (emphasis cause” the trustee ‘for other remove cause,” purposes for the “good at least legislature has defined (a) (d) §72-33-618(2). removal, through including grounds as trustee (a) trust[.]” a breach of the ‘if the trustee has committed Ground 72-33-618(2)(a). to remove Thus, cause”exists for a court “good Section the trust. if it finds that the trustee has breached a trustee *4 governing rules trusts that the common law ‘Except to the extent is the law of stаtute, law as to trusts by the common are modified (Second) 72-33-103, According to the Restatement MCA. state.”Section trusts, “[a] of summary of the common law Trusts, authoritative of as any duty which by the trustee of is a violation breach of trust (Second) of Trusts beneficiary.” § he Restatement trustee owes (1959). above, 72, these duties are set forth Title As noted Thus, any 34, 1, by breaching Code Annotated. Chapter Part Montana duties, cause for a court to remove provides good the trustee of these (Second) 72-33-618(2)(a); of Trusts him. See § Restatement (1959). trustees, under the same duties as Since conservators that of responsibilities cognate the nature of their
since trustees, a conservator breaches the we conclude likewise when duties, by Title Part Montana Code Chapter set forth (Duties Trustees), §72-5-423, MCA, upon imposes Annotated which him him, gives good he a court cause to remove as conservator. see 7¶ Therefore, duties, by alleging fiduciary the various breaches of established) above, hold, alleged (though, good Elizabeth has as we not for conservator. cause Tim’s removal as Specifically, Elizabeth claims that Tim has breached his by certain real leasing property, part
duties of Elizabeth’s Montana (Pat) assets, Pat Saylor brother on terms which yield Elizabeth and her estate no financial benefit. 11,2000, agreement July As the settlement established Deane’s
powers guardian, specify and duties as limited so also did it Tim’s estate, powers and duties as conservator of Elizabeth’s Montana among property was the to lease the real for agricultural purposes. property, approximately This 690 acres in Teton County, parties is known to the as ‘Glen Willow.” The lease which Tim entered into with Pat for Glen Willow term, provides part five-year in relevant for a lease with annual rent $14,960.00, by multiplying calculated 220 head of cattle $17.00 per agreed good animal-unit-month. Pat to till and farm in a according farming practices, manner to the best and to husband-like seed, fertilizer, labor, equipment, furnish all and all the other costs of return, farming operations. crops, In Pat was entitled to 100% graze crop and to cattle on the land once the has been removed. Furthermore, pay Pat to maintain the all required property, the lease thereon, keep totalling insurance no less than owing taxes $500,000.00. irrigation owing subject The rent was to two offsets. For use of he was
system purchased property, which Pat had and installed $12,000.00 in the annually. compensated to receive Pat also was to be $3,000.00 year maintaining the residence in a per amount of together offsets condition suitable for Elizabeth’s return. These two *5 nominally rent Pat owed under the lease. eliminated the which system the has not been used fоr parties agree irrigation All that to receive the years, but that Pat nonetheless continues several $12,000.00 obligation. rental annual credit towards his associated Thus, the no material benefit to the estate only provide not does lease $12,000.00 year each claims, actually costs Elizabeth Elizabeth but furthermore, testimony, that during that it is in effect. Tim admitted nihilo in order to essentially credit amounts were fabricated ex the monetary obligation. cancel Pat’s lease, grounds the that justifies part, Tim arrangement upkeep the formal for the
memorialized less began dated to when Pat maintenance of Glen Willow which (now deceased) Saylor tending property for his father Fred found, and Elizabeth, Fred’s The District Court so based wife. law, finding of fact. part, conclusions of chief, only, upon or basis which the Were this the even lease, be, claims it to our case law Court affirmed the as Elizabeth clear rule that the District Court had committed would constrain us to alia, stands, principle any arrangement for the error. Clark inter person and the which present protectеd between a conservator does of the not prior imposition subsisted the standard of care which conservator necessarily determine under the owes, arrangement if the continuance of such particularly the estate which it is the cause detriment regime new would Clark, 237 duty preserve productive. and to make conservator’s 184-85, at 302. Mont. at 772 P.2d ruled, rather, lease relieved the estate Court that the The District and reflected the economic maintaining property, expense
of the endeavor. unprofitablе agricultural as an reality that Glen Willow was tended testimony is which this determination substantial Supporting virtually ineradicable leafy a controllable but spurge, to establish that forty years. weed, for at least the last property has infested the noxious to the effect that testimony District Court also heard substantial The irrigate, difficult to property the soil renders the gravelly nature of crop yield. reducing potential further the land’s thus [2] Elizabeth’s expert proferred a model lease which he had its lease estimated survey property, which formulated after a annum. Given $31,500.00per approximately to the estate at value err Court did not testimony, hold that the District we aforementioned unrealistic. model lease was finding profits he from moreover, in Pat’s admission that not, find We do Elizabeth does. import at Glen Willow the sinister which operations that, testimony though he cannot during It was established Pat’s the infestation hay grows he on Glen Willow due to market which hay grows he on his leafy spurge, he is able to sell more of he feeds his own cattle with the Glen Willow property own because primе method of hay. Leasing conservatorship property real it, it, and maintenance to the benefit deriving profit procuring from of the estate. As one noted commentator has observed: necessary incident of the generally
