State of Minnesota, Respondent, vs. Stephen Ray Pacholl, Appellant.

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480 A. 08, subd. 3 (1998).

STATE OF MINNESOTA
IN COURT OF APPEALS
C1-99-389

In Re the Estate of:
Winifred Esther Korhonen, Deceased.

 

Filed December 7, 1999
Affirmed in part and reversed in part
Klaphake, Judge

St. Louis County District Court
File No. P5-97-600725

Daniel F. Jambor, Jambor & Rubbelke, LLC, 212 Village Bank Financial Center, 9298 Central Avenue NE, Blaine, MN 55434 (for appellant James Korhonen)

Steve Marden, 2415 Foshay Tower, 821 Marquette Ave., Minneapolis, MN 55402 (for respondent personal representative)

Considered and decided by Klaphake, Presiding Judge, Forsberg, Judge,[*] and Mulally, Judge.[**]

 

U N P U B L I S H E D   O P I N I O N

KLAPHAKE

, Judge

James Korhonen appeals from an order (1) denying his motion to remove respondent Vivian Hogbakka as personal representative of the estate of Winifred Esther Korhonen and confirming respondent's transfer of certain real property; (2) authorizing the hiring of an appraiser; and (3) directing appellant to pay rent to the estate. Because respondent has not mismanaged the estate or otherwise breached any duty she owes to appellant or to the estate, we affirm the district court's denial of appellant's motion to remove respondent, its confirmation of respondent's transfer of real property, and its authorization to hire an appraiser. Because respondent has not established that the premises occupied by appellant are part of the estate, we reverse the part of the district court's order that directs appellant to pay rent to the estate for his occupancy.

 

D E C I S I O N

I.

A personal representative may be removed for cause when, among other reasons, "removal is in the best interests of the estate" or the "personal representative has disregarded an order of the court * * * or has mismanaged the estate." Minn. Stat. § 524.3-611(b) (1998). The district court's decision should not be disturbed unless it is a clear abuse of discretion. In re Estate of Michaelson, 383 N.W.2d 353, 356 (Minn. App. 1986).

Appellant argues that the district court abused its discretion by failing to remove respondent for her conflict of interest and inability to meet the best interests of the estate. In particular, appellant points to respondent's conveyance of real property to her daughter and son-in-law, Bonita and Frank Anderson. That conveyance was intended to correct an error in the legal description of property that was given to the Andersons in 1968 by the decedent and her husband. The Andersons built a home on the property that they believed had been given to them. After the decedent's death in 1997, respondent informed the other heirs, whom included appellant and two other sisters, of the title defect.

In January 1998, appellant's attorney drafted the following agreement, which was approved by all of the heirs on the record before the district court:

a. That if the * * * home [occupied by the Andersons] is not on their .88 acres, [respondent] can exchange with them their parcel for the parcel their home is actually located on.

b. That all of remaining [continguous homestead land] which should be still about 108.9 acres will be decreed to all four heirs as tenants in common.

c. That * * * [a noncontiguous] 40 acre parcel will be sold for either cash or contract to a family member or third party for a fair price.

d. That the four heirs * * * will meet and divide and distribute the few items of personal property and household goods on their own.

e. That the cash and proceeds from the sale of the 40 acres will be used to pay expenses of administration and the funeral bill that was guaranteed by James Korhonen and the residue distributed equally among all four heirs.

In accordance with this agreement, respondent executed a deed to the Andersons conveying to them the property on which their home is located. In exchange, the Andersons conveyed to the estate the parcel that had been incorrectly conveyed to them by the decedent. Admittedly, this deed has not yet been recorded and is being held by the title company pending the Andersons' satisfaction of delinquent taxes. Although respondent has a continuing obligation to ensure that these encumbrances are satisfied and that this deed is recorded, at this point, her conveyance of the property to the Andersons is not grounds for her removal. Respondent appropriately followed the parties' agreement and the court's implicit approval of that agreement.

Appellant further claims that respondent intends to convey the 40-acre parcel to her grandson for $1,500, which appellant claims is below market value. Respondent's amended inventory states that she "believes that this parcel should sell for between $3,000 and $5,000" and that she "intends to obtain the best sale price within a reasonable amount of time." Indeed, the district court has assured that this will occur; its order requires respondent to obtain an appraisal of the 40-acre parcel and to sell it for no less than the lowest appraised value.

Because respondent has not disregarded any court order and has followed the parties' agreement with respect to the exchange of property with respondent's daughter, the district court did not abuse its discretion by refusing to remove respondent as personal representative or by confirming her conveyance of property to the Andersons.

 

II.

Appellant next argues that the district court abused its discretion by authorizing respondent to hire an appraiser to value and inventory the personal property. He insists that the parties agreed that the value of this property was minimal and that an appraisal was not necessary.

Since the parties reached that agreement, however, appellant has refused to allow respondent into the homestead to value and inventory the decedent's personal property. Minn. Stat. § 524.3-707 (1998) permits a personal representative to "employ a qualified and disinterested appraiser to assist in ascertaining the fair market value" of assets. The district court did not abuse its discretion in authorizing the hiring of an appraiser in this case, especially in light of the acrimony among the heirs.

 

III.

Appellant argues that the district court improperly ordered him to pay $100 per month to the estate for rent of the premises he occupies when the personal representative has failed to establish that the house or its surrounding property is owned by the estate. The only evidence in the record suggests that the decedent held a life estate interest in the homestead and that her children held interests in the remainder. Although the record contains a number of deeds containing legal descriptions, respondent has failed to provide any survey or drawing indicating exactly where the homestead is located within these legal descriptions. In addition, respondent's statements in her letter brief admit that some of the property occupied by appellant "belongs to the Estate, and some * * * does not" and that appellant "occupies a house which is located on a part of the ‘Homestead' which may, or may not be part of the 15 acres which were clearly owned, in fee, by the Decedent."

Because it is unclear whether appellant occupies estate property, the district court abused its discretion in ordering appellant to pay rent to the estate. Cf. Bowen v. Willard, 203 Minn. 289, 292-93, 281 N.W. 256, 258-59 (1938) (where heir is in possession under his own right, heir is not accountable to personal representative for rents and profits received during his possession).[1]

 Affirmed in part and reversed in part.

[*] Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.

[**] Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.

[1] Respondent has proposed that the estate issue a quit claim deed to establish the property decedent owned at the time of her death and the property in which she held only a life estate. See Minn. Stat. § 507.06 (1998) (quit claim deed passes all rights and interests that grantor possesses at time and could convey). While respondent's proposal would save the estate the expense of a quiet title action, the proposal will only be successful if the heirs can reach some agreement.