Kerper v. Kerper
Annotate this Case
Kerper v. Kerper
1991 WY 134
819 P.2d 407
Case Number: 91-34
Decided: 10/25/1991
Supreme Court of Wyoming
MEIKE KERPER,
APPELLANT
(DEFENDANT),
v.
JANEEN
KERPER; JILL KERPER; WYOMING NATIONAL BANK, PERSONAL REPRESENTATIVE OF THE
ESTATE OF LOUJEN KERPER, DECEASED; WILLIAM DANIEL ELSOM; RYAN LENNON; COLBY
LENNON; KARA BEREMAN; AND KEY BANK-WYOMING, SUCCESSOR TRUSTEE OF KERPER TRUST
NO. 1,
APPELLEES
(PLAINTIFFS/DEFENDANTS).
Rehearing
Denied December 18, 1991.
Appeal from the District Court,
ParkCounty, Hunter Patrick,
J.
Ross D.
Copenhaver (argued) of Copenhaver, Kath & Kitchen, Powell, for appellant.
Janeen
Kerper, pro
se.
Before URBIGKIT, C.J., and THOMAS, CARDINE, MACY
and GOLDEN, JJ.
CARDINE,
Justice.
[¶1.] This is the second
appeal of the Kerper family's dispute over trust funds and other legacies left
to the four Kerper daughters by their parents. See Kerper v. Kerper, 780 P.2d 923 (Wyo.
1989). In this appeal, appellant Meike Kerper (Meike) contends the district
court erred in determining that oil and gas royalties mistakenly paid into
Kerper Trust No. 1 should remain as part of the principal of the trust pending
the resolution of other matters in this case. She claims those royalties are the
property of the four Kerper daughters, have never lawfully been the property of
Kerper Trust No. 1, and, therefore, should now be paid to the four Kerper
daughters. Appellee, Janeen Kerper (Janeen), contends that her sister Meike
cannot, for a variety of reasons, now pursue this issue on appeal. We hold that
Meike's appeal is properly before this court, and that the district court erred
in not ordering that the Husky royalties be paid out to their rightful owners.
Thus, we reverse that portion of the district court's order which determined the
Husky royalties should remain in the principal of the Kerper Trust No. 1,
subject to trust indebtedness, and be paid out only as, and if, principal
becomes available. In reaching this decision, we employ the equitable device
known as a constructive trust.
ISSUES
[¶2.] Meike raises these
issues:
"(1)
That portion of the Order Upon Remand as identified in the Notice of Appeal1 is unsupported by the evidence and
contrary to the evidence.
"(2)
That part of the Order Upon Remand which is appealed from is contrary to law in
that Appellant [Meike] is not treated equally with other income
beneficiaries.
"(3) By
reason of that part of the Order Upon Remand which is appealed from, there is
error in the assessment of the amounts to be paid to Appellant which deprive
Appellant of oil and gas royalty income previously found to be vested in her,
while approving payment of such royalty income to other income beneficiaries who
are of equal status.
"(4)
That part of the Order Upon Remand which is appealed from constitutes a gross
inequity, injustice and penalty upon Appellant without cause or reason, in
violation of her right to be treated equally with other income beneficiaries by
reason of which Appellant is injured and damaged."
Janeen
states these issues in response:
"1.
Whether appellant, in submitting only a partial record to this court, has
sustained her burden of demonstrating that the order appealed from is not
supported by substantial evidence?
"2.
Whether appellant's appeal is an attempt to appeal an order which has become
final and is not subject to review?
"3.
Whether error, if any, was invited by appellant?
"4.
Whether, by accepting the benefits of the district court's order, appellant has
waived her right to appeal?"
PROCEEDINGS
AND FACTS
[¶3.] We are reviewing, for a
second time, the district court's disposition of this very complex family
dispute over trust funds and other property which were left to the Kerper
daughters by their parents. See Kerper v.
Kerper, 780 P.2d 923. The dispute has turned a long-term legacy of
considerable value into a short-term benefice for lawyering skills and a
diseconomy for the Wyoming court system, as a district court and
this supreme court attempt to sort out problems that virtually defy judicial
resolution. This Bleak House2-like tragedy could likely have been
avoided if the beneficiaries of the Kerper trusts had employed some small
measure of the common sense and legal acumen with which their parents were so
generously endowed.
[¶4.] The dispute at this
stage of the proceedings is whether funds, which we shall identify as the "Husky
royalty," are the property of the Kerper daughters or part of the principal of
Kerper Trust No. 1. The record reveals the royalties were initially paid by
Husky Oil but are now paid by Marathon Oil. For purposes of simplicity, they
will be referred to in this opinion only as the "Husky
royalties."