The to lease is management property. of trust real If the trustee is to hold real duty property estate and has the usual to make the trust only by he from it productive, generally profits leasing can obtain others, normally permitted expected it to since he would not be *6 engage profit dirеctly. to in business and from the land obtain (6th 1987). George T. It Bogert, Trusts ed. would be difficult to trust, or, here, attract if conservatorship, property lessees as right courts denied them the profit property to take from the which they yield lease. The fact that Glen Willow could not estate reasonably necessary recompense excess what was to Pat is immaterial. Thus, here, on the facts we conclude that the District Court
did not err Tim judgment when concluded that exercised reasonable regarding arrangement, duty the lease and did not breаch his as require conservator so as to his removal. above, however, As Tim during we noted conceded ¶
testimony that the sums with which the lease credited Pat as offsets obligation to his rent simply answered to no actual calculation. We cannot countenance such a of action. Though accept course we determination, arrangement District Court’s essential that this lease estate, given is best that could be obtained for the the realities of Tim situation, and that position has not abused his as conservator detrimеnt, to Elizabeth’s imposed formalities respected. must be The conservator must shun even the appearance impropriety, appearance procedure an which the present help followed in the case could not but foster in Elizabeth’s Court, mind. We therefore remand to the District with the instruction arrangement performed. it order an audit of the lease to be This require will enable the District Court to the lease to be reformed way figures closely actualities. such will conform more to subject arrangement, dispute, This will also the lease the crux of this Court, free searching scrutiny to the more of the District which will be light scrutiny bring should such to prior to revise its determinations in the record us. appear facts which do not before Justice, authority to order dissenting, questions The Chief our Court. trace our requested relief was not of the District which sources: law and authority prime to order an audit of lease two equity. 72-5-421(3), MCA, Court with all the Section vests the District affairs, make except power
powers over Elizabeth’s estate will, person. not a protected which she could exercise were she 72-5-421(3)(d), MCA, furthermore, powers that those provides Section A lease is a contract. Riis include the to “enter into contracts.” 696, 699; Day v. Black’s Law 188 Mont. (7th 1999). As the Court can make a lease on Dictionary 898 ed. audited, can it order that the lease be protected person, behalf of a so case, In the District includes the lesser. greater power as the conservator, through the Tim. Court has chosen to exercise its 72-5-421, such, the court has the “exclusive Section MCA. As protected person to determine how the estate of the jurisdiction managed, expended, state shall or subject to the laws of this be any of his protected person to or for the use of the distributed 72-5-405(2), the facts of this case Section MCA. Under dependents.” ordering trial court certainly legal prohibition no for the there is case, good audit-indeed, the circumstances again, given Tim step requiring an initial toward management require would such enable the court stewardship of his and better to better account fiduciary obligations. Tim’s discharge of his supеrvise By Moreover, aside, approach. favors this legal authority equity duties, Elizabeth invoked Tim had claiming that breached *7 MCA, and, thus, §3-5-302(c), jurisdiction, equity the District Court’s §3-2-203, jurisdiction has equity MCA. “Acourt of appeal, our own on breach, abuse, duty obligation a or betrayal alleged over an (1992) Equity fiduciary relations[.]” ... 30A C.J.S. arising §59 out of the Chief point This is a (‘Fiduciary Rights Obligations’). and cases, none of which we as her list of acknowledge, fails to Justice makes clear. equity, decided as a court of As held relief. we power grant complete has the to equity An сourt ¶33 29, 35, 858 Haugen v. (1993), 260 Mont. in Blaine Bank Montana all to determine equity empowered in sitting 18: ‘Courts P.2d justice; complete and to do involved in the case questions in also stated result.” We equitable to fashion an includes the 555, 568-69, 217 Gas Co. (1950), 123 Mont. Consolidated Reickhoff v. over a jurisdiction an court with equity to all matters judgment in relation controversy “may render final controversy.” growing out of involved to his granted that Tim had argument was The core of Elizabeth’s property, of her reflect the true value which did not brother Pat a lease benefit, her Pat’s thereby abusing his сited Tim’s admission argument, for her she support detriment. As negate in the lease in order to figures of the up that he made some in question involved This fact became central obligation. Pat’s rental to treat the formalities case, apparent Tim’s failure and reflected Although requisite seriousness. fiduciary relationship finding that Tim has not abused affirm the District Court we court, and, in turn office, nevertheless, the trial equity, as a court which, here, remedy-one is also Court, equitable must fashion an in and all matters involved fully by authorized statut&which resolves cоntroversy and Tim. We would growing out of the between Elizabeth doing less. be remiss matter, to better practical requiring Asa an audit now with view management litigation. in the future head off further The
financial will continuing jurisdiction conservatorship. Court over this District has 72-5-405(2), lease, imaginary figures, Section MCA. The with its will naturally presents and invite conflict each time Tim suspicion arouse accounting. think it better to lance this boil than to let his annual We it fester. overly That the Chief Justice would refuse to do so based on her approach prerogative.
