HELEN TRAKUL V PAUL A TRAKUL REVOCABLE TRUST
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STATE OF MICHIGAN
COURT OF APPEALS
HELEN TRAKUL,
UNPUBLISHED
September 18, 2008
Plaintiff-Appellant/Cross-Appellee,
v
PAUL A. TRAKUL REVOCABLE TRUST and
SANDRA WOODRUFF,
No. 279346
Oakland Probate Court
LC No. 2006-306007-CZ
Defendants-Appellees/CrossAppellants,
and
ESTATE OF PAUL A. TRAKUL,
Defendant.
Before: Whitbeck, P.J., and Bandstra and Donofrio, JJ.
PER CURIAM.
Plaintiff Helen Trakul appeals as of right from an opinion of the probate court that
granted summary disposition to defendants on her claims for conversion of funds that occurred in
2003 and before. Defendants Paul A. Trakul Revocable Trust and Sandra Woodruff cross-appeal
from the same order, arguing that the trial court erred in denying them summary disposition on
Helen Trakul’s claims that arose in 2004. We reverse and remand. We decide this appeal
without oral argument.1
I. Basic Facts And Procedural History
Helen Trakul filed a complaint against defendants Estate of Paul A. Trakul, deceased, and
Sandra Woodruff individually and as successor trustee of the Paul A. Trakul Revocable Trust.2
1
MCR 7.214(E).
2
A probate estate was not opened and so references to “defendants” in this opinion are to
appellee/cross-appellants Sandra Woodruff individually and as successor trustee of the Paul A.
Trakul Revocable Trust.
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Paul Trakul was Helen Trakul’s son who died on July 26, 2005. At the time of his death, Paul
Trakul was engaged to defendant Sandra Woodruff. Woodruff is the successor trustee of the
Paul A. Trakul Revocable Trust and personal representative under the Last Will and Testament
of Paul A. Trakul. Woodruff is also the primary beneficiary under the terms of both documents.
Helen Trakul alleged that in anticipation of surgery, in or around 2000, she gave Paul
Trakul signatory authority of certain of her investment accounts for the purpose of permitting
Paul Trakul to administer her financial affairs during her temporary incapacity. Helen Trakul
stated that she did not authorize Paul Trakul to withdraw any of the funds in the accounts for his
personal use.
The parties do not dispute that Helen Trakul’s claims are for the conversion of funds
from the accounts. Helen Trakul claims that on ten separate occasions between July 2000 and
October 2004, Paul Trakul wrongfully withdrew funds in the amount of $153,933.05, without
her permission, for his personal use. Seven of the withdrawals, totaling $147,971.67, occurred
prior to February 2003. The remaining three withdrawals occurred during 2004, in the total
amount of $5,961.38. The dates and amounts of the withdrawals are not disputed.
Defendants answered the complaint and shortly thereafter filed a motion for summary
disposition pursuant to MCR 2.116(C)(7), asking the trial court to dismiss Helen Trakul’s claims
with regard to the first seven withdrawals because they accrued more than three years before
Helen Trakul filed the complaint and, thus, were barred by the statute of limitations. Defendants
also argued that the remaining three withdrawals were barred because Helen Trakul failed to
respond to defendants’ disallowance of claims within the statutorily required 63 days to file a
lawsuit pursuant to MCL 700.7507(a).3
Based on the briefs submitted by the parties, the trial court determined that Helen
Trakul’s claims were for “the wrongful taking of property of another” and subject to the threeyear period of limitations set forth in MCL 600.5805(10). On that basis, the trial court decided
that Helen Trakul’s claims regarding the first seven withdrawals, having occurred more than
three years before the complaint was filed, were time-barred.
Regarding the remaining withdrawals, the trial court held they were not barred because
defendants’ notice of disallowance failed to warn of the bar to claims brought after 63 days:
3
As noted, Paul Trakul died in July 2005. In September 2005, Woodruff published notice to
creditors of the Paul A. Trakul Revocable Trust in her capacity as successor trustee of the Trust.
On January 6, 2006, Helen Trakul’s counsel wrote to Woodruff making the claims upon which
this action is based. On January 17, 2006, counsel for Woodruff responded by letter:
Sandra, as Trustee of Paul’s Trust as well as a beneficiary of any property that she
might have received from Paul will not agree to any reimbursements of amounts
which may still be in his Trust, or amount she may have receive [sic] as his
beneficiary. Sandra is ready and willing and able to defend any legal action that
you and your client might be inclined to bring regarding this matter.
Helen Trakul filed the complaint on August 29, 2006, 102 days later.
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Pursuant to MCL 700.7502(a), the Defendant is required to notice of disallowance
[sic] to the Plaintiff. The notice requires the Defendant to inform the Plaintiff that
unless the suit is brought within 63 days, the claim will be forever barred. This
Court is of the opinion that the disallowance letter sent to the Plaintiff does not
meet the statutory required language; therefore, the claims presented by the
Plaintiff that were not barred by the statute of limitations cannot be considered
barred because the 63 day required notice was not properly provided.
The trial court did not hear or decide facts regarding whether the withdrawals at issue were
authorized or gifts.
