In re the Guardianship of William Henry Broughton (Alleged Incapacitated Adult), Dennis Broughton, Kevin Broughton and Otis Broughton v. Warren Broughton (mem. dec.)

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D), FILED
this Memorandum Decision shall not be
Aug 28 2018, 9:49 am
regarded as precedent or cited before any
court except for the purpose of establishing CLERK
Indiana Supreme Court
the defense of res judicata, collateral Court of Appeals
and Tax Court
estoppel, or the law of the case.
ATTORNEYS FOR APPELLANTS ATTORNEY FOR APPELLEE
Bryan L. Ciyou John A. Kraft
Darlene R. Seymour Young, Lind, Endres & Kraft
Ciyou & Dixon, P.C. New Albany, Indiana
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
In re the Guardianship of August 28, 2018
William Henry Broughton Court of Appeals Case No.
(Alleged Incapacitated Adult), 18A-GU-44
Dennis Broughton, Kevin Appeal from the Crawford Circuit
Broughton, and Otis Broughton, 1 Court
The Honorable Joseph L.
Appellants-Cross-Petitioners,
Claypool, Special Judge
v. Trial Court Cause No.
13C01-1612-GU-25
Warren Broughton,
Appellee-Petitioner.
1
Connie Broughton Manley (“Connie”) did not file a brief, and counsel did not file an appearance on her
behalf. However, pursuant to Indiana Appellate Rule 17(A), a party of record in the trial court shall be a
party on appeal.
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Mathias, Judge.
[1] The Crawford Circuit Court appointed Warren Broughton (“Warren”) as
guardian over his elderly father, William Henry Broughton (“Henry”).
Thereafter, Warren’s three brothers, Dennis Broughton, Kevin Broughton, and
Otis Broughton (collectively the “Brothers”), filed objections to the
appointment. The trial court held a hearing on the Brothers’ objections after
which it denied the objections and confirmed that Warren would remain
Henry’s guardian. The Brothers now appeal, claiming that the trial court erred
in appointing Warren as Henry’s guardian. We affirm.
Facts and Procedure
[2] Henry is the ninety-year-old father of Warren, the Brothers, and their sister
Connie. Henry owns approximately 350 acres of land (the “Farm”) that is, in
part, used to raise cattle for sale. The Farm also includes several homes that are
used as residences for Henry, Warren and his wife, and Warren’s son Will.
Warren has lived and worked on the Farm with his father for the past thirty or
forty years.2 Henry has not had much of a relationship with his other children
since he divorced his wife, and their mother, approximately ten years ago.
[3] On March 15, 2010, Henry signed a durable power of attorney (“POA”)
making Warren his attorney-in-fact and health care representative. On the same
2
Warren’s son Will also works on the Farm. Neither Warren nor Will has ever received payment from
working on the Farm. See Tr. pp. 112–14
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day, Henry transferred ownership of the Farm to Warren in fee simple,
reserving a life estate for himself. Henry did not want the Farm sold upon his
death, and he believed Warren would take care of it and keep it in operation.
[4] In 2016, Henry began exhibiting concerning behavior. Warren explained that
Henry “was doing a lot of stuff that was going to get himself injured, or some
neighbors injured, or somebody on the road.” Id. at 94. At the time, Henry was
living with Mary Morgan (“Mary”) who lived directly across the street from the
Farm. She too was concerned for Henry because “he was confused a lot of
times[,]” and there were occasions where he would urinate on himself and go to
bed without cleaning himself up. Id. at 206–07. As a result of Henry’s
deteriorating condition, on December 5, 2016, Warren filed an application for
Henry’s emergency detention. Henry was taken to a hospital, and he was later
transferred to a nursing home where he remains today.
[5] Henry and Warren own a joint checking account together (the “Checking
Account”), and Henry owns a savings account (the “Savings Account”) which
is payable on death to Warren. Funds for the Checking Account come from
Henry’s pension and the sale of cattle on the Farm. Whenever Henry felt too
much money was in the Checking Account, he would transfer money into the
Savings Account.
[6] On December 9, 2016, Warren, acting as Henry’s POA, wrote a check from the
Checking Account for $31,000 payable to Henry. Warren then transferred the
funds into a Broughton Farms, LLC account owned by Warren and his wife.
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The same day, Warren also, acting as Henry’s POA, wrote a check from the
Savings Account for $234,632.37 payable to Henry. Warren transferred this
amount into a separate savings account owned by Warren and his wife. He
explained that “this was [] the same time my sister had robbed our accounts,
and we knew that there was a possibility of her doing more, so we put it in a
safe spot.”3 Tr. p. 82.