formalistiс these sorts of cases is simply agree approach. do not with that LEAPHART,
JUSTICES COTTER and MORRIS concur. GRAY, concurring part dissenting CHIEF JUSTICE part. it agree entirely opinion I with the Court’s insofar as addresses us, namely, by the District Court erred issue before whether
holding that Tim had not breached his duties as conservator dissent, however, I from property. respectfully of Elizabeth’s Montana the Court’s remand. others, asks this Court appellant In this case and most others, Similarly, in this case and most
reverse the District Court. affirm the District Court. respondent asks us to Here, presented Court оn the issue properly we affirm should be the end of it. appellant. That Instead, “simply the Court decides that cannot countenance” *8 424 result, steps noted in the record. As a it
certain other matters has and any requested by any party appeal outside relief to this remands to the District Court with instructions that an audit of the lease “require ordered so the District Court can the lease to arrangement be way figures closely in a that its conform more be reformed such will actualities” so as to
subject arrangement, dispute, the crux of this lease Court, scrutiny free searсhing more which will be scrutiny bring to prior to revise its determinations should such in light appear facts which do not the record before us. it-rather than generally As is case when this Court decides parties appropriate manager” or the District CourtTs the “case case, by away actually making and stepping from issues before us briefed, sought strenuously nor I dissent. determinations neither Moreover, egregious the Court’s action here is even more than is only require It the trial court to sometimes the case. not remands audit, clearly that court to and revise expects order an it then revisit suggest propriety prior determinations should the “new”record a of action. of such course my reasoning dissenting I at in from the length need not discuss sponte
Court’s sua and, my view, in actions here. I have inappropriate many concurring dissenting opinions written far too and on subject years stop over the to believe I can influence the Court to such #75, See, Klyap, Arrowhead Sch. Dist. Park Co. v. e.g., 2003 practices. 294, 81-83, 103, 81-83, 250, P.3d MT 318 Mont. 79 81-83 ¶¶ ¶¶ ¶¶ C.J., (Gray, concurring dissenting); State, 32, 314, 32, 794, Mallak v. 35,MT 308 Mont. 42 P.3d 2002 ¶ ¶ Steiner, v. 334, dissenting); Larson-Murphy J., 2000 MT (Gray, 32 C. ¶ 1205, J., 140, 96, 140, 15 (Gray, dissenting); 140 303 Mоnt. P.3d ¶ ¶ ¶ State, 77, 261, 77, 361, Armstrong v. MT 296 Mont. 989 1999 ¶ ¶ Worrall, v. 55, State 364, J., concurring); 1999 MT 61- (Gray, ¶¶ ¶ 61-64, 67, 968, 61-64, (Gray, 64, 67, 439, 976 P.2d 293 Mont. ¶¶ ¶¶ Schell, Craig v. 40, 47, J., 1999 MT 49- concurring dissenting); ¶¶ 47, 49-55, 820, 47, (Gray, J., 975 P.2d 49-55 293 Mont. ¶¶ ¶¶ dissenting); State v. Santos 273 Mont. 902 P.2d (Gray, J., concurring). takes here briefly, my view of such an action as the Court Stated role, verges depriving party least proper that it our at oversteps Sadly, of the trial courts. ignores important of due role process, also, view, trust and confidence my public actions decrease these appropriate oft-stated and sometimes subject our Court and us to I lawyers, Legislators simply join attacks from and othеrs. cannot here. such action inappropriate I ever in such actions participated Have have, I I I do may although specific
Court? cannot recall instance. (and that, Worrall, opinion recall the author of the Court’s there *9 here) I exchanged propriety raising and views about the of this Court There, I resolving sponte. expressed again my and issues sua concerns subject on this and statement in concurrence in observed his State v. 307, 318, 928 Zabawa 279 ‘“[i]t Mont. that is our obligation to decide the cases filed in this Court on thе basis of the ” arguments parties.’ Worrall, J., issues and raised (Gray, 63¶ concurring dissenting). His response Tt]hat was concurrence still correctly my Worrall, (Nelson, J., sets forth concurring). view.” He ¶ on, however, went justification departing to discuss the for from that Worrall, “general (Nelson, J., rule.” concurring). 72-82 ¶¶ The problem looking exceptions justifications with for to and ¶43 departing general from the appellate rule-that we are an court which obligated is to decide the they likely cases as come to us-is that it is possible to justification nearly any Indeеd, locate such a case. it is not at all reviewing think, uncommon for us-in lawyer cases-to “the had a winner here right but didn’t raise the or arguments.” issues Nor is uncommon for us to read transcripts and locate additional issues which, view, in our should have been argued raised and to this Court. It practice, however, so, is our appropriately to decide the cases courts, before us on the issues properly preserved in the trial raised and appeal. briefed on To the extent only selectively, we do so open we leave ourselves to the all too common accusation that we are being circumstances, result-oriented. Under such it is an unanswerable accusation. The response my First, Court’s dissent simply wrong. is
