Opinion
HHDCV166070150S
08-14-2017
In re Estate of Kurt E. Bilo Appeal From Probate
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT
CESAR A. NOBLE, J.
The issue presented is whether the court should grant the defendants' motion for summary judgment on the ground that there is no genuine issue of material fact that the decedent's trust should not be included in the decedent's estate for the purposes of calculating the plaintiff's statutory share. For the reasons outlined below the court grants the defendants' motion for summary judgment.
FACTS
On July 29, 2016, the plaintiff, Martha Bilo, appealed a June 30, 2016 Probate Decree (the decree), which denied the plaintiff's request to include trust assets in her decedent husband's estate for the purpose of calculating her statutory share. The defendants, Jill L. Capella and Bruce K. Bilo, both individually and as co-trustees of the Kurt E. Bilo Trust dated June 16, 1999 (the trust), filed an answer to the plaintiff's appeal on September 14, 2016. The appeal alleges the following relevant facts. The plaintiff married the decedent on May 30, 1997. On June 16, 1999, the decedent executed his last will and testament (the will) and the trust. Pursuant to the will, the decedent left the rest, residue, and remainder of his estate to the trust. Upon the decedent's death, the trust would create two sub-trusts--the marital trust and the estate tax sheltered trust (sheltered trust). Compl., p. 3, ¶ 21. " Pursuant to the [t]rust, any amount of the [e]state over the federal tax estate marital deduction would fund the marital trust, which was for [the plaintiff's] sole benefit." Compl., p. 3, ¶ 21. The decedent's children, the defendants, were to benefit from the sheltered trust. The decedent passed away on July 12, 2015, and the decedent's will was admitted to probate thereafter. The plaintiff claims that the Probate Court erred in failing to include the trust assets in the decedent's estate for the calculation of the plaintiff's statutory share.
For purposes of the present motion before the court, this memorandum will refer to the moving defendants, Bruce K. Bilo and Jill L. Capella, both in their individual capacities and as co-trustees of the trust, as the defendants. The appeal, additionally, names Kenneth Swanson, executor of the estate of Kurt E. Bilo; Capella and Bilo, individually and as co-trustees; and Neil Kraner, Esq., as trustee of the trust, as the defendants.
On February 7, 2017, the defendants moved for summary judgment and filed a supporting memorandum of law and accompanying exhibits on the ground that no genuine issue of material fact exists that the trust, which is valid, was outside of the decedent's probate estate and, therefore, should not be included in the estate for the purpose of calculating the plaintiff's statutory share. The plaintiff filed a memorandum in opposition to the defendants' motion with supporting exhibits on March 24, 2017. The plaintiff argues, inter alia, that a genuine issue of material fact exists as to the decedent's intent that the plaintiff benefit from the trust and, accordingly, the defendants' motion should be dismissed. The court heard oral argument at short calendar on May 30, 2017.
" [T]here is currently no appellate authority regarding whether a motion for summary judgment is procedurally appropriate in a probate appeal and there is a split of authority among the lower courts . . ." Wright v. Probate for District of Region #22 Southbury, Superior Court, judicial district of Waterbury, Docket No. CV-15-6029355-S, 2017 WL 1333968, at *3 (March 21, 2017, Shah, J.) [64 Conn.L.Rptr. 133, ]. In the present case, neither party raised an issue as to whether a motion for summary judgment is inappropriate in an appeal from probate. Accordingly, the court exercises its discretion to consider the motion for summary judgment. See Wright v. Probate District of Region #22 Southbury, supra, Docket No. CV-15-6029355-S, (granting summary judgment in probate appeal); Ackerman v. Sobol, Superior Court, judicial district of Hartford, Docket No. CV-07-4027616-S, 2007 WL 4305667, at *9 (November 19, 2007, Elgo, J.) (denying summary judgment in probate appeal); Daddona v. Probate Appeal, Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-05-4004788-S, 2007 WL 827600, at *2 (February 27, 2007, Nadeau, J.) (denying summary judgment in probate appeal); Infante v. Trumbull Probate Appeal, Superior Court, judicial district of Fairfield, Docket No. CV-03-0405936-S, 2005 WL 1971242, at *2 (July 20, 2005, Dewey, J.) (granting summary judgment in probate appeal). But see In re Palmer, Superior Court, judicial district of Fairfield, Docket No. CV-074022946-S, 2010 WL 4277616, at *3 (October 7, 2010, Levin, J.) (50 Conn.L.Rptr. 739, 740, ) (" a summary judgment motion is not permitted in an appeal from probate" [internal quotation marks omitted]).
