in the Estate of Eldridge Lee Brimberry ( 2006 )

ChiefJustice ^V^7*7^*^ Clerk
James T. Worthen ^s^ao*^ c:,vn IY >s jA SK
Twelfth Court of Appeals
Justices q hi:i Staff Att< >rney
Sam Griffith Margaret Hussey
Diane DeVasto
Friday, March 31, 2006
Mr. William R. Pemberton Mr. Timothy D. Salley
P. O. Box 1112 604 East Goliad Avenue
306 N. 7th Street Crockett, TX 75835
Crockett, TX 75835
RE: Case Number: 12-04-00154-CV
Trial Court Case Number: 8444
Style: In the Estate of Eldridge Lee Brimberry, Deceased
Enclosed is a copy of the Memorandum Opinion issued this date in the above styled and
numbered cause. Also enclosed is a copy of the court's judgment.
Very truly yours,
CATHY S. LUSK, CLERK
By: KtilUJUL. MA
Katrina McClenny, Chief Deputy Clerk
CC: Hon. John Ovard
Judge Sarah Tunnell Clark
Ms. Bridget Lamb
1517 West Front Street • Suite 354 • Tyler, TX 75702 • Tel: 903-593-8471 • Fax. 903-593-2193
Serving Anderson, Angelina, Cherokee, Gregg, Henderson, Houston, Nacogdoches. Rains. Rusk. Sabine. San Augustine. Sketby, Smith. Trinity. I'psbur.
Van Zandt and Wood Counties
www.12thcoa.courts.state.tx.us
NO. 12-04-00154-CV
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
IN THE ESTA TE OF § APPEAL FROM THE
ELDRIDGE LEE BRIMBERRY, § COUNTY COURT AT LAW
DECEASED § HOUSTON COUNTY, TEXAS
MEMORANDUM OPINION
This is a probate case. Appellants, Jerry Lee Brimberry, Alice Sue Colburn, Norma Kay
Durfee, and Tonya Renee Pelham, applied for probate of the will of Eldridge Lee Brimberry,
deceased. Theyalsosoughtto havetwo of the executors namedin the will appointed as independent
co-executors and to have Delores McComb McDonald, the third executor named by the testator,
disqualified from serving as independent co-executor. The trial court admitted the will to probate
and appointed all three executors named in the will as independent co-executors. The trial court
required each independent executor to post a $600,000.00bond although the will provided that no
bond should be required of them. Appellants complain in their first issue that the trial court erred
in requiring Jerry Lee Brimberry and Norma Kay Durfee to give bond as a condition to their
qualifyingas independentco-executors. In their secondissue, Appellantscontendthat the trial court
abused its discretion in failing to find that Dolores McComb McDonald was disqualified to act as
independent co-executor. We modify the trial court's order and affirm as modified.
Background
Eldridge Brimberry died on August 21, 2003. His spouse of thirty-six years, Errolene
Brimberry, diedfour and a half years earlier on March 25,1999. Her estateconsisted of $10,000.00
in separate property and one-half ofthe community estate, her half valued at $383,869.00. Her will
named her husband, Eldridge, as independent executor and trustee of the trust created by the will.
The trust directed that the trustee pay to her husband out of the income of the trust estate such
amounts "as are reasonably required, in the trustee's discretion, for his health, maintenance and
support in his accustomed manner of living at my death."
Apparently, Eldridge made no effort to segregate the property of the trust from his own
property. On March 6, 2001, some two years after Errolene's death, Eldridge changed the name on
his checking account in the First State Bank in Grapeland to "E. L. Brimberry or Delores McComb."
The account created was a joint account with right of survivorship. The account had been opened
originally on March 18, 1981 as a joint account of "E. L. Brimberry or Errollene Brimberry," joint
tenants with right of survivorship. At Errollene's death, the account balance was $1,244.00. At
Eldridge's death, the account contained $64,292.94. After Eldridge's death, Delores withdrew all
but $1,200.00 from their joint checking account.
