In re Estate of Alberts , 293 Neb. 1 ( 2016 )

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Nebraska A dvance Sheets
293 Nebraska R eports
IN RE ESTATE OF ALBERTS
Cite as 293 Neb. 1
In re Estate of Emil C. A lberts, deceased.
M ark A lberts and Mike A lberts, in their individual
capacities and as Copersonal R epresentatives
and Cotrustees, appellants, v.
Lois M. A lberts, appellee.
___ N.W.2d ___
Filed March 11, 2016. No. S-15-173.
1. Decedents’ Estates: Appeal and Error. An appeal from the county
court’s allowance or disallowance of a claim in probate will be heard as
an appeal from an action at law. In reviewing a judgment of the probate
court in a law action, an appellate court does not reweigh evidence, but
considers the evidence in the light most favorable to the successful party
and resolves evidentiary conflicts in favor of the successful party, who is
entitled to every reasonable inference deducible from the evidence. The
probate court’s factual findings have the effect of a verdict and will not
be set aside unless clearly erroneous.
2. Judgments: Appeal and Error. On a question of law, an appellate court
is obligated to reach a conclusion independent of the determination
reached by the court below.
3. Statutes: Appeal and Error. The language of a statute is to be given
its plain and ordinary meaning, and an appellate court will not resort
to interpretation to ascertain the meaning of statutory words which are
plain, direct, and unambiguous.
4. ____: ____. When construing a statute, an appellate court must look
to the statute’s purpose and give to the statute a reasonable construc-
tion which best achieves that purpose, rather than a construction which
would defeat it.
5. Attorney and Client. The power of the attorney to act for his client in
an action is to be considered valid and sufficient until disproved.
6. Statutes: Appeal and Error. An appellate court may not add language
to the plain terms of a statute to restrict its meaning.
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IN RE ESTATE OF ALBERTS
Cite as 293 Neb. 1
Appeal from the County Court for Custer County: Tami K.
Schendt, Judge. Affirmed in part, and in part reversed and
remanded with directions.
William J. Lindsay, Jr., of Gross & Welch, P.C., L.L.O.,
and Steve Windrum, of Malcom, Nelsen & Windrum, L.L.C.,
for appellants.
Gregory C. Scaglione and John V. Matson, of Koley Jessen,
P.C., L.L.O., and Claude E. Berreckman, of Berreckman &
Davis, P.C., for appellee.
Heavican, C.J., Wright, Connolly, Cassel, and Stacy, JJ.
Wright, J.
NATURE OF CASE
Following the death of Emil C. Alberts, his surviving spouse,
Lois M. Alberts, authorized her attorney to file a petition on
her behalf to elect to take one-half of Emil’s augmented estate
under Neb. Rev. Stat. § 30-2313 (Reissue 2008). Emil’s two
nephews, Mark Alberts and Mike Alberts, as copersonal repre-
sentatives of Emil’s estate and as beneficiaries of Emil’s trust
(the appellants), challenge both the validity of Lois’ petition
and the county court’s inclusion of the value of certain trust
property into the calculation of Lois’ elective share.
BACKGROUND
Emil passed away in June 2013 and was survived by Lois
and the appellants. After Emil’s death, Lois hired an attorney
who filed a petition with the county court for Custer County
for Lois to elect one-half of Emil’s augmented estate pursuant
to § 30-2313.
In response to the petition for the elective share, the appel-
lants objected to the petition’s validity and to the calculation
of Lois’ elective share within it. The appellants alleged that
the petition was not valid, because Neb. Rev. Stat. § 30-2315
(Reissue 2008) states that the right to an elective share may
only be exercised by the surviving spouse, and Lois did not
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IN RE ESTATE OF ALBERTS
Cite as 293 Neb. 1
sign or file the petition herself. The appellants also alleged
that the value of certain property transferred during Emil’s
lifetime was improperly included in the augmented estate for
purposes of calculating Lois’ elective share; they argued that
Lois consented to the transfer and that thus, the value of the
property should have been excluded from the augmented estate
under Neb. Rev. Stat. § 30-2314(c)(2) (Reissue 2008).