The defendants' exhibits include: (1) A copy of the decedent and plaintiff's prenuptial agreement; (2) the plaintiff's claim for election of statutory share, dated April 22, 2016, and filed with the Probate Court, which includes the following attached exhibits: (A) a copy of the decedent's will; (B) a copy of the trust; (C) a copy of the decedent's Preferred Client FMA Statement for December 1 through 31, 1997; (D) a copy of a letter requesting an amendment to the trust from the decedent to Attorney Kearns, dated April 5, 2007; (E) a copy of the first amendment to the trust, dated July 18, 2007; (F) a copy of a financial spreadsheet; and (G) a copy of an envelope addressed to the plaintiff; and (H) a copy of the account of the trust, dated April 27, 2016.
The plaintiff's exhibits include: (A) the plaintiff's affidavit; (B) a copy of the decedent's will; (C) a copy of the trust; (D) a copy of the decedent's Preferred Client FMA Statement for December 1, through 31, 1997; (E) a copy of the decedent and plaintiff's prenuptial agreement; (F) a copy of a letter requesting an amendment to the trust from the decedent to his attorney, dated April 5, 2007; (G) a copy of the first amendment to the trust, dated July 18, 2007; (H) a copy of a financial spreadsheet; (I) a copy of an envelope addressed to the plaintiff; and (J) the Probate Court's, Elkin, J., memorandum of decision on the plaintiff's motion to include the trust in the decedent's estate for purposes of calculating her statutory share.
The defendants' exhibits are not accompanied by an affidavit attesting to their authenticity. The plaintiff has not objected to the defendants' exhibits or the lack of an affidavit addressing the same, and the plaintiff's exhibits mirror those introduced by the defendants. Given the common reliance on the exhibits the court exercises its discretion to consider all exhibits provided by the parties.
STANDARD
Appeal from Probate
" [T]he Superior Court, on an appeal from probate, sits as, and has no greater power than, a court of probate." (Internal quotation marks omitted.) In re Probate Appeal of Cadle Co., 152 Conn.App. 427, 438-39, 100 A.3d 30 (2014). " In ruling on a probate appeal, the Superior Court exercises the powers, not of a constitutional court of general or common-law jurisdiction, but of a Probate Court." (Internal quotation marks omitted.) Silverstein v. Laschever, 113 Conn.App. 404, 409, 970 A.2d 123 (2009). The Superior Court " tries the questions presented to it de novo, but in so doing it is . . . exercising a special and limited jurisdiction conferred on it by the statute authorizing appeals from probate." (Internal quotation marks omitted.) In re: Probate Appeal of Cadle Co., supra, 439.
Summary Judgment
" [S]ummary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Cefaratti v. Aranow, 321 Conn. 637, 645, 138 A.3d 837 (2016). " The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried . . . However, since litigants ordinarily have a constitutional right to have issues of fact decided by a jury . . . the moving party for summary judgment is held to a strict standard . . . of demonstrating his entitlement to summary judgment." (Citation omitted; footnote omitted; internal quotation marks omitted.) Grenier v. Commissioner of Transportation, 306 Conn. 523, 534-35, 51 A.3d 367 (2012).