[¶5.] The district court
determined in a partial summary judgment, entered on March 31, 1987,
that:
"I. HUSKY ROYALTY.
"A. Findings of Fact.
"(1) The
Declaration of Trust, executed by Loujen Kerper as purported Trustor, dated
September 7, 1965, as to the Husky Oil royalty, (1) provides for vested
remainders, in equal one-fourth (1/4) shares to MEIKE KERPER (formerly Minabelle
Kerper Milodragovich) LOUJEN KERPER (formerly Loujen Kerper Kuiva), JANEEN
KERPER and JILL KERPER; (2) pursuant to the terms of this trust and the
accomplishment of its purposes, this trust terminated and became distributable
to said four remaindermen on September 1, 1967 and at all times since; (3) that
the said four remaindermen were then and now are entitled to conveyance of each
of their undivided one-fourth (1/4) interest therein together with any
accumulated income, but for the Order of this Court hereinafter deferring such
distribution and payment.
"B. Conclusions of
Law.
"(1) The
Amendment to Declaration of Trust No. 1, executed by Loujen Kerper as purported
Trustor on May 30, 1972, was not effective as to the 1965 Declaration of Trust
for two reasons. First, the 1965 Declaration had already expired by its terms,
and secondly, no power to revoke, amend or modify had been reserved in the 1965
Declaration of Trust and, accordingly by operation of law, it was irrevocable
and not subject to any amendment or modification.
"(2)
The Amendment to Declaration of Trust No. 1 did not constitute a partial
modification of the trust as to only Loujen Kerper's undivided one-fourth (1/4)
thereof, because the real settlors never consented to any such modification,
either before or after the trust expired by its terms on September 1,
1967.
"(3)
Application of the Wyoming Principal and Income Act, W.S. §
2-3-601 et seq. (1977) to this trust is moot, all principal and income being
distributable to the same four persons as both income and remainder
beneficiaries."
[¶6.] No issue is raised as
to the validity of these findings, but Meike contests the district court's
application of these findings to the issue of when, and under what
circumstances, the Husky royalties should be paid out to the Kerper daughters.
Meike, in essence, contends the ultimate result of the district court's partial
summary judgment should have been that all sums payable from the Husky royalty
are immediately distributable to the owners. It is evident that much of it was
"distributed" to some of the daughters in the form of loans. Janeen borrowed
almost the amount she was entitled to as a distribution, or $36,500. Loujen
Kerper applied the indebtednesses owed the trust by three of the daughters
against the distribution owed them by the trust. Janeen Kerper owed the trust
$36,500, Loujen Kerper owed the trust $30,000, and Jill Kerper owed the trust
$10,000. Meike Kerper owed the trust nothing. However, for the period May 1985
through September 8, 1987, instead of paying out that portion of the royalties
not applied to an indebtedness, Loujen Kerper, as trustee, and in reaction to
the initiation of this litigation which had the potential to require the Kerper
daughters to repay a large sum of money to Kerper Trust No. 1, simply showed all
undistributed royalties as "accounts payable" from the trust. The effect of all
this was that Janeen had received distribution of her full share of the royalty
(less $92) and Meike had received nothing.
DISCUSSION
[¶7.] Meike contends the
monies shown as accounts payable should now be paid out to their rightful
owners. Janeen responds that Meike misunderstands the accounting and the
"mathematics" which need to be employed in determining what monies should now be
distributed to the Kerper daughters. Janeen seriously misapprehends Meike's
argument when she attributes to Meike a proposed disposition of the Husky
royalties we are unable to discern from Meike's brief. Janeen also contends
Meike has failed to demonstrate that the decision of the district court is not
supported by substantial evidence. She appears to comprehend Meike's argument as
one contesting the facts found by the district court, but which Meike attempts
to disguise as an issue of law. Again, we perceive just the
opposite.
[¶8.] Meike's protest is not
that the accountings are inaccurate or the facts otherwise insufficient to
sustain the order upon remand. Rather, she asserts the district court's
determination that the Husky royalties should be paid out only as, and if,
principal of the trust becomes available is inconsistent with the law applied in
the initial decision which was that the Husky royalties were the individual
property of the Kerper daughters and, thus, should never have been mingled with
the property of the Kerper Trust No. 1. We hasten to add that the record
supports the conclusion that Loujen acted in good faith when she included the
Husky royalties in the Kerper Trust; but, nonetheless, she did so
mistakenly.
