No. 01-434
IN THE SUPREME COURT OF THE STATE OF MONTANA
2002 MT 164
IN THE MATTER OF THE ESTATE OF
LEO E. McDERMOTT, SR.,
Deceased,
and
IN THE MATTER OF THE ESTATE
AND GUARDIANSHIP OF
ALAN J. McDERMOTT, an incompetent
person.
APPEAL FROM: District Court of the Third Judicial District,
In and for the County of Anaconda-Deer Lodge,
The Honorable Ted L. Mizner, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Alan F. Blakley, Blakley & Velk, Missoula, Montana
For Respondents:
D. Patrick McKittrick, McKittrick Law Firm, Great Falls, Montana
Submitted on Briefs: December 13, 2001
Decided: July 25, 2002
Filed:
__________________________________________
Clerk
Justice Patricia O. Cotter delivered the Opinion of the Court.
¶1 Appellant Leo E. McDermott Jr. appeals from an order issued by
the Third Judicial District Court, Anaconda-Deer Lodge County,
which consolidated two causes of action, ordered proceedings from
the sale of real estate be deposited into a guardianship account,
and awarded attorney fees and costs to Respondents Patricia Raunig
and Helen Ricci. We affirm.
¶2 We address the following restated issues on appeal:
¶3 1. Did the District Court err when it consolidated the
probate and guardianship proceedings?
¶4 2. Did the District Court err when it ruled that the 1973
transaction concerning Leo E. McDermott Sr.’s residence created a
constructive trust for the benefit of Alan McDermott?
¶5 3. Did the District Court err when it awarded attorney fees
to Respondents Patricia Raunig and Helen Ricci?
FACTUAL AND PROCEDURAL BACKGROUND
¶6 Decedent Leo E. McDermott Sr. (“Senior”) fathered six
children, four of which are involved in this action: Alan McDermott
(“Alan”); Appellant Leo E. McDermott Jr. (“Junior”); and
Respondents Patricia Raunig and Helen Ricci. In 1972, Alan
sustained a serious brain injury as a result of a motorcycle
accident. Following the accident, Junior was appointed as Alan’s
legal guardian in December of 1972. In December of 1973, Junior
filed an annual accounting which valued Alan’s estate at
approximately $62,000. However, Junior neglected to file another
accounting until 1999.
2
¶7 From 1972 until 1998, Alan lived with his father at Senior’s
residence in Sunnyside Addition near Anaconda, Montana. In July of
1973, Senior executed a deed which conveyed
the Sunnyside residence to Junior. Junior recorded this deed on
February 25, 1975. In 1986, Junior purportedly executed a deed
which conveyed the Sunnyside residence back to Senior. However,
Junior vehemently disputes the validity of the alleged re-
conveyance and contends that someone forged his signature on the
1986 deed.
¶8 In 1991, Senior executed a will which devised the Sunnyside
residence, together with its contents and personal belongings, to
Alan, Junior, Patricia, and Helen. Then, on September 23, 1992,
Senior executed a deed to the Sunnyside residence which purportedly
retained a life estate for himself and conveyed a future interest
in the residence to Junior, Patricia, and Helen as joint tenants
with right of survivorship.
¶9 On December 21, 1998, Senior died and Alan moved in with
Patricia. On January 29, 1999, Patricia, appointed as personal
representative of Senior’s estate, filed a petition for informal
probate of Senior’s will in Cause Number DP-99-4. Shortly
thereafter, Patricia and Helen learned that Junior had not filed an
accounting on Alan’s behalf since 1973. Therefore, in an action
separate from DP-99-4, on February 24, 1999, Patricia and Helen
requested that the District Court substitute them as Alan’s co-
guardians in the place of Junior. Patricia and Helen also
requested that the District Court order Junior to file a
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contemporaneous accounting of Alan’s estate. On May 12, 1999, the
District Court granted both of the requests in the guardianship
action, Cause Number 5838.