" [T]he party moving for summary judgment . . . is required to support its motion with supporting documentation, including affidavits." (Internal quotation marks omitted.) Romprey v. Safeco Ins. Co. of America, 310 Conn. 304, 324 n.12, 77 A.3d 726 (2013). " The existence of the genuine issue of material fact must be demonstrated by counter-affidavits and concrete evidence." (Internal quotation marks omitted.) Bruno v. Whipple, 162 Conn.App. 186, 214, 130 A.3d 899 (2015), cert. denied, 321 Conn. 901, 138 A.3d 280 (2016). " The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact . . . A material fact . . . [is] a fact which will make a difference in the result of the case." (Internal quotation marks omitted.) Stuart v. Freiberg, 316 Conn. 809, 821, 116 A.3d 1195 (2015).
DISCUSSION
In the present case, the defendants move for summary judgment on the ground that there is no genuine issue of material fact that the trust did not pass under the decedent's will and was, therefore, outside of the estate for the purpose of calculating the plaintiff's statutory share. The plaintiff, in opposition, contends that a genuine issue of material fact exists as to the decedent's intent that the plaintiff benefit from the trust and, therefore, that summary judgment should be denied. Specifically, the plaintiff argues that a genuine issue of fact exists as to whether the decedent intended to leave the plaintiff one-third of the trust estate.
I. A Valid Trust Is Not Included in Probate Estate for Calculation of Statutory Share
General Statutes § 45a-436(a) provides in relevant part: " On the death of a spouse, the surviving spouse may elect, as provided in subsection (c) of this section, to take a statutory share of the real and personal property passing under the will of the deceased spouse. The 'statutory share' means a life estate of one-third in value of all the property passing under the will, real and personal, legally or equitably owned by the deceased spouse at the time of his or her death, after the payment of all debts and charges against the estate. The right to such third shall not be defeated by any disposition of the property by will to other parties." (Emphasis added.)
The Connecticut Supreme Court has held that valid trusts do not pass under a will and, therefore, are not included in a decedent's estate for purposes of calculating a spouse's elected statutory share. See Dalia v. Lawrence, 226 Conn. 51, 65, 70, 627 A.2d 392 (1993); Cherniack v. Horne National Bank & Trust Co. of Meriden, 151 Conn. 367, 369-70, 198 A.2d 58 (1964). In Dalia, the court determined that " the legislature did not intend that valid trust savings accounts . . . be considered a part of a decedent's estate for the purposes of determining the surviving spouse's share of that estate . . ." Dalia v. Lawrence, supra, 65. " [S]uch accounts pass according to their terms . . . and . . . no exception was intended by the legislature for surviving spouses." Id. The court reasoned that the trust account was outside of the decedent's estate and, therefore, could not be used to calculate the surviving spouse's statutory share. Id. The court stated that " [i]t is evident, therefore, that a surviving spouse's elective share in lieu of what he or she would take under a will does not include the proceeds of a [trust savings account], because those proceeds cannot be regarded as passing under the will . . ." Id., 69.
In its memorandum of decision, the Probate Court, Elkin, J., stated that General Statutes § 45a-436(a), which allows for a surviving spouse to elect a statutory share of the decedent spouse's estate, " is explicit that it applies only to probate property." Estate of Kurt E. Bilo, Probate Court, judicial district of West Hartford, Docket No. 15-0731 (June 30, 2016, Elkin, J.); Pl.'s Exh. J, p. 3. The Probate Court discussed the Dalia and Cherniack decisions, and found that those decisions stand for the proposition that property that does not pass under the decedent's will is not included in the calculation of determining the spouse's elected statutory share. Id.; Pl.'s Exh. J, pp. 4-6.
