The Estate of George A. Henry v. Nadene Woods

FILED
May 19 2017, 10:32 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Christopher T. Smith C. Dennis Wegner
Smith Davis LLC C. Dennis Wegner & Assoc., P.C.
Greenfield, Indiana Indianapolis, Indiana
Jonathan E. Palmer
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
The Estate of George A. Henry, May 19, 2017
Deceased, Court of Appeals Case No.
Appellant-Defendant, 49A05-1604-PL-810
Appeal from the Marion Superior
v. Court
The Honorable Steven R.
Nadene Woods, Eichholtz, Judge
Appellee-Plaintiff. Trial Court Cause No.
49D08-1202-EU-4311
49D08-1208-PL-31442
Bailey, Judge.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 1 of 18
Case Summary
[1] Nadene Woods (“Woods”) filed a claim for services against the Estate of
George Henry (“the Estate”), which was disallowed and then contested in a
bench trial. The Marion County Superior Court, Probate Division, partially
allowed the claim, and the Estate appealed. We affirm.
Issues
[2] The Estate presents three issues for review, which we restate as the following:
I. Whether the probate court erroneously evaluated the claim
under a standard applicable to general creditors as opposed
to a standard for family members incorporating a
presumption that services were gratuitous;
II. Whether a finding of fact is clearly erroneous; and
III. Whether the conclusion that Woods is entitled to partial
recovery upon her claim is clearly erroneous.
Facts and Procedural History
[3] In 1944, George Henry (“Henry”) married Phyllis Henry (“Phyllis”); she was
subsequently diagnosed with cystic fibrosis. By 1998, Phyllis needed in-home
assistance while Henry pursued his law practice. Henry hired a housekeeper to
clean one day per week and paid her $90.00. He hired Woods to personally
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 2 of 18
assist Phyllis. Four days per week, Woods prepared lunch, emptied Phyllis’
catheter, changed bed linens, and did some errands. Henry paid Woods
$150.00 per week.
[4] Phyllis died on February 4, 1998. Woods asked Henry if her services were still
needed and he replied in the negative. However, after a week or two, Henry
confessed to a friend that he was running out of clothing and he didn’t know
how to do laundry. Henry invited Woods over for a home-cooked meal. He
then asked Woods to do his laundry and she obliged.
[5] As time went on, Woods took on other household duties. Also, she and Henry
began to go out socially. Customarily, Henry paid for Woods’ meals when they
dined out. At some point, Woods asked Henry about payment and he
responded, “I feed you, don’t I?” (Tr. at 317.)
[6] In the fall of 1998, Henry suffered a heart attack. He recovered such that he
could continue practicing law, but as time went on he needed additional
assistance with daily tasks. Henry asked Woods to spend more time at his
residence. Eventually, Woods moved into Henry’s house. She kept some of
her possessions there, but always maintained a separate residence. Henry
continued working until his mid-eighties. At times, Woods took work
providing in-home services for elderly clients.
[7] Sometime in 2006, Henry began having some episodes of falling and he also
began to need assistance to rise from a chair. In early 2010, he began
experiencing chest pains. In December of 2010, Henry had a second heart
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 3 of 18
attack. Henry survived the second heart attack, but became more sedentary.
He developed pressure sores, and Woods tended to those, after receiving
instruction at the St. Francis Wound Care Center. Henry died on January 5,
2012, at the age of ninety-two. His will was admitted to probate in Marion
County.
[8] Woods filed a claim against the Estate, seeking compensation for fourteen years
of services. As amended, Woods’s claim sought $381,355.00 (for housekeeping
services, nursing care, cleaning supplies, and adult diapers). The services
described as relating to February 1998 to December 2008 (for $113,200.00)
were:
Basic household chores for housekeeping/maid services for 3000
square foot home, vacuuming, dusting, mopping, cleaning,
cooking, average two meals daily, dishwashing, bed linens,
laundry, ironing and putting away clothes. In addition to the
basic services, heavy cleaning twice a year, lawn mowing twice a
week, trimming 94 bushes twice a year, landscaping, planting,
weeding, harvesting for vegetable garden, canning all produce,
tending flowers, washing furnace filters, cleaning flooded
basement two times and supervising the third time,
transportation, prescription pill monitoring, attending doctor
visits, and all other personal services, including calling for all
doctor appointments and service calls. This gradually became
seven days a week, often 24 hours a day.
