Opinion ID: 1787074
Heading Depth: 1
Heading Rank: 5

Heading: fiduciary duty of personal representative

Text: We begin this section of our analysis by explaining what issues are presented here. Not all of the arguments made in Linda's brief are properly before us in this appeal. For multiple reasons, we do not consider the argument in Linda's appellate brief that the administration of the estate should be supervised and that Sandra and her attorney should be removed as representatives of the estate and their actions voided. Brief for appellant at 13. First, while Linda objected in the county court to the appointment of Sandra as personal representative of the estate, she did not make a motion to have Sandra removed, or take any other timely action to seek appellate review of that issue. See, In re Trust of Rosenberg, 269 Neb. 310, 693 N.W.2d 500 (2005); In re Estate of Snover, 233 Neb. 198, 443 N.W.2d 894 (1989) (order overruling motion to remove personal representative is final, appealable order). Cf. In re Estate of Casselman, 219 Neb. 653, 365 N.W.2d 805 (1985) (affirming order that had appointed personal representative over objection). See, also, Moss v. Eaton, 183 Neb. 71, 157 N.W.2d 883 (1968) (explaining interdependency between objection to appointment of personal representative and proceedings to remove personal representative). Furthermore, even if the question of Sandra's appointment as personal representative was presented in a timely appeal, Linda did not assign Sandra's appointment as error in this appeal. Linda's assignment of error and supporting argument, as we understand it, is that Sandra's fiduciary duty to the estate, as personal representative, should have precluded her from claiming that the Strata stock was held in joint tenancy. However, there is no indication in the record that this argument was presented to the county court. Linda objected in the county court to Sandra's appointment as personal representative, on the basis of an alleged conflict of interest, and then litigated the issue of the Strata stock ownership on the merits of that dispute. The record does not indicate that Linda ever argued to the county court that Sandra's claim to ownership of Strata should be stricken because of a conflict of interest. In the absence of plain error, when an issue is raised for the first time in an appellate court, it will be disregarded inasmuch as a lower court cannot commit error in resolving an issue never presented and submitted to it for disposition. In re Interest of Natasha H. & Sierra H., 258 Neb. 131, 602 N.W.2d 439 (1999). We find no such plain error. Linda appears to be arguing that by virtue of her fiduciary duty to the estate, Sandra was required, in her capacity as personal representative, to claim that the Strata stock was the property of the estate, and was further required, in her individual capacity, to refrain from claiming personal ownership of the Strata stock. Linda is incorrect on both points. It is not disputed that a personal representative is a fiduciary and that there is a fiduciary relationship between a personal representative and the estate of the deceased, as well as the heirs, beneficiaries, and all persons interested in the estate. See, § 30-2464; Johnson v. Richards, 155 Neb. 552, 52 N.W.2d 737 (1952). The personal representative is under a duty to settle and distribute the estate of the decedent in accordance with the terms of any probated and effective will and the Nebraska Probate Code, and as expeditiously and efficiently as is consistent with the best interests of the estate. § 30-2464. But that duty does not extend beyond the assets that actually belong to the estate. For instance, in Zimmerman v. FirsTier Bank, 255 Neb. 410, 585 N.W.2d 445 (1998), the plaintiff and decedent had been the joint owners of three bank accounts. A bank, acting as personal representative of the decedent's estate, took possession of the proceeds of each account, and took the position that the funds were assets of the estate. The plaintiff sued the bank for conversion. The district court entered summary judgment for the bank, but we reversed that judgment. We concluded that the uncontroverted facts [were] sufficient to establish distinct acts of dominion inconsistent with [the plaintiff's] ownership rights and that under the facts of the case, the record [did] not reflect a bona fide reasonable detention of the funds by [the bank] for the purpose of ascertaining ownership. Id. at 420-21, 585 N.W.2d at 453. Zimmerman stands squarely for the proposition that a personal representative's fiduciary duty does not permit, much less require, the personal representative to take possession of property that does not lawfully belong to the estate. Furthermore, we have recognized that as a general rule, those who are directly interested in estates are usually selected and appointed as personal representatives. See Estate of Haeffele, 145 Neb. 809, 18 N.W.2d 228 (1945). It is common practice for a will to nominate a personal representative who is close to, or related to, the testator, and it is thus not uncommon for the nominated personal representative to have an interest in the estate, or in other property of the decedent. That the named personal representative is interested in the estate and that his or her interest may become hostile to those of the other interested beneficiaries does not necessarily render the personal representative legally incompetent. See id. If the individual interest of the personal representative comes into irreconcilable conflict with the interests of the estate, then the county court has the authority to act to protect the interests of all by restraining or removing the personal representative, or supervising the personal representative's administration of the estate. See, id. ; §§ 30-2440 through 30-2443 and 30-2450. In other words, the procedure established by the Nebraska Probate Code for dealing with a personal representative's actual conflict of interest is to replace, restrain, or seek supervision of the personal representative, not to try and eliminate the personal representative's individual interests. Linda cites In re Estate of Kennedy, 220 Neb. 212, 214, 369 N.W.2d 63, 65 (1985), for the general rule that a personal representative cannot deal with the estate's assets for personal profit or gain. However, that proposition is not relevant here. In that case, the administratrix of an estate maintained the decedent's ranching operation and, as the landowner, provided pasturing and feed for the cattle. The county court allowed the administratrix compensation from the estate for the pasturing and feed. We concluded that the compensation was allowable, as the administratrix had not profited from the transaction. But the question there was premised on the fact that the administratrix was engaged in self-dealing, because she had done business, in an individual capacity, with the estate for which she served as a fiduciary. For instance, in this case, if Sandra had purchased corporate stock from the estate, she would have had the burden of showing that the transaction was in good faith and promotive of the interests of the estate. See id. But no such self-dealing occurred here, and In re Estate of Kennedy has no application under these circumstances. Finally, we note that to resolve contested issues, the probate code permits a personal representative to invoke the jurisdiction of the court, in proceedings authorized by this code, to resolve questions concerning the estate or its administration. § 30-2465. That authority was used in this case to allow the county court to hold a hearing and determine the ownership of the Strata stock. Plain error must prejudicially affect a substantial right of a litigant. See McClure v. Forsman, 266 Neb. 90, 662 N.W.2d 566 (2003). Given Sandra's invocation of the county court's jurisdiction to determine the question of stock ownership in a contested hearing, we have difficulty seeing how, if at all