Title: Marchant v. Cook

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Marchant v. Cook1998 WY 140967 P.2d 551Case Number: 98-84Decided: 11/25/1998Supreme Court of Wyoming
 
Joyce M. MARCHANT, Appellant (Plaintiff),

v.

John Ronald COOK and 
Andrea Leone Cook, his wife, Appellees (Defendants).

 

Appeal from the District 
Court, Laramie County, Jeffrey A. Donnell, J.

Robert A. Hampe, 
Cheyenne, for Appellant.

Jack B. Speight, 
Robert T. McCue, and Martin L. Hardsocg of Hathaway, Speight & Kunz, LLC, 
Cheyenne, for Appellees.

Before 
LEHMAN, C.J., and THOMAS, MACY, GOLDEN and TAYLOR,* 
JJ.

* Retired November 2, 
1998.

MACY, 
Justice.

[¶1]      Appellant Joyce 
Marchant appeals from the summary judgment that was granted in favor of 
Appellees John Ronald Cook (Ron) and Andrea Cook.

[¶2]      We 
affirm.

ISSUES

[¶3]      The appellant 
presents four issues for our review:

1. Did the trial 
court [err] in granting Defendants['] motion for summary judg[ ]ment on 
Plaintiff's claim for fraud?

2. Did the trial 
court [err] in granting Defendants['] motion for summary judgment on Plaintiff's 
claim for conversion?

3. Did the trial 
court [err] in granting Defendants['] motion for summary judgment on Plaintiff's 
claim for undue influence?

4. Did the trial 
court [err] in not allowing Plaintiff to amend the 
complaint?

FACTS

[¶4]      This case 
involves a controversy over the disposition of the assets that belonged to John 
Cook. John was married to June, and they had four children: Ron, Joyce, Shirley 
Brooks, and Jane Eickbush. John and June legally separated in February 1969. Ron 
married Andrea, and they had a daughter, Jayna Lybeck.

[¶5]      On October 17, 
1980, John executed a revocable trust agreement and a pour-over will. In the 
trust agreement, he identified himself as the settlor and appointed himself as 
the trustee of the trust created by that agreement. He also appointed Ron to 
serve as the successor trustee in the event that he was not able to fulfill the 
trustee's duties. In his will, John named Ron as the personal representative of 
his estate. He conveyed the following assets to the trust: (1) stock in 
Cook-McCann Concrete, Inc.; (2) a fifty-percent partnership interest in rental 
property located at 1816 Fremont in Cheyenne; (3) a fifty-percent interest in a 
joint venture called J & J Partnership; and (4) unspecified certificates of 
deposit and savings accounts.

[¶6]      In 1983, John and 
his partner sold the J & J Partnership property. John did not place the sale 
proceeds into the trust. In 1985, he transferred his Cook-McCann stock to Ron. 
John amended his trust agreement on May 23, 1985, to reflect the stock transfer 
but made the disposition of the stock contingent upon Ron's surviving him. The 
Cook-McCann shareholders approved the stock transfer on June 24, 1985. John 
deeded his fifty-percent interest in the property located at 1816 Fremont to the 
partnership entity on May 24, 1989, and, as a result, the appellees, who owned 
the remaining fifty-percent interest, became the sole owners of the 
property.

[¶7]      John executed a 
second amendment to the trust agreement on November 14, 1989, in which he 
directed the trustee to divide his trust estate, upon his death, equally among 
his four children and to distribute it over a five-year period. He also deleted 
all mention of the Cook-McCann stock and the two partnership interests. On March 
16, 1993, John executed a third amendment to his trust agreement in which he 
instructed the trustee to divide his trust estate, upon his death, equally among 
his four children and to distribute it one year after his 
death.

[¶8]      John died on 
February 13, 1995. Ron, acting as the personal representative of John's estate, 
petitioned to file John's will without probate or administration because the 
estate did not contain property that would be subject to probate. The petition 
and a copy of John's will were sent to each heir. John's attorney also sent 
letters to each heir, explaining that, during his lifetime, John disposed of all 
his assets that would have been subject to probate.

[¶9]      John had two bank 
accounts at the time of his death. One account had a balance of approximately 
$106,000 and was held jointly, with the right of survivorship, by John, Ron, and 
Jayna. The other account was owned jointly, with the right of survivorship, by 
John, Ron, and Shirley, and that account had a balance of $5,789.67. Ron, 
Shirley, and Jayna agreed to gratuitously distribute the proceeds of the 
accounts as follows: One-half to June; and one-half in equal shares to John and 
June's four children. The appellant, consequently, received 
$13,510.42.