¶10 On July 1, 1999, in the probate proceeding (DP-99-4), Patricia
informed the District Court that the Sunnyside residence had been
sold and moved the District Court to deposit the proceeds in an
account monitored by the Court, pending resolution of Junior’s
obligations in the guardianship action. On July 6, 1999, the Court
granted Patricia’s motion, subject to Junior’s obligations in Cause
Number 5838. On September 23, 1999, Junior filed what the District
Court described as a “woefully inadequate” accounting of Alan’s
estate in Cause Number 5838.
¶11 On November 15, 1999, Junior moved the District Court to
release the proceeds of the residence’s sale to him as he “held the
real property in fee simple” pursuant to the terms of the 1973
conveyance. As the false signature on the 1986 deed “could not
pass title even to a bona fide purchaser,” Junior argued that
Senior had no interest in the property to convey on September 23,
1992. Conversely, Patricia and Helen argued, in part, that “[w]hen
[Senior] transferred the subject property to [Junior] in 1973, he
did so for purposes of effectuating the Guardianship of Alan and to
insure Alan had a home.” While Patricia and Helen maintained that
the subsequent conveyances were valid, they also argued that Senior
conveyed the property to Junior for the benefit of Alan, thereby
creating a constructive trust. Consequently, Patricia and Helen
4
argued that Junior would “be unjustly enriched if he were allowed
to retain the property or receive the sale proceeds.”
¶12 In the ensuing months, the parties filed several documents in
both actions, including a motion for fees and costs in the
guardianship action, and motions for sanctions in the probate
action. Finally, on November 28, 2000, the District Court issued
its findings of fact, conclusions of law, and order in which it
consolidated the two actions. The District Court found that the
1973 transaction established a constructive trust for the benefit
of Alan. Therefore, the District Court ordered that all proceeds
from the sale of the Sunnyside residence be deposited in the
guardianship account for Alan. Further, the District Court ordered
Junior to pay eighty percent of Respondents’ attorney fees and
costs, and Junior’s attorney to pay the remaining twenty percent of
their fees and costs. Junior appeals that portion of the District
Court’s order which consolidated the two actions, found that the
1973 transaction established a constructive trust, and awarded
attorney fees.
DISCUSSION
ISSUE 1
¶13 Did the District Court err when it consolidated the probate
and guardianship proceedings?
¶14 Consolidation rests in the discretion of the court and will
not be overturned absent a clear abuse of discretion. Tribby v.
Northwestern Bank of Great Falls (1985), 217 Mont. 196, 208, 704
P.2d 409, 417. To determine whether a district court abused its
5
discretion, we review the case to ascertain whether the court acted
arbitrarily without employment of conscientious judgment or
exceeded the bounds of reason resulting in substantial injustice.
In re Marriage of Moss, 1999 MT 62, ¶ 15, 293 Mont. 500, ¶ 15, 977
P.2d 322, ¶ 15.
¶15 The record provides little indication as to the specific date
whereon the District Court consolidated the probate and
guardianship matters. As Junior points out, on January 26, 2000,
in an order utilizing a consolidated caption, the District Court
ordered that “the outstanding issues in the above-captioned case
shall be submitted to Mediation . . . .” Then, on February 9,
2000, the District Court granted Respondents’ motion to file
discovery responses under an order which referred solely to the
probate matter. Finally, on February 23, 2000, the District Court
directed the parties to submit proposed findings of fact,
conclusions of law, and supporting briefs in an order reverting
back to the consolidated caption. While this inconsistent practice
does create some confusion as to the initial status of the matters,
the District Court, on November 28, 2000, found that “[t]he above
two Causes are interrelated and therefore the Court will address
both Causes within these Findings and Conclusions.”
¶16 Junior argues that the two actions involve “clearly different
parties” and contemplate entirely different legal and factual
issues. Therefore, Junior urges us to remand the two causes for
separate consideration as “[c]onsolidation of the two cases was
clearly inappropriate.” We disagree.
