Opinion
No. 2D21-3878
01-27-2023
Edward J. DUNLEY, Appellant, v. Samuel W. DUNLEY, AS TRUSTEE FOR the JAMES E. DUNLEY REVOCABLE LIVING TRUST, DATED JUNE 26, 1984, Appellee.
John R. Stump and Benjamin C. Iseman of Swann, Hadley, Stump, Dietrich & Spears, P.A., Winter Park, for Appellant. Margaret H. White-Small of Margaret H. White-Small, P.A., Longboat Key; and Stacy L. Haverfield of Stacy L. Haverfield, P.A., Fort Myers, for Appellee.
John R. Stump and Benjamin C. Iseman of Swann, Hadley, Stump, Dietrich & Spears, P.A., Winter Park, for Appellant.
Margaret H. White-Small of Margaret H. White-Small, P.A., Longboat Key; and Stacy L. Haverfield of Stacy L. Haverfield, P.A., Fort Myers, for Appellee.
LABRIT, Judge.
Edward J. Dunley (Edward) seeks review of a final summary judgment in favor of Samuel W. Dunley (Samuel), as trustee for the James E. Dunley Revocable Living Trust dated June 26, 1984 (Trust). Edward challenges the trial court's determination that he is not entitled to an accounting because he is not a qualified beneficiary of the Trust. We reverse and remand for further proceedings because genuine issues of material fact preclude summary judgment.
We refer to the parties and other Dunley family members by their first names for simplicity.
Background
James E. Dunley (James) was married to Alice M. Dunley (Alice); Edward and Samuel are their adult children. James established the Trust in 1984 and was the initial trustee. Shortly after James established the Trust, James and Alice transferred two income producing properties (the Barcelona Avenue/Venice property and the Tamiami Trail/Nokomis property) into the Trust. In June 1990, James signed an amendment to the Trust Agreement whereby Samuel was named successor trustee.
The record is not entirely clear on this, but it appears that these properties were the only assets of the Trust.
James passed away in 2014 and was survived by Alice; Samuel succeeded James as trustee. The applicable provision of the Trust Agreement states that "[t]he residue of the Trust shall be distributed to ... [Alice], if living, and if not, the same shall be distributed" to Edward and Samuel or their lineal descendants, per stirpes.
Much of the argument below and on appeal is directed to a provision of the Trust agreement relating to creation of a separate tax shelter subtrust (the Credit Shelter Trust), which apparently was never funded. Our disposition obviates the need to address the merits of the arguments concerning the Credit Shelter Trust.
Alice passed away in 2018. Between 2014 and 2017, Alice revised her will and other estate planning documents to disinherit Edward. At the time of Alice's death, the Barcelona Avenue/Venice property and the Tamiami Trail/Nokomis property remained titled in the Trust. Between the time of James' death and the time of Alice's death, Samuel exercised responsibility with respect to the properties, including making repairs to the properties and collecting the rental income. Samuel disbursed the rental income from the Tamiami Trail/Nokomis property to Alice, and he disbursed the income from the Barcelona Avenue/Venice property to his wife.
A few months after Alice passed away, Edward sued Samuel in his capacity as trustee of the Trust, seeking an accounting of the Trust. Samuel asserted an affirmative defense that Edward lacked standing to seek an accounting because he is not a beneficiary of the Trust. Ultimately, Samuel and Edward cross-moved for summary judgment on the issue of whether Edward is a qualified beneficiary of the Trust within the meaning of section 736.0103(19), Florida Statutes (2019). In simple terms, Samuel argued that Edward is not a beneficiary because the Trust terminated when James died and the residue was to be distributed to Alice. Thus, according to Samuel, there was no Trust property for which to account and no Trust beneficiary to whom an accounting was owed. For his part, Edward argued (among other things) that he is entitled to an accounting because (1) on the date of James' death, he became a contingent remainder beneficiary under the terms of the Trust and (2) Samuel's obligations as Trustee (including the obligation to provide an accounting) are not contingent, and in any event, Samuel acted in the capacity of trustee after James' death.
Section 736.0103(19) provides:
"Qualified beneficiary" means a living beneficiary who, on the date the beneficiary's qualification is determined:
(a) Is a distributee or permissible distributee of trust income or principal;
(b) Would be a distributee or permissible distributee of trust income or principal if the interests of the distributees described in paragraph (a) terminated on that date without causing the trust to terminate; or
(c) Would be a distributee or permissible distributee of trust income or principal if the trust terminated in accordance with its terms on that date.
In a detailed order, the trial court granted Samuel's motion and denied Edward's motion. In essence, the court determined that Edward is not a qualified beneficiary of the Trust because the Trust terminated upon James' death. Crucial to the trial court's decision was its finding that, even though the Barcelona Avenue/Venice property and the Tamiami Trail/Nokomis property remained titled in the Trust, Alice did not "disclaim" either property. The trial court also seemingly concluded that Alice's apparent intention to disinherit Edward confirmed Samuel's position that the Trust terminated upon James' death.
Analysis
Under the recently revised summary judgment rule, summary judgment is appropriate when "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fla. R. Civ. P. 1.510(a). "[T]he correct test for the existence of a genuine factual dispute is whether ‘the evidence is such that a reasonable jury could return a verdict for the nonmoving party.’ " See In re Amends. to Fla. Rule of Civ. Proc. 1.510 , 317 So. 3d 72, 75 (Fla. 2021) (quoting Anderson v. Liberty Lobby, Inc ., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ).
On this record, genuine disputes as to material facts regarding termination of the Trust and Samuel's status as trustee preclude summary judgment. It is unclear if or when the Trust was ever terminated, and it appears that Samuel may have acted in the capacity of trustee during the time between James' death and Alice's death.
The facts that are not in dispute raise more questions than answers. For instance, it is undisputed that title to the Barcelona Avenue/Venice property and the Tamiami Trail/Nokomis property was never transferred to Alice. As the trial court explained in the December 2021 final summary judgment, "the Sarasota Property Appraiser records and the Official Records in Sarasota County state that the Trustee of the Trust is the owner of" the Barcelona Avenue/Venice property and the Tamiami Trail/Nokomis property. It is difficult to understand why the Trust retained title and ownership of the properties if the Trust terminated seven years earlier; the Trust's retention of title is at least somewhat inconsistent with the trial court's finding that Alice didn't "disclaim" the properties. The trial court found that "Alice's tax returns following ... [James'] death but prior to her own death demonstrated that she recognized the income from ... [the properties] on her tax returns." But the trial court's reliance on the tax returns was misplaced because they were not authenticated and only were attached as an exhibit to Samuel's memorandum of law in opposition to Edward's motion for summary judgment. See Bryson v. Branch Banking & Tr. Co. , 75 So. 3d 783, 786 (Fla. 2d DCA 2011) (explaining that unauthenticated documents are "insufficient for summary judgment purposes because only competent evidence may be considered in ruling on a motion for summary judgment"). Competence of the tax returns aside, it is difficult to understand why Alice recognized income that undisputedly was distributed not to Alice, but to Samuel's wife.
The Trust's retention of title to the properties is also at least arguably consistent with the notion that Samuel acted in the capacity of trustee by maintaining the properties, collecting the rents, and distributing the rental income.
In sum, there exist genuine disputes as to (1) whether the Trust terminated and whether its assets were distributed to Alice upon James' death and (2) whether Samuel ever acted in the capacity of trustee with respect to the Trust assets. These facts are material to a determination of whether Edward is a qualified beneficiary of the Trust. We reverse the final summary judgment and remand for further proceedings.
Reversed and remanded.
MORRIS, C.J., and SILBERMAN, J., Concur.