(Claimant’s Ex. 18.)
[9] Woods sought compensation for January 2009 to December 2011 in the
amount of $262,800.00. The claim included the description:
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 4 of 18
Services included nursing back to health after falls, ER and
hospital visits, dressing, bathing, assistance in walking,
incontinent care, anus wound care, and insuring that George
took his pills, thus allowing him to continue in his own home
with 24 hour care and to avoid assisted living or nursing home
care costs.
(Claimant’s Ex. 18.) Woods requested $400.00 for cleaning Henry’s home after
his death, $4175.00 for cleaning supplies purchased over the years, and
reimbursement for Henry’s adult diapers in the amount of $780.00. The claim
was substantially disallowed by the Estate executor and a bench trial ensued.
[10] The parties presented evidence on March 17, 2015, April 21, 2015, and October
20, 2015. On March 16, 2016, the probate court partially allowed Woods’
claim, awarding $125,400.00. This appeal ensued.
Discussion and Decision
Standard of Review
[11] An oral request for findings of fact and conclusions thereon, such as was made
in this case, does not invoke Indiana Trial Rule 52(A). D.A.X., Inc. v. Employers
Ins. of Wausau, 659 N.E.2d 1150, 1155 (Ind. Ct. App. 1996), trans. denied.
Where the trial court issues findings of fact and conclusions thereon sua sponte,
“the findings control our review and the judgment only as to the issues those
specific findings cover. Where there are no specific findings, a general
judgment standard applies and we may affirm on any legal theory supported by
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 5 of 18
the evidence adduced at trial.” Samples v. Wilson, 12 N.E.3d 946, 949-50 (Ind.
Ct. App. 2014).
[12] We apply a two-tier standard of review to the sua sponte findings and
conclusions. Id. at 950. First, we determine whether the evidence supports the
findings and second, whether the findings support the judgment. Id. We will
set aside findings and conclusions only if they are clearly erroneous, that is,
when the record contains no facts or inferences supporting them. Id. In
conducting our review, we consider only the evidence favorable to the
judgment and all reasonable inferences flowing therefrom. Id. We do not
reweigh the evidence nor do we assess witness credibility. Id.
Legal Standard for Recovery
[13] The Estate contends that the probate court relied upon an improper legal
standard. Per the Estate, “the trial court relied on the general rule for proving
an implied contract, rather than the more specific rule applicable to proving an
implied contract within a family relationship.” Appellant’s Br. at 10. The
Estate’s position is that Woods was required to rebut a presumption that her
services were gratuitous, and that she was unable to do so.
[14] Recently, in Neibert v. Perdomo, 54 N.E.3d 1046 (Ind. Ct. App. 2016), a panel of
this Court determined that a cohabitant’s claim for services performed without
donative intent survived a motion for dismissal. The Court recognized: “A
person who cohabits with another person without ever marrying is entitled to
relief if he establishes an express contract, an implied contract, or unjust
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 6 of 18
enrichment.” Id. at 1051. The Court explained the potential theories of
recovery:
“Also referred to as quantum meruit or quasi-contract, unjust
enrichment requires a party who has been unjustly enriched at
another’s expense to make restitution to the aggrieved party.”
