Case Title: In re Estate of Lovell

Citation: 

Docket Number: 2010-285

State: vermont

Court: Vermont Supreme Court

Date: 2011-06-10T00:00:00Z

Document:
2011 VT 61













In re Estate of Lovell (2010-285)
 
2011 VT 61
 
[Filed 10-Jun-2011]
 
NOTICE:  This opinion is
subject to motions for reargument under V.R.A.P. 40 as well as formal revision
before publication in the Vermont Reports.  Readers are requested to
notify the Reporter of Decisions, Vermont Supreme Court, 109
State Street, Montpelier, Vermont 05609-0801 of any errors in order that
corrections may be made before this opinion goes to press.
 
 
2011 VT 61 
 
No. 2010-285
 
In re Estate of Phillip Lovell
Supreme Court
 
 
 
On Appeal from
 
Superior Court, Windsor Unit,
 
Civil Division
 
 
 
January Term, 2011
 
 
 
 
Harold
  E. Eaton, Jr., J.
 
Bettina V. Buehler and Ellen Kreitmeier,
Law Clerk (On the Brief) of McCarty & Buehler, P.C., 
  Brattleboro, for Appellants.
 
Stephen S. Ankuda
of Parker & Ankuda, P.C., Springfield, for Appellee.
 
 
PRESENT:  Reiber, C.J.,
Dooley, Johnson, Skoglund and Burgess, JJ.
 
 
¶ 1.            
REIBER, C.J.  Defendants Charles and Hubert Lovell appeal a
grant of summary judgment to plaintiff, Duane Amsden,
in which the trial court found that Charles Lovell could not, pursuant to his
powers as his father's attorney-in-fact, transfer title of his father's farm to
himself and his brother, Hubert Lovell, where the power of attorney failed to
explicitly grant the power to make such a gift.  We affirm.
¶ 2.            
The facts of this case are not in dispute.  On June 6, 1997,
Phillip I. Lovell executed a will appointing his son, defendant Charles Lovell,
and his stepson, plaintiff Duane Amsden, as
co-executors.  He also executed a power of attorney (POA) naming defendant
Charles Lovell as his attorney-in-fact.  The inventory of Phillip Lovell's
estate, filed June 4, 2008, listed a farm in Springfield, Vermont (the farm) as
belonging to the estate.  On May 28, 2003, Phillip Lovell's wife, Zada Lovell, quitclaimed her interest in the farm to her
husband.  The next day, defendant Charles Lovell, acting as Phillip
Lovell's attorney-in-fact, executed a quitclaim deed, conveying the farm from
Phillip Lovell to defendants for no consideration.  Several of the
Lovell's children and stepchildren, including plaintiff, signed a consent
statement dated May 31, 2003, approving the transfer.  The statement
explained that they were "consenting to the exercise of Charles I. Lovell's
Power of Attorney" to quitclaim the farm to defendants because the parties had
come to a consensus that this was "in the best interest of Zada
Lovell and Phillip Lovell" but that "[a]s soon as reasonably possible after the
transfer [wa]s completed,
[they would] all enter into a family discussion to make provisions for the
ultimate distribution of the farm."  Phillip Lovell died the following
week on June 4, 2003.  
¶ 3.            
In June 2008, following the death of Zada
Lovell, plaintiff filed a declaratory judgment action in the probate court
claiming the transfer of the farm to defendants was invalid under 14 V.S.A. §
3504(e) and (f) (the amended POA statute) enacted in 2002, and seeking to
establish the estate of Phillip Lovell as the farm's rightful owner.  The
probate court issued a declaratory judgment order in favor of defendants,
finding that the quitclaim transfer was valid because the language of the POA failed
to restrict defendant Charles Lovell's power to gift the property to himself or others.  The superior court reversed,
granting plaintiff's motion for summary judgment.  The court found that
the amended POA statute prohibited an attorney-in-fact from making gifts of the
principal's property to himself or others unless the POA "explicitly" granted
such authority.  Defendants appealed. 
¶ 4.            
On appeal from summary judgment, "[w]e review
the trial court's decision de novo, using the same standard as the trial
court."  Clayton v. Unsworth, 2010 VT 84,
¶ 15, ___ Vt. ___, 8 A.3d 1066.  Summary judgment
is appropriate "if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, referred to in the
[statement of material facts], show that there is no genuine issue as to any
material fact and that any party is entitled to judgment as a matter of law."
 V.R.C.P. 56(c)(3).
¶ 5.            
Subsection (e) of the amended POA statute mandates: "No agent may make a
gift or a loan to a third party unless the terms of the power of attorney
explicitly provide for the authority to make gifts or loans."  14 V.S.A. § 3504(e).  Subsection (f) declares: "No
agent may make a gift or a loan to him or herself of property belonging to the
principal unless the terms of the power of attorney explicitly provide for the
authority to make gifts or loans to the agent."  Id. §
3504(f).  The language of Phillip Lovell's power of attorney
granted Charles Lovell the power: 
  [t]o
negotiate, execute, acknowledge and deliver leases or deeds upon any and all
real property and premises owned by [Phillip Lovell], and particularly upon any
real property located in Springfield, Vermont and to collect, demand and
receive any rents which may become due to me from any tenants of [Phillip
Lovell] or tenants as a result of the power of attorney; and to do any other
acts pertaining to said property that [Phillip Lovell] might do; including the
signing of agreements of sale or other necessary papers.
 