[7] On December 13, 2016, Warren filed a petition to establish a permanent
guardianship over Henry’s person and estate and to name him as guardian. On
December 15, the court entered an order that established a temporary
guardianship over Henry and appointed Warren temporary guardian. On
December 27, Connie filed a petition to set aside the court’s December 15
order. The court granted Connie’s petition that same day, and it set the matter
for hearing. On December 29, the court appointed a Guardian Ad Litem to act
on Henry’s behalf.
[8] On March 6, 2017, Warren amended his December 13 petition for appointment
of a permanent guardian. The trial court held a hearing on Warren’s petition on
April 13. At the conclusion of the hearing, the trial court named Warren
Henry’s guardian and explained, “I’m going to take this under advisement, and
we’ll set another hearing date shortly after I get some more information about
what’s going on in this thing.” Tr. p. 16. The court also noted that “Henry is of
3
Connie had written a check for $16,450 out of the Checking Account, and she was subsequently ordered by
the court to repay those funds. See Appellee’s App. p. 5–6.
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an age where I know that sometimes you need some help, and we want to make
sure that help is given, whether or not that be in a guardianship or otherwise is
what this Court . . . needs to determine.” Id. at 16–17. On April 18, the court
issued an order reflecting its remarks in which it determined a guardianship was
necessary. The court then “temporarily appointed” Warren as Henry’s guardian
“until further ORDER of this Court.”4 Appellee’s App. p. 4 (emphasis in
original).
[9] On April 25, 2017, the Brothers, pro se, filed objections to Warren’s
appointment as Henry’s guardian.5 Each objection alleged, “[e]vidence supports
that [Henry] is a victim of abuse, coercion, and theft. I will not tolerate this
injustice any longer, crimes have been committed.” See Appellants’ App. pp.
66–68. Warren filed a motion to strike the Brothers’ objections on May 23, and
the Brothers, now represented by counsel, filed a motion in opposition to strike
the objections on June 2.
[10] On June 30, the Brothers filed a motion for an order seeking to compel Warren
to file an inventory of guardianship property to comply with Indiana Code
section 29-3-9-5. On August 15, the court directed Warren to file an accounting
within ten business days and also set a hearing for September 26. Warren filed
4
The trial court also noted, prior to its findings, that it was taking “the matter under advisement for issuance
of a further Order, as may be necessary concerning the guardianship of the estate and person of [Henry].”
Appellee’s App. p. 3.
5
Kevin Broughton’s pro se objection was filed on May 8, but it contained identical language.
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several documents titled “Guardian’s Accounting” on September 7. A hearing
on the Brothers’ objections and the outstanding issues was held on September
26, during which Warren, the Brothers, Mary, and Henry all testified.
[11] On November 6, the trial court issued findings of fact and conclusions of law in
which it denied Brothers’ objections and confirmed its appointment of Warren
as guardian over Henry and his estate. The Brothers filed a motion to correct
error on December 1, which the trial court denied on December 22. The
Brothers now appeal.
Standard of Review
[12] On appeal, we afford trial courts a great deal of deference in family law matters
because of their extended face-to-face interactions with the parties. Best v. Best,
941 N.E.2d 499, 502 (Ind. 2011). Trial judges are able to assess the credibility
and character of the parties involved, and, because of this evidence, they are in
a superior position to determine the best interests of parties. Id. As such, we
review a trial court’s determinations relating to a guardianship for an abuse of
its discretion. In re Guardianship of Morris, 56 N.E.3d 719, 723 (Ind. Ct. App.
2016). This occurs when the trial court’s decision is clearly against the logic and
effect of the facts and circumstances presented. Id.
[13] At Warren’s request, the trial court entered findings of fact and conclusions of
law. In this scenario we apply a two-tiered standard of review, determining first
whether the evidence supports the findings and second whether the findings
support the judgment. Sexton v. Sexton, 970 N.E.2d 707, 710 (Ind. Ct. App.
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2012), trans. denied. We will not set aside a trial court’s findings unless they are
clearly erroneous, meaning that our review of the record leaves us firmly
convinced that a mistake has been made. Id. We do not defer to the trial court’s
conclusions of law and will find clear error if the court has applied an incorrect
legal standard. Id.
Discussion and Decision
[14] The Brothers allege that the trial court erred by appointing Warren as Henry’s
permanent guardian.6 Indiana Code section 29-3-1-6 defines a guardian as “a
person who is a fiduciary and is appointed by a court to be a guardian or
conservator responsible as the court may direct for the person or the property of
an incapacitated person[.]” Once appointed, a guardian has a statutory duty to
manage the property for the ward’s best interest, and he is responsible to protect
and preserve the property of the protected person. See I.C. § 29-3-8-3(2); Wells v.
