Opinion
No. CV 01 0186822 S
May 22, 2003
MEMORANDUM OF DECISION
This application for a prejudgment remedy was brought under date of November 26, 2001 by Beverly Cogswell and Heidi Hemingway against Sheri Paige, individually, as administrator of the estate of Kriemhilde Byxbee, and as trustee of the Kriemhilde Byxbee life insurance trust, and against Warren Seper. The allegations contained in the unsigned complaint accompanying the application are in ten counts, some against Sheri Paige and Warren Seper, her husband, some against Sheri Paige alone, and one count against Warren Seper alone. The various counts allege larceny, conspiracy, conversion, legal malpractice, breach of fiduciary duty, tortuous interference with an expectancy or inheritance, breach of contract, and violation of the Connecticut Unfair Trade Practices Act (CUTPA). After the denial of a motion to dismiss filed by the defendants, an evidentiary hearing on the application was begun on July 15, 2002 before Judge Adams. The hearing was continued to November 20, 2002 before the undersigned, who heard eight days of evidence. Earlier, counsel had stipulated that the court would render a decision based upon the July 15, 2002 transcript of the hearing before Judge Adams, and upon the subsequent evidence heard by the undersigned in the continued hearing.
Hereinafter, when the court refers to "defendant" in the singular, it is referring to the defendant Sheri Paige.
Jurisdictional issues raised by the defendants must be resolved before the court addresses the merits of the plaintiffs' claims. Baldwin Piano Organ Co. v. Blake, 186 Conn. 295, 297, 441 A.2d 183 (1982). The defendants reassert their argument made in their motion to dismiss dated July 12, 2002 denied by Judge Adams. The gravamen of this claim is that the Court lacks jurisdiction over the prejudgment remedy application because no hearing was commenced within 30 days of the date initially scheduled by the Clerk of the Court and thus is violative of Conn. Gen. Statutes § 52-278j (b). The court has reviewed the court file and Judge Adams' Memorandum of Decision denying the motion. (Memorandum of Decision, August 5, 2002), and finds its reasoning sound and its results correct. Accordingly, the court deems it to be the law of the case, and will not disturb the conclusions. Breen v. Phelps, 186 Conn. 86, 100, CT Page 7093 439 A.2d 1066 (1982).
The defendants raised another jurisdictional issue, for the first time in their memorandum of law dated December 27, 2002, two weeks after the completion of evidence. Nevertheless, the court is obliged to address it. Baldwin Piano Organ Co. v. Blake, supra 186 Conn. 297. The defendants claim that the plaintiffs Beverly Cogswell and Heidi Hemingway commenced the proceeding by filing the application for a prejudgment remedy as individuals, rather than as fiduciaries of the Estate of Kriemhilde Byxbee. Their position is that only the fiduciaries of the decedent's estate have standing to bring this action and that the plaintiffs, as beneficiaries of the estate, have no such standing. The defendants claim that the plaintiffs' substituted unsigned complaint is not an amended complaint, but actually is an attempt to add new parties improperly.
At the time of the filing of the application for a prejudgment remedy in November 2002, the plaintiffs were not yet appointed as fiduciaries of the Estate of Kriemhilde Byxbee. The defendant, Sheri Paige, in fact was the Administrator of the Estate at that time. However, in January of 2002, the plaintiffs were appointed as co-executrices under the will of the decedent, replacing Sheri Paige. A substituted unsigned complaint was filed at the conclusion of the evidence on December 13, 2002, the last day of the hearing, which named the plaintiffs individually and as co-executrices of the Byxbee Estate. The plaintiffs have remained as the fiduciaries since the day of their appointment on January 30, 2002, and before, during and after this hearing. The defendants have offered no authority for the proposition that the subject matter jurisdiction of the court has been affected by the sequence of events in the case.