It also granted
him: 
full authority and
power to do and perform any and all other acts necessary or incident to the
performance and execution of the powers herein expressly granted, with power to
do and perform all acts authorized hereby, as fully to all intents and purposes
as the grantor might or could do if personally present, with full power of
substitution.
 
¶ 6.            
Defendants argue that this POA provision is broad enough to include the
power to transfer gifts, despite the fact that such power is nowhere
"explicitly" included in the POA, because it is written with enough specificity
to meet the standard set by In re Estate of Kurrelmeyer,
2006 VT 19, 179 Vt. 359, 895 A.2d 207.  In Kurrelmeyer,
we upheld a transfer of real estate made by two attorneys-in-fact, wife and
daughter of the grantor, into a trust they had created naming themselves
trustees and the wife as beneficiary.  Id. ¶¶ 2-3.  We held
that the transfer was valid despite the fact that the explicit POA language
limited the attorneys-in-fact to "mak[ing] gifts to members of [the principal's] family (other
than [the principal] himself or herself)."  Kurrelmeyer,
2006 VT 19, ¶¶ 10-11; see also In re Estate of Kurrelmeyer,
2010 VT 20, ¶ 12, 187 Vt. 620, 992 A.2d 316 (mem.) (stating Court could not conclude wife had violated fiduciary
duty to decedent or given herself gift not allowed under POA).  The POA in
Kurrelmeyer gave the wife and daughter
explicit authority to "execute and . . . deliver trust instruments" in addition
to broad authority to transact "in any way which [the principal him]self could do, if [he] were personally present."  Kurrelmeyer, 2006 VT 19, ¶¶ 10-11.  We
concluded that while the POA in Kurrelmeyer
limited gift giving and did not grant the wife and the daughter the "explicit"
power to create a trust for the wife's own benefit, it did explicitly grant her
the power to convey real estate to any person or entity, to transfer real
estate into a trust, and to do anything that the principal might do himself.
 We held that such language, granting specific authority to create trusts
without limitation, necessarily implied the authority to create a trust for the
benefit of anyone, including the wife.  Defendants argue that the language
here granting Charles Lovell the authority to "do any other acts pertaining to
[principal's real property] that [the grantor] might do" is equally broad and
is therefore sufficient to grant him the power of transfer.  
¶ 7.            
The distinction between these cases, however, lies not in the language
of the POAs, but rather in the language and effective date of the amended POA
statute and its relation to the exercise of power under any "term" of the POA.
 In Kurrelmeyer, both the
execution of the power of attorney and the subsequent transfer of property into
the trust were complete before the amended POA statute became effective
in 2002.  The transfer in Kurrelmeyer was
therefore not subject to the amended POA statute's limitation on the power to
make gifts, and our analysis was based upon a construction of the POA under our
common law alone.  See Kurrelmeyer, 2006
VT 19, ¶ 2 (noting power of attorney executed in 1996 and property transferred
to co-trustees in 2000).  Here, on the other hand, the property transfer
occurred after the effective date of the amended POA statute.  
¶ 8.            
Under 14 V.S.A. § 3515(b): "[a]ny
term of a power of attorney, executed after the effective date of [the
POA statute] . . . which is otherwise inconsistent with, the provisions of this
subchapter, shall be void and unenforceable."  (Emphasis added.) 
This provision is clarified by 14 V.S.A. § 3515(a), which explains that "[t]he
duties and obligations of agents under [the POA statute] shall be deemed
incorporated into all powers of attorney."  Id. § 3515(a)
(emphasis added).  Reading these provisions in their entirety, it appears
that even for a POA created prior to the effective date of the statute, any
exercise of authority under that POA which occurs after the statute's effective
date must conform with the entire statute or the
execution is invalid.  The POA granting Charles Lovell authority to make
transfers in his father's stead was created prior to the effective date of the
amended POA statute; however, he exercised the term providing him power of
transfer after the effective date.  The term providing the power to
transfer did not give him the explicit power to make gifts, as required by the
amended POA statute, and thus an attempt to exercise authority pursuant to that
term after the statute's effective date was void and unenforceable.*  
¶ 9.            
Defendants claim that the equitable principles of laches
and estoppel should bar plaintiff's claims because
plaintiff signed a consent statement approving the farm's transfer and waited
an unreasonable amount of time before bringing his claim.  Defendant
Charles Lovell contends that this delay was prejudicial to his interests
because he paid taxes and made improvements to the farm without contributions
from the alleged co-tenants.  The lower court did not address these
arguments, but as it did not grant laches relief, we
assume it found them unpersuasive.  We agree.
¶ 10.        
When a party fails "to assert a right for an unreasonable and
unexplained period of time when the delay has been prejudicial to the adverse
party, rendering it inequitable to enforce the right," laches
will bar relief.  Comings v. Powell, 97 Vt. 286,
293, 122 A. 591, 594 (1923).  "But lapse of time is not
enough.  Laches involves prejudice, actual or
implied, resulting from the delay. It does not arise from delay alone, but from
delay that works disadvantage to another."  Id.  As an
equitable remedy, "laches is so much a matter of
discretion by the lower court that its action will not be disturbed unless
clearly shown to be wrong."  In re Vermont Elec.
Coop., Inc., 165 Vt. 634, 635, 687 A.2d 883, 885 (1994) (mem.) (quotation omitted). 

