Title: Kerper v. Kerper

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Kerper v. Kerper1991 WY 134819 P.2d 407Case Number: 91-34Decided: 10/25/1991Supreme Court of Wyoming
MEIKE 
KERPER,

APPELLANT 
(DEFENDANT),

v.

JANEEN 
KERPER; JILL KERPER; WYOMING NATIONAL BANK, PERSONAL REPRESENTATIVE OF THE 
ESTATE OF LOUJEN KERPER, DECEASED; WILLIAM DANIEL ELSOM; RYAN LENNON; COLBY 
LENNON; KARA BEREMAN; AND KEY BANK-WYOMING, SUCCESSOR TRUSTEE OF KERPER TRUST 
NO. 1,

APPELLEES 
(PLAINTIFFS/DEFENDANTS).

Rehearing 
Denied December 18, 1991.

Appeal from the District Court, 
ParkCounty, Hunter Patrick, 
J.

 Ross D. 
Copenhaver (argued) of Copenhaver, Kath & Kitchen, Powell, for appellant.

 Janeen 
Kerper, pro 
se.

 Before URBIGKIT, C.J., and THOMAS, CARDINE, MACY 
and GOLDEN, JJ.

 CARDINE, 
Justice.

 [¶1.]     This is the second 
appeal of the Kerper family's dispute over trust funds and other legacies left 
to the four Kerper daughters by their parents. See Kerper v. Kerper, 780 P.2d 923 (Wyo. 
1989). In this appeal, appellant Meike Kerper (Meike) contends the district 
court erred in determining that oil and gas royalties mistakenly paid into 
Kerper Trust No. 1 should remain as part of the principal of the trust pending 
the resolution of other matters in this case. She claims those royalties are the 
property of the four Kerper daughters, have never lawfully been the property of 
Kerper Trust No. 1, and, therefore, should now be paid to the four Kerper 
daughters. Appellee, Janeen Kerper (Janeen), contends that her sister Meike 
cannot, for a variety of reasons, now pursue this issue on appeal. We hold that 
Meike's appeal is properly before this court, and that the district court erred 
in not ordering that the Husky royalties be paid out to their rightful owners. 
Thus, we reverse that portion of the district court's order which determined the 
Husky royalties should remain in the principal of the Kerper Trust No. 1, 
subject to trust indebtedness, and be paid out only as, and if, principal 
becomes available. In reaching this decision, we employ the equitable device 
known as a constructive trust.

ISSUES

 [¶2.]     Meike raises these 
issues:

"(1) 
That portion of the Order Upon Remand as identified in the Notice of Appeal1 is unsupported by the evidence and 
contrary to the evidence.

"(2) 
That part of the Order Upon Remand which is appealed from is contrary to law in 
that Appellant [Meike] is not treated equally with other income 
beneficiaries.

"(3) By 
reason of that part of the Order Upon Remand which is appealed from, there is 
error in the assessment of the amounts to be paid to Appellant which deprive 
Appellant of oil and gas royalty income previously found to be vested in her, 
while approving payment of such royalty income to other income beneficiaries who 
are of equal status.

"(4) 
That part of the Order Upon Remand which is appealed from constitutes a gross 
inequity, injustice and penalty upon Appellant without cause or reason, in 
violation of her right to be treated equally with other income beneficiaries by 
reason of which Appellant is injured and damaged."

Janeen 
states these issues in response:

"1. 
Whether appellant, in submitting only a partial record to this court, has 
sustained her burden of demonstrating that the order appealed from is not 
supported by substantial evidence?

"2. 
Whether appellant's appeal is an attempt to appeal an order which has become 
final and is not subject to review?

"3. 
Whether error, if any, was invited by appellant?

"4. 
Whether, by accepting the benefits of the district court's order, appellant has 
waived her right to appeal?"

