Articles Posted in Trusts & Estates

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Two years after the district court denied class certification, the parties settled the individual claims. After settling, the parties jointly asked the court to enter a stipulated judgment dismissing with prejudice the Trusts’ individual claims, and the court did so. In the judgment, the Trusts reserved any right they may have to appeal the district court’s class-certification denial. The Trusts now appealed that denial, contending that the class-certification order merged with the stipulated judgment dismissing their individual claims, resulting in a final, appealable order under 28 U.S.C. 1291. Relying on Microsoft Corp. v. Baker, 137 S. Ct. 1702 (2017), the Tenth Circuit held that it lacked statutory appellate jurisdiction to review the district court’s order denying class certification. "Voluntarily dismissing the Trusts’ individual claims with prejudice after settling them doesn’t convert the class-certification denial—an inherently interlocutory order—into a final decision under 28 U.S.C. 1291." The Court dismissed this appeal. View "Anderson Living Trust v. WPX Energy Production" on Justia Law

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The first appeal in this case involved claims by the estate of Vera Cummings (the Estate) against Community Health Systems, Inc. (CHSI) under New Mexico state law, against the United States under the Federal Tort Claims Act (FTCA), and against Mountain View Regional Medical Center (Mountain View) under state law. The Tenth Circuit Court of Appeals disposed of the appeal by: (1) entering an order approving the stipulated dismissal with prejudice of the appeal of the district court’s dismissal for lack of personal jurisdiction of the claims against CHSI; (2) affirming the district court’s dismissal of the claims under the FTCA for lack of subject-matter jurisdiction; and (3) directing the district court to vacate its judgment in favor of Mountain View and to remand the claims against Mountain View (but not the claims against CHSI) to state court for lack of subject-matter jurisdiction. On remand to the district court, however, it went beyond the Tenth Circuit’s mandate by vacating its dismissal of the claims against CHSI and remanding those claims to state court. CHSI appealed. The Tenth Circuit reversed the order vacating the dismissal of the claims against CHSI and remanded those claims to state court. The Tenth Circuit also rejected the Estate’s motion to dismiss this appeal for lack of jurisdiction. View "Estate of Vera Cummings v. Community Health Systems" on Justia Law

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This appeal arose out of a property damage claim filed by the Hayes Family Trust with its insurer, State Farm Fire & Casualty. When the parties could not agree on the amount of loss, Hayes invoked an appraisal process provided by the policy to calculate the loss incurred. After Hayes sought the district court's assistance with the appointment of an umpire, the parties participated in the appraisal process, which resulted in a unanimous award. State Farm paid the balance of that award, and Hayes accepted payment. But despite State Farm's payment, at Hayes's request, the district court confirmed the award and entered judgment in favor of Hayes. Hayes promptly moved for an award of prejudgment interest, attorney's fees, and costs under a prevailing party statute. In response, State Farm moved to vacate or amend the judgment. Finding that the parties settled any dispute over the amount of loss, the court agreed with State Farm and vacated its order confirming the appraisal award and the judgment. Hayes appealed the order vacating judgment in an attempt to recover prejudgment interest, fees, and costs. Finding no reversible error, the Tenth Circuit affirmed. View "In re: Hayes Family Trust" on Justia Law