¶ 11.        
Defendants argue that the doctrine of laches
forecloses plaintiff from bringing this claim because he filed it over four
years after the underlying property transfer and signature of a consent
statement in which plaintiff agreed to the transfer.  However, we do not
believe the underlying transfer is the proper moment from which to measure
plaintiff's delay.  The consent statement upon which defendants rely is
explicit that the transfer to defendants was made "[i]n
consideration of the consensus that it is in the best interests of Zada Lovell and Phillip I. Lovell to transfer the family
farm to Hubert J. Lovell and Charles I. Lovell during the lifetime of Zada Lovell and Phillip I. Lovell."  (Emphasis
added.)  The statement goes on to explain that the parties would "enter
into a family discussion to make provisions for the ultimate distribution of
the farm" at a later date.  The transfer was made for the benefit of
Phillip and Zada Lovell during their lifetimes, and
hence one would not expect a challenge to the transfer until that purpose had
expired.  Thus, the death of Zada Lovell seems a
more appropriate date to focus on in any determination of the reasonableness of
plaintiff's delay.
¶ 12.        
Plaintiff filed the petition to reopen the estate of Phillip Lovell only
five months after Zada Lovell's death.  We
cannot conclude that this delay was unreasonable, and we certainly cannot
conclude that the trial court's decision not to consider laches
was clearly wrong.
Affirmed.
 
 
FOR THE COURT:
 
 
 
 
 
 
 
 
 
 
 
Chief
  Justice
 

* 
Defendants argue that despite this, the quitclaim of the farm was nevertheless
valid because the "grandfather" provision, 14 V.S.A. § 3516, excuses the
transfer from strict compliance.  The grandfather provision of the amended
POA statute states "[a] power of attorney shall be valid if it: (1) complies
with the terms of this subchapter; or (2) is executed before July 1, 2002 and
valid under common law or statute existing at the time of execution." 14 V.S.A. § 3516.  However, the question here is not
whether the POA is a valid instrument.  Rather, the question is whether
the exercise of a power granted by a term of the POA, after the effective date
of the POA statute, was valid.