The defendants, in their next claim on jurisdictional issues, contend that Beverly Cogswell and Heidi Hemingway as the fiduciaries of the estate in question, are indispensable parties, and thus the court has no subject matter jurisdiction. The response to this claim is the same as stated above on the standing issue, that is, that the plaintiffs were in fact fiduciaries since January 30, 2002, but were simply not identified as such in the unsigned complaint. Although they were not yet appointed at the time of the filing of the prejudgment remedy application, they were endowed with the powers of fiduciaries throughout the subsequent proceedings. Additionally, neither party has provided authority to suggest whether or not the beneficiaries under the will of Kriemhilde Byxbee had or have, as individuals, a cause of action against the defendants for their conduct, and the court does not address that issue.
The defendants' final claim on preliminary issues is that the plaintiffs have no procedural right to amend the unsigned complaint or file a substituted unsigned complaint. The substantive change in the unsigned substituted complaint, being the addition of one count in fraud, is permitted. It merely conforms the complaint to the evidence elicited at the prejudgment remedy hearing. No writ had been served in this matter and thus there is no civil action pending. Raynor v. Hickock Realty Corp., 61 Conn. App. 234, 763 A.2d 54 (2000). The defendants point to no authority which prohibits, prior to the service of a writ instituting a civil action, the substitution of an unsigned complaint to conform to the proof after the hearing on a prejudgment remedy.
The court turns now to the ultimate question raised by the evidence in this case i.e., are the plaintiffs entitled to relief on their claims in this proceeding for a prejudgment remedy? That question is answered in the negative for the reasons that follow.
First, let the court state that the conduct of the parties as described by the testimony and exhibits in this case amounts to the most grievous and outrageous behavior one could imagine by persons granted the trust of an elderly woman. The court finds the acts of the defendant and of both plaintiffs in their relations with Kriemhilde Byxbee despicable, such conduct hereinafter described in part only, and to be condemned by all reasonable members of a moral society. The testimony of the defendant was so lacking in credibility, her explanations for her conduct and for the creation of certain documents so outlandish, her efforts to paint herself as an innocent victim so transparent as to shock the conscience of the court.
The plaintiffs' case presents no less disturbing a picture. The plaintiffs freely admit that their conduct toward Byxbee was wrong, in some cases illegal, and that they knew it at the time. Cogswell confesses that she lied under oath when she signed an affidavit on April 1, 2000 (Exhibit V). The parties point to each other as the reason for their actions. The respective explanations of their behavior by the plaintiffs on the one hand and by the defendant on the other, are diametrically opposed in almost every instance. The court finds the following relevant facts.
The defendant, a practicing Norwalk attorney, first met Kriemhilde Byxbee (Byxbee) in the spring of 1999, when the plaintiffs, Beverly Cogswell and Heidi Hemingway, called her to come to Byxbee's house for the purpose of discussing a living will. The plaintiffs were cleaning women, who had been employed by Byxbee for 10 to 15 years, and they and some members of their families had prior dealings with Attorney Paige as a lawyer. Subsequently, the defendant was authorized by Byxbee to prepare a last will and testament naming the plaintiffs as the sole beneficiaries of her estate, equally. They were also named as co-executrices under the will.
The defendant soon began advising the plaintiffs that for tax reasons Byxbee should start to make inter vivos gifts in order to reduce her taxable estate. The defendant is a general practice lawyer with a tax background. She also suggested that an insurance policy be purchased on the life of Byxbee, 83 years of age at the time, so that funds would be available to pay succession and estate taxes at her death. The defendant brought in her husband Warren Seper, an insurance salesman, to sell such a policy to Byxbee. The face amount of the policy obtained was $400,000, and the first year's premium was approximately $57,000. She also retained one Attorney O'Grady to prepare an insurance trust to receive the eventual proceeds of the policy. In the summer of 1999, the defendant and the plaintiffs began to arrange methods of obtaining "gifts" from Byxbee. Among the first were some expensive lamps which the defendant asked the plaintiffs to purchase for her. The plaintiff Hemingway used Byxbee's debit card to pay for the lamps, in excess of $1,000, and brought them to the defendant. The defendant retained possession of the lamps without any permission from Byxbee.