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The Estate of Clayton Lockett, through its personal representative Gary Lockett, filed suit against the Governor of Oklahoma Mary Fallin; corrections officials, medical officials, EMTs and drug manufacturers, all in relation to the execution of Clayton Lockett. In 1999, Lockett kidnapped, assaulted, and killed nineteen-year-old Stephanie Neiman. Lockett shot Neiman with a shotgun and then had an accomplice bury her alive. In 2000, a jury found Lockett guilty of 19 felonies arising from the same incident, including the murder, rape, forcible sodomy, kidnapping, and assault and battery of Neiman. The jury recommended that the court impose the death penalty. Oklahoma used a common drug protocol previously administered in at least 93 Oklahoma executions: three drugs (1) sodium thiopental; (2) pancuronium bromide; and (3) potassium chloride. In 2010, facing difficulty obtaining sodium thiopental, Oklahoma officials amended the Field Memorandum to substitute in its place pentobarbital. In 2014, Oklahoma officials amended their “Field Memorandum” to allow several new alternate procedures for use in executions by lethal injection. As one of these new procedures, officials substituted midazolam as he first drug used in the protocol. Before Lockett’s execution, Oklahoma had not used midazolam during an execution. Warden Anita Trammell and Director of Corrections Robert Patton chose this new protocol. The Estate asserted several constitutional violations related to Lockett’s execution with respect to the new procedures, essentially arguing that changing of the drugs caused Lockett intense pain as additional drugs were entered into the mix. The State parties moved to dismiss the estate’s suit against them, asserting qualified immunity (among other defenses). The district court granted the motion, reasoning that the estate failed to show defendants violated any established law. Finding no error in this judgment, the Tenth Circuit agreed and affirmed. View "Estate of Clayton Lockett v. Fallin" on Justia Law

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Frances Scott and her husband Galen Amerson filed for Chapter 7 bankruptcy protection. Scott amended her petition to identify as an asset her interest in a Florida state action that she and her half-sister had filed contesting the legitimacy of their father’s will. The bankruptcy trustee retained Florida counsel, who in turn reached a tentative settlement of the ongoing probate contest. The trustee then moved the bankruptcy court to approve the settlement agreement. The bankruptcy court granted the trustee’s motion over Scott’s objection and approved the settlement agreement. Scott appealed to the Tenth Circuit Bankruptcy Appellate Panel (BAP), which affirmed the bankruptcy court’s decision. Scott appealed the BAP’s decision to the Tenth Circuit Court of Appeals. At issue was whether Scott’s interest in a spendthrift trust created by her late father was properly treated as property of the bankruptcy estate, or if that interest was excluded. Finding no error in the BAP's conclusion, the Tenth Circuit affirmed inclusion of that Florida interest in Scott's bankruptcy estate. View "Scott v. King" on Justia Law

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Sheldon Hathaway became embroiled in a stranger-originated-life-insurance (STOLI) scheme at the involving his neighbor, Jay Sullivan. Here, Intervenor Defendant-Appellant Windsor Securities, LLC (Windsor) loaned Defendant-Appellant the Sheldon Hathaway Family Trust (the Trust) $200,000 to finance the initial premium on a life insurance policy (the policy) for Hathaway. In exchange, Windsor “receive[d] a moderate return on [its] investment” if a trust repaid the loan. Alternatively, Windsor “foreclose[s] on the life insurance policy that was pledged as collateral” when a trust fails to do so. That’s what happened here. But before Windsor could profit from its investment, Plaintiff-Appellee PHL Variable Insurance Company (PHL) sought to rescind the policy based on alleged misrepresentations in Hathaway’s insurance application. The district court ultimately granted PHL’s motion for summary judgment on its rescission claim, and allowed And it allowed PHL to retain the premiums Windsor already paid. On appeal, Windsor and the Trust (collectively, the defendants) argued the district court erred in granting PHL’s motion for summary judgment because there was at least a genuine dispute of material fact as to whether PHL waived its right to rescind the policy. Alternatively, they argued the district court erred in granting summary judgment because, at a minimum, a genuine dispute of material fact existed as to: (1) whether the application contained a misrepresentation; and (2) whether PHL relied on that misrepresentation in issuing the policy. Finally, even assuming summary judgment was appropriate, defendants argued the district court lacked authority to allow PHL to retain the paid premiums. The Tenth Circuit affirmed, concluding no genuine dispute of material fact existed as to whether PHL waived its right to rescind the policy. Nor was there any genuine dispute of material fact as to whether the application contained a misrepresentation or whether PHL relied on that misrepresentation in issuing the policy. Lastly, the Court held the district court had authority to allow PHL to retain the paid premiums. View "PHL Variable Insurance v. Sheldon Hathaway Family Trust" on Justia Law