The property at issue was real estate transferred by deeds to
Emil’s revocable trust. Seventeen months prior to Emil’s death,
he and Lois jointly met with an attorney to put together an
estate plan. In addition to Emil’s living trust and will, the attor-
ney prepared four deeds for them. Two of the deeds conveyed
real property to Lois as trustee of Lois’ trust. The other two
deeds conveyed the real property at issue in this appeal, valued
at $2,529,460, to Emil as trustee of Emil’s trust. All four deeds
were signed by both Emil and Lois on the same day that Emil’s
trust and will and Lois’ trust and will were executed. Lois does
not dispute that she signed the deeds and does not allege any
fraud in the inducement.
The county court ultimately found that Lois’ petition for
elective share was validly filed and that the value of the prop-
erty at issue should be included in the augmented estate for
purposes of calculating Lois’ elective share.
ASSIGNMENTS OF ERROR
The appellants assign, combined and restated, that the
county court erred in finding that the petition for elective share
was validly filed and in failing to exclude from the augmented
estate the value of the real estate transferred by deeds to Emil’s
trust under § 30-2314(c)(2).
STANDARD OF REVIEW
[1,2] An appeal from the county court’s allowance or disal-
lowance of a claim in probate will be heard as an appeal from
an action at law.1 In reviewing a judgment of the probate court
1
In re Estate of Lamplaugh, 270 Neb. 941, 708 N.W.2d 645 (2006).
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in a law action, an appellate court does not reweigh evidence,
but considers the evidence in the light most favorable to the
successful party and resolves evidentiary conflicts in favor of
the successful party, who is entitled to every reasonable infer-
ence deducible from the evidence.2 The probate court’s factual
findings have the effect of a verdict and will not be set aside
unless clearly erroneous.3 On a question of law, an appellate
court is obligated to reach a conclusion independent of the
determination reached by the court below.4
ANALYSIS
[3,4] This case presents two issues involving statutory inter-
pretation. The language of a statute is to be given its plain
and ordinary meaning, and an appellate court will not resort
to interpretation to ascertain the meaning of statutory words
which are plain, direct, and unambiguous.5 When construing
a statute, an appellate court must look to the statute’s purpose
and give to the statute a reasonable construction which best
achieves that purpose, rather than a construction which would
defeat it.6
Validity of Petition for
Elective Share
The first issue is whether the surviving spouse’s claim for
her elective share was properly filed. The appellants claim the
petition for elective share was not valid, because it was signed
and filed by Lois’ attorney. The appellants concede that Lois
verbally authorized her attorney to file the petition, but they
assert that the petition was void, because the attorney signed
and filed it, and Lois did not. We disagree.
2
Id.
3
Id.
4
Id.
5
Robertson v. Jacobs Cattle Co., 285 Neb. 859, 830 N.W.2d 191 (2013).
6
In re Estate of Fries, 279 Neb. 887, 782 N.W.2d 596 (2010).
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IN RE ESTATE OF ALBERTS
Cite as 293 Neb. 1
Section 30-2315 provides in part that “[t]he right of election
of the surviving spouse may be exercised only during his or
her lifetime by him or her.” That right may be exercised “by
filing in the court and mailing or delivering to the personal rep-
resentative, if any, a petition for the elective share.”7 Neither
§ 30-2315 nor § 30-2317 requires the surviving spouse to per-
sonally sign and file the petition. And we reject the appellants’
argument that “[n]o one other than [Lois], her conservator or
her agent under an appropriate power of attorney can have the
authority to act for [Lois] in exercising her personal right to
elect to take the elective share.”8
The purpose of the statutory elective share is to protect the
surviving spouse against disinheritance, and the purpose of
§ 30-2315 is to ensure that such protection is afforded only
to the surviving spouse.9 In other words, § 30-2315 prevents
someone other than the surviving spouse, such as the surviving
spouse’s heir, from claiming the elective share for himself or
herself. But § 30-2315 is clearly not meant to deprive the sur-
viving spouse of his or her own elective share simply because
the surviving spouse directed an attorney to sign and file the
petition, rather than doing so himself or herself.
