UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
JOHN T. MALTAS, as Personal
Representative of the Estate of
Richard B. Maltas,
Plaintiff-Appellant,
v. No. 02-1605
MICHAEL L. MALTAS; MARY ELLEN
MALTAS,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
Andre M. Davis, District Judge.
(CA-00-3671-AMD)
Argued: April 1, 2003
Decided: June 12, 2003
Before NIEMEYER, MOTZ, and GREGORY, Circuit Judges.
Reversed and remanded by unpublished per curiam opinion.
COUNSEL
ARGUED: Henry Mark Stichel, GOHN, HANKEY & STICHEL,
L.L.P., Baltimore, Maryland, for Appellant. Douglas Clark Hollmann,
Annapolis, Maryland, for Appellees. ON BRIEF: Benjamin D.
Hinceman, GOHN, HANKEY & STICHEL, L.L.P., Baltimore, Mary-
land, for Appellant.
2 MALTAS v. MALTAS
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
Richard Brian Maltas ("Ben")1 brought this diversity action against
his son, Michael T. Maltas ("Michael"), and Michael’s wife, Mary
Ellen Maltas ("Mary Ellen"). In his complaint, Ben alleged, inter alia,
that Michael and Mary Ellen took advantage of Ben’s confidential
relationship with them and unduly influenced him to transfer
$100,000 for the purchase of Michael and Mary Ellen’s Connecticut
home. The district court granted summary judgment in favor of
Michael and Mary Ellen, concluding that there was no evidence to
support a finding of a confidential relationship or the exercise of
undue influence. Ben then filed this appeal. Because we find that
there is a material issue of fact in dispute, we reverse and remand the
case for further proceedings consistent with this decision.
I.
Ben and his wife, Virginia Maltas, were married in 1942, lived in
Connecticut, and raised seven children: Richard Brian Maltas
("Brian"), Virginia Maltas, John Thomas Maltas ("Tom"), George
Maltas, Michael, Jeanne Maltas, and Patrice Maltas. Because of a
childhood head injury, Ben had limited faculties, thus, Virginia was
responsible for conducting the family’s financial affairs and managing
their assets until her death in 1991.
Ben relied on Brian and Michael and their respective spouses, Mar-
ilyn and Mary Ellen, to conduct his financial affairs after his wife
died. Shortly after she passed away, Ben stayed with Brian and his
family for a few weeks and then traveled to Alaska to stay with Tom
1
Ben passed away in April 2001, and John Thomas Maltas ("Tom"),
Ben’s son and the personal representative of his estate, was substituted
as plaintiff in this action.
MALTAS v. MALTAS 3
and his family for a few weeks. While Ben was in Alaska, and pre-
sumably with his permission, Brian and Michael arranged to sell their
parent’s home in Connecticut. In September 1999, Brian and Michael
sold their parent’s home for $202,500. After the mortgage, real estate
commissions, and legal fees were satisfied, Ben received $117,115
from the proceeds of the sale, which represented his net worth.
During this time, Ben expressed a desire not to live alone; at the
same time, Michael and Mary Ellen were looking to purchase a home
but could not afford to do so on their own. In order to accommodate
Ben’s and Michael’s needs, Brian and Michael devised a plan
whereby Ben would use a portion of the proceeds from the sale of his
marital home to provide the down payment for Michael and Mary
Ellen’s home. In return, Michael and Mary Ellen promised to provide
Ben with a place to live for the rest of his life. In September 1991,
Ben transferred $100,000 to Michael and Mary Ellen to purchase a
home located on Sylvan Drive in Ridgefield, Connecticut. The new
house cost $212,500. Of the $100,000 that Ben gave to them, Michael
and Mary Ellen used $78,000 as a down payment on the home. They
obtained a mortgage of $135,000 to finance the rest of the purchase
price. Ben, Michael, and Mary Ellen agreed that the remainder of the
$100,000 — $22,000 — would be used to fund construction of an
addition to the new home, which would provide Ben with more pri-
vacy.
In November 1991, Ben, Michael, Mary Ellen and their three chil-
dren moved into the Ridgefield home. Ben lived in the basement of
the home, next to the garage and utility room. Instead of building the
addition with the $22,000 Ben provided, Michael and Mary Ellen
used the money to pay for household expenses, including the mort-
gage, utility and heating bills. According to Mary Ellen, Ben was
aware that his money was being used in this manner.
In January 1992, Ben, Brian, Marilyn, Michael, and Mary Ellen
met with James Mannion, a Connecticut attorney who had been
Brian’s lawyer for many years. Mannion was asked to draft a quit
claim deed (the "1992 Deed"), which would protect Ben’s interest in
the Ridgefield residence. The 1992 Deed provided: (1) that Ben had
a life estate in the home; and (2) that should Michael and Mary Ellen
move further than 75 miles from Ridgefield, Connecticut, Ben would
4 MALTAS v. MALTAS
be entitled to repayment of either $78,000 or a payment comprised of
$78,000 minus $1,000 for each month Ben resided with Michael and
his family. The 1992 Deed also contained a condition requiring Ben
to forfeit his life estate should he remain absent from the home for a
six-month consecutive time period.2 The deed, however, did not con-
tain any provision providing for the repayment of the $22,000 that
was designed to fund construction of an addition to the home. During
their meeting with Mannion, Ben asked Michael about repayment of
this money, to which Michael responded, "[D]on’t worry about it Pop,
that’s between you and me."
In 1993, Michael and Mary Ellen sought to refinance the mortgage
on their home. Ben’s life estate in the Connecticut residence, as
memorialized in the 1992 Deed, however, prevented them from refi-
nancing their mortgage. Michael contacted Mannion and scheduled a
meeting to discuss drafting a new quit claim deed (the "1993 Deed"),
which would remove the encumbrance contained in the 1992 Deed.
Mannion drafted the 1993 Deed and met with Michael and Ben to dis-
cuss the impact of the new deed on Ben’s legal rights in the Connecti-
cut home. According to Mannion, he thoroughly explained to Ben the
legal effect of releasing the 1992 Deed. Mannion testified that Ben
appeared lucid, understanding, and responsive to Mannion’s explana-
tions of the impact of the 1993 Deed. After Mannion explained the
impact of the 1993 Deed, Ben signed the deed thereby releasing his
interest in the house. Neither Ben, Michael nor Mary Ellen disclosed
the existence of the 1993 Deed to the remaining family members.
In 1994, Ben traveled to Alaska to visit his son, Tom. He decided
to reside permanently with Tom and became a resident of Alaska.
With the exception of a few brief visits to Connecticut, Ben never
returned to live in Michael’s and Mary Ellen’s home. Until 1996,
Michael and Mary Ellen remained in the Connecticut house and
stored Ben’s belongings and tools. Michael and Mary Ellen left Ben’s
apartment empty in case he decided to return to Connecticut.
2
According to Mannion, he inserted this condition in the 1992 Deed to
protect Michael and Mary Ellen from the effects of the Medicaid Act in
the event that Ben required nursing home care and could not sign a
release of the lien created by the 1992 quit claim deed.
MALTAS v. MALTAS 5
In 1996, Michael’s employer transferred him to Maryland.
Michael, Mary Ellen, and their three children moved to Maryland and
leased their Connecticut home for two years before deciding to sell
the home in 1999. The house sold for $249,000, and after the mort-
gage, real estate commissions, and fees were paid, Michael and Mary
Ellen received $87,036.70. They used $60,440.47 of that amount as
a down payment on a new residence in Riva, Maryland. It was during
this time that Marilyn, Brian’s wife, discovered the 1993 Deed. She
disclosed this information to Brian and Tom who urged Ben to con-
tact Michael and Mary Ellen to ask that they repay a portion of the
money that Ben had given them in 1991. Michael and Mary Ellen
insisted that they did not owe any money to Ben but were willing to
refund Ben a portion of the money he had given them. However, Ben,
Michael, and Mary Ellen could not agree on the amount of money
that should be repaid to Ben.
In August 1999, Tom arranged for Ben to meet with Leroy
DeVeaux, an Alaskan attorney, to discuss the 1992 and 1993 deeds
and Ben’s legal rights with respect to the money he transferred to
Michael and Mary Ellen in 1991. DeVeaux explained to Ben and Tom
the legal effect of the 1993 Deed on the terms contained in the 1992
Deed. According to DeVeaux, Ben "was extremely surprised and agi-
tated" to learn that he had released his rights in the Connecticut home
when he signed the 1993 Deed. Based on Ben’s reaction to
DeVeaux’s explanation of the effect of the 1993 Deed, DeVeaux
opined that Ben had "no concept of the meaning and significance of
the documents."
On several different occasions after his meeting with DeVeaux,
Ben demanded repayment from Michael and Mary Ellen. The
amounts Ben requested in repayment varied from $35,500 to $25,000
repaid over 10 years and a life estate in the Maryland residence to
$5,500 for a car loan. Although Michael and Mary Ellen continued to
argue that they were not legally obligated to pay Ben, they eventually
agreed to pay him $5,000 in September 1999.
Ben, however, was not satisfied with the $5,000 he received from
Michael and Mary Ellen. After making several demands that Michael
and Mary Ellen repay a larger portion of the $100,000 he transferred
to them in 1991, Ben filed this diversity action against them in federal
6 MALTAS v. MALTAS
district court in Maryland in December 2000. His complaint contained
claims of, inter alia, undue influence, abuse of confidential relation-
ship, constructive trust and unjust enrichment. Ben passed away in
April 2001, at which time his son, Tom, was substituted as plaintiff
in this suit. Shortly thereafter, Michael and Mary Ellen moved for
summary judgment, which the district court granted on April 26,
2002. Tom, on behalf of Ben’s estate, filed a motion for reconsidera-
tion, which the district court denied. Tom then timely filed this
appeal.
II.
This Court reviews the district court’s grant of summary judgment
de novo. See A.T. Massey Coal Co., Inc. v. Massanari, 305 F.3d 226,
235 (4th Cir. 2002). Summary judgment is appropriate where "there
is no genuine issue of material fact . . . and the moving party is enti-
tled to summary judgement as a matter of law." Fed. R. Civ. P. 56(c).
In determining whether summary judgment is appropriate, all reason-
able inferences must be drawn in the light most favorable to the non-
moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). "Where the record taken as a whole could not lead a rational
trier of fact to find for the non-moving party, there is no genuine issue
for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S.
574, 587 (1986) (internal quotation & citation omitted).
III.
When this Court is asked to resolve appeals such as this, the diffi-
culty lies not in the legal questions but in our recognition that resolv-
ing the legal issues does little to heal the emotional wounds created
by the circumstances surrounding the lawsuit itself. The circum-
stances surrounding this lawsuit involved an oral agreement between
Ben and Michael whereby Ben agreed to provide $100,000 to
Michael to purchase a new home in exchange for Michael’s promise
to care and provide housing for Ben for the rest of his life. Indeed,
the parties do not dispute that such an arrangement was entered into
by Ben, Michael and Mary Ellen in 1991. Where the parties differ is
upon the terms of that agreement.
MALTAS v. MALTAS 7
3
It is well-established under Connecticut law that "[w]hether a trust
has been created depends upon the intent of the settlor and of the
trustee." Colonial Bank & Trust Co. v. Matoff, 556 A.2d 619, 623
(Conn. App. 1989) (citing Hansen v. Norton, 374 A.2d 230 (Conn.
1977)). In fact, Connecticut courts have been willing to find the exis-
tence of a trust based upon the parties’ oral agreement where the
intent to create the trust is evident. See, e.g., id. at 623 (upholding the
trial court’s finding that a trust relationship based upon the parties’
oral agreement that defendant hold plaintiff’s money for plaintiff’s
care and support); see also Hansen, 374 A.2d at 296 ("An oral decla-
ration may be sufficient to create an inter vivos trust of personal prop-
erty, even without consideration and without delivery."). The relevant
inquiry, therefore, addresses the intention of the parties at the time of
the transfer. See Spatola v. Spatola, 492 A.2d 518, 520 (Conn. App.
1985).
Ben argues that at the time he transferred $100,000 to Michael, he
intended that $78,000 be used for the down payment on the Ridge-
field residence and that $22,000 be used to construct an addition for
his privacy. Ben claims that he transferred the money to Michael upon
the mutual understanding that Michael would repay the $78,000
received for the down payment on the Connecticut home. To buttress
this argument, Ben points to the 1992 deed, which is, according to
Ben, a written memorialization of their original oral agreement. The
purpose of the 1993 deed, Ben claims, was not to amend the original
oral agreement but simply to allow Michael and Mary Ellen to refi-
nance their mortgage.
Michael and Mary Ellen, on the other hand, argue that when Ben
transferred $100,000 to them in 1991, there was no specific agree-
ment as to how those funds would be used. To this end, Michael and
Mary Ellen contend that the parties’ oral agreement consisted solely
of Ben’s promise to transfer $100,000 to Michael and Mary Ellen to
purchase a new house in exchange for their promise to provide Ben
with a place to live for the rest of his life. According to Michael and
Mary Ellen, prior to the 1992 Deed, the parties never discussed
whether Michael and Mary Ellen would repay Ben any amount of
money. They also contend that to the extent that Ben was entitled to
3
The parties do not dispute that Connecticut law applies in this case.
8 MALTAS v. MALTAS
repayment of $78,000 under the 1992 deed, the terms of the 1993
deed abrogated that obligation.
As noted above, the parties do not dispute that Ben, Michael and
Mary Ellen entered an oral agreement in which Ben agreed to provide
$100,000 to Michael and Mary Ellen to purchase a new home in
exchange for Michael and Mary Ellen’s promise to care and provide
housing for Ben for the rest of his life. The parties, however, dispute
the exact terms of their 1991 oral trust agreement. Because their dis-
agreement creates a genuine issue of material fact, we reverse the dis-
trict court’s grant of summary judgment to Michael and Mary Ellen.
REVERSED AND REMANDED