The inventory of Errollene's estate shows that at her death she also possessed a community
one-half interest in two certificates of deposit issued by the Grapeland State Bank worth a total of
approximately $89,000.00, her community one-halfinterest amounting to $44,500.00. One ofthese
certificates of deposit was closed on March 6, 2001, two years after Errollene's death. It was
replaced on that date by a new certificate styled as E. L. Brimberry, payable on death to Delores
McComb McDonald. At Eldridge's death, there was $70,000.00 in the account represented by the
certificate of deposit. Delores claims the entire account as her own by virtue of the "payable on
death" clause to her.
The inventory also shows that Errollene possessed a community one-half interest in an
Edward Jones account having a total value of $76,784.00, her half interest being $38,392.00. A
Paine Weber account included in the inventory contained $199,562.00, Errollene's half interest
amountingto $99,781.00. Accordingto the evidenceadducedat trial, at Eldridge's death four years
later, the Edward Jones account had grown to $171,000.00 and the Paine Weber account contained
$191,000.00. The total appreciation in the two accounts between the deaths of Errollene and
Eldridge amounted to $86,654.00.
Shortly before Eldridge died, Delores collected a $297.00 payment on a contract for deed due
from Willie Shepherd. Eldridge endorsed the check, and Delores deposited it in the checking
account from which she withdrew all but $ 1,200.00. The contract for deed had been the community
property of Errollene and Eldridge, and Errollene's one-half interest became part of the trust estate
of the trust created by her will.
Appellants contend that after Errollene's death, Eldridge failed to segregate his property from
the property of the trust created by Errollene's will. Since the trust property remained commingled
with his own property, Appellants argue that the entire commingled fund must be treated as subject
to the trust. While avoiding any accusation that their father breached his fiduciary duty in his
management of the trust estate, they nevertheless maintain that his attempt to convey the bank
accounts was ineffectual to transfer ownership to Delores. Therefore, they contend that Delores's
claim as sole owner of the checking account and the certificate of deposit is a claim adverse to
Eldridge's estate rendering her unsuitable to act as independent co-executor. They further contend
that as one ofthe successor trustees to her father ofErrollene's trust, she breached her fiduciary duty
in withdrawing money from the bank account, at least part of which was property belonging to the
trust estate. Similarly, they regard her claim to the entire certificate of deposit payable to her on
Eldridge's death as a breach of her duty as trust fiduciary.
Delores contends that as trustee ofErrollene's trust, Eldridge had broad powers to do all acts
that an absolute owner of the property could do, subject only to his fiduciary duty. In Delores's
view, Eldridge was free to consider the bank accounts as his own and an offsetting portion of the
investment accounts as trust property if he believed that would benefit the trust. The growth in the
brokerage accounts together with his portion of the bank accounts exceeded the total amount of the
certificate of deposit payable to Delores on his death and the joint checking account that Delores
took as survivor upon his death.
At the conclusion of the final hearing, the court determined that Delores was entitled to the
balance of the joint checking account as Eldridge's survivor and that she was entitled to the
certificate ofdeposit which Eldridge had directed the bank to pay to her on his death. Therefore, she
was not making an adverse claim to property of Eldridge's estate. Hence, she was not "unsuitable"
to act as independent co-executor. The court appointedas independentco-executorsall threepersons
named in Eldridge's will to act in that capacity conditioned upon their each giving a $600,000.00
bond. The trial court noted that Eldridge had been married three times and that each of the
independent co-executors named was a child of a different marriage.
Bond Required of Independent Co-Executors
In their first issue, Appellants contend the court erred in requiring Jerry Lee Brimberry and
Norma Kay Durfee to post bond contrary to the will ofthe testator that no bond be required ofthem.
Delores maintains that portion of the trial court's order setting bond is interlocutory and that the
appeal on this ground should be dismissed. As authority, Delores cites Estate of Navar v.