It is from the trial court’s grant of summary disposition as to the first seven withdrawals
that Helen Trakul now appeals. Defendants cross-appeal from the trial court’s denial of
summary disposition on the claims concerning the remaining withdrawals.
II. Determining The Applicable Statute Of Limitations
A. Standard Of Review
Helen Trakul argues that the period of limitations for her claims is six years, as
established by MCL 600.5813, and that the trial court erred by applying the three-year period of
limitations set forth in MCL 600.5805(10). The question of whether a claim is barred by a
statute of limitations is a question of law that this Court reviews de novo.4 Also, motions for
summary disposition are reviewed de novo.5
B. Analysis
At issue in this case is whether the limitations period applicable to claims for the
conversion of funds is the three-year period in MCL 600.5805(10) for “all other actions to
recover damages for the death of a person, or for injury to a person or property[,]” or the six-year
period in MCL 600.5813 for “[a]ll other personal actions” not otherwise specified.
This Court in Tillman v Great Lakes Truck Ctr, Inc,6 recognizing that precedent was
inconsistent, recently resolved this issue, holding the three-year period to be applicable. In doing
so, the Tillman Court relied on Janiszewski v Behrmann,7 in which the Michigan Supreme Court
stated that an action for conversion of property was barred by the statute of limitations for injury
to person or property. The Tillman Court noted that the statute referenced in Janiszewski was, in
relevant part, the predecessor statute to MCL 600.5805(10).8 Thus, this Court determined that
4
Scherer v Hellstrom, 270 Mich App 458, 461; 716 NW2d 307 (2006).
5
Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999).
6
Tillman v Great Lakes Truck Ctr, Inc, 277 Mich App 47, 50; 742 NW2d 622 (2007).
7
Janiszewski v Behrmann, 345 Mich 8, 32; 75 NW2d 77 (1956).
8
Tillman, supra at 50.
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Janiszewski was controlling and that an action for conversion is an action to recover damages for
injury to property subject to the three-year period of limitations of MCL 600.5805(10).9
Accordingly, we conclude that trial court properly concluded that Helen Trakul’s claims were
subject to the three-year period of limitations that MCL 600.5805(10) sets forth.
III. Applying The Statute Of Limitations
A. Standard Of Review
Helen Trakul argues that even if the three-year period of limitations applies, defendants
fraudulently concealed her claims and she did not discover them until some time after they
accrued. Therefore, Helen Trakul argues that MCL 600.5855 should apply and that all of the
disputed withdrawals were within the statute of limitations at the time she filed the complaint.
Helen Trakul did not raise this issue below and did not preserve it for appellate review.
Instead she argued that MCL 600.5813 was the applicable statute of limitation. Further, the trial
court did not address this issue. But “this Court may overlook preservation requirements if the
failure to consider the issue would result in manifest injustice, if consideration is necessary for a
proper determination of the case, or if the issue involves a question of law and the facts
necessary for its resolution have been presented.”10 Accordingly, the fact that Helen Trakul may
not have fully briefed and argued this issue in her lower court pleadings, or that she now cites
authority that the trial court did not consider, does not preclude her from raising the issue on
appeal. Because consideration of this matter is necessary for a proper determination of the case
and involves a question of law, the resolution of which may be determined on the facts
presented, this Court shall overlook lack of preservation and consider the issue.
B. Analysis
Specifically, MCL 600.5855 establishes that:
if a person who is or may be liable for any claim fraudulently conceals the
existence of the claim or the identity of any person who is liable for the claim
from the knowledge of the person entitled to sue on the claim, then the action may
be commenced at any time within two years after the person who is entitled to
bring the action discovers, or should have discovered, the existence of the claim
or the identity of the person who is liable for the claim, although the action would
otherwise be barred by the period of limitations.
Under the fraudulent concealment statute, which provides generally that the limitation
period is tolled when a party conceals the fact that the plaintiff has a cause of action, the plaintiff
must plead the acts or misrepresentations that comprised the fraudulent concealment and must
prove that the defendant committed affirmative acts of misrepresentation that were designed to
9
Id.
10
Smith v Foerster-Bolser Constr, Inc, 269 Mich App 424, 427; 711 NW2d 421 (2006).
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prevent subsequent discovery.11 Fraudulent concealment occurs when a defendant uses an
artifice with the intent to prevent inquiry or avoid investigation, and to mislead or hinder
discovery of information that would provide notice of a cause of action.12 Finally, the plaintiff
must show that defendant concealed the existence of a claim or the identity of the actor.13
The record supports Helen Trakul’s claim that the withdrawals at issue were fraudulently
concealed and that Helen Trakul brought her action with regard to all of the withdrawals within
the two-year period established in MCL 600.5855. First, Helen Trakul alleged facts showing
that Paul Trakul was her fiduciary. Helen Trakul stated that she added Paul Trakul to her
accounts in anticipation of her temporary incapacity and did not authorize him to withdraw funds
for his personal use. As between persons sustaining a fiduciary or other confidential relationship
toward each other, the person occupying the relation of fiduciary is under a duty to reveal facts to
the plaintiff. Further, his silence when he ought to speak, or his failure to disclose what he ought
to disclose, is as much a fraud as an actual affirmative false representation.14 In other words, the
fiduciary’s silence as to a cause of action amounts to fraudulent concealment.15
In addition, Helen Trakul alleged additional factual issues surrounding the fraudulent
concealment of her claims by defendants. Helen Trakul stated that she was 77 years old, legally
blind, did not have the ability to read her bank statements, and relied on Paul Trakul’s honesty in
assisting her with her affairs. Helen Trakul further alleged that Paul Trakul diverted the delivery
of Helen Trakul’s bank statements to his home and that she was unaware the withdrawals were
being made. Therefore, Helen Trakul properly alleged that Paul Trakul used fraudulent actions
to conceal the conversion of her funds.