Reid v. Reid, 980 N.E.2d 277, 296 (Ind. 2012). To recover for
unjust enrichment, the plaintiff must show that (1) he rendered a
measurable benefit to the defendant at the defendant’s express or
implied request; (2) he expected payment from the defendant;
and (3) allowing the defendant to retain the benefit without
restitution would be unjust. Id. Equitable principles prohibit the
unjust enrichment of a person who accepts the unrequested
benefits provided by another despite having the opportunity to
decline those benefits. Bright v. Kuehl, 650 N.E.2d 311, 316 (Ind.
Ct. App. 1995).
Similarly, to recover under implied contract, the plaintiff
generally must establish that the defendant impliedly or expressly
requested the benefits conferred. Id. at 315. “Any benefit,
commonly the subject of pecuniary compensation, which one,
not intending it as a gift, confers upon another who accepts it, is
an adequate foundation for a legally implied or created promise
to render back its value.” Id.
Neibert, 54 N.E.3d at 1051. The Neibert Court summarized the holdings of
several cases involving cohabitants’ claims for property division or value of
services, Glasgo v. Glasgo, 410 N.E.2d 1325 (Ind. Ct. App. 1980), trans. denied,
Chestnut v. Chesnut, 499 N.E.2d 783 (Ind. Ct. App. 1986), Turner v. Freed, 792
N.E.2d 947 (Ind. Ct. App. 2003), and Bright v. Kuehl, 650 N.E.2d 311 (Ind. Ct.
App. 1995): “[these] simply eroded and eventually eliminated an exclusion for
cohabitants seeking relief on theories of implied contract and unjust enrichment
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 7 of 18
in a previously prohibited context.” Id. at 1052. The Court reviewed the facts
of Turner, where a cohabitant had provided child care and household services
while her partner developed a business, and then observed: “Perhaps most
importantly, Turner illustrates that to prevail, the aggrieved party need not
establish an expectation of monetary payment for the services rendered.” Neibert,
54 N.E.2d at 1052.
[15] Subsequently, in McMahel v. Deaton, 61 N.E.3d 336, 344 (Ind. Ct. App. 2016),
the appellant requested that this Court reconsider the holding in Bright,
“regarding the equitable remedies that may be invoked in disputes between
formerly cohabiting couples who never married.” McMahel urged that an
express agreement should be required before dividing property acquired by
cohabitating couples. Upon review of the reasons for the decisions in such
cases as Bright and Turner, the McMahel panel expressly declined the invitation
to reconsider the holding of Bright “or other cases regarding the equitable
remedies available to Indiana courts in addressing claims by formerly
cohabitating persons based upon the theories of implied contract and unjust
enrichment.” McMahel, 61 N.E.3d at 346.
[16] Nonetheless, the Estate insists that Henry and Woods were in a familial
relationship and thus, there arose a presumption that Woods performed services
gratuitously. The Estate directs our attention to Estate of Prickett v. Womersley,
905 N.E.2d 1008 (Ind. 2009). In Estate of Prickett, a woman sought
compensation for the value of her services while caring for her mother when the
mother was subject to a guardianship. See id. at 1009. The mother’s estate
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 8 of 18
sought summary judgment on the daughter’s reimbursement claim on grounds
that the daughter had gratuitously served her mother. See id. at 1012. Our
Indiana Supreme Court reversed the denial of summary judgment, concluding
that the designated evidence did not as a matter of law rebut the presumption of
gratuitousness. Id. at 1015.
[17] In rendering its decision, the Court discussed the presumption applicable to
family members living together:
We recognize that in general, “[w]here one accepts valuable
services from another the law implies a promise to pay for them.”
Schwartz v. Schwartz, 773 N.E.2d 348, 354 (Ind. Ct. App. 2002)
(quoting Estate of Hann v. Hann, 614 N.E.2d 973, 979 (Ind. Ct.
App. 1993)). Indeed, this principle appropriately applies to
general creditors. “However, where the parties are family
members living together, and the services are rendered in the
family context, no implication of a promise to pay by the
recipient arises.” Id. at 355. Instead, in these circumstances, the
rebuttable presumption is that services are gratuitous. See Hill v.