6
¶17 Rule 42(a), M.R.Civ.P., provides:
Consolidation. When actions involving a common
question of law or fact are pending before the court, it
may order a joint hearing or trial of any or all the
matters in issue in the actions; it may order all the
actions consolidated; and it may make such orders
concerning proceedings therein as may tend to avoid
unnecessary costs or delay.
¶18 We agree that the probate and guardianship proceedings did not
contemplate similar issues at their inception. The guardianship
action simply sought a substitution of Alan’s legal guardian and an
accounting of Alan’s estate. On the other hand, the probate action
sought to informally probate Senior’s will. At this point, the
only similarity enjoyed by the separate actions was the parties
involved, i.e., each cause pitted Respondents against Junior and
concerned Alan in some fashion or another.
¶19 However, as the arguments developed in the probate action, it
became apparent that a common bond conjoined the two proceedings.
That common bond was the ownership interest in the proceeds from
the sale of the Sunnyside residence. In the probate action, the
parties proffered evidence surrounding four alleged conveyances of
the Sunnyside residence. Each respective conveyance contemplated a
unique composition of grantees. At least two of the ownership
theories implicated Alan’s potential interest in the property.
Therefore, the accounting and value of Alan’s estate had a direct
correlation to the District Court’s determination regarding the
Sunnyside residence. As such, the two actions shared common
questions of both law and fact.
7
¶20 Like most discretionary matters, one could probably fashion an
argument supporting either perspective. However, the District
Court determined that the collective interests would be better
served by consolidating the matters. Despite this conclusion,
Junior was given every opportunity to participate, and did in fact
participate, in every proceeding irrespective of its origin.
Consequently, Junior suffered no injustice at the hands of judicial
economy. We hold that the District Court did not act arbitrarily
or exceed the bounds of reason when it consolidated the two
matters.
ISSUE 2
¶21 Did the District Court err when it ruled that the 1973
transaction concerning Leo E. McDermott Sr.’s residence created a
constructive trust for the benefit of Alan McDermott?
¶22 The standard of review governing proceedings in equity is
codified at § 3-2-204(5), MCA, which directs the appellate court to
review and determine questions of fact as well as questions of law.
Gitto v. Gitto (1989), 239 Mont. 47, 50, 778 P.2d 906, 908. We
review a district court’s findings of fact to ascertain whether
they are clearly erroneous. Daines v. Knight (1995), 269 Mont.
320, 324, 888 P.2d 904, 906. A finding is clearly erroneous if it
is not supported by substantial evidence, if the trial court
misapprehended the effect of the evidence, or if our review of the
record convinces us that the district court made a mistake.
Kovarik v. Kovarik, 1998 MT 33, ¶ 20, 287 Mont. 350, ¶ 20, 954 P.2d
1147, ¶ 20. Further, we review a district court’s conclusions of
8
law to determine whether they are correct. Carbon County v. Union
Reserve Coal Co. (1995), 271 Mont. 459, 469, 898 P.2d 680, 686.
¶23 Junior argues that to impose a constructive trust, Respondents
had to prove by clear and convincing evidence that Junior committed
fraud or exerted undue influence over Senior in regard to the 1973
conveyance. While allegations of fraud have been raised regarding
Junior’s conduct in the ensuing years, Junior maintains that
Respondents presented no evidence of the same in 1973.
Consequently, Junior contends that Respondents failed to carry
their burden of proof, and insists that the District Court erred in
imposing a constructive trust over the proceeds from the sale of
the Sunnyside residence.
¶24 Montana law recognizes two general categories of trusts,
voluntary and involuntary. Involuntary trusts arise independently
of any express contract and may be proven by parol evidence.
Gitto, 239 Mont. at 50, 778 P.2d at 909. Within the category of
involuntary trusts, two subclasses exist: resulting trusts and
constructive trusts. Under § 72-20-111, MCA (repealed 1989),
constructive trusts could arise upon a showing of fraud, accident,
mistake, undue influence, the violation of a trust, or other
wrongful acts.