In Cherniack, the surviving spouse contested the validity of the decedent's trust on the grounds that the trust was invalid as it acted as a testamentary disposition and that it was in fraud of the plaintiff's rights, as the decedent's wife, to the decedent's estate. Cherniack v. Home Nat'l Bank & Trust Co., supra, 151 Conn. 369. The court held that " [w]here . . . an interest is created during the settlor's lifetime in beneficiaries of the trust other than the settlor himself, a trust is not invalid, as an attempted testamentary disposition, merely because under its terms the settlor is to receive the net income of the trust corpus for and during his life and also retains the power of modification and termination." Id., 369-70. The court further acknowledged that " under Connecticut statute law neither husband nor wife acquires, by virtue of marriage, any interest in the real or personal property of the other during that other's lifetime . . . In other words, either spouse may, in his lifetime, without the consent or knowledge of the other, make a valid gift, or otherwise dispose of his property, to a third party." (Citation omitted; footnote omitted.) Id., 370.
In the present case, the evidence submitted by both parties establishes the existence of a trust, created by the decedent, which provided that upon the decedent's death, a marital trust would be created from a fractional share of the entire trust estate, " which, if allowed as a federal estate tax marital deduction would be required to reduce to a minimum any federal estate tax" on the trust estate. Defs.' Memo. in Supp., pp. 2-3; Defs.' Exh. 1(B); Pl.'s Exh. C. The plaintiff does not allege that the trust is invalid, and does not argue that it was entered into under duress, through undue influence, or fraud. Therefore, it is clear from the evidence submitted that no genuine issue of material fact exists as to the existence of the trust, including its validity, which did not pass under the decedent's will. Accordingly, no genuine issue of material fact exists as to whether the trust should have been included in the probate estate for the purpose of calculating the plaintiff's statutory share.
II. Settlor's Intent
In the present case, the plaintiff argues that the evidence demonstrates that the decedent intended for her to benefit from the trust and that the plain language of the trust, at the time the decedent made the first amendment to the same, provided a benefit to the plaintiff. She continues to claim that the change in tax law was unforeseeable to the decedent at the time the trust was drafted and that the decedent never intended to leave the plaintiff essentially disinherited. The evidence she points to is the trust itself and an envelope the decedent gave her, containing relevant estate planning documents, which bears the inscription " to Martha . . . 1/3 Trust." Pl.'s Exh. C; Pl.'s Exh. I.
" The requisite elements of a valid and enforceable trust are: (1) a trustee, who holds the trust property and is subject to duties to deal with it for the benefit of one or more others; (2) one or more beneficiaries, to whom and for whose benefit the trustee owes the duties with respect to the trust property; and (3) trust property, which is held by the trustee for the beneficiaries." (Internal quotation marks omitted.) Palozie v. Palozie, 283 Conn. 538, 545, 927 A.2d 903 (2007). Furthermore, " the settlor may reserve extensive powers over the administration of a trust . . . and may reserve the right to modify or revoke the trust at will." (Citation omitted; internal quotation marks omitted.) Id., 546. See also 1 Restatement (Third), Trusts § 25, p. 377 (2003) (trust " is not rendered testamentary merely because the settlor retains extensive rights such as a beneficial interest for life, powers to revoke or modify the trust, and the right to serve as or control the trustee . . . or because the trust is intended to serve as a substitute for a will").
Connecticut courts examine the language of the trust document itself to determine whether the decedent possessed the requisite intent to create a valid trust. See Palozie v. Palozie, supra, 283 Conn. 546-47. " This is because where the manifestation of the settlor's intention is integrated in a writing, that is, if a written instrument is adopted by the settlor as the complete expression of the settlor's intention, extrinsic evidence is not admissible to contradict or vary the terms of the instrument in the absence of fraud, duress, undue influence, mistake, or other ground for reformation or recission . . . If a [trust instrument] is unambiguous within its four corners, intent of the [settlor] is a question of law . . . Where the language of the [trust instrument] is clear and unambiguous, the [instrument] is to be given effect according to its terms. A court will not torture words to import ambiguity . . . Similarly, any ambiguity in a [trust instrument] must emanate from the language used . . . rather than from one party's subjective perception of its terms . . . If, however, the instrument is an incomplete expression of the settlor's intention or if the meaning of the writing is unambiguous or otherwise uncertain, evidence of the circumstances and other indications of the transferor's intent are admissible to complete the terms of the writing or to clarify or ascertain its meaning." (Citations omitted; footnote omitted; internal quotation marks omitted.) Id., 547-48.