Hill, 121 Ind. 255, 23 N.E. 87, 88-89 (1889); Cole v. Cole, 517
N.E.2d 1248, 1250 (Ind. Ct. App. 1988) (citing Schroeder v.
Schroeder, 117 Ind. App. 410, 70 N.E.2d 764, 765 (1947). The
public policy advanced by this presumption is that family
members “have reciprocal, natural, and moral duties to support
and care for each other.” Cole, 517 N.E.2d at 1250. . . .
Our state has traditionally recognized only one way to rebut the
presumption that services were rendered gratuitously, which
requires evidence of an express or implied contract. Schroeder,
117 Ind. App. at 412, 70 N.E.2d at 765. Rebutting the
presumption in this manner requires the family member to
demonstrate two specific elements: “an intention on the part of
recipient of the services to pay or compensate therefor, and an
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 9 of 18
expectation of pay or compensation on the part of the one
rendering the services.” Grout v. Solon, 131 Ind. App. 650, 174
N.E.2d 593, 594 (1961).
Estate of Prickett, 905 N.E.2d at 1012-1013.
[18] The Estate claims that the trial court factually found Woods to be Henry’s
family member but then required proof as if she were only a general creditor.
Paragraph 40 of the probate court’s order provides in pertinent part: “They
operated as a family and were a family.” (App. Vol. II at 25.) Also, the
appealed order includes language:
Generally there is a presumption of gratuity when one is caring
for a relative but no such presumption for a nonrelative. … a
presumption of gratuity may arise when services are rendered
and the parties live together in a family relationship. … Having
been involved as a couple rather than patient and caretaker may
create a presumption that the services were performed
gratuitously, but that presumption can also be overcome by
proving an express or implied contract.
(App. Vol. II at 28-29.) Ultimately, however, there was no express finding or
conclusion as to whether Woods rebutted a presumption.
[19] Notwithstanding the Estate’s urging of the imposition of a presumption of
gratuitousness, the facts of this case are not analogous to those of Estate of
Prickett, which involved a parent and child. Here, the probate court’s reference
to “family” describes how Woods and Henry conducted themselves socially
after becoming a “couple.” (App. Vol. II at 25.) There is no evidence of a
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 10 of 18
biological, marital, or adoptive relationship. Woods and Henry were
cohabitants, just as were those in Bright and its progeny. To the extent that the
probate court’s language may be read to suggest that a higher burden of proof is
imposed upon Woods as a matter of law, we reject the suggestion. Indeed, in
McMahel, the trial court found that the cohabitants and their child “presented a
family unit.” 61 N.E.3d at 341. This did not have the effect of creating a
rebuttable presumption or otherwise altering the analysis as to equitable
remedies available to former cohabitants. Here, the probate court’s omission of
a finding or conclusion relative to whether Woods rebutted a presumption of
gratuitousness is not error.
Challenged Finding of Fact
[20] The Estate challenges the finding of fact of Paragraph 40, which provides:
When some of George’s friends would kid him about marrying
Nadene, he would say he didn’t need to marry her and when the
time came she would be well taken care of.
(App. Vol. II at 24.) There was only testimony from one of Henry’s friends to
this effect. Tim Green testified that Henry said he only had one wife and
“didn’t need” to remarry, but he cared for Woods and she “would be well taken
care of.” (Tr. at 161.) Thus, the finding is in-artfully drafted in using “some”
and inaccurate in using the plural for “friend.” However, this does not render
the finding unsupported by evidence.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 11 of 18
[21] Nonetheless, the Estate argues: “To the extent that the trial court could have
relied on any inference drawn from Mr. Green’s testimony to support a finding
that George Henry had agreed in the future to compensate Nadene for her
services, such an inference is not reasonable.” Appellee’s Br. at 14. The
Estate’s argument provides no grounds for reversal, as we do not reweigh the
evidence nor assess witness credibility. Samples, 12 N.E.3d at 950.