¶25 However, in 1989, the Legislature repealed § 72-20-111, MCA,
and enacted the Trust Code, codified at Title 72, Chapters 33-36 of
the Montana Code Annotated. Constructive trusts are now imposed
pursuant to § 72-33-219, MCA, which provides:
9
Constructive Trust. A constructive trust arises
when a person holding title to property is subject to an
equitable duty to convey it to another on the ground that
the person holding title would be unjustly enriched if he
were permitted to retain it.
Thus, Montana law no longer requires a showing of fraud or other
wrongful acts as a prerequisite to imposing a constructive trust
pursuant to § 72-33-219, MCA.
¶26 Although a constructive trust may be imposed because the title
holder obtained title by fraud, accident, mistake, undue influence,
the violation of a trust, or other wrongful act, a constructive
trust may also be imposed pursuant to § 72-33-219, MCA, in cases
where a title holder innocently obtained title to property but
would be unjustly enriched if he were allowed to retain the title.
Moss, ¶ 29. While the 1973 transaction in question clearly arose
prior to the new statute’s enactment, § 72-33-102(1), MCA, provides
that “[a]fter September 30, 1989, chapters 33 through 36 apply to
all trusts regardless of when they were created” unless the court
believed such application would interfere with the rights of the
parties and other interested persons.
¶27 As to the 1973 conveyance and subsequent ownership of the
residence, the District Court entered the following findings:
4. [Senior] executed a deed for the family home to
[Junior] in July 1973 with the intended result to be that
Alan would have a place to live as is evidenced by:
a) [Junior’s] comments in Exhibit 6 of the David
McLean deposition which reflects, “I have arranged with
Dad to keep our family home in Sunnyside for a home for
Alan.”
b) David McLean’s deposition on page 63. [McLean
testified that Senior stated, “Fine. I’m going to deed
to you the house. Then, when I go you got a place to
take care of Alan.”]
10
c) the two affidavits of Norma Fitzgerald.
[Stating: “The reason Leo McDermott Jr. was first deeded
the property was to help take care of Alan McDermott as
Leo Jr. was then guardian.”]
. . . .
30. The record reflects that [Junior] has also
communicated several inconsistencies and has communicated
in a fraudulent manner regarding his purported ownership
of the Sunnyside property, as is identified below:
. . . .
c). In the mid 1990's [sic] [Junior] filed
bankruptcy. He did not list the Sunnyside home as one of
his assets.
d). In 1991 [Junior] was divorced. He did not
identify the Sunnyside
home as one of his assets.
e). On deposition Exhibit 3, a loan application for
a boat, [Junior] indicates that the Sunnyside home is
owned by [Senior].
f). On page 14 lines 18 through 20 of his
deposition [Junior] declares that he has never
fraudulently made any legal documents.
31. In this case [Junior] argues that the Sunnyside home
is his, yet in his divorce proceedings and in his
bankruptcy proceedings he did not declare the Sunnyside
home as being his. [Junior] is either attempting to
commit a fraud upon this Court in this case or has
committed fraud during the course of his bankruptcy
proceedings and his divorce proceedings. Based upon the
record herein, the Court believes that [Junior] is
attempting to fraudulently acquire exclusive ownership of
the Sunnyside property.
. . . .
33. [Junior] states that [Senior] gave him the house by
the 1973 deed yet [Junior] has never paid any gift tax
nor had [Junior] ever paid any property taxes on the
house prior to [Senior’s] death.
Based on the foregoing, the District Court concluded:
24. The history surrounding the Sunnyside property
including the transfer of the Sunnyside property to
[Junior] in 1973 supports the creation of a constructive
trust. There was never a transfer of ownership of the
Sunnyside property from [Senior] to [Junior]. Ownership
11
of the Sunnyside property remained with [Senior] until
the time of his death. The constructive trust was
created for the benefit of Alan. No ownership interest
transferred to [Junior].