6
Warren argues that the Brothers’ appeal is untimely because “Warren was appointed as guardian, in a
permanent fashion, over the person and estate of Henry” in the trial court’s April 18, 2017 order, and entered
on the CCS on May 2, 2017. Appellee’s Br. at 10. And thus, Warren contends that the Brothers had until
June 1, 2017, to file their notice of appeal, which was not filed until January 10, 2018. Warren filed a motion
to dismiss the Brothers’ appeal on these same grounds on June 1, 2018, which our motions panel denied on
July 13, 2018. Although it is well settled that a writing panel may reconsider a ruling by the motions panel,
we decline to do so here. Simon v. Simon, 957 N.E.2d 980, 987 (Ind. Ct. App. 2011). The trial court noted in
its April 18 order that a guardian for Henry “should be appointed temporarily until further Order of the Court
determining that a guardianship is necessary[.]” Appellee’s App. pp. 2–3. And it then appointed Warren as
Henry’s guardian “until further ORDER of this Court.” Id. at 5 (emphasis in original). It is clear from the
trial court’s language that it anticipated and planned for future proceedings relating to the guardianship over
Henry. See Bacon v. Bacon, 877 N.E.2d 801, 804 (Ind. Ct. App. 2007) (holding that a final judgment ends a
particular case and leaves nothing for future determination), trans. denied. Moreover, the Brothers filed pro se
objections to Warren’s appointment in May and June of 2017, which they were free to do at any time.
Therefore, it is the trial court’s November 6, 2017 order denying the Brothers’ objections that is the basis for
their appeal. The Brothers filed a motion to correct error which the trial court denied on December 22, 2018,
and the Brothers’ initiated this appeal on January 10, 2018, well before their deadline. For these reasons, the
Brothers’ appeal is not untimely.
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Guardianship of Wells, 731 N.E.2d 1047, 1051–52 (Ind. Ct. App. 2000), trans.
denied.
[15] The guardian must also conserve any property of the protected person in excess
of the protected person’s current needs. I.C. § 29-3-8-3(3). Thus, in order to
adequately perform his or her responsibilities, the guardian must maintain
sufficient contact with the protected person to know of this person’s capabilities,
disabilities, limitations, needs, opportunities, and physical and mental health.
See I.C. § 29-3-8-1(a)(1); (b)(1).
[16] Here, the Brothers contend that Warren is not the proper person to care for
Henry and his estate because they allege that Warren has breached his fiduciary
duty as a guardian in two ways: (1) by failing to provide an inventory of
Henry’s estate as required by statute; and (2) by transferring funds from Henry’s
accounts to his own personal accounts without authority or cause. See
Appellants’ Br. at 12–16. We address each contention in turn.
1. Failing to Provide an Inventory Required by Statute
[17] Under Indiana Code section 29-3-9-5, a guardian is required to “file with the
court a complete inventory of the property subject to the guardian’s control”
within ninety days after appointment.7 Indiana Code section 29-1-12-1 explains
that the inventory must:
7
The timeframe is thirty days for a temporary guardian. Ind. Code § 29-3-9-5.
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(1) consist of at least one (1) written instrument;
(2) indicate the fair market value of each item of property;
and
(3) include a statement of all known liens and other
charges on any item.
(b) Property listed in the inventory required by subsection (a)
must be classified as follows:
(1) Real property, with plat or survey description, and if a
homestead, designated as a homestead.
(2) Furniture and household goods.
(3) Emblements and annual crops raised by labor.
(4) Corporate stocks including the class, the par value or
that it has no par value, if preferred stock the dividend
rate.
(5) Mortgages, bonds, notes or other written evidences of
debt or of ownership described by name of debtor,
recording data, and other identification.
(6) Bank accounts, money, and insurance policies if
payable to the estate of the decedent or to the decedent's
personal representative.
(7) All other personal property accurately identified,
including the decedent’s proportionate share in any
partnership, but no inventory of the partnership property
shall be required.
Id. at §§ (a); (b).
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[18] On June 30, 2017, the Brothers filed a motion for an order from the court
seeking to compel Warren to file an inventory in compliance with the above
statutes. The trial court issued an order on August 15, directing Warren to “file
an Accounting . . . with the Court within ten business days[.]” Appellants’ App.
p. 82. On September 7, Warren filed a “Guardian’s Accounting[,]” that
included four bank statements from Henry’s First Harrison Bank account,8
copies of checks written out of Henry’s accounts to pay bills, and billing
statements and receipts from several providers. See Appellee’s App. pp. 14–46.