[¶10]   On May 3, 1996, the appellant filed 
a petition for the probate of John's will and requested that the district court 
issue letters testamentary. Ron objected to the appellant's petition because the 
estate did not contain assets that were subject to probate. The appellant 
subsequently withdrew her petition.

[¶11]   On August 16, 1996, the appellant 
filed a complaint against the appellees that included a claim for conversion 
and/or an accounting of the assets in John's estate and trust. The district 
court dismissed the complaint because the appellant failed to state a claim for 
conversion and granted the appellant leave to file an amended complaint. The 
appellant filed the first amended complaint in which she stated two causes of 
action: (1) fraud and/or misrepresentation; and (2) conversion and/or 
accounting.

[¶12]   The appellees filed a motion for a 
summary judgment on September 19, 1997, asserting that they were entitled to be 
awarded a judgment as a matter of law on both of the appellant's causes of 
action. The district court held a hearing, and, subsequently, issued a decision 
letter and an order granting a summary judgment in favor of the appellees. The 
appellant perfected her appeal to the Wyoming Supreme 
Court.

DISCUSSION

A. Standard of 
Review

[¶13]   A summary judgment is appropriate 
when no genuine issue exists as to any material fact and the moving party is 
entitled to be awarded a judgment as a matter of law. Covington v. W.R. 
Grace-Conn., Inc., 952 P.2d 1105, 1106 (Wyo. 1998). A genuine issue of material 
fact exists when a disputed fact, if it were proven, would establish or refute 
an essential element of a cause of action or defense that the parties have 
asserted. Thunder Hawk By and Through Jensen v. Union Pacific Railroad Company, 
844 P.2d 1045, 1047 (Wyo. 1992); Allmaras v. Mudge, 820 P.2d 533, 535 (Wyo. 
1991). The movant bears the initial burden of establishing a prima facia case 
for summary judgment. Weber v. McCoy, 950 P.2d 548, 551 (Wyo. 1997); Thunder 
Hawk By and Through Jensen, 844 P.2d  at 1047. If the movant carries his burden, 
the party who is opposing the motion for a summary judgment must present 
specific facts to demonstrate that a genuine issue of material fact does exist. 
Weber, 950 P.2d  at 551; Boehm v. Cody Country Chamber of Commerce, 748 P.2d 704, 
710 (Wyo. 1987).

[¶14]   The Wyoming Supreme Court evaluates 
the propriety of a summary judgment by employing the same standards and by using 
the same materials as the district court employed and used. Covington, 952 P.2d  
at 1106. We examine the record in the light most favorable to the party who 
opposed the motion for a summary judgment, and we give that party all the 
favorable inferences that may be fairly drawn from the record. Id. We do not 
accord deference to the district court's decisions on issues of law. Ahearn v. 
Tri-County Federal Savings Bank, 948 P.2d 896, 897 (Wyo. 
1997).

B. Fraud and/or 
Misrepresentation

[¶15]   The appellant asserts that the 
district court erred by granting a summary judgment in favor of the appellees on 
her fraud and/or misrepresentation claim. The district court concluded that the 
appellant had "wholly failed to come forward with any facts to support her claim 
or to show any material issue of fact."

[¶16]   "In all averments of fraud or 
mistake, the circumstances constituting fraud or mistake shall be stated with 
particularity." W.R.C.P. 9(b).

Fraud is 
established when a plaintiff demonstrates, by clear and convincing evidence, 
that (1) the defendant made a false representation intended to induce action by 
the plaintiff; (2) the plaintiff reasonably believed the representation to be 
true; and (3) the plaintiff relied on the false representation and suffered 
damages.

Jurkovich v. 
Tomlinson, 905 P.2d 409, 411 (Wyo. 1995). See also M & A Construction Corp. 
v. Akzo Nobel Coatings, Inc., 936 P.2d 451, 457 (Wyo. 1997). When a party who is 
asserting a fraud claim is confronted with a motion for a summary judgment, that 
party must present clear, unequivocal, and convincing evidence to demonstrate 
that a genuine issue of material fact exists. McKenney v. Pacific First Federal 
Savings Bank of Tacoma, Washington, 887 P.2d 927, 929 (Wyo. 1994); Laird v. 
Laird, 597 P.2d 463, 466 (Wyo. 1979).