In deciding a motion for summary disposition based on statute of limitations, a court
should consider all affidavits, pleadings, and other documentary evidence submitted by the
parties.16 If no facts are in dispute, the question of whether a claim is barred on statute of
limitations grounds is a question of law, which may be decided on a motion for summary
disposition.17 Here, the material issues of genuine fact regarding whether claims were
fraudulently concealed precluded summary disposition against Helen Trakul on the ground that
her action was barred by the statute of limitations.
11
MCL 600.5855; Phinney v Perlmutter, 222 Mich App 513, 562; 564 NW2d 532 (1997).
12
Doe v Roman Catholic Archbishop, 264 Mich App 632, 642; 692 NW2d 398 (2004).
13
Id. at 643.
14
See, e.g., Barrett v Breault, 275 Mich 482; 267 NW 544 (1936); Allen v Conklin, 112 Mich 74;
70 NW 339 (1897); Tompkins v Hollister, 60 Mich 470; 27 NW 651 (1886).
15
See Lumber Village, Inc v Siegler, 135 Mich App 685, 355 NW2d 654 (1984).
16
MCR 2.116(C)(7); Holmes v Michigan Capital Medical Ctr, 242 Mich App 703; 620 NW2d
319 (2000).
17
Id.
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IV. Perfection Of Helen Trakul’s Claims
A. Standard Of Review
On cross-appeal, defendants assert that Helen Trakul’s claims based on the 2004
withdrawals are barred because she did not perfect them by bringing action within 63 days from
defendants’ notice of disallowance of claims as required by MCL 700.7507. Again, we review
motions for summary disposition de novo.18 We also review questions of statutory construction
de novo.19
B. Analysis
When no probate proceeding is open with respect to a decedent with a revocable trust, the
trustee of the trust must give notice to creditors of the decedent in much the same manner
required as a personal representative in a probate proceeding.20 Further, MCL 700.7507 provides
that the trustee may allow or disallow a claim. It also specifies that a claim is barred if it is not
filed within 63 days and if the notice of disallowance specifically warns of the impending bar.
Specifically, that provision provides in relevant part:
The trustee may deliver or mail a notice to the claimant stating that the claim has
been disallowed in whole or in part. If, after allowing or disallowing a claim, the
trustee changes a decision concerning the claim, the trustee shall notify the
claimant. The trustee shall not change a decision disallowing a claim if the time
for the claimant to commence a proceeding for allowance expires or if the time to
commence a proceeding on the claim expires and the claim has been barred. A
claim that is disallowed in whole or in part by the trustee is barred to the extent
not allowed unless the claimant commences a proceeding against the trustee not
later than 63 days after the mailing of the notice of disallowance or partial
allowance if the notice warns the claimant of the impending bar. Failure by the
trustee to deliver or mail to a claimant notice of action on the claim within 63
days after the time for the claim’s presentation has expired constitutes a notice of
allowance.[21]
When the language of a statute is unambiguous, the Court gives the words their plain
meaning and applies the statute as written.22 “The Legislature is presumed to have intended the
meaning it has plainly expressed, and if the expressed language is clear, judicial construction is
not permitted and the statute must be enforced as written.”23 MCL 700.7507 is straightforward,
18
Maiden, supra at 118.
19
Perry v Golling Chrysler Plymouth Jeep, Inc, 477 Mich 62, 65; 729 NW2d 500 (2007).
20
MCL 700.7504.
21
MCL 700.7507(a).
22
Rowland v Washtenaw Co Rd Comm’n, 477 Mich 197, 202; 731 NW2d 41 (2007).
23
Robertson v DaimlerChrysler Corp, 465 Mich 732, 748, 641 NW2d 567 (2002).
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clear, unambiguous, and not constitutionally suspect. Accordingly, it should be enforced as
written.
MCL 700.7507 requires that for the bar to apply, notice of that bar need be given as
directed and that such notice is adequate if it specifically warns of the 63-day limitation to file a
lawsuit and otherwise complies with the requirements of the statute. Defendants’ letter advising
Helen Trakul of the disallowance of her claims did not contain the warning of the impending bar.
Therefore, the trial court correctly determined that the bar was not applicable.
We reverse and remand for proceedings consistent with this opinion. We do not retain
jurisdiction.
/s/ William C. Whitbeck
/s/ Richard A. Bandstra
/s/ Pat M. Donofrio
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