Soon, a scheme was developed for the obtaining of money gifts from Byxbee. Cogswell would present personal checks for Byxbee to sign for the payment of her legitimate bills. She then requested Byxbee to sign some additional checks in blank. Cogswell gave the blank, signed checks to Hemingway who filled in the name of the payees and the amounts, having received her instructions from the defendant.
The defendant prepared documents to be signed by Byxbee which were authorizations and/or permissions for the gifts to be made. Cogswell often blocked out the contents of the documents with her hand as she had Byxbee execute them. With respect to some documents, Byxbee was falsely told that they were Probate Court documents which had to be signed and were in reference to her late husband's estate. The defendant also required both plaintiffs to sign these documents saying it was required by law.
Another scheme was used in connection with the defendant's representation of Byxbee in real estate closings in which Byxbee sold two houses in Stamford. The defendant deposited the proceeds of the sales in her lawyer's trustee account and wrote checks therefrom. Checks were written and given to herself, her husband, her four children, both plaintiffs, members of both plaintiffs' families, and to the defendants' part-time babysitter. The defendant prepared documents showing these disbursements. Byxbee was not aware of all the gifts because she either did not read documents presented to her before she signed, or the contents thereof were hidden from her.
These fraudulent schemes were orchestrated by the defendant and the plaintiffs willingly participated. The fraud netted the defendant and her family more than $250,000. The plaintiffs each received in excess of $300,000. In addition, the defendant charged Byxbee $98,000 in legal fees for services rendered from the spring of 1999 to September 2000, representing for the most part services regarding estate planning, the insurance policy, the insurance trust, and gifting, although Attorney O'Grady had been retained for estate planning purposes and to prepare the insurance trust. She also received a 25% contingency fee in excess of $100,000 for the collection of the $400,000 life insurance proceeds. Now that the plaintiffs have run through most of the money taken from Byxbee, they ask the court to help obtain for them that which the defendant improperly took from their benefactor. Given the fraudulent nature of the whole enterprise, the court will decline to use its powers to intervene. See Zappone v. Zappone, Superior Court, judicial district of Waterbury, docket number 109109 (March 3, 1993; Blue, J.) ( 9 Conn.L.Rptr. 449). Although the plaintiffs alleged and submitted evidence that the defendant has committed larceny, neither law nor equity will give relief to one who is particeps criminis. Medve v. Chatlos, 9 Conn. Sup. 362 (1941); Funk v. Gallivan, 49 Conn. 124 (1881). "No one shall be permitted to profit by his own fraud, or to take advantage of his own wrong, or to found any claim upon his own inequity, or to acquire property by his own crime. These maxims are dictated by public policy, have their foundation in universal law administered in all civilized countries and have nowhere been superceded by statutes." Cotto v. Martinez, 26 Conn. Sup. 232, 237, 217 A.2d 416 (1965). Actions brought on illegal or corrupt bargains cannot prevail if the parties are in pari delicto. Greenberg v. Evening Post Association, 91 Conn. 371, 375, 99 A. 1037 (1917). "The real objection is not to one man's unclean hands but to the whole enterprise. The court does not want to touch an unlawful transaction with a ten-foot pole. It always refuses to help carry it out, and it often refuses to pick up the pieces after the enterprise has fallen apart. Courts were set up to enforce the law, not to enforce violations of law." Zappone v. Zappone, supra, Zachariah Chafee, Coming Into Equity With Clean Hands, 47 Mich.L.Rev. 877, 896 (1949). When the parties are involved in an illegal transaction, the court will leave the parties where it finds them. Funk v. Gallivan, supra, 49 Conn. 124.
It is not for the defendant's sake however, that the objection of illegality is allowed, ". . . but is founded in general principles of policy, which the defendant has the advantage of, contrary to the real justice as between him and the plaintiff, by accident, if I may say so." Funk v. Gallivan, supra, 49 Conn. 128. "In such cases the defense of illegality prevails, not as a protection to the defendant, but as a disability in the plaintiff. Upon this principle possession acquired . . . will often avail the parties holding it as a sufficient title . . . the transaction takes effect from the disability of the parties to assert any right to the contrary. The court does not give it effect, but simply refuses to aid to undo what the parties have already done." Id., 129.