[5] Moreover, we have said that the power of the attorney to
act for his client in an action is to be considered valid and suf-
ficient until disproved.10 Here, there is no evidence that Lois’
attorney filed the petition without Lois’ permission or direc-
tion; on the contrary, the appellants agree that Lois authorized
her attorney to file the petition on her behalf. Accordingly, we
find that Lois properly exercised her right of election by direct-
ing her attorney to file the petition on her behalf. We conclude
that the petition for elective share was validly filed and that the
appellants’ first assignment of error is without merit.
7
Neb. Rev. Stat. § 30-2317(a) (Reissue 2008).
8
Brief for appellants at 19.
9
See, In re Estate of Fries, supra note 6; Annot., 83 A.L.R. 2d 1077 (1962).
10
See Koch v. Koch, 226 Neb. 305, 411 N.W.2d 319 (1987).
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IN RE ESTATE OF ALBERTS
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Calculation of
Elective Share
The second issue is whether the value of the real estate
transferred by deeds to Emil’s trust ($2,529,460) should be
included in the augmented estate. The county court determined
that it should, and the appellants disagree. The appellants argue
that the value of the property at issue should be excluded from
the augmented estate under § 30-2314(c)(2).
Section 30-2314 sets forth what is to be included in and
excluded from the augmented estate. Subsection (a) generally
sets forth what is to be included in the calculation, and subsec-
tion (c) excludes certain property otherwise includable under
subsection (a).
Section 30-2314(a), in relevant part, includes in the aug-
mented estate:
(1) The value of property transferred by the decedent
at any time during marriage . . . to or for the benefit of
any person other than a bona fide purchaser or the surviv-
ing spouse, but only to the extent to which the decedent
did not receive adequate and full consideration in money
or money’s worth for such transfer, if such transfer is a
transfer of any of the following types:
....
(ii) Any transfer to the extent to which the decedent
retained at death a power alone or with any other person
to revoke such transfer or to consume, invade, or dispose
of the principal of the property for his or her own benefit.
The appellants concede that the property would be included
in the augmented estate under subsection (a) of § 30-2314, if it
were not excluded under subsection (c)(2).
Section 30-2314(c)(2) excludes from the augmented estate:
Property transferred by the decedent to any person other
than the surviving spouse by any . . . deed . . . joined
in by the surviving spouse of the decedent or with the
consent to transfer manifested before or after death of
the decedent by a writing signed by the surviving spouse
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of the decedent before, contemporaneously with, or after
the transfer[.]
The county court found that § 30-2314(c)(2) did not apply.
In its January 30, 2015, order, it stated:
Although [Lois] signed warranty deeds convey-
ing the real estate to [the trust], [Emil] retained the
power to revoke the trust and enjoy the benefits from
the income of this trust during his lifetime, therefore,
under §30-2314(a)[(1)](ii) the augmented estate must be
increased by the value of the real estate. §30-2314(c)(2)
is not applicable and cannot be used to exclude the real
estate from the augmented estate, because [Emil] effec-
tively retained possession and enjoyment and right to the
income from the property.
We do not agree with the county court’s conclusion that
the deeds from Lois and Emil were transfers for purposes of
subsection (a)(1) of § 30-2314 and were not excluded by sub-
section (c)(2). The plain language in § 30-2314(c)(2) excludes
from the augmented estate certain “[p]roperty transferred by
the decedent to any person other than the surviving spouse
. . . .” (Emphasis supplied.) The rights reserved by Emil as the
settlor of the trust do not control the determination of whether
the transfer is excluded from the augmented estate. Rather,
the question is whether a trust is a “person” for purposes of
§ 30-2314(c)(2). We find that it is. Although not cited by
either party, Neb. Rev. Stat. § 30-2209 (Cum. Supp. 2014)
sets forth general definitions of terms applicable to § 30-2314.