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Brooklyn Coons (called "Brook" by her estate) died from being shaken and possibly struck on the head while in the care of her father's girlfriend. Her estate, the remaining plaintiff in this case, alleged that Defendant Linda Gillen, a social worker, knew that Brook was in danger and subject to abuse but did not respond to reports of the abuse, increasing Brook's vulnerability to danger. The estate sued Defendant under 42 U.S.C. 1983 for violating Brook's right to substantive due process. The district court granted Defendant summary judgment, holding that she was entitled to qualified immunity because she did not take any affirmative action that increased the child's vulnerability to danger and because there was no clearly established law that her alleged conduct violated Brook's due-process rights. Finding that Defendant’s conduct was not a violation of clearly established law, the Tenth Circuit affirmed.View "Estate of B.I.C., et al v. Gillen" on Justia Law

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THI of New Mexico at Hobbs Center, LLC and THI of New Mexico, LLC (collectively THI) operate a nursing home in Hobbs, New Mexico. When Lillie Mae Patton's husband was admitted into the home, he entered into an arbitration agreement that required the parties to arbitrate any dispute arising out of his care at the home except claims relating to guardianship proceedings, collection or eviction actions by THI, or disputes of less than $2,500. After Mr. Patton died, Mrs. Patton sued THI for negligence and misrepresentation. THI then filed a complaint to compel arbitration of the claims. The district court initially ruled that the arbitration agreement was not unconscionable and ordered arbitration. Under New Mexico law a compulsory-arbitration provision in a contract may be unconscionable, and therefore unenforceable, if it applies only, or primarily, to claims that just one party to the contract is likely to bring. The question before the Tenth Circuit was whether the Federal Arbitration Act (FAA) preempted the state law for contracts governed by the FAA. The Court held that New Mexico law was preempted in this case and the arbitration clause should have been enforced. View "THI of New Mexico at Hobbs v. Patton" on Justia Law

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The district court permitted the government to foreclose on federal tax liens on a ski cabin titled in the name of the D.E. Brown Family Trust, whose beneficiaries were Douglas Brown's wife and children. The taxes were owed by Douglas Brown (Brown) and his wife, not the trust, but the court found that the Browns were the beneficial owners of the cabin because Brown had a purchase-money resulting trust (PMRT) arising from his having purchased the cabin and then conveyed it to the Family Trust. The trustee of the Family Trust, Robert Tingey, appealed. He argued: (1) that the government waived its claim that the Browns held the beneficial interest in the cabin; and (2) that the district court erroneously concluded that a PMRT arose under Utah law. Upon review, the Tenth Circuit concluded that the government did not intentionally relinquish its claim to the cabin, and the evidence supported the district court's determination that Brown intended the trust to hold the cabin for his benefit. Accordingly, the Court affirmed the district court's judgment. View "United States v. Tingey" on Justia Law

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This case arose from the death of a minor child, 23-month-old Brooklyn Coons (BIC) at the hands of her father's girlfriend. Plaintiffs-Appellants, Larry and Mary Crosetto and the Estate of BIC, filed an action alleging that a social worker, Defendant-Appellee Linda Gillen, created the danger that resulted in the death of their granddaughter and denied them their rights to familial association. The district court granted summary judgment in favor of Ms. Gillen, and declined to hear a supplemental state law claim. On appeal, Plaintiffs argued that qualified immunity was unwarranted on their state danger-creation and familial association claims. Upon review, the Tenth Circuit agreed that qualified immunity was not appropriate on the state danger-creation claim given genuine issues of material fact. Thus the Court reversed in part. The Court affirmed summary judgement on the familial association claims. View "The Estate of B.I.C., et al v. Gillen" on Justia Law