PROCEEDINGS 
AND FACTS

 [¶3.]     We are reviewing, for a 
second time, the district court's disposition of this very complex family 
dispute over trust funds and other property which were left to the Kerper 
daughters by their parents. See Kerper v. 
Kerper, 780 P.2d 923. The dispute has turned a long-term legacy of 
considerable value into a short-term benefice for lawyering skills and a 
diseconomy for the Wyoming court system, as a district court and 
this supreme court attempt to sort out problems that virtually defy judicial 
resolution. This Bleak House2-like tragedy could likely have been 
avoided if the beneficiaries of the Kerper trusts had employed some small 
measure of the common sense and legal acumen with which their parents were so 
generously endowed.

 [¶4.]     The dispute at this 
stage of the proceedings is whether funds, which we shall identify as the "Husky 
royalty," are the property of the Kerper daughters or part of the principal of 
Kerper Trust No. 1. The record reveals the royalties were initially paid by 
Husky Oil but are now paid by Marathon Oil. For purposes of simplicity, they 
will be referred to in this opinion only as the "Husky 
royalties."

 [¶5.]     The district court 
determined in a partial summary judgment, entered on March 31, 1987, 
that:

"I. HUSKY ROYALTY.

 "A. Findings of Fact.

 "(1) The 
Declaration of Trust, executed by Loujen Kerper as purported Trustor, dated 
September 7, 1965, as to the Husky Oil royalty, (1) provides for vested 
remainders, in equal one-fourth (1/4) shares to MEIKE KERPER (formerly Minabelle 
Kerper Milodragovich) LOUJEN KERPER (formerly Loujen Kerper Kuiva), JANEEN 
KERPER and JILL KERPER; (2) pursuant to the terms of this trust and the 
accomplishment of its purposes, this trust terminated and became distributable 
to said four remaindermen on September 1, 1967 and at all times since; (3) that 
the said four remaindermen were then and now are entitled to conveyance of each 
of their undivided one-fourth (1/4) interest therein together with any 
accumulated income, but for the Order of this Court hereinafter deferring such 
distribution and payment.

"B. Conclusions of 
Law.

 "(1) The 
Amendment to Declaration of Trust No. 1, executed by Loujen Kerper as purported 
Trustor on May 30, 1972, was not effective as to the 1965 Declaration of Trust 
for two reasons. First, the 1965 Declaration had already expired by its terms, 
and secondly, no power to revoke, amend or modify had been reserved in the 1965 
Declaration of Trust and, accordingly by operation of law, it was irrevocable 
and not subject to any amendment or modification.

"(2) 
The Amendment to Declaration of Trust No. 1 did not constitute a partial 
modification of the trust as to only Loujen Kerper's undivided one-fourth (1/4) 
thereof, because the real settlors never consented to any such modification, 
either before or after the trust expired by its terms on September 1, 
1967.

"(3) 
Application of the Wyoming Principal and Income Act, W.S. § 
2-3-601 et seq. (1977) to this trust is moot, all principal and income being 
distributable to the same four persons as both income and remainder 
beneficiaries."

 [¶6.]     No issue is raised as 
to the validity of these findings, but Meike contests the district court's 
application of these findings to the issue of when, and under what 
circumstances, the Husky royalties should be paid out to the Kerper daughters. 
Meike, in essence, contends the ultimate result of the district court's partial 
summary judgment should have been that all sums payable from the Husky royalty 
are immediately distributable to the owners. It is evident that much of it was 
"distributed" to some of the daughters in the form of loans. Janeen borrowed 
almost the amount she was entitled to as a distribution, or $36,500. Loujen 
Kerper applied the indebtednesses owed the trust by three of the daughters 
against the distribution owed them by the trust. Janeen Kerper owed the trust 
$36,500, Loujen Kerper owed the trust $30,000, and Jill Kerper owed the trust 
$10,000. Meike Kerper owed the trust nothing. However, for the period May 1985 
through September 8, 1987, instead of paying out that portion of the royalties 
not applied to an indebtedness, Loujen Kerper, as trustee, and in reaction to 
the initiation of this litigation which had the potential to require the Kerper 
daughters to repay a large sum of money to Kerper Trust No. 1, simply showed all 
undistributed royalties as "accounts payable" from the trust. The effect of all 
this was that Janeen had received distribution of her full share of the royalty 
(less $92) and Meike had received nothing.