The plaintiff urges the court to exercise its equitable powers to include the trust in the probate estate because, as the plaintiff contends, the decedent intended for her to receive one-third of the trust assets. In the present case, both parties provide copies of the trust as evidence. Pl.'s Exh. C; Defs.' Exh. B. The relevant portion of the trust provides that " [i]f the Grantor's wife survives him, the Trustee shall hold in a separate trust that fractional share of the trust estate which, if allowed as a federal estate tax marital deduction, would be required to reduce to a minimum any federal estate tax on the Grantor's estate, after taking into account as credits against such tax only the unified credit and the credit for state death taxes (to the extent that such credit does not increase state death taxes)." (Emphasis added.)
This court, however, sits as a court of probate. See In re Probate Appeal of Cadle Co., supra, 152 Conn.App. 438-39. " [C]ourts of probate do not have any general equity jurisdiction." (Internal quotation marks omitted.) In re Michaela Lee R., 253 Conn. 570, 593, 756 A.2d 214 (2000). " While probate courts do not have general equity jurisdiction, they may exercise equitable powers under certain circumstances." Killen v. Klebanoff, 140 Conn. 111, 118, 98 A.2d 520 (1953). " For example, the court will entertain an equitable proceeding directly attacking a prior judgment or decree if it is alleged that the judgment or decree is invalid because of fraud or mistake entering into its procurement." Reynolds v. Owen, 34 Conn.Supp. 107, 114, 380 A.2d 543 (1977). In the present case, the plaintiff does not allege the Probate Decree was procured by fraud or mistake. Accordingly, the court lacks equitable jurisdiction.
Contrary to the plaintiff's assertion otherwise, the plain language provides that the plaintiff would benefit from the marital trust if the trust exceeded the federal estate tax exemption at the time of the decedent's death. The plaintiff argues that the envelope is evidence that the decedent intended to provide for the plaintiff in the amount of one-third of the proceeds of the trust. Pl.'s Exh. I. The plain language of the trust, however, leaves no ambiguity for the court to make this interpretation, as the plaintiff suggests. Additionally, absent ambiguity, the court is instructed to give effect to the document according to its terms. Palozie v. Palozie, supra, 283 Conn. 546-47.
A plain reading of the trust provides that the marital trust would be funded from that portion of the trust which would be necessary to reduce the trust itself to a minimum for the purpose of the federal estate tax. The trust language does not indicate that the decedent intended to provide one-third of the proceeds of the trust corpus to the plaintiff but, rather, that the plaintiff would receive a benefit if such a reduction of the trust corpus was necessary to reach a minimum for federal tax purposes. The trust language is clear--the sheltered trust was to receive any amount under the federal estate tax, and the marital trust was to receive that portion of the trust that would be necessary to reduce the trust estate to a minimum for such tax purposes. The language of the trust is unambiguous in that it does not limit the amount which could be provided to the decedent's children by the sheltered trust or set a condition that the marital trust be funded if the federal tax amount exceeds the amount in the trust, consequently rendering the marital trust unfunded, which is precisely the situation in the present case.
Accordingly, the court may not infer that the decedent intended to give the plaintiff one-third of the trust assets when the language indicates otherwise. The language of the trust states clearly that the determining factor as to what the plaintiff would receive, if anything, is the amount needed to reduce the trust assets to the federal estate tax minimum. The decedent placed no cap on this amount. There is no genuine issue of material fact that the decedent only intended for the plaintiff to receive the excess of the trust estate, which would be necessary to keep the trust from exceeding the federal estate tax limit.
CONCLUSION
For the aforementioned reasons, the court grants the defendants' motion for summary judgment.