Section 30-2209 states that the term “[p]erson means . . . an
organization . . .” and that the term “[o]rganization includes a
. . . trust . . . .”
Substituting the term “person” in § 30-2314(c)(2) with the
term “trust,” we find that subsection (c)(2) clearly applies and
excludes from the augmented estate the value of the property
in question. Subsection (c)(2) excludes from the augmented
estate “[p]roperty transferred by the decedent to any [trust]
by any . . . deed . . . joined in by the surviving spouse of the
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decedent or with the consent to transfer manifested before or
after death of the decedent by a writing signed by the surviv-
ing spouse . . . .” Here, the property was transferred by Emil
to his trust by deeds joined in by Lois, and with Lois’ consent
to the transfer manifested by her signature on the deeds. Lois
joined in the transfer by Emil of the property to the trust, and
the property was not part of the augmented estate.
Lois does not dispute that she signed the deeds. She does
not allege any fraud in the inducement. Yet, Lois contends that
her signature on the deeds was not a consent to the transfer.
She argues that in order to be excluded under § 30-2314(c)(2),
the consent must be to a transfer that diminishes the decedent
spouse’s estate. In support of her argument, Lois relies on our
discussion of § 30-2314(c)(2) in In re Estate of Fries.11 Her
reliance is misplaced.
In In re Estate of Fries, a wife executed quitclaim deeds
transferring her interest in three parcels of land (Properties) to
her husband. The husband later recorded the quitclaim deeds
and then transferred the Properties by deed to his children as
joint tenants. The wife did not sign the joint tenancy deed.
After the husband’s death, the wife filed a petition for elective
share and included the Properties in the augmented estate for
purposes of calculating her elective share.
Both parties filed motions for summary judgment. The trial
court sustained the personal representative’s motion and dis-
missed the wife’s petition for an elective share as augmented
by the Properties described in the quitclaim deeds.
We held that the trial court erred in concluding as a mat-
ter of law that the Properties described in the quitclaim deeds
should not be included in the augmented estate.
As an alternative basis for summary judgment, the personal
representative of the husband’s estate and the husband’s chil-
dren argued that even if the Properties were includable in the
augmented estate under § 30-2314(a), the Properties should
be excluded under subsection (c)(2), because the wife signed
11
In re Estate of Fries, supra note 6.
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IN RE ESTATE OF ALBERTS
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the deeds transferring the Properties to her husband, thereby
relinquishing her rights to inheritance.
We explained that the pertinent transfer for purposes of
§ 30-2314(c)(2) was the husband’s transfer of the Properties
to the children. Not only is such fact explicit in the statute
(“[p]roperty transferred by the decedent to any person . . .”
(emphasis supplied)), but we also explained why the decedent’s
transfer to his children, rather than the transfer by the wife to
the decedent, comports with the policy of § 30-2314(c)(2):
Logically, when a spouse agrees to a transfer of prop-
erty that diminishes the eventual decedent’s estate, the
surviving spouse should not be allowed to reclaim the
value of the transferred property in the augmented estate.
But that principle is not implicated if a transfer did not
remove the property from the decedent spouse’s estate,
because the consent of the surviving spouse to the trans-
fer was not a consent to any corresponding diminution in
the estate.12
When the husband presented three documents for the wife’s
signature, he told her the documents were for tax purposes.
Most important was the fact the wife did not sign the deed
transferring title of the Properties to the husband’s children.
The husband’s deed of the Properties, and not the wife’s execu-
tion of the quitclaim deeds, was the decisive transfer.
We concluded there was a genuine issue of material fact
regarding whether the wife’s execution of the quitclaim deeds
to the husband should be interpreted as her written consent
to the later transfer of the Properties to the children. We con-
cluded the county court erred in entering summary judgment
and dismissing the wife’s petition for an elective share of the
husband’s estate, and we reversed the judgment and remanded
the cause for further proceedings.