[¶17]   The district court determined that 
the appellant had failed to allege, or to proffer evidence to establish, the 
elements of her fraud claim. The district court stated in 
part:

Plaintiff's 
First Amended Complaint fails to allege any misrepresentation made to Plaintiff 
or, for that matter, to her father. Neither does Plaintiff allege any 
misrepresentation to herself or to her father which she or he believed to be 
true and which was, in fact, not true. Neither has Plaintiff presented any 
evidence what[so]ever of any such misrepresentation or reliance thereon in her 
response to Defendants' motion.

The appellant 
argues that she did submit evidence to demonstrate that the appellees made a 
false representation. She states in her appellate brief: "This false 
representation revolves around Decedent's mental state and Defendants['] 
intentional actions." The appellant maintains that the medical records and the 
testimony of John's longtime girlfriend confirmed that John's mental capacity 
was compromised and that he was, therefore, susceptible to being influenced by 
others.

[¶18]   The bulk of the statements in the 
appellant's fraud claim, as set forth in her first amended complaint, pertained 
to John's deteriorating mental and physical health. Only two paragraphs of her 
cause of action addressed the appellees' alleged fraudulent 
actions.

19. THAT before 
March, 1988, John Cook exhibited head pain, disorientation, loss of memory and 
other symptoms, and the Plaintiff is informed and verily believes that the 
Defendants and each of them did[,] individually or in collusion with others, . . 
. systematically set upon a course of conduct intended to separate and 
permanently deprive John Cook of his assets and/or their control, use and 
benefit.

. . . 
.

24. That the 
Defendant, John Ronald Cook, aided by his attorney, continued to create trust 
addendums and will codiciles, systematically dissipating the assets of John Cook 
by placing them in the name and under the control of the Defendants, John Ronald 
Cook and Andrea Leone Cook.

The appellant 
was specifically questioned about the factual basis for her allegations when she 
gave her deposition:

Q. Do you see 
where it makes reference in that paragraph to "The defendants," being your 
sister-in-law and brother, "individually or in collusion with others did 
systematically set upon a course of conduct." What others are you referring to 
there, if you know?

A. I don't 
know.

Q. What course 
of conduct did they set upon to deprive John Cook of his assets? What did they 
specifically do to deprive him of his assets?

A. My 
brother?

Q. 
Yeah.

A. They gave him 
just so much money every month for pocket money.

Q. They being 
your -

A. Well, Ronny, 
my brother.

Q. Gave 
who?

A. My 
dad.

Q. But the 
question is what did they do to take the money from him in the first place, 
specifically that you're aware of?

A. I don't 
know.

Q. Look at 
paragraph 24, if you would, please. "That the Defendant, John Ronald Cook, aided 
by his attorney, continued to create trust addendums and will codicils 
systematically dissipating the assets." Is the attorney Perry 
Dray?

A. 
Yes.

Q. And what is 
your understanding, if any, about the trust addendums or will codicils 
dissipating the assets? Do you have any facts to support that 
statement?

A. 
No.

[¶19]   The appellant's deposition was 
obviously strong evidence in support of the appellees' motion for a summary 
judgment, and the district court pointed to the appellant's testimony as 
demonstrating that no genuine issue of material fact existed with regard to her 
fraud claim. Additionally, the appellees presented affidavits from two persons 
who witnessed John's execution of various will and trust documents. The affiants 
averred that John executed the documents of his own free will and that he was 
not under undue influence. They also stated that they believed John had the 
requisite mental capacity to execute the documents.

[¶20]   Although the appellant was 
confronted with the appellees' evidence in support of their motion for a summary 
judgment on her fraud claim, she did not proffer specific evidence to show that 
the appellees made a false representation. We are, therefore, left with the 
inescapable conclusion that the appellant failed to establish a factual basis 
for her fraud claim. The district court correctly determined that no genuine 
issue of material fact existed and that the appellees were entitled to be 
awarded a judgment as a matter of law.

[¶21]   The appellant also claims that the 
district court should have allowed her case to proceed past the summary judgment 
stage because she presented a claim for negligent misrepresentation. The 
elements of a negligent misrepresentation claim are: "False information supplied 
in the course of one's business for the guidance of others in their business, 
failure to exercise reasonable care in obtaining or relating the information, 
and pecuniary loss resulting from justifiable reliance thereon." Duffy v. Brown, 
708 P.2d 433, 437 (Wyo. 1985). See also Rissler & McMurry Co. v. Sheridan 
Area Water Supply Joint Powers Board, 929 P.2d 1228, 1234 (Wyo. 
1996).