Fitzgerald, 14 S.W.3d 378, 380 (Tex. App.-El Paso 2000, no pet.).
Applicable Law
Texas Probate Code section 149 states that ifthe will provides that the independent executor
shall not be required to give bond, the testator's direction shall be observed, and no bond required
unless
it be made to appear at any time that such independentexecutor is mismanaging the property, or has
betrayed or is about to betray his trust, or has in some other way become disqualified, in whichcase,
upon proper proceedings had for that purpose, as in the case of executors or administrators acting
under orders of the court, such executor may be required to give bond. (Emphasis added).
Tex. Prob. Code Ann. § 149 (Vernon 2003).
A person is disqualified to serve as an executor if he is:
(a) An incapacitated person;
(b) A convicted felon . . . ;
(c) A non-resident . . . who has not appointed a resident agent to accept service of
process. . . ;
(d) A corporation not authorized to act as a fiduciary in this state; or
(e) A person whom the court finds unsuitable.
Id. § 78.
Texas Probate Code section 195 reiterates the mandate of section 149 that no bond maybe required
of a qualified and suitable person named as executor by the testator.
A probate order need not fully dispose ofthe entire proceeding in order to be appealable. See
Crowson v. Wakeham, 897 S.W.2d779,781 (Tex. 1995). "However, [theorder] must be one which
finally disposes of and is conclusive of the issue or controverted question for which that particular
part of the proceeding is brought. . . ." Id.
Analysis
The issues presented to the trial court in this case were the admissibility ofthe will to probate
and the suitability of one ofthe co-executors named by the testator. The sole controverted question
was the suitability ofco-executor Delores McComb McDonald. Although the trial court's order did
not finally dispose of the entire probate proceeding, it disposed of all questions presented in the
application for probate.
In Navar, the probate court found that the independent executor, Navar, had not obeyed a
court order to appear and show cause why he had failed to pay certain claims ordered paid by the
court. The probate court therefore ordered Navar to post bond or face removal as independent
executor. Navar, 14 S.W.3dat379. The court of appeals held that the order requiring bond was not
a separable part of the proceeding, but only a part of that portion of the administration dealing with
the satisfaction of creditors. Nothing in the record indicated that all creditor's claims had been
disposed of. Therefore, the order in question was not appealable because it was not conclusive of
the issue or controvertedquestion for which that particularpart ofthe proceedingwas brought. The
order in the case at bar was conclusive of the controverted questions before the probate court. We
conclude that under the test announced in Crowson, the order in this case is an appealable order.
The Probate Code vests the testator with the absolute power to select his own representative,
and the probate court must appoint the person nominated in the will as independent executor unless
that person is found to be disqualified or unsuitable. Hunt v. Knolle, 551 S.W.2d 764, 767 (Tex.
Civ. App.-Tyler 1977, no writ). When the testator provides that the independent executor named
in the will shall serve without bond, the testator's direction must be observed, unless it appears at
any time that the independent executor is mismanaging the property, or has betrayed or is about to
betrayhis trust, or has in some other waybecomedisqualified. Tex. Prob. Code Ann. § 149. The
trial court found the named independent co-executors were not disqualified or unsuitable. There is
a complete absence of evidence in the record of acts or circumstances contemplated by the Probate
Code that would authorize the probate court to ignore the testator's direction that no bond be
required ofthe independent co-executors. The trial court erred in requiring bond ofthe independent
co-executors absent any of the grounds therefor recognized by the Probate Code. Appellant's first
issued is sustained.
Suitability of Delores McCoivib McDonald
In their second issue, Appellants complain that the trial court abused its discretion in failing
to find that Delores McComb McDonald is a person who is unsuitable to serve as independent co-
executor of the estate. Appellants contend that Delores McComb McDonald is unsuitable because
she claims property of the estate as her own.