Based on our statements about diminution of the estate, Lois
argues that § 30-2314(c)(2) does not apply to the transfer of
the property, because the transfer did not diminish the estate.
12
Id. at 899, 782 N.W.2d at 606 (emphasis in original).
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She argues that Emil retained control over the property and
could have terminated the trust at any time prior to his death
and that therefore, the deeds to the trust did not diminish her
husband’s estate. Based on these presuppositions, Lois argues
that her signature on the deeds could not have been a consent
to relinquish her rights to the property.
But Lois misapplies our rationale in In re Estate of Fries
regarding the effect of the quitclaim deeds from the wife to
the husband. In that case, we explained that § 30-2314(c)(2)
applies to transfers made by the decedent and consented to by
the surviving spouse in writing. Although the quitclaim deeds
were executed by the surviving spouse in writing, subsection
(c)(2) did not apply, because the quitclaim deeds by the wife to
the husband were not a transfer by the husband. Although the
husband’s deed to his children was a transfer made by the hus-
band, the value of the Properties transferred was not excluded
from the augmented estate under subsection (c)(2), because the
wife did not consent to that transfer.
[6] Lois misconstrues In re Estate of Fries as adding a
requirement to § 30-2314(c)(2) that in order to be excluded
from the augmented estate, the transfer must diminish the
decedent’s estate. But an appellate court may not add language
to the plain terms of a statute to restrict its meaning.13 And our
discussion of the diminution of the estate in In re Estate of
Fries explained why the exclusion in subsection (c)(2) would
apply to the transfer made by the husband (had the wife con-
sented) and not to the quitclaim deeds from the wife to her
husband. Whether the quitclaim deeds were a consent to the
transfer by the husband to his children was a material issue of
fact, which cause we remanded to the trial court.
Emil and Lois’ transfer of property to the revocable trust
did diminish the decedent’s estate for purposes of calculating
the elective share, because § 30-2314(c)(2) excludes transfers
by the decedent to any person other than the surviving spouse
by an instrument joined in by the surviving spouse. The fact
13
Black v. Brooks, 285 Neb. 440, 827 N.W.2d 256 (2013).
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that the trust was revocable during Emil’s lifetime is irrelevant
for purposes of subsection (c)(2), because the decedent did not
revoke the trust while he was alive and cannot revoke it now.
Unlike In re Estate of Fries, Lois joined in the transfer of the
property to a person other than herself.
We find that the language within the deeds of the prop-
erty, which contained Lois’ signatures, is clear evidence that
Lois joined in and consented to the transfer. The deeds state
that both Emil and Lois convey the property to “EMIL C.
ALBERTS, TRUSTEE OF THE EMIL C. ALBERTS LIVING
TRUST.” Nothing within the deeds suggests that Lois (or Emil
in his personal capacity) retained any interest. Accordingly,
we conclude that the value of the property at issue should be
excluded from Emil’s augmented estate.
This result is not only compelled by the clear language of
the statute as explained above, but it also comports with the
purposes of the elective share and augmented estate statutes.
Those statutes work together to protect the surviving spouse
from disinheritance, but also to prevent the surviving spouse
from taking more than his or her “fair share” of the total wealth
of the decedent.14 Under these principles, Lois cannot include
in her elective share the property transferred to Emil’s trust by
deeds signed by Lois.
CONCLUSION
For the foregoing reasons, we affirm the county court’s
finding that the petition for elective share was validly filed.
We reverse the finding that § 30-2314(c)(2) did not apply and
remand the cause with directions to recalculate Lois’ elective
share consistent with this opinion.
A ffirmed in part, and in part reversed
and remanded with directions.
Miller-Lerman, J., not participating.
14
In re Estate of Fries, supra note 6, 279 Neb. at 892, 782 N.W.2d at 601.