Court states that I question “authority’to this Court’s order relief not requested in the District Court. This is not true. I do question not whether this Court can authority. many exercise such It can. As aware, this Court anything majority can do almost of its members Indeed, decide occasions, to do. on some approach has been called “gorilla” approach. Authority Court not at is issue here. This (and it) dissent others questions before the wisdom of the Court’s exercise of authority. Next, the Court cites to various statutes which come nowhere near
supporting its decision here sponte. to raise and decide an issue sua clearly grant The statutes powers. district courts certain I have no statutes, however, not vest those statutes; do quarrel with in this Court. legal there is ‘ho Moreover, the Court that agree I problem, The ordering an audit....” for the trial court prohibition an audit. This the trial court course, in this case did not order is that entirely different to do so. Two Court orders the District Court concepts, indeed. I approach,” “equity statement favors As to the Court’s 3-2-203, MCA, by the Court invoked disagree not more. Section
could jurisdiction of merely “appellate states that regard, in this equity.” and in The statute to all cases at law supreme corut extends any way authorize appellate jurisdiction. It does not to our speaks a trial court in equity. to take on the role of us Equity 30A C.J.S. correctly quotes from Similarly, while the Court Equity has The C.J.S. title §59, here. quote applicаtion has no §L, clearly Title. It states first, Scope entitled very The sections. in other ‘tsjubjects are treated equivocation and without appeals from decrees or and not treated in this title include titles added). Thus, Equity (emphasis equity!.]” 30A C.J.S. orders distinction failing acknowledge some accuses me of while the Court cases, might suggest I approach equity *10 proper appellate our between the differences just fails to understand apparently the Court that Court’s role. trial court’s role and this between a for the Court’s action Haugen provide support Nor do Reickhoff disagree with the Court’s statement person would here. No rational said so complete relief. We grant court has to equity that an Haugen However, 35, at 18. clearly Haugen, Mont. at 858 P.2d in 260 a trial court remedy fashioned appellate of a our review involved appeal. argued by parties the as raised and sitting equity, remedy was not erroneous. that the trial court’s ultimately concluded 18. at 858 P.2d at Haugen, See 260 Mont. from correctly our statement Likewise, quotes the Court Reickhoff may judgmеnt render final equity court the effect that an
to notice however, Court fails to Again, the matters. regard to all involved statement, was that both that which we made context to this Court. appealed equity decision in a trial court parties to addressing the After P.2d at 1077. Reickhoff, Mont. at decree and of the trial’s portion one we affirmed arguments, parties’ entry of only court another, remanding to the trial reversed Reickhoff, reversal. prevailing party in favor of judgment P.2d at 1083-84. at 123 Mont. my distinction may, prerogative, perceive The Court court, my urging of appellate
between a trial court and an restraint, “overly approach cases[.]” as an formalistic to these sorts of so, If so it. be I I opinion legal concur the Court’s issue before us. beyond from the issue
vigorously go presented dissent its decision to in order to reach to a more ‘fair” I what believes be result. would opinion affirm the District Court and end the there. joins foregoing concurring dissenting
JUSTICE RICE in the Opinion of CHIEF JUSTICE GRAY.
JUSTICE WARNER concurs and dissents. I agree opinion also with the Court’s insofar as it addresses remanding issues us. I dissent to the order before matter District Court for continued proceedings parties did not ask for, want, costly, do not and are money wasteful time and both the estate and the District Court. appellate dogs This Court should know better than to unleash the judgment, humility, war. This Court should have the and the need, people they
know its function is not to decide what or what They want. are perfectly capable deciding join such for themselves. I vigorous dissent of Chief Gray Justice for the reasons she has folly lawyers stated. It is indeed to force people retain accountants, they and send them into a battle do not want.