Applicable Law
The trial court is given broad discretion in determining whether an individual is suitable to
serve as an executor or administrator. Dean v. Getz, 970 S.W.2d 629, 633 (Tex. App.-Tyler 1998,
no pet.); Kay v. Sandler, 704 S.W.2d 430, 433 (Tex. App.-Houston [14th Dist] 1985, writ refd
n.r.e.). The standard of review is abuse of discretion. Olguin v. Jungman, 931 S.W.2d 607, 610
(Tex. App.-San Antonio 1996, no writ).
No person found unsuitable by the probate court is qualified to serve as an executor or
administrator. Tex.Prob.CodeAnn. § 78(e) (Vernon 2003). An individual claiming under the will
or asserting a claim in probate against the estate is not unsuitable merely because of that claim or
assertion. B oyles v. Gresham, 158 Tex. 1 58, 3 09 S.W.2d 5 0, 54 (1958). A different case is
presented, however, when a named executor claims adversely to the estate, as his own, property which
is owned, claimed, or should be claimed by the estate. Bays v. Jordan, 622 S.W.2d 148, 149 (Tex.
App.-Fort Worth 1981, no writ). The reason underlying the distinction is that a beneficiary, creditor,
or claimant does not dispute the estate's title, but seeks satisfaction of his claim from the estate's
assets. But one claiming as his own assets claimed by the estate is denying the estate's title. Hence,
his personal interests are so adverse to those of the estate that he is unsuitable to act as the estate's
representative. Id.;seealsoHaynes v. Clanton, 257 S.W.2d 789, 792 (Tex. Civ. App.-ElPaso 1953,
writ dism'd by agr.). The administrator in Haynes was found unsuitable ("incapable of performing
the duties of his trust") to continue to act as administrator, because he owned an eleven percent
interest in a bank that had brought suit against the administrator to recover all of the assets of the
estate contending that all of the property had been acquired by the deceased with money embezzled
from the bank. Haynes, 257 S.W.2d at 792. In Bays, the court of appeals decided that the trial court
had abused its discretion in granting letters testamentary to a joint venturer with the decedent who
claimed substantially all ofthe estates assets by virtue ofa written agreement with the testator creating
rights of survivorship in their joint ventures. Bays, 622 S.W.2d at 149. In Hitt v. Dumitrov, 598
S.W.2d 355, 355-56 (Tex. Civ. App.-Houston [14th Dist.] 1980, no writ), an individual was
disqualified from serving as administrator of the estates of both a husband and his wife who died
together in a plane crash, because each estate had adverse claims to the same insurance proceeds. In
a later case, a surviving spouse was found unsuitable, because she claimed property of her deceased
husband's separate estate as community property. Ayala v. Martinez, 883 S.W.2d 270, 272 (Tex.
App-Corpus Christi 1994, writ denied).
Where a trustee has wrongfully commingled trust funds with his own, the burden is on the
trustee or his successors to distinguish his funds from those ofthe beneficiary; ifthe trustee is unable
to do so, the entire commingled fund or the property purchased therewith becomes subject to the trust.
Eaton v. Husted, 141 Tex. 349,172 S.W.2d 493, 498-99 (1943); Logan v. Logan, 138 Tex. 40,156
S.W.2d 507, 510 (1941). If, however, the commingling is not wrongful, the basis for the general rule
is removed and no presumption is raised that the commingled fund and property purchased with it is
subject to the trust. Logan, 156 S.W.2d at 510; Peirce v. Sheldon Petroleum Co., 589 S.W.2d 849,
853 (Tex. Civ. App.-Amarillo 1979, no writ). The trustee is presumed to have withdrawn his own
money first, if he or she draws on an improperly commingled fund. Batmanis v. Batmanis, 600
S.W.2d 887, 890 (Tex. Civ. App.-Houston [14th Dist.] 1980, writ ref d n.r.e.).