Sufficiency of the Evidence
[22] The Estate does not deny that, over fourteen years, Woods provided
innumerable services to Henry. However, the Estate points to the absence of an
express contract between Henry and Woods and argues that Woods was unable
to prove the existence of an implied contract for payment of her services.
According to the Estate, Woods’ claim fails due to a lack of evidence that
Henry intended to compensate Woods.
[23] “To recover under the theory of implied contract, the plaintiff is usually
required to establish that the defendant impliedly or expressly requested the
benefits conferred.” Bright, 650 N.E.2d at 315. A benefit that is commonly the
subject of pecuniary compensation which one, not intending a gift, confers
upon another who accepts it, is an adequate foundation for a legally implied or
created promise to render back the value of benefit. Id. Also, “[t]o prevail on a
claim for unjust enrichment, a plaintiff must establish that a measurable benefit
has been conferred on the defendant under such circumstances that the
defendant’s retention of the benefit without payment would be unjust.” Id. at
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 12 of 18
316. Equitable principles prohibit the unjust enrichment of a party who accepts
unrequested benefits another provides despite having the opportunity to decline
those benefits. Id.
[24] Here, the trial court entered sua sponte findings and conclusions as to implied
contract but did not specifically address unjust enrichment. However, a general
judgment standard of review pertains to any legal theory supported by the
evidence adduced at trial. Samples, 12 N.E.3d at 950. Our review of the
testimony and exhibits discloses sufficient evidence for recovery under either
implied contract or unjust enrichment principles.
[25] As to implied contract, Woods established that Henry requested the benefits
conferred upon him. The trial testimony reveals that his request was sometimes
expressed and, at other times, his request was implied. Woods testified that she
did not intend a gift of fourteen years of housekeeping, maintenance, gardening,
and nursing services; indeed, both she and her daughter had questioned Henry
about the lack of payment. Henry protested that he was providing a reciprocal
benefit of food but also suggested that something would be done to take care of
Woods’ needs in the future. Henry’s neighbor testified that Woods had cried
about “doing all this without pay.” (Tr. at 39.) When pressed on whether she
should just leave, Woods responded that she could not “turn her back on”
Henry. (Tr. at 40.)
[26] As for unjust enrichment, it is abundantly clear that Woods provided valuable
services. She attended to the needs of an elderly man who, despite two heart
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 13 of 18
attacks, obesity, incontinence, and bed sores, was never admitted to an assisted
living or skilled nursing facility. Henry’s children testified to a lack of full
knowledge of his medical conditions but never contended that the medical
records were fabricated or exaggerated. They made no arrangements for
alternate care and thus incurred no expense depleting potential estate assets. It
would be unjust to permit the Estate to retain all the assets preserved without
making payment to Woods. There is evidentiary support for the trial court’s
partial allowance of Woods’ claim on equitable grounds.
Conclusion
[27] The probate court was not required to evaluate Woods’ claim in a manner that
presumed the services to be gratuitous. There is not a complete lack of
evidentiary support for the challenged finding as to Henry’s expression of
intent. Finally, Woods put forth sufficient evidence to establish that partial
allowance of her claim – in the amount of $125,400.00 – was supportable under
either implied contract or unjust enrichment.
[28] Affirmed.
Robb, J., concurs.
Vaidik, C.J., concurs in result with separate opinion.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 14 of 18
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Christopher T. Smith C. Dennis Wegner
Smith Davis LLC C. Dennis Wegner & Assoc., P.C.
Greenfield, Indiana Indianapolis, Indiana
Jonathan E. Palmer
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
The Estate of George A. Henry, May 19, 2017
Deceased, Court of Appeals Case No.
Appellant-Defendant, 49A05-1604-PL-810
Appeal from the Marion Superior
v. Court
The Honorable Steven R.
Nadene Woods, Eichholtz, Judge
Appellee-Plaintiff. Trial Court Cause No.
49D08-1202-EU-4311
49D08-1208-PL-31442
Vaidik, Chief Judge, concurring in result.
