# FILED
March 18, 1999 Cecil Crowson, Jr. Appellate C ourt Clerk IN THE COURT OF APPEALS OF TENNESSEE WESTERN SECTION AT JACKSON

______________________________________________ SHIRLEY DIANNE BOWDEN, Executrix of the Estate of JONES ELMER BOWDEN, Deceased, Complainant-Appellee, Shelby Probate No. B-27231 Vs. C.A. No. 02A01-9805-PB-00127 LARRY E. WARD, Defendant-App

ellant.

______________________ _____________________________________________________ _ FROM THE SHELBY COUN TY PROBATE COURT THE HONORABLE ROBERT S. BENHAM, JUDGE

John J. Mulrooney; Cr

one & Mason, PLC, of M emphis For Appellee Kathleen N. Gome

s; Peppel, Gomes & Ma

cIntosh, P.C. of Mem

phis For Appellant

REVERSED AND REMANDED Opinion filed:

W. FRANK CRAWFORD,

PRESIDING JUDGE, W.S.

CONCUR: ALAN E. HIGHERS, JUDGE DAVID R. FARMER,

JUDGE This case concerns a creditor’s claim against a decedent ’s esta te. Appellant, Larry E. Ward, appea ls from the order of the probate court disallowing his claim against the Estate of Jones Elmer Bowden.2 On January 20, 1989, Ward and the decedent, Jones Elmer Bowden, entered into an agreement in which Ward sold a business and an airplaneto the decedent. In accordance

with the agreement, the decedent made regular payments to Ward until March 1 991 when the decedent developed financial troubles. Because of the friendship that existed between the two, Ward agreed to carry the loan until the decedent was able to repay the debt. Unfortunately, the decedent was unable to repay the debt before his death on March 27, 1996. On April 9, 1996, the de

cedent’s estate

was opened with hi

s d aughter, Shirley Dianne Bowden, qualifying as the Executrix. Pursuant to T.C.A. § 30-2-306(a), the probate court clerk published a Notice to Creditors in the newspaper on April 12 and 19, 1996. Furthermore, after being infor me d of her duty to sen d actual notice to

creditors who we

re known or reas

onably ascertainable, the Executrix searched through the decedent’s records in order to locate the names and addresses of suc

h credito rs. As a result of this search, the Executrix identified seven creditors,none of which were Ward. Actual notice was properly given to each of these seve n creditors pursuant to T.C.A. § 30-2-306(e). While preparing the decedent’s belongings for storage, the Execut rix found Ward’s

name in the decedent’s p

ersonal address

book. On October 2

8, 1996, th

inking that Wa rd may have information regarding litigation unrelated to the present action, the Executrix called thenumber listed for Ward and spoke to his daughter whoanswered the telephone. During the conversation, the Executrix asked why War d’s na me would be in the decedent’s personal address book. Ward’s daughter told

the Executrix that Ward and the decedent had business dealings and that the decedent owed Ward some money. The Executrix also informed Ward’s daughter of th e decedent’s death. After the conversation, the Executrix searched the decedent’s records a second time and was still unable to find any evidence of the debt claimed by Ward. After learni ng of the decedent’s death from his daughter in November, Ward mailed a letter on November 20, 19

96 to the Administra

tor of the Estate in

which he identifie

d himself

as a creditor of the decedent. In response, the attorney for the Estate sent a letter dated D ecember 2, 1996 to Ward which denied that Ward was a creditor, and further stated that even if he was

a creditor of the e

state, his claim wa

s t ime-barred because he did no t file his claim withi

n six months after the first publicationof the Notice to Cred

itors. A copy of the

published Notice to Creditors was enclosed in this letter to Ward. Ward called the attorney for the Estate upon1 There is some dispute as to w hen this call was ma de. The attorney

for the Estate contends that the call was placed on Decembe r 6, 199 6. Ward, on the other hand, does not remember

exactly when the conversation occurred but implies that it took place after his return from a trip to Mexico on December 13, 1996. However, the trial court credited the testimony of the attorney and found that the call was placed on December 6, 1 996. The trial cou rt used this date as the date Ward received actual notice of the decedent’s d

eath and, thus, in

determining the time in which Ward

had to file his clai

m. 3 receipt of the letter. 1 On December 30, 19

96, Ward wrote a

letter to th

e att orney represe

nting the Estate informing the attorney that he had spoken to an attorney who advised

him that he had a ye

ar to filehis claim since he w

as not notified of th

e decedent’s de

athand that he should file his clai m immediately. However, Ward did not f

ile his claim until more than two months later on February 11, 1997. The claim against the Estate was in the amount of $64,668.55. In response, the Executrix filed a

n exception to Wa

rd’s claim on February 24, 1997 on grounds t hat his claim was invalid and, even if it was valid, it was not timely filed. The matter was heard on March 24, 1997 by Judge Leonard Pierotti who took the matter under advisement. While

under advisemen

t, Judge Pie

rotti pass ed away, and the matter was taken over by Judge Robert Benham who, by consent of the parties, made a determination of the matter based on the pleadings and the transcript of the March 24 hearing. On March 18, 1998, the

probate court iss

ued a memorandum o

pin ion and entered an order disallowing Ward’s claim against the Estate. The probate court found that Ward w as a known creditor of the decedent by November 20, 1996 when he mailed the letter to the attorney representing the Estate claiming to be a creditor, thus entitling Ward to receive actual notice as providedin T.C.A. § 30-2-306 (e)(1984). The court further found that Ward received actual notice on December