Analysis
Appellants do not directly claim that Eldridge Brimberry violated his fiduciary duty as trustee
of the Errollene Brimberry Testamentary Trust. They essentially argue that unless and until he
formally segregated the trust property from his own, all of his property and all of the trust property
was subject to the trust. As a result, they argue, he lacked the power to make a nontestamentary
transfer of the bank accounts to Delores McDonald because an undetermined amount of the bank
deposits were trust funds. Therefore, his creation of a joint checking account with right of
survivorship in Delores as well as the designation of Delores as the payee upon his death of the
certificate of deposit was not effective. Hence, they argue, Delores holds or claims these funds
adversely to Eldridge's estate, which renders her unsuitable.
As trustee of Errollene's trust, Eldridge had broad powers "to do all acts, to take all the
proceedings, and to exercise all the rights, powers, and privileges which an absolute owner would
have," subject always to the discharge of his fiduciary obligations. Errolene's will directed that the
trustee may pay her surviving husband (Eldridge)
[s]uch amounts out of the income of the trust estate as are reasonably required, in the trustees'
discretion, for his health, maintenance and support in his accustomed manner of living at the time of
my death.
The evidence at trial showed that Eldridge fully discharged his fiduciary responsibilities. When he
died he had approximately $171,000.00 in the Edward Jones account and $191,000.00 in the Payne
Weber account. The original trust account of the Errollene's trust lists a total of $38,392.00 in the
Edward Jones account and $99,781.00 in the Payne Weber account. The appreciation in the
brokerage house accounts far exceeds the $44,500.00 interest of the trust in the two certificates of
deposits listed as trust assets. If, as appears to be the case, Eldridge chose to consider the certificates
of deposit as his own and an offsetting portion of an investment account as trust property, he did not
wrongfully confuse the accounts requiring that all of his own property be considered subject to the
trust. The substitute trustees/independent co-executors should have no difficulty in adjusting accounts
between the Errollene's trust and Eldridge's estate. T he Eaton commingling rule, invoked by
Appellants, is inapplicable to these facts. Eldridge's duties as trustee did not deprive him ofthe right
to dispose of his own property, to direct that the certificates of deposit be payable on his death to
Delores, and to create a joint checking account with her with right of survivorship.
This record supports the conclusion that the bank accounts passed to Delores outside of the
estate and that she therefore does not hold them adversely to the estate. There is no evidence that
Delorespresentlyclaims the $297.00 check from Willie Shepherdas her own. The trialjudge did not
abuse her discretion in finding Delores suitable to serve as independent co-executor. Appellants'
second issue is overruled.
Disposition
The order of the trial court admitting the will to probate is modified to delete the requirement
of bond of the co-executors. In all other respects, the judgment of the trial court is affirmed.
BILL BASS
Justice
Opinion delivered March 31, 2006.
Panel consisted of Worthen, C.J., Griffith, J., and Bass, Retired J., Twelfth Court ofAppeals, Tyler, sitting by assignment.
(PUBLISH)
COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT OF TEXAS
JUDGMENT
MARCH 31, 2006
NO. 12-04-00154-CV
IN THE ESTATE OF ELDRIDGE LEE BRIMBERRY, DECEASED
Appeal from the County Court at Law
of Houston County, Texas. (Tr.Ct.No. 8444)
THIS CAUSE came to be heard on the appellate record and briefs filed herein,
and the same being inspected, it is the opinion of this court that the order of the trial court below
should be modified and as modified, affirmed.
It is therefore ORDERED, ADJUDGED and DECREED that the order ofthe
court below be modified to delete the requirement ofbond of the co-executors, and as modified, the
trial court's order is affirmed.
It is further ORDERED that all costs ofthis appeal are hereby adjudged against
the Appellants, Jerry Lee Brim berry, Alice Sue Colburn, Norm a Kay Durfee and Tonya
Renee Pelh am, for which execution may issue, and that this decision be certified to the court below
for observance.
Bill Bass, Justice.
Panel consisted of Worthen, C.J., Griffith, J., and Bass, Retired J.,
Twelfth Court ofAppeals, Tyler, sitting by assignment.