[¶9.] Janeen also contends
Meike argues that the Kerper Trust No. 1 owns the royalties which Meike claims
should be distributed. Once again, our perception is the opposite. Meike's
argument recognizes that Kerper Trust No. 1 does not now, and never did, own the
Husky royalty. The argument may not have been as clearly worded as Janeen's, or
this court would like, but the disposition we make is that for which Meike has
contended. Meike's conclusion then is that if the Husky royalty is owned by the
daughters individually, there is no reason why those sums should not now be paid
to them in sums accurately reflected in the court's order.
[¶10.] In addition, Janeen claims Meike invited
the error of which she now complains by proposing findings of fact and
conclusions of law which were adopted as a part of the district court's March
1987 summary judgment. This is at best a non sequitur since that judgment was in
large part reversed by this court. Kerper
v. Kerper, 780 P.2d 923. The proposed findings of fact and conclusions of
law which Janeen would have serve as a roadblock to this appeal were submitted
in reaction to a judgment that is now largely revised. We do not perceive this
circumstance as an impediment to Meike's instant appeal.
[¶11.] Janeen also argues that because Meike has
accepted some benefits of the district court's order on remand she may not
appeal from that portion of it which she finds objectionable. This contention is
based upon a theory of judicial estoppel. The authority cited by Janeen simply
does not support that proposition. An appealing party may often be in the
position of having won half a loaf in the district court and yet that
circumstance, standing alone, is no bar to an appeal that seeks an opportunity
to gain the other half loaf as well. Here, Meike's appeal is unrelated to any
benefits she received under other aspects of the district court's order on
remand or the earlier partial summary judgment. Under the partial summary
judgment, there was no reason for Meike to contest the holding of the Husky
royalty by Kerper Trust No. 1 because that judgment required her to pay an even
larger sum of money back to the trust. Once Meike was freed of that burden by
our earlier disposition of this case, then her right to seek a remedy for the
Husky royalties held back from her became ripe. There is, quite simply, no issue
of judicial estoppel to be decided in this case.
[¶12.] Finally, Janeen objects to any relief for
Meike claiming her litigating has cost everyone substantial amounts of money.
The Wyoming
Constitution, Art. 1, § 8 provides that: "All courts shall be open and every
person for an injury done to person, reputation or property shall have justice
administered without sale, denial or delay." Meike was guaranteed access to the
courts for resolution of this dispute. She was successful in the trial court.
Our reversal was not unanimous. And now Janeen (and Meike) continue litigation.
That litigation is costly, does not make it unavailable.
[¶13.] Having disposed of Janeen's initial
objections to the validity of Meike's appeal, we proceed to deal with the Husky
royalties directly. The revised accounting for the years 1985 through September
8, 1987, revealed that royalties paid to the trust for 1985 were $48,456.67; for
1986 they totalled $25,333.47; and, through September 8, 1987, they were
$19,847.99. As noted earlier, some of these royalties were distributed, but the
residue of them was held back by the trust either as payments on the
indebtednesses of three of the sisters, or as accounts payable where no
indebtedness existed. In the Order Upon Remand, the district court
found:
"IT
FURTHER HEREBY IS ADJUDGED, DECREED AND ORDERED that the following sums of money
are payable to the respective persons named from the principal of the Kerper
Trust No. 1, but only as and if the said same principal sums become available,
and subject to such adjustment, if any, to the said sum payable to Meike Kerper
as may appear necessary upon the revised and supplemental accounting of the Key
Bank of Cody, Wyoming, as successor trustee, to wit:
Meike
Kerper $26,445.26
Loujen Kerper 17,010.41
Janeen
Kerper 92.98
Jill Kerper 16,858.18
* * * *
* *
"IT
FURTHER HEREBY IS ADJUDGED, DECREED AND ORDERED that the Husky royalty payments
set over free of trust pursuant to the partial summary judgment of this Court
herein entered on March 30, 1987 be freed from sequestration under the September
8, 1987 Order of this Court by the Key Bank-Cody, in its capacity as successor
trustee of Kerper Trust No. 1, and that any said sums of money heretofore
sequestered and held by said bank that are traceable to the said Husky
royalties, and payable to Loujen Kerper, Meike Kerper, Janeen Kerper, and Jill
Kerper in accordance with the partial summary judgment of this Court entered
March 30, 1987, be segregated and separately accounted for by the Key Bank-Cody,
as successor trustee of Kerper Trust No. 1, and be paid to the following persons
in equal shares:
The
personal representative of the estate of
Loujen Kerper, now
deceased
Meike Kerper
Janeen Kerper
Jill
Kerper
"The
foregoing said payments of accumulated royalties shall be accounted for by said
bank and receipted for by the payees as a special proceeding incidental to this
action through this Court."