[¶22]   The facts of this case do not even 
remotely suggest that negligent misrepresentation took place. The appellant does 
not direct us to any evidence showing that the appellees supplied false 
information to John or the appellant. Given the obscure nature of the 
appellant's negligent misrepresentation claim and the complete lack of evidence 
to support such a claim, we are not surprised that the district court did not 
even address the issue in its decision letter or order. We conclude that the 
district court did not err by granting a summary judgment in favor of the 
appellees on the appellant's fraud and/or misrepresentation 
claim.

C. 
Conversion

[¶23]   The appellant contends that the 
district court erred when it granted the appellees' motion for a summary 
judgment on her conversion claim.1 "[C]onversion occurs when a person 
treats another's property as his own, denying the true owner the benefits and 
rights of ownership." Ferguson v. Coronado Oil Company, 884 P.2d 971, 975 (Wyo. 
1994). In order to establish a conversion claim, a plaintiff must show 
that:

(1) he had legal 
title to the converted property; (2) he either had possession of the property or 
the right to possess it at the time of the conversion; (3) the defendant 
exercised dominion over the property in a manner which denied the plaintiff his 
rights to use and enjoy the property; (4) in those cases where the defendants 
lawfully, or at least without fault, obtained possession of the property, the 
plaintiff made some demand for the property's return which the defendant 
refused; and (5) the plaintiff has suffered damage by the loss of the 
property.

Frost v. 
Eggeman, 638 P.2d 141, 144 (Wyo. 1981). See also McCarthy v. James E. Simon Co., 
923 P.2d 747, 750 (Wyo. 1996).

[¶24]   The district court concluded that 
the appellant had

not alleged that 
she has or ever had legal title to any of the subject property; that she either 
had possession of the property or the right to possess it at the time of the 
alleged conversion; or that she had any right to use and enjoyment of the 
property, Neither does Plaintiff address any of these issues in her response to 
Defendants' motion. Plaintiff's deposition testimony indicates quite clearly 
that she has no evidence or facts what [so]ever to support her claim, but that 
she believes she is entitled to a share of the property simply because she was 
the decedent's daughter.

The appellant 
stated in her first amended complaint that the appellees had systematically 
converted property belonging to John and that she had a legal claim to his 
property. She did not state, however, that she had legal title to the property. 
The appellant argues on appeal that she enjoyed legal title to the property in 
two ways: (1) she was an heir to John's estate and a beneficiary under his 
trust; and (2) by virtue of the intestacy statutes.

[¶25]   John transferred his property to 
himself as trustee of his revocable trust. Over the next several years, he 
conveyed and disposed of the trust res, which he had a right to do as the owner 
of the property and under the terms of the revocable trust. While the appellant 
was giving her deposition, she was questioned about what specific facts she had 
to support her conversion claim, and her responses were 
evasive:

Q. Now, besides 
the defendants, your sister-in-law and brother, individually or in concert with 
another or others, who is the another or others, if you 
know?

A. My two 
sisters.

Q. Do you have 
any facts that they worked with your brother and sister-in-law to take anything 
from you or that you think you're entitled to -

A. I have no 
facts.

Q. - that your 
father had?

A. I have no 
facts.

Q. A lot of 
suspicion?

A. Yes. . . . 
.

Q. Do you feel 
that you are entitled to any shares of stock of 
Cook-McCann?

A. Yes, I 
do.

Q. 
Why?

A. Because I am 
the daughter of John Cook also.

. . . 
.

Q. You have no 
information whatsoever as to why your dad transferred that stock to your 
brother?

A. 
No.

[¶26]   The appellant's deposition was 
obviously very damaging to her conversion claim because she repeatedly admitted 
that she did not have specific facts to support that claim. The appellant did 
not produce evidence to verify that she enjoyed legal title to any of the 
disputed property or that she possessed or had an immediate right of possession 
to the property at the time the appellees allegedly converted it. The fact that 
she was John's daughter, without more, was not sufficient to substantiate the 
appellant's claim that she had legal title to John's property. Faced with the 
inadequacy of the appellant's pleading and the woeful lack of evidence to 
support her conversion claim, the district court appropriately granted a summary 
judgment in favor of the appellees on the appellant's conversion 
claim.

