Opinion ID: 2516475
Heading Depth: 1
Heading Rank: 8

Heading: protectable interest in the estate.

Text: ¶ 29 The COCA ruled nephew had no protectable interest in the estate and, therefore, it was not error for the trial judge to treat him as a volunteer unentitled to reimbursement in any amount. This ruling by the COCA is plainly inconsistent with the summary judgment record. Nephew was the named residuary beneficiary under the will and had an interest in the residuary estate. Notwithstanding the apparent facts he took possession of, at least, some of the assets of the residuary estate, and he may have had a part in transferring other residuary estate assets to others, nephew's status as the residuary beneficiary gave him a protectable interest in the estate. ¶ 30 Generally, where a person interested in an estate pays a debt of the estate, he is subrogated to the claim of the creditor against the estate to the extent to which he or his interest is not primarily liable. 83 C.J.S. Subrogation § 15 (1953). Section 15, pp. 614-616, provides in pertinent part: As a general rule, where a person interested in the administration of an estate as heir, devisee, legatee, or surviving spouse pays, in order to protect his interest or benefit the estate, or has his interest taken for, or applied to the satisfaction of, a debt or claim against the estate for which the general estate, or the interests of others, are primarily liable either in whole or in part, he will be subrogated to the rights of the creditor whose debt is thus paid, to the extent that may be necessary to reimburse him for the amount for which he or his interest is not primarily responsible; but to no greater extent. In no case can a person, claiming by way of subrogation against an estate, stand in a better position than the person whose rights he claims to be subrogated.    [However], if the facts and circumstances show definitely that at the time of payment the right of subrogation was not intended to be exercised, and could not be exercised without injustice to others, no such right will be held to exist. (footnotes omitted) See also Chamness v. Chamness' Estate, 53 Ind.App. 225, 101 N.E. 323 (1913)(an heir having a personal interest in estate may be entitled to be subrogated to right of creditor where, with knowledge and consent of other heirs, he pays a note of decedent; subrogation may also be applicable when heir pays costs of administration); Owen Creek Presbyterian Church v. Taggart, 44 Ind.App. 393, 89 N.E. 406, 408 (1909)(when heir, devisee or legatee pays debts against testator for purpose of protecting his/her interest in the property of decedent, such payments are not considered voluntary and equity will keep debt alive for protection of person making payment.); Suydam v. Voorhees, 58 N.J.Eq. 157, 43 A. 4 Third Syllabus (Ch. Ct.1899) (devisee of life interest in lands of testator who pays with his own funds a debt of testator, which debt is either charged upon land by will, or payable out of land by statute, will be subrogated to creditor's right). ¶ 31 Like the situation involving payment of the funeral/burial expenses, nephew's claim to reimbursement for payment of decedent's medical bills, other debts and estate administration costs is grounded on the doctrine of equitable subrogation. The doctrine is a creature of equity intended to achieve the natural justice of placing the burden where it ought to rest. Republic Underwriters Ins. Co. v. Fire Ins. Exchange, 1982 OK 67, 655 P.2d 544, 547. It is unlike a fixed rule of law; instead, equitable subrogation is pliable and capable of being molded to attain justice to compel the ultimate discharge of a debt or obligation by the party who in good conscience ought to pay it. Id. ¶ 32 As noted in PART III(B), the order of priority in regard to the source of the funds liable for payment of debts/estate expenses in the present case under the summary judgment record would be the residuary estate, and if exhausted, then decedent's residence. Because the residuary estate was primarily liable and nephew was the residuary beneficiary under decedent's will, there is, of course, a question as to the value thereof to be deducted from or offset against any ultimate amount, if any, nephew is due under his reimbursement claim. There are also factual questions under this summary judgment record concerning whether payments made by nephew were actually necessary expenses beneficial to estate administration or preservation, or other payments made by him were reasonable in amount. The answer to the ultimate question, i.e. where natural justice should place the burden of the payments made by him, is also left in doubt under this summary judgment record. These matters, and possibly other potential questions impacting the ultimate amount he may be entitled to under his reimbursement claim, are matters that must first be taken up on remand by the trial judge upon proper presentation of the parties. To dispose of this appeal we need go no farther than to recognize, the COCA erred in its affirmance of the trial court summary judgment in favor of the SPR on the basis nephew had no protectable interest in the estate. The summary judgment record shows he did have an interest in the estate and it was error for the COCA to have ruled otherwise.