[¶14.] The district court found that the Husky
royalty did not belong to Kerper Trust No. 1. We agree with that portion of its
judgment. However, the district court erred in providing that those sums which
are owed to the four daughters, as a result of the trust mistakenly taking
possession of the Husky royalties, are payable only from the principal of the
trust as, and if, those amounts become available. We hold that the Kerper Trust
No. 1 retains such sums as may be traceable to the Husky royalties in a
constructive trust for the four daughters. In so holding, we apply the
principles embodied in Restatement of the Law of Restitution, Quasi Contracts
and Constructive Trusts, § 165 (1937):
"§ 165.
Transfer by Mistake to Person Not Intended.
"Where
the owner of property by mistake transfers it to one person under such
circumstances that a third person is entitled to restitution from the
transferee, the transferee holds the property upon a constructive trust for the
third person." Also see, Scott, The Law of Trusts, Vol. V, §§ 467, et
seq. (4th ed. 1989); 66 Am.Jur.2d, Restitution and Implied Contracts, §§
118-152; Thomasi v. Koch, 660 P.2d 806, 809-12 (Wyo. 1983); Fuller v. Fuller, 606 P.2d 306, 309-10
(Wyo.
1980).
[¶15.] Applying these principles to the
circumstances presented here, Loujen Kerper, in her capacity as a trustee of an
earlier trust, mistakenly transferred property which belonged to the four
daughters individually to the Kerper Trust No. 1, of which she was also trustee,
apparently believing that was the intent of the trust document which governed
the disposition of those funds and her parents who originally owned the Husky
royalty. The transferee was Kerper Trust No. 1. Thus, Kerper Trust No. 1 held
the royalties in a constructive trust for the four Kerper
daughters.
[¶16.] In addition to the distributions made in
the first five months of 1985 and the distributions made in the form of credits
on indebtednesses, a small distribution of the Husky royalty money was made to
the Kerper daughters in 1988, but the balance remains unpaid. Janeen received
$92.98; and Jill, Loujen and Meike each received $2,654.05. This results in the
following Husky royalties remaining unpaid:
Janeen
Kerper - None (though she still has a right to interest and/or income from the
Husky royalty monies)
Meike Kerper - $23,791.21
Estate
of Loujen Kerper - $14,356.36
Jill Kerper -
$14,204.13
The
record appears to demonstrate that there remains $65,591.12 in monies (including
interest and/or income) that should be paid out to the Kerper daughters, in
accordance with their respective rights in that fund. The calculation provided
by Meike, which appears to be accurate, demonstrates those monies should be paid
out as follows:
Meike
Kerper - $27,101.06
Janeen Kerper - $3,309.85
Jill
Kerper - $17,513.99
Estate of Loujen Kerper -
$17,666.22
[¶17.] Some additional accounting may be
required to assure accuracy of these figures and to account for additional
interest and/or income earned between the time the above figures were developed
and the time when the monies are actually paid out. In imposing this
constructive trust, we also hold, and direct that, the funds in the constructive
trust must be paid as the first priority of the Kerper Trust No. 1. This is so
because, under the principles we hold applicable to this case, the Husky royalty
monies never became the property of Kerper Trust No. 1. The trust merely held
them in a constructive trust for the Kerper daughters. Thus, no claim that is
made against the trust can affect those monies.
[¶18.] We also note that Janeen Kerper
maintained in her brief that all Husky royalties, except those attributable to
that portion of the 1985 royalty which was not distributed, are held in a
separate account and are not part of the Kerper Trust No. 1. If that is indeed
the case, then the paying out of these funds should be relatively simple.
However, the fact that a significant portion of these funds may be in a separate
account does not lessen our concern that the district court's order on remand
appears to make them a part of the Kerper Trust No. 1. The district court
directs that they may be paid out only as, and if, those sums become available
from the principal of Kerper Trust No. 1. We add this to clarify that whether
these Husky royalty monies are actually in the Kerper Trust No. 1, or in a
separate account, or both, they are required to be paid out in accordance with
the sense of this opinion.
[¶19.] The order of the district court upon
remand is reversed to the extent described above, and the case is remanded to
the district court with directions that the Husky royalty monies be paid out to
the Kerper daughters from the Kerper Trust No. 1, or such other fund in which
they may be found, in accordance with this opinion.
1 See p. 410-411 for the text
referred to.
2 Bleak House, Charles Dickens' ninth
novel. In this novel, Dickens relates the extraordinarily complex story of Jarndyce v. Jarndyce. The novel must be
read to appreciate its tangled story of familial apprehensiveness. The final
result is that, after years of hostility and resentfulness, the family fortune
has been consumed by lawyers - not lawyers necessarily eager to engage in fee
enhancements - but lawyers hired and paid to tourney the family battle. See
Hardwick and Hardwick, The Charles
Dickens Encyclopedia, Scribner's (1973).
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