[19] The trial court remarked that Warren’s provided accounting “appears to be an
income statement. It’s all [Henry’s] income that’s coming in and the outflow of
his income. However, there’s no balance sheet. There’s nothing in there about
the assets of the Estate.” Tr. p. 22. The court then stated, “well we need to find
out what assets are claimed to be in the guardianship and are not claimed to be
in the guardianship and make a determination of that fact.” Id. at 28. However,
our review of the record does not indicate that the accounting was ever
amended, or that a separate inventory was ever filed.
[20] Although we agree with the Brothers that Indiana law requires Warren to file
an inventory in compliance with Section 29-3-9-5, we do not believe that a
failure to do so necessarily implies that Warren “is not the best person available
to serve as Henry’s guardian.” Appellants’ Br. at 15. Initially, we note that the
8
The statements covered April 15, 2017 through August 15, 2017.
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Brothers have failed to cite to any authority to support their position. See Ind.
Appellant Rule 46(8)(a). Indeed, a guardian has a continuing relationship with
the court and a fiduciary responsibility to real and potential beneficiaries of the
estate of the ward. At any time, whether on motion, or sua sponte, the court may
direct or order the guardian to provide an accounting with specific directions as
to its contents. Moreover, the Brothers have failed to demonstrate how they
have been prejudiced by Warren’s deficient inventory filing. Absent statutory
authority, we will not conclude that the failure to file an inventory under
Sections 29-3-9-5 and 29-1-12-1 automatically renders an individual unsuitable
to serve as guardian. See Wells, 731 N.E.2d at 1050.
[21] There is substantial evidence before us that demonstrates Warren is more than
suitable to serve as guardian over Henry and Henry’s estate. Warren has a close
relationship with Henry, and they have worked on the Farm together for
approximately forty years. Since Henry has been in a nursing home, Warren
has visited him every day, and he has paid Henry’s bills and kept the farm
running in Henry’s absence. Although the Brothers alleged in their objections to
Warren’s appointment that Henry was the victim of abuse, coercion and theft,
none of the Brothers has testified to any personal knowledge substantiating
these claims, and Henry has denied them outright. Henry has also testified that
Warren is “the only one that has ever helped me.” Tr. p. 221. And when asked
if he believed it was in his best interest that Warren continue as guardian,
Henry responded, “The only way.” Id. at 224.
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[22] Therefore, we acknowledge that Warren has failed to file an inventory in
compliance with Section 29-3-9-5, and we remand with instructions for the trial
court to direct Warren to file a proper inventory. However, we conclude that
Warren’s failure to do so does not on its own render him incapable of serving as
Henry’s guardian.
2. Transferring of Funds
[23] On December 9, 2016, Warren, acting as Henry’s POA, wrote a check for
$31,000 in Henry’s name from the Checking Account and deposited the
amount into a Farm account owned by Warren and his wife. The same day,
Warren also wrote a check for $234,632.37 in Henry’s name from the Savings
Account and deposited the amount into a separate savings account owned by
Warren and his wife. The Brothers allege that “[t]here was no evidence that the
removal of these funds was necessary for Henry’s care or protection[,]” and
therefore Warren’s “actions constitute a conflict of interest between Warren’s
interest and Henry’s interest; breach Warren’s fiduciary duty to Henry;
demonstrate a failure to act on Henry’s behalf; and contravene Warren’s
obligation to conserve Henry’s property.” Appellants’ Br. 16. We disagree.
[24] Warren testified that he transferred the funds from Henry’s accounts9 because
his sister Connie had recently written herself a check for $16,450 out of the
Checking Account, and “we knew that there was a possibility of her doing
9
The Checking Account is jointly owned by Henry and Warren, and Warren owns a right of survivorship in
the Savings Account.
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more, so we put it in a safe spot.” Tr. p. 82. Warren explained that Connie “has
a history of doing exactly what she did by removing money from the account.
She has a history that goes way back with that.” Id. at 85. Importantly, Connie
was directed to return the $16,450 in the trial court’s April 18 order. Appellee’s
App. p. 5–6.
[25] Moreover, Warren explained that the money he transferred “went into a
savings account, which is still intact and growing interest every day.” Tr. p. 83.
In addition, Warren has paid all of Henry’s bills since Henry was placed in a
nursing home. For these reasons, Warren did not breach his fiduciary duty as
Henry’s guardian when he transferred funds out of the Checking and Savings
accounts on December 9, 2016.
Conclusion
[26] Based on the facts and circumstances before us, the trial court did not err when
it denied the Brothers’ objections, nor did it err when it confirmed Warren as
guardian over Henry’s person and estate. In these respects, we affirm the
judgment of the trial court. However, we remand with instructions for the trial
court to order Warren to provide a proper inventory of guardianship property in
compliance with Indiana Code section 29-3-9-5. Affirmed and remanded for
proceedings consistent with this opinion.
Bailey, J., and Bradford, J., concur.
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