6, 1996 when he received the letter from the a

ttorney represe

nting the Estate which contained the original Notice to Creditors. Since Ward received the Notice to Creditors after the expiration of the six month period, but more than 60 days before the first anniversary of decedent’s death, the probate court determined that pursuant to T.C.A. § 30-2-307(a)(1)(A) Ward was provided sixty days from the date he received actual notice - December 6, 1996 - to filehis claim. Thus, the

probate court he

ld that Ward’s cla

imfiled February 11, 1997, was not timely filed, and, therefore barred. Wa rd p erfected this appeal and presents the following issues, as stated in his brief, for4

our review: 1. Was the Appellant, Larry Ward, a known or reasonably

ascertainable

creditor that should hav e be en given notice pursuant to T.C.A. § 30-2-306(e)? 2. What constitu

tes actual notice

pursuant t

o T.C.A. § 30-2

- 307(a)(1) and d

id Appellant timely f

ile his claim? We will consider these issues together. Since this case was tried by the trial court sitting without a jury, we review the case de

novo upon the record w

ith a presumption of

correctness of

the findings of fa

ct by the trial cou

rt. Unless the ev idence pre ponderates against the findings, we must affirm, absent error of law. T.R.A.P. 13(d). The statutes pert

inent to our inquiry

are as follows: 30-2-306. Notice to credi tors of qu alif

ication of personal representative. - (a) It shall be the duty of the clerk of the court in which an e

st ate is being administere d, within thirty (30) days after

the is suance of letters testamentary or of administration, to give in the name of the personal representative of such estate public notice of his qualification as such by two (2) consecutive weekly notices published in some newspaper of the county in which letters te

stamentary or of

admin i stration are granted, or, if no newspaper is published in such county, by written notices posted in three (3) public places in the county, one (1) of which shall be posted at the usual place for posting notices at the courthouse.

* * * (c) The notice shall

be substantially in

the following form: NOTICE TO CREDITO

RS Estate of __________________________ (name of deceased) Notice is hereby given tha t on the _____ day of _____, 19__ letters testamentary (or of administra tion a s the case may be)

in respect of the estate of

_______ (name of deceased) were issued to the undersigned by the _______ c ourt of _______ County, Tennessee. All persons, resid ent and nonreside

nt, having claims, matured or

unmatured, against his (or her) estate ar

e required to file the same with the clerk of the above named court

within six (6) months fromth e date of the first publication (or of the posting, as the case may be) of t his notice, otherwise

their claims will be forever barred. This ___________ day of __________, 19___.

(Signed)_________________________ Administrator (or Executor) Estate of _____________________

(Name of deceased)

* * * (e) In a dd ition, it shall be the duty of the personal2 Subsection (c) of T.C.A. § 30-2-306 w

as amended in 1997

reducing the amou

nt of time in which to file a claim from six months to four months. The amendment became effective on January 1, 1998 and applies to estates of decedents dying on or after January 1, 1998. In the case sub judice, the amendment was not in effect given the fact that the decedent died on March 27, 1996, thus the six month period was applicable. 5 representativeto mail or

deliver by other means a copy of the published or posted notice a s described in subs

ection (c) to all creditors of the decedent of whom the personal representative has actual kn owle dge or who are reasonably ascertainable by the personal representative, at such creditors’ last

known addresses

.

. . . T.C.A. § 30-2-306 (a), (c) (1984) and (e) (Supp. 1998). 2 In addition, T.C.A. § 30-2-307(a)(1)(A) and (B) provide:

(A) If a creditor receives actual notice less than sixty (60) days before the expiration of the period prescribed in § 3 0-2

- 306(c) or after the expiration of the period presc

ribed in § 30-2- 306(c) and more than sixty (60) days befor

e th e date wh ich is twelve (12 ) months from the decedent’s date of death, such creditor’s claim shall be barred unless filed within

sixty (60) days from the date of receipt of actual notice; or (B) If a creditor receives actual notice less than sixty (60) days before the date

which is tw e lve (12) months from the decedent’s date of death or receives no notice, such c reditor’s claim shall be barred unless filed within twelve (12) months from the decedent’s date of death. Ward agrees with the probate court that he was a “known” creditor on No vember 20, 1996. However, he further asserts that he was “reasonably ascertainable” prior to this date, and

as such, he should have received the Notice to Creditors before the expiration of the six month period. Since he did not receive such notice prior to the expiration of the six months, Ward contends that he should have received notice pursuant to T.C.A. § 30-2-307. Furthermore, Ward

contends that

as a known or reasonably ascertainable creditor who falls within the provisions of T.C.A. § 30-2-307(a)( 1), it was the duty of the