DISCUSSION

 [¶7.]     Meike contends the 
monies shown as accounts payable should now be paid out to their rightful 
owners. Janeen responds that Meike misunderstands the accounting and the 
"mathematics" which need to be employed in determining what monies should now be 
distributed to the Kerper daughters. Janeen seriously misapprehends Meike's 
argument when she attributes to Meike a proposed disposition of the Husky 
royalties we are unable to discern from Meike's brief. Janeen also contends 
Meike has failed to demonstrate that the decision of the district court is not 
supported by substantial evidence. She appears to comprehend Meike's argument as 
one contesting the facts found by the district court, but which Meike attempts 
to disguise as an issue of law. Again, we perceive just the 
opposite.

 [¶8.]     Meike's protest is not 
that the accountings are inaccurate or the facts otherwise insufficient to 
sustain the order upon remand. Rather, she asserts the district court's 
determination that the Husky royalties should be paid out only as, and if, 
principal of the trust becomes available is inconsistent with the law applied in 
the initial decision which was that the Husky royalties were the individual 
property of the Kerper daughters and, thus, should never have been mingled with 
the property of the Kerper Trust No. 1. We hasten to add that the record 
supports the conclusion that Loujen acted in good faith when she included the 
Husky royalties in the Kerper Trust; but, nonetheless, she did so 
mistakenly.

 [¶9.]     Janeen also contends 
Meike argues that the Kerper Trust No. 1 owns the royalties which Meike claims 
should be distributed. Once again, our perception is the opposite. Meike's 
argument recognizes that Kerper Trust No. 1 does not now, and never did, own the 
Husky royalty. The argument may not have been as clearly worded as Janeen's, or 
this court would like, but the disposition we make is that for which Meike has 
contended. Meike's conclusion then is that if the Husky royalty is owned by the 
daughters individually, there is no reason why those sums should not now be paid 
to them in sums accurately reflected in the court's order.

 [¶10.]  In addition, Janeen claims Meike invited 
the error of which she now complains by proposing findings of fact and 
conclusions of law which were adopted as a part of the district court's March 
1987 summary judgment. This is at best a non sequitur since that judgment was in 
large part reversed by this court. Kerper 
v. Kerper, 780 P.2d 923. The proposed findings of fact and conclusions of 
law which Janeen would have serve as a roadblock to this appeal were submitted 
in reaction to a judgment that is now largely revised. We do not perceive this 
circumstance as an impediment to Meike's instant appeal.

 [¶11.]  Janeen also argues that because Meike has 
accepted some benefits of the district court's order on remand she may not 
appeal from that portion of it which she finds objectionable. This contention is 
based upon a theory of judicial estoppel. The authority cited by Janeen simply 
does not support that proposition. An appealing party may often be in the 
position of having won half a loaf in the district court and yet that 
circumstance, standing alone, is no bar to an appeal that seeks an opportunity 
to gain the other half loaf as well. Here, Meike's appeal is unrelated to any 
benefits she received under other aspects of the district court's order on 
remand or the earlier partial summary judgment. Under the partial summary 
judgment, there was no reason for Meike to contest the holding of the Husky 
royalty by Kerper Trust No. 1 because that judgment required her to pay an even 
larger sum of money back to the trust. Once Meike was freed of that burden by 
our earlier disposition of this case, then her right to seek a remedy for the 
Husky royalties held back from her became ripe. There is, quite simply, no issue 
of judicial estoppel to be decided in this case.