D. Undue 
Influence

[¶27]   The appellant claims that the 
district court erred when it did not allow her to amend her complaint to plead a 
cause of action for undue influence. The appellant's claim is both curious and 
disingenuous. The appellant did not request leave to amend her complaint to 
plead undue influence. Further, even though the district court recognized that 
the appellant had not formally pleaded an undue influence cause of action, it 
did consider the issue in its summary judgment decision because she had raised 
the issue in her response to the appellees' motion for a summary judgment. The 
appellant does not, therefore, have a right to complain on appeal that the 
district court erred by failing to allow her to amend her complaint to assert a 
claim for undue influence.

[¶28]   The appellant also contends that 
the district court erred by granting a summary judgment in favor of the 
appellees on the undue influence issue. The district court stated in its 
decision letter that "the record reveals nothing even remotely hinting at the 
actual exercise of any undue influence" by the appellees.

[¶29]   The appellant asserts that the 
appellees exercised undue influence over John to procure the inter vivos 
transfer of his property to them and to control his testamentary dispositions. 
She claims that John's mental capacity was compromised and that the appellees 
were aware of his failing mental and physical health. The appellant suggests 
that, in some vague way, the appellees used their knowledge of John's failing 
mental abilities to their advantage to control his dispositions of his 
property.

[¶30]   In order to prove undue influence 
in an inter vivos transaction, the plaintiff must show: "(1) opportunity to 
control; (2) a condition permitting subversion; and (3) activity on the part of 
the person charged." Macaraeg v. Wilson (Estate of Obra), 749 P.2d 272, 277 
(Wyo. 1988). See also Walsh v. Walsh, 841 P.2d 831, 834 (Wyo. 1992). Courts 
carefully scrutinize deed transactions when the parties involved have a 
confidential relationship with one another. Short v. Hall, 785 P.2d 1167, 1170 
(Wyo. 1990). Once the person who is seeking to void the transaction on the basis 
of undue influence has established that a confidential relationship existed 
between the grantor and the grantee, the burden of proof shifts to the recipient 
of the property to prove that the transaction was fair and conducted in good 
faith. Walsh, 841 P.2d  at 834; Short, 785 P.2d  at 1170.

[¶31]   With regard to claims of undue 
influence in testamentary dispositions, this Court has 
stated:

[B]efore the 
proponent of the will has any obligation to present evidence showing that undue 
influence did not exist there must be evidence, the probative force of which 
establishes that (1) the relations between the one charged with exercising undue 
influence and the decedent afforded an opportunity to control the testamentary 
act, (2) the decedent's condition was such as to permit subversion of his 
freedom of will, (3) there was activity on the part of the person charged with 
exercising undue influence; and (4) that such person unduly profited as 
beneficiary under the will.

Pence v. Lush 
(Estate of Draper), 374 P.2d 425, 430-31 (Wyo. 1962). See also Brosius v. 
Gardner, 683 P.2d 663, 666 (Wyo. 1984).

[¶32]   The elements of undue influence are 
very similar regardless of whether a plaintiff is seeking to cancel an inter 
vivos transaction or he is seeking to set aside a will. Under either theory, the 
party who is asserting the claim must present evidence that shows the actual 
application of control and undue influence by the party charged with exercising 
undue influence. Short, 785 P.2d at 1170-71; Brosius, 683 P.2d  at 
666.

[¶33]   Once again, we turn to the 
appellant's deposition to determine whether or not a genuine issue of material 
fact existed on her undue influence claim:

Q. Do you have 
any facts that your sister-in-law or brother had any kind of undue influence or 
control over your father?

A. 
No.

Q. Or 
manipulated or directed or controlled him in any way for him to give away his 
property during his lifetime?

A. I can't make 
any accusations that I can't prove.

Q. Because you 
have no facts, correct?

A. 
No.

. . . 
.

Q. You have no 
information whatsoever as to why your dad transferred that stock to your 
brother?

A. 
No.

The appellant's 
testimony illustrates that she based her undue influence claim on suspicion 
rather than on actual facts. The facts that John's mental abilities were failing 
and that the appellees were aware of his condition were not sufficient to 
validate the appellant's undue influence claim. She does not direct us to 
specific evidence in the record to prove that the appellees actually exerted 
undue influence or control over John. We, therefore, agree with the district 
court that the appellees were entitled to be awarded a summary judgment on the 
undue influence claim.

[¶34]   Affirmed.

Footnotes

1 The 
appellant did not raise an issue on appeal about her demand for an accounting. 
Accordingly, we will not consider that matter in this 
decision.