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Ellison v. Fry

Supreme Court of Missouri, En Banc

August 19, 2014

MARY ELLISON, ARTHUR FRY, DAVID FRY, and SUSAN SLEEPER, Appellants/Cross-Respondents,
v.
J.D. FRY, DECEASED, BY LINDA FRY, TRUSTEE OF THE JOHN DELBERT FRY REVOCABLE INTERVIVOS TRUST, et al., Respondents/Cross-Appellants

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[Copyrighted Material Omitted]

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Appeal from the Circuit Court of Camden County. Honorable Ralph Jaynes, Judge.

Mary Ellison, Arthur Fry, David Fry and Susan Sleeper were represented by Beverly J. Figg and Joshua K. Friel of Andereck, Evans, Widger, Johnson & Lewis LLC in Jefferson City.

Linda Fry (in her personal capacity), Delbert Fry and Fry Grain were represented by Daniel S. Simon of the Simon Law Offices in Columbia.

Linda Fry (in her capacity as trustee of the John Delbert Fry Revocable Intervivos Trust) was represented by Thomas M. Harrison of VanMatre, Harrison, Hollis, Taylor & Bacon PC in Columbia.

LAURA DENVIR STITH, JUDGE. Russell, C.J., Breckenridge, Fischer, Draper and Teitelman, JJ., concur. Wilson, J., not participating.

OPINION

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LAURA DENVIR STITH, JUDGE.

In a family dispute over the inheritance of money and property, Plaintiffs Mary Ellison, Susan Sleeper, and David and Arthur Fry appeal the trial court's dismissal of all of Arthur's claims and some of David, Susan, and Mary's claims.[1] Defendants cross-appeal the court's refusal to dismiss all of the remaining claims. As a result of the dismissals, the trial court submitted only six of the ten claims Plaintiffs initially brought. The primary defendant, J.D. Fry, died after suit was filed but before trial. The trial court substituted J.D.'s wife, Linda Fry, in her capacity as trustee of J.D.'s trust. The jury returned verdicts against Linda Fry, as substitute for J.D., and in favor of Mary, David and Susan on three of their claims tat J.D. committed frauds and other wrongs beginning in 1990 that resulted in J.D.'s pecuniary gain. The trial court overruled Defendants' motion for judgment notwithstanding the verdict.

This Court reverses the trial court's judgment on the jury verdicts in favor of David, Susan and Mary. The statute of limitations for fraud claims, section 516.120(5),[2] gives a person up to 10 years to discover the fraud and requires, without exception, that all such claims be brought within five years of discovery so that no claim of fraud may be brought more than 15 years after the fraud occurred, even if the fraud is concealed for a longer period. Because Susan and David's claims were brought more than 15 years after the fraud allegedly occurred in 1990, their claims are time-barred by section 516.120(5). Mary's claims likewise are

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barred. Sections 537.010 and 537.021.1(2) require substitution of J.D.'s personal representative. Linda was not J.D.'s personal representative -- indeed, Plaintiffs failed even to open an estate -- and, therefore, it was improper to substitute Linda upon J.D.'s death.

The trial court properly dismissed Plaintiffs' other claims before trial for the reasons noted below, and the judgment of the trial court with respect to these claims is affirmed. The judgment on the jury verdicts for Plaintiffs is reversed, and the case is remanded for entry of judgment for Defendants on those claims.

I. FACTUAL BACKGROUND

In 1981, Vincil and Willa Fry executed a joint will that distributed their assets among their children, Mary Ellison, Arthur Fry, and J.D. Fry, and two grandchildren, David Fry and Susan Sleeper. The will devised a 40-acre tract of land and cash to Mary, a 160-acre homestead to J.D., and a 200-acre tract of land to David and Susan, subject to a life estate in their father Arthur.

In 1990, when he was 82 years old, Vincil caused a car crash that injured the occupants of another car. Although Vincil and Willa were fully insured, they worried that Vincil's liability would cost them their farm. J.D. took them to his attorney, and in June 1990 they executed new wills, settled a trust to benefit Arthur, Susan, and David, and deeded the 200-acre farm to J.D. and the 160-acre homestead to J.D.'s son Delbert, reserving life estates for themselves in both properties. Vincil and Willa also conveyed the 40-acre tract to Mary subject to life estates in themselves. In their 1990 wills, Vincil and Willa devised all of their property to the surviving spouse or, if the other spouse was deceased, to their three children. J.D. subsequently conveyed the 200-acre tract to himself and his wife, Linda, and they later conveyed the land into the J.D. Fry Revocable Inter Vivos Trust. In 1998, Vincil granted J.D. his durable power of attorney. Vincil died in 2000, and Willa died in 2005. After Willa's death, her monies were distributed among the children without a probate estate being opened because, the children later said, they did not believe there was enough property to make it worthwhile to open an estate.

Three years later, in April 2008, Mary sued to set aside the 1990 deeds to J.D. and Delbert and brought claims against J.D. for breach of fiduciary duty, fraud, conversion, and unjust enrichment. Though the 1990 deeds transferring property to J.D. were recorded and reported in the newspaper, Mary alleged that she and Arthur did not know that J.D. gave no consideration for the deeds until December 2006 because J.D. fraudulently concealed this information. Nor was she aware of their 1990 wills, which replaced the also unknown 1981 will that had divided Willa and Vincil's property evenly among the children. Mary also alleged that J.D. had used the power of attorney he obtained in 1998 to purchase multiple certificates of deposit (CDs) in his own name with Vincil and Willa's funds and to cash other CDs owned by Willa and Vincil that had listed Mary and Arthur as payable-on-death beneficiaries. She further alleged that J.D. exercised undue influence over his parents to obtain the 1990 deeds, change their wills, and obtain powers of attorney, and that he acted fraudulently and unjustly enriched himself. Arthur did not join Mary's suit and instead entered into a settlement agreement with J.D. under which he fully released any and all potential claims in exchange for $100. J.D. vehemently denied all of the allegations.