 [¶12.]  Finally, Janeen objects to any relief for 
Meike claiming her litigating has cost everyone substantial amounts of money. 
The Wyoming 
Constitution, Art. 1, § 8 provides that: "All courts shall be open and every 
person for an injury done to person, reputation or property shall have justice 
administered without sale, denial or delay." Meike was guaranteed access to the 
courts for resolution of this dispute. She was successful in the trial court. 
Our reversal was not unanimous. And now Janeen (and Meike) continue litigation. 
That litigation is costly, does not make it unavailable.

 [¶13.]  Having disposed of Janeen's initial 
objections to the validity of Meike's appeal, we proceed to deal with the Husky 
royalties directly. The revised accounting for the years 1985 through September 
8, 1987, revealed that royalties paid to the trust for 1985 were $48,456.67; for 
1986 they totalled $25,333.47; and, through September 8, 1987, they were 
$19,847.99. As noted earlier, some of these royalties were distributed, but the 
residue of them was held back by the trust either as payments on the 
indebtednesses of three of the sisters, or as accounts payable where no 
indebtedness existed. In the Order Upon Remand, the district court 
found:

"IT 
FURTHER HEREBY IS ADJUDGED, DECREED AND ORDERED that the following sums of money 
are payable to the respective persons named from the principal of the Kerper 
Trust No. 1, but only as and if the said same principal sums become available, 
and subject to such adjustment, if any, to the said sum payable to Meike Kerper 
as may appear necessary upon the revised and supplemental accounting of the Key 
Bank of Cody, Wyoming, as successor trustee, to wit: 

Meike 
Kerper $26,445.26 Loujen Kerper 17,010.41Janeen 
Kerper 92.98 Jill Kerper 16,858.18

* * * * 
* *

"IT 
FURTHER HEREBY IS ADJUDGED, DECREED AND ORDERED that the Husky royalty payments 
set over free of trust pursuant to the partial summary judgment of this Court 
herein entered on March 30, 1987 be freed from sequestration under the September 
8, 1987 Order of this Court by the Key Bank-Cody, in its capacity as successor 
trustee of Kerper Trust No. 1, and that any said sums of money heretofore 
sequestered and held by said bank that are traceable to the said Husky 
royalties, and payable to Loujen Kerper, Meike Kerper, Janeen Kerper, and Jill 
Kerper in accordance with the partial summary judgment of this Court entered 
March 30, 1987, be segregated and separately accounted for by the Key Bank-Cody, 
as successor trustee of Kerper Trust No. 1, and be paid to the following persons 
in equal shares:

The 
personal representative of the estate ofLoujen Kerper, now 
deceasedMeike KerperJaneen KerperJill 
Kerper

"The 
foregoing said payments of accumulated royalties shall be accounted for by said 
bank and receipted for by the payees as a special proceeding incidental to this 
action through this Court."

 [¶14.]  The district court found that the Husky 
royalty did not belong to Kerper Trust No. 1. We agree with that portion of its 
judgment. However, the district court erred in providing that those sums which 
are owed to the four daughters, as a result of the trust mistakenly taking 
possession of the Husky royalties, are payable only from the principal of the 
trust as, and if, those amounts become available. We hold that the Kerper Trust 
No. 1 retains such sums as may be traceable to the Husky royalties in a 
constructive trust for the four daughters. In so holding, we apply the 
principles embodied in Restatement of the Law of Restitution, Quasi Contracts 
and Constructive Trusts, § 165 (1937):

"§ 165. 
Transfer by Mistake to Person Not Intended.

"Where 
the owner of property by mistake transfers it to one person under such 
circumstances that a third person is entitled to restitution from the 
transferee, the transferee holds the property upon a constructive trust for the 
third person." Also see, Scott, The Law of Trusts, Vol. V, §§ 467, et 
seq. (4th ed. 1989); 66 Am.Jur.2d, Restitution and Implied Contracts, §§ 
118-152; Thomasi v. Koch, 660 P.2d 806, 809-12 (Wyo. 1983); Fuller v. Fuller, 606 P.2d 306, 309-10 
(Wyo. 
1980).