The transactions with Byxbee with which the parties were involved were illegal and corrupt. The plaintiffs testified that Byxbee never knew she was giving gifts of cash. They got her to sign blank checks and filled them in later. They hid from her the content of documents she signed. The plaintiffs knew their acts were illegal and wrong, but they continued anyway. Cogswell admits that she committed perjury in signing a false affidavit in which she stated that Byxbee had given 61 gifts voluntarily and of her own free will. Defendants' (Exhibit V).
The plaintiffs explained their actions by stating that everything they did was at the direction of the defendant, whom they considered to be not only Byxbee's lawyer, but also theirs. The defendant provided them with the documents to be "signed" by Byxbee and insisted the plaintiffs sign them as well. The signed blank checks were completed as directed by the defendant, and of course the plaintiffs were receiving and accepting checks themselves. They were told by the defendant that they could go to jail and that if they did not sign documents she prepared, she, the defendant, could lose her license to practice law. No explanation by the plaintiffs, of course, will absolve their crime.
As for the defendant, her version of the transactions are preposterous. She claims that everything was the idea of the plaintiffs; that she didn't want the lamps the plaintiffs had purchased for her with Byxbee's debit card; that the plaintiffs told her that Byxbee insisted on the gift, and she finally kept the lamps. The defendant testified that the plaintiffs must have prepared many of the documents because she had not; that the defendant would give the plaintiffs the distribution statements regarding her trustee account without any mention of the defendant or her family, and the document would come back to her with her and the names of her family members added with substantial amounts. She claims she tried to return checks to Byxbee many times, actually driving to Byxbee's house in Stamford from her office in Norwalk to do so. She was unsuccessful at any time in actually rejecting any gift or check. She prepared a contingency fee agreement calling for a 25% fee for the collection of the $400,000 insurance policy if the insurance company failed to pay the proceeds within 30 days of Byxbee's death. After Byxbee's demise, the defendant claimed that the insurance company was refusing to pay the proceeds, and submitted in evidence a letter (Exhibit DD) purportedly from the company denying payment. Approximately ten days later, pursuant to her claimed extraordinary efforts, the company paid the full $400,000. After a few days postponement of the hearing, granted for the purpose, the purported signator of the letter came from Omaha, Nebraska to testify that the letter was not genuine, that she had never prepared or signed such a letter and that the company never denied coverage. Any delay in payment, she testified, was due to the failure of the defendant's law office to produce routine documents, such as a copy of the trust agreement. The court finds that said letter was fraudulent and was prepared by or at the direction of the defendant for the purpose of attempting to justify the 25% contingent fee she received, amounting to in excess of $100,000. The defendant claims that the plaintiffs and Byxbee were the ones who insisted on such a fee arrangement.
In short, the defendant points the figure at the plaintiffs as the instigators of each scheme to defraud Byxbee. She claims they insisted that she accept all gifts proffered because Byxbee threatened to stop giving gifts to the plaintiffs if she would not accept them, and that Byxbee would change her will to eliminate them as beneficiaries. The court cannot credit the defendant's testimony that she, an experienced lawyer with a tax background was intimidated by two, in one case less educated, and in the other poorly educated, cleaning women, into defrauding her own client. Indeed, there was precious little of the defendant's testimony which the court deems worthy of belief.
Because all the parties are in pari delicto, and were complicit in criminal schemes to defraud Kriemhilde Byxbee, the court is obliged to deny the plaintiff's application for a prejudgment remedy against the defendants. The court recognizes that because of the general principles of policy that bind our law, complete justice cannot be done in this case today. However, justice may lie in another courtroom, or in another forum, on another day.
The Court intends to refer this matter to the State's Attorney's Office for the investigation of the role of all the parties in their dealings with Kriemhilde Byxbee, and to the Statewide Grievance Committee for inquiry into the conduct of Sheri Paige, particularly, the offering into evidence of Exhibit DD.
So Ordered.
D'ANDREA, J.T.R.