¶28 There is ample evidence in the record to support the
District Court’s findings. Undoubtedly, Junior would be enriched,
to the extent of $80,000, if he were to receive the proceeds from
the sale of the Sunnyside residence. Further, for the reasons
articulated above by the District Court, we conclude that this
enrichment would have been unjust. Therefore, we hold that the
District Court did not err when it imposed a constructive trust
upon the proceeds of the Sunnyside residence.
¶29 Junior challenges the District Court’s findings and
conclusions regarding the validity of the post-1973 conveyances.
However, the District Court premised its ultimate ruling on the
finding and imposition of a constructive trust which resulted from
the 1973 transaction. As we have held that the District Court
correctly imposed a constructive trust in regard to the 1973
transaction, we need not examine Junior’s arguments as they pertain
to the subsequent conveyances.
ISSUE 3
¶30 Did the District Court err when it awarded attorney fees to
Respondents Patricia Raunig and Helen Ricci?
¶31 A district court’s grant or denial of a motion for attorney
fees is a discretionary ruling which we review to determine whether
the court abused its discretion. Braach v. Graybeal, 1999 MT 234,
¶ 6, 296 Mont. 138, ¶ 6, 988 P.2d 761, ¶ 6.
12
¶32 Although somewhat difficult to ascertain, it appears that
Junior raises two issues with regard to the award of attorney fees.
First, Junior argues that “the trial court had no basis to award
attorney fees . . . and this Court should reverse that order in its
entirety.” Second, assuming that we affirm the award of attorney
fees, Junior contends that the District Court erroneously failed to
hold a hearing to determine the appropriate extent of the award.
Therefore, we will address each argument in turn.
¶33 In response to Respondents’ motion for attorney fees and costs
and Junior’s respective opposition, the District Court, on November
28, 2000, found the following:
22. Attorney fees and costs were incurred by the
sisters in part due to [Junior’s] deception,
contradiction, and fraud. [Junior’s] deceptive and
fraudulent behavior, as well as his contradictory
statements are identified throughout the text of these
Findings and Conclusions. As a result of [Junior’s]
deception, contradiction and fraudulent behavior
considerable time, effort and expense have been spent in
an attempt to arrive at a reasonable understanding of the
condition of the guardianship estate and of the true
ownership of the Sunnyside property.
23. The record reflects that [Junior] and his
counsel have taken every opportunity to obstruct and
avoid a resolution of the issues in this case by filing
at best questionable motions to dismiss and for sanctions
as well as taking positions that are not supported by law
or facts and failing to mediate the issues in good faith.
By doing so, [Junior] and his counsel have needlessly
protracted this litigation at considerable expense to the
sisters.
Based on the above findings, the District Court ordered Junior to
pay eighty percent of Respondents’ attorney fees and costs and
Junior’s attorney to pay the remaining twenty percent.
13
¶34 In In re Support of K.F. (1988), 232 Mont. 326, 331, 756
P.2d 460, 463, we reaffirmed the proposition that a district court
has the equitable power to order attorney fees when justice so
requires. Further, § 37-61-421, MCA, authorizes a district court
to award attorney fees, costs, and expenses against “[a]n attorney
or party . . . who . . . multiplies the proceedings in any case
unreasonably and vexatiously . . . .” See also In re Marriage of
Rager (1994), 263 Mont. 361, 366, 868 P.2d 625, 628. As there is
substantial evidence in the record to support the above findings,
we conclude that the District Court did not abuse its discretion in
awarding attorney fees and costs to Respondents. Therefore, we
must next determine whether the actual monetary award was
reasonable.
¶35 In its November 28, 2000 ruling, the District Court ordered
counsel for Respondents to “submit his bill for attorney fees and
costs to the Court with a supporting affidavit for review and
approval by the Court.” Consequently, on February 27, 2001,
Respondents’ counsel submitted the requested bill and corresponding
affidavit. On March 20, 2001, the District Court approved
Respondents’ alleged fees and costs. In the months that followed,
Junior’s attorney remitted his twenty percent share of the fees and
costs in full satisfaction of his obligation.