Executrix to tell h

im how to file, where to file, and how long he had to file. He asserts that the E

xecutrix never gave him such notice in that she should have notified him of the time restraints in T.C.A. § 30-2-307 rather than the time restraints of T.C.A. § 30-2-306. Ward argues that the Estate failed to give him actual notice in

that the notice giv

en contained the

wrong time limits

and also informed

him that his claim was time barred. Thus, he asserts that the improper notice he received is equivalent

to no notice, and as such, he falls within the provision

s of T.C.A. § 30-2-3 07(a)(1)(B) therefore havi

ng one year from

the date of the de

cedent’s death t

o file his claim.Having filed6

on February 11, 1997, within the one-year period, Ward argues that his claim was timely filed and should not be barred. The Executrix

contends tha t Ward failed to p rove that he was a

known or reasona

bly ascertainable

creditor before November 20, 1996. She states that none of the decedent’s records identified Ward as a creditor of the decedent and that she did not know Ward to be a cr edito r. Furthermore, the Executrix claims that she fulfilled her statutory duty

as executrix by delivering to Ward the published Notice to Creditors. She argues that the re is no statutory provision that requires her to change or modify the content of the N otice to Creditors to conform with the individual circumstances of a particular creditor. The Executrix further asserts that Ward’s claim was time barred because it was not filed within sixty days after he received the actual Notice to Creditors. She states that Ward was not known to or reasonably ascertainable by her as a creditor until after the six month period prescribed in T.C.A. § 30-2-306(c) expired and, when she did learn of Ward as a creditor, she delivered to him a copy of the actual Notice to Creditors as prescribed in T.C.A. 30-2-306(c). Finally, the Executrix sub m its that Ward’s failure to follow the advice of his attorney was the cause of his claim being time barred. From our review of the record, we find that the ev idence does not pr

eponderate

against the trial court’s fin

ding that Ward wa

s not a known or reasonably a

scertainable c

reditor prior to November

20, 1996. Th e probate court correctly determined that Ward was a known creditor

on November 20, 1996 when the Estate received the letter from Ward claiming to be a creditor of the decedent. If

the o riginal Notice to Creditors Ward received on December 6, 199 6 constitutes actual notice for purposes of T.C.A. § 30-2-307, Ward had sixty days from December 6, 1996 within which to file his claim since such notice was received after the expiration of the six month period andmore than sixty days before the date which is twelve mon

ths from the date of the dece dent’s death. See T.C.A. § 30-2-307(a)(1)(A). If this is the case, Ward’s filing on February 11, 1997 would be outside of the sixty day per iod therefore ba

rring his claim aga

inst the Estate. Thus, our inquiry is whether W a rd received on December 6, 1996 actual notice as contemplated by T.C.A. § 30-2-307. What constitutes actual notice for purposes of T.C.A. § 30-2-307 was addressed in Estate of Jenkins v. Guyton , 912 S.W.2d 134 (Tenn. 1 995). The Supreme Court in Estate of Jenkins3 It is also important t o note that the attorney representing the Estate submitted erroneous information to Ward by stating that his claim was barred since it was no t filed within t he six month period. 7 concluded

that “while

the term ‘actual notice’ in § 30-2-307(a)(1) may be something other than

an exact copy of the published Notice to Creditors outlined in § 30-2-306(c), such notice must, at a minimum, include information regarding the commencement of probate proceedings and the time period within which claims must be filed with the probate court.” Id. at 138. See also 2 Jack W. Robinson & Jeff Mobley, Pritchard on Wills and Administration of Estates § 784 (5th ed. Supp. 1998) (“To be adequate, actual notice to a known creditor must include information regarding commencement of theprobate procee dings and the perio

d within which clai

ms may be timely filed.”). Under the above authorities, the “actual notice” required by T.C.A. § 30-2-307 (a)(1)(A) and (B) must contain the time period within which a claim must befiled. Thus, given Ward’s circumstances,

the actual notice must have informed Ward that he had sixty days within which to fi le his claim against the Estate. See T.C.A. § 30-2-307(a)(1)(A). The Notice t o Creditor s sent to Ward containe

d the wrong ti

m e period. That notice contained a time period that had since expired and was n

ot applicable to W

ard si nce he received it outsid e of the six month period. 3 Since the notice Ward received contained a time period that

had since expired and failed to contain, at a minimum, the applicable time period in which he had to file his clai

m, Ward did notreceived “ac

tual notice” as r

equired by T.C.A.

§ 30-2-307. Thus, W

ard, as a creditor of the Estate, falls within

the provisions of T. C.A. § 30-2-307(a )(1)(B) in that he did not receive actual notice and has twelve months from the decedent’s date of death within which

to file his claim. Ward’s claim filed on February 11, 1997, within the twelve month period from the date of the decedent’s death, was timely filed. According ly , the order of the p robate court disa

llowing the claim is r

eversed, and the

case is remanded for

such further

proceedings as n

ecessary. Costs o

f the appeal are

assessed against the appellee.

_________________________________ W. FRANK CRAWFORD, PRESIDING JUDGE, W.S.8

CONCUR:

____________________________________ ALAN E. HIGHERS, JUDGE

____________________________________ DAVID R. FARMER,

JUDGE