 [¶15.]  Applying these principles to the 
circumstances presented here, Loujen Kerper, in her capacity as a trustee of an 
earlier trust, mistakenly transferred property which belonged to the four 
daughters individually to the Kerper Trust No. 1, of which she was also trustee, 
apparently believing that was the intent of the trust document which governed 
the disposition of those funds and her parents who originally owned the Husky 
royalty. The transferee was Kerper Trust No. 1. Thus, Kerper Trust No. 1 held 
the royalties in a constructive trust for the four Kerper 
daughters.

 [¶16.]  In addition to the distributions made in 
the first five months of 1985 and the distributions made in the form of credits 
on indebtednesses, a small distribution of the Husky royalty money was made to 
the Kerper daughters in 1988, but the balance remains unpaid. Janeen received 
$92.98; and Jill, Loujen and Meike each received $2,654.05. This results in the 
following Husky royalties remaining unpaid:

Janeen 
Kerper - None (though she still has a right to interest and/or income from the 
Husky royalty monies)Meike Kerper - $23,791.21Estate 
of Loujen Kerper - $14,356.36Jill Kerper - 
$14,204.13

The 
record appears to demonstrate that there remains $65,591.12 in monies (including 
interest and/or income) that should be paid out to the Kerper daughters, in 
accordance with their respective rights in that fund. The calculation provided 
by Meike, which appears to be accurate, demonstrates those monies should be paid 
out as follows:

Meike 
Kerper - $27,101.06Janeen Kerper - $3,309.85Jill 
Kerper - $17,513.99Estate of Loujen Kerper - 
$17,666.22

 [¶17.]  Some additional accounting may be 
required to assure accuracy of these figures and to account for additional 
interest and/or income earned between the time the above figures were developed 
and the time when the monies are actually paid out. In imposing this 
constructive trust, we also hold, and direct that, the funds in the constructive 
trust must be paid as the first priority of the Kerper Trust No. 1. This is so 
because, under the principles we hold applicable to this case, the Husky royalty 
monies never became the property of Kerper Trust No. 1. The trust merely held 
them in a constructive trust for the Kerper daughters. Thus, no claim that is 
made against the trust can affect those monies.

 [¶18.]  We also note that Janeen Kerper 
maintained in her brief that all Husky royalties, except those attributable to 
that portion of the 1985 royalty which was not distributed, are held in a 
separate account and are not part of the Kerper Trust No. 1. If that is indeed 
the case, then the paying out of these funds should be relatively simple. 
However, the fact that a significant portion of these funds may be in a separate 
account does not lessen our concern that the district court's order on remand 
appears to make them a part of the Kerper Trust No. 1. The district court 
directs that they may be paid out only as, and if, those sums become available 
from the principal of Kerper Trust No. 1. We add this to clarify that whether 
these Husky royalty monies are actually in the Kerper Trust No. 1, or in a 
separate account, or both, they are required to be paid out in accordance with 
the sense of this opinion.

 [¶19.]  The order of the district court upon 
remand is reversed to the extent described above, and the case is remanded to 
the district court with directions that the Husky royalty monies be paid out to 
the Kerper daughters from the Kerper Trust No. 1, or such other fund in which 
they may be found, in accordance with this opinion.

1 See p. 410-411 for the text 
referred to.

2 Bleak House, Charles Dickens' ninth 
novel. In this novel, Dickens relates the extraordinarily complex story of Jarndyce v. Jarndyce. The novel must be 
read to appreciate its tangled story of familial apprehensiveness. The final 
result is that, after years of hostility and resentfulness, the family fortune 
has been consumed by lawyers - not lawyers necessarily eager to engage in fee 
enhancements - but lawyers hired and paid to tourney the family battle. See 
Hardwick and Hardwick, The Charles 
Dickens Encyclopedia, Scribner's (1973).