¶36 On appeal, Junior insinuates that the bill of fees and costs
contained expenses for which he should not be held responsible.
Junior argues that the District Court should have held a hearing
following submission of the bill instead of “simply rubber-
14
stamp[ing] the affidavit of counsel for respondents . . . .” In
support of his position, Junior cites Lindey’s, Inc. v. Goodover
(1994), 264 Mont. 489, 872 P.2d 767, for the proposition that due
process requires notice and a hearing before attorney fees may be
awarded.
¶37 Junior’s reliance on Lindey’s is misplaced. In Lindey’s, we
held that a hearing is necessary to provide a party a sufficient
opportunity to defend against the imposition of Rule 11,
M.R.Civ.P., sanctions. Lindey’s, 264 Mont. at 497, 872 P.2d at
772. Here the District Court did not rely on Rule 11, M.R.Civ.P.,
for its award of attorney fees and costs. Moreover, Junior was on
notice that fees would be awarded, and had an opportunity to
challenge the amount.
¶38 Junior filed a brief in opposition to Respondents’ request for
an award of fees. Thus, he was heard by the Court with respect to
the propriety of a fee award. Subsequently, Respondents submitted
a bill of expenses together with supporting affidavit. At this
point, Junior had the opportunity to be heard with respect to the
amount of the requested fees and expenses. However, in the three
weeks following the submission of the affidavit and bill of
expenses, Junior filed no objections to the bill of expenses. The
District Court was therefore justified in entering an order
approving the bill of expenses as submitted.
¶39 Not only did Junior fail to object to the bill of expenses,
his attorney appeared to acquiesce in the order when he remitted
his twenty percent of the award in due course. Now, on appeal,
15
Junior asks us to overturn the District Court’s award. It is well
settled that we will not address an issue on appeal that a party
did not properly raise in the district court. Nason v. Leistiko,
1998 MT 217, ¶ 11, 290 Mont. 460, ¶ 11, 963 P.2d 1279, ¶ 11. As
stated above, Junior did not raise an objection to the alleged fees
and costs following Respondents’ submission of the same. Instead
Junior challenges the fees and costs for the first time on appeal.
Therefore, we decline to address the reasonableness of the award.
¶40 Affirmed.
/S/ PATRICIA COTTER
We Concur:
/S/ KARLA M. GRAY
/S/ JAMES C. NELSON
/S/ JIM RICE
16
Justice Terry N. Trieweiler dissenting.
¶41 I dissent from the majority Opinion. The findings,
conclusions and order of the District Court are so riddled with
procedural irregularity and substantive inconsistency that I
reluctantly conclude that the order must be reversed.
¶42 First, there was no procedural basis for the District Court's
sua sponte consolidation of the proceeding for an accounting in
Alan J. McDermott's guardianship and a contest to the distribution
of property in Leo E. McDermott, Sr.'s, estate. As noted in the
majority Opinion, Rule 42(a), M.R.Civ.P., permits consolidation of
actions involving a common question of law or fact. There were
neither legal nor factual issues common to these two cases.
¶43 In the guardianship action, Alan's sisters sought an
accounting from Leo McDermott, Jr., of how he handled assets which
had been entrusted to him as Alan's conservator. Those assets were
clearly limited to the principal and interest remaining in Alan's
estate following deposit in that estate of his personal injury
settlement and the expenditures that were made on Alan's behalf
from that principal and interest.
¶44 The probate proceedings involved Leo McDermott, Jr.'s,
challenge to the distribution of the proceeds from the sale of the
Sunnyside residence. Leo, Jr., contended that he owned the
residence following the transfer to him by Leo, Sr., in 1973. His
sister, the personal representative of the estate, contended that
it was transferred from Leo, Jr., back to Leo, Sr., in 1986 and
then transferred by a third conveyance from Leo, Sr., to himself
17
and three of his children and then finally devised to three of his
children, including Leo, Jr., by his last will and testament. None
of the issues in the probate proceeding are factually or legally
related to what Leo, Jr., did with the personal injury proceeds
entrusted to him as Alan's conservator.