[29] I concur in the result reached by the majority. I write separately to express my
view that the rebuttable presumption that services are gratuitous should apply to
this case because although Woods and Henry were not married, they lived
together as a couple and operated as a family for fourteen years.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 15 of 18
[30] The record shows that shortly after Phyllis’s death in February 1998, Woods
started doing Henry’s laundry. As time went on, Woods’s jobs progressed to
cleaning Henry’s house, to mowing his lawn, to eventually becoming his
caregiver. Since Henry had paid Woods for taking care of Phyllis, she expected
to be paid for this work as well, but Henry never paid her. After Henry suffered
a heart attack in September 1998, Woods moved in with Henry to help with his
recovery. This resulted in them spending more time together, which they both
enjoyed. They started going on vacations together, went out socially as a
couple, entertained in Henry’s home as a couple, attended church as a couple,
went to funerals together, and sent Christmas cards signed in both of their
names. Many of their friends thought of them as boyfriend and girlfriend, and
Henry sometimes referred to Woods as his girlfriend. Henry’s family included
Woods in celebrating the holidays. According to one of Henry’s friends,
although Henry said he was not going to marry Woods, he said she would be
well taken care of. As Henry’s health declined (he had a second heart attack in
2010), Woods did more for Henry, especially in the last two years of his life.
She accompanied him to his doctor appointments, monitored his medications,
and took care of his sores. Henry died in 2012. Woods was listed in his
obituary as his “loving companion.” Appellant’s App. Vol. II p. 41.
[31] Thereafter, Woods filed a claim against Henry’s estate for fourteen years of
services and supplies she provided to Henry. The probate court partially
granted Woods’s claim, awarding her $125,400.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 16 of 18
[32] In general, where one accepts valuable services from another, the law implies a
promise to pay for them. Estate of Prickett v. Womersley, 905 N.E.2d 1008, 1012
(Ind. 2009). But where the parties are family members living together and the
services are rendered in the family context, no implication of a promise to pay
by the recipient arises. Id. Instead, the rebuttable presumption is that the
services are gratuitous. Id. In order to rebut the presumption, there must be
evidence of an express or implied contract. Id.
[33] The probate court recognized this general rule. It found that although Woods
was not Henry’s relative, the presumption nevertheless applied because “the
parties live[d] together in a family relationship.” Appellant’s App. Vol. II p. 29.
The court noted that although “[c]aregivers and clients often grow fond of each
other,” “this relationship was more than caregiver and client”; “it was more like
girlfriend and boyfriend.” Id. I believe that the probate court correctly applied
the rebuttable presumption to this set of facts, because Woods and Henry lived
together and “operated as a family” for fourteen years. Id. at 25. The fact that
they were not married does not change the fact that they lived together as a
family for an extended period of time. See Kitch v. Moslander, 114 Ind. App. 74,
50 N.E.2d 933, 938 (1943) (finding that ex-husband and ex-wife who lived
together after living apart were family and that there was an implied contract
for services ex-wife provided to ex-husband for over thirty years). Accordingly,
I respectfully disagree with the majority that the presumption that services are
gratuitous does not apply here because there is “no evidence of a biological,
marital, or adoptive relationship.” Slip op. at 10-11.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 17 of 18
[34] Further, I agree with the probate court that Woods rebutted this presumption.
The court explained that the presumption could be overcome by proving an
implied contract. Appellant’s App. Vol. II p. 29 (“Having been involved as a
couple rather than patient and caretaker may create a presumption that the
services were performed gratuitously, but that presumption can also be
overcome by proving an express or implied contract.”). By then finding an
implied contract in the amount of $125,400, the court found this presumption to
be rebutted. Because the majority affirms the $125,400 claim for Woods, I
concur in the result reached by the majority.
Court of Appeals of Indiana | Opinion 49A05-1604-PL-810 | May 19, 2017 Page 18 of 18