In December 2008, just a few months after the suit was filed, J.D. died. Mary

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filed suggestions of death on December 15, 2008. Rule 52.13 requires that a new party be substituted in the manner permitted by the probate statutes within 90 days after a suggestion of death is filed or the case will be dismissed without prejudice. Sections 537.010 and 537.021.1(2) together provide that a property claim against a defendant may continue after the defendant's death by substituting the appointed personal representative of the deceased defendant's estate. Neither Arthur, Mary, nor any person legally entitled to do so opened an estate for J.D. or sought appointment of a personal representative. Mary instead moved the trial court to substitute J.D.'s daughter as a defendant in J.D.'s place. Defendants objected that only a personal representative could be appointed. The trial court sua sponte substituted J.D.'s widow, Linda, in her capacity as trustee of J.D.'s trust, as defendant.

Plaintiffs subsequently subpoenaed Arthur's testimony and, in 2011, Arthur and his children David Fry and Susan Sleeper joined the suit. Plaintiffs amended the petition to bring a total of 10 counts against J.D., Linda, Linda as trustee, Delbert, and Fry Grain Enterprises, a business owned by J.D. and Delbert. Just prior to trial, Plaintiffs again amended their petition by removing Mary from multiple counts.[3]

At the close of Plaintiffs' evidence and again at the close of all the evidence, Defendants moved for a directed verdict on numerous grounds. The trial court sustained these motions in part, dismissing all claims by Arthur based on his signing of a release of those claims, dismissing all claims against J.D.'s son Delbert because of lack of evidence of his involvement in any of the asserted wrongs, dismissing the conversion claim against J.D.'s company, Fry Grain, and refusing to submit punitive damages.

As a result of the amendments and the dismissals, the only claims that remained at the close of evidence were Susan and David's claims against J.D. (through Linda as trustee[4]) and Linda (individually) for fraud and undue influence (Count I), Susan and David's claims against Linda as trustee for unjust enrichment relating to the 1990 deeds (Count VIII), and Mary's claims against J.D. and Linda (individually) for breach of fiduciary duty, fraud, fraudulent concealment, fraudulent misrepresentation, conversion and replevin, and unjust enrichment (Counts II through V). The court instructed the jury on these six remaining claims. As to claims against J.D., the court instructed the jury that " defendant J.D. Fry is deceased and [trustee] has been substituted to take his place; therefore if you find against defendant J.D. Fry, your verdict must be against [trustee]."

In Verdicts A and C, the jury found for David and Susan against Linda as trustee for unjust enrichment, awarding each $5,500. In Verdicts B and D, the jury found for David and Susan against Linda as trustee for undue influence but awarded $0.

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In Verdict E, the jury found for Mary against Linda as trustee for unjust enrichment, breach of fiduciary duty, fraudulent concealment, and conversion and awarded her $35,000.[5] In Verdict F, the jury found for Mary against Linda individually for unjust enrichment, but awarded Mary $0.

After the verdicts were returned, Plaintiffs moved the court to add to the final judgment an award to Mary of several items of personal property she claims were intended for her. Defendants timely filed a motion for judgment notwithstanding the verdict (JNOV) or, in the alternative, for a new trial.

The trial court did not rule on Mary's motion for an order granting her certain items of personal property, and it overruled Defendants' motion for JNOV. Plaintiffs appealed, Defendants cross-appealed, and the court of appeals consolidated the appeals. This Court transferred the consolidated case after opinion under article V, section 10 of the Missouri Constitution.

II. STANDARD OF REVIEW

Defendants argue that the trial court erred in overruling their motions for judgment notwithstanding the verdict on all issues. Plaintiffs argue that the trial court erred in sustaining Defendants' motions for directed verdict on any issue.

A case may not be submitted unless each and every fact essential to liability is predicated on legal and substantial evidence. Moore v. Ford Motor Co., 332 S.W.3d 749, 756 (Mo. banc 2011). Whether the plaintiff made a submissible case is a question of law that this Court reviews de novo. Id. To determine whether a directed verdict or judgment notwithstanding the verdict should have been granted this Court applies essentially the same standard. Keveney v. Mo. Military Acad., 304 S.W.3d 98, 104 (Mo. banc 2010). To determine whether the evidence was sufficient to support the jury's verdict, an appellate court views the evidence in the light most favorable to the verdict. Moore, 332 S.W.3d at 756. A motion for directed verdict or JNOV should be granted if the defendant shows that at least one element of the plaintiff's case is not supported by the evidence. Id.; Clevenger v. Oliver Ins. Agency, Inc., 237 S.W.3d 588, 590 (Mo. banc 2007).

III. DISCUSSION

The parties' cross-appeals raise a total of 11 points. Defendants offer multiple grounds on which they believe that the trial court erred in overruling their motion for JNOV. Because this Court's resolution of two of Defendants' points requires the judgment be reversed, it does not reach Defendants' other points. Plaintiffs argue ...


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