¶45 The two separate and independent proceedings were simply
consolidated by the District Court to facilitate the District
Court's arbitrary satisfaction of the claim that Leo, Jr., breached
his fiduciary duty to his brother Alan. However, there was neither
statutory nor common law authority for doing so. Nor is any cited
in the majority Opinion.
¶46 Closer examination of the District Court's decision on the
merits also reveals highly irregular findings and conclusions
unsupported by any legal theory of which I am aware. First, the
District Court sets forth extensive evidence which seems to lead to
the inevitable finding that Leo, Jr., did in fact transfer title to
the Sunnyside property back to Leo, Sr., in 1986. The District
Court ultimately states in its findings that, "[b]ased upon the
record herein, the Court believes that Jr. is attempting to
fraudulently acquire exclusive ownership of the Sunnyside
property." I would, therefore, infer from the District Court's
findings that Leo, Jr., transferred the Sunnyside property back to
Leo, Sr., in 1986. If that is the case, then Leo, Sr., owned the
Sunnyside property when, in 1991, he executed a will which devised
it to four of his children including Leo, Jr. He also owned the
property when, in 1992, he executed the deed which retained a life
estate for himself and conveyed a future interest to three of his
18
children, including Leo, Jr. If those are the facts, then what
authority did the District Court have to transfer the entire
proceeds from the sale of the Sunnyside property to Alan's
conservatorship estate as a sanction for Leo, Jr.'s, breach of his
fiduciary duty to manage that estate for Alan's best interest? At
most, Leo, Jr., had a 33_% interest and the proceeds from the sale
of the home.
¶47 Furthermore, the District Court did not simply find that the
1973 transaction established a constructive trust for the benefit
of Alan and then order that the proceeds from the Sunnyside
residence be deposited in Alan's guardianship account, as suggested
in the majority Opinion. Instead, the District Court inexplicably
concluded that because a constructive trust had been created:
There was never a transfer of ownership of the Sunnyside
property from Sr. to Jr. Ownership of the Sunnyside
property remained with Leo Sr. until the time of his
death. The constructive trust was created for the
benefit of Alan. No ownership interest transferred to
Leo Jr.
¶48 The District Court's analysis of legal ownership following the
1973 transaction is a legal impossibility. If the property was
transferred in trust for Alan, title was still transferred to Leo,
Jr., as the trustee. If Leo, Sr., retained the title as the
District Court concluded, then there was no trust for Alan, Leo,
Sr., did not transfer any title, and the property passed by
conveyance in the 1992 transaction. Either way, there was simply
not $80,000 of proceeds from the sale of the Sunnyside residence to
arbitrarily transfer to Alan's conservatorship account.
19
¶49 Finally, there was no authority for the District Court to
confiscate any of Leo, Jr.'s, property and arbitrarily transfer it
to Alan. The remedy for breach of a fiduciary duty is a suit for
the damage resulting from that breach and entry of a judgment for
the amount of damage proven. Here, there was no separate suit for
breach of fiduciary duty. There was an accounting action in which
Leo, Jr.'s, sisters also sought their substitution as conservator
of Alan's estate and there was a probate proceeding in which title
to certain property was disputed. To simply combine these two
independent and separate proceedings and then fashion an
"equitable" remedy by grabbing some property here and moving it
there is the height of arbitrariness and disregard for rules of
procedure and substantive law. However, all concern for law seems
to have been lost in the District Court’s and the majority's
revulsion at what they assume was Leo, Jr.'s, irresponsible
administration of Alan's money. If what happened in this case is
acceptable, then this Court has removed any restrictions on the
motion of an "equitable remedy."
¶50 For these reasons, I dissent from the majority Opinion.
/S/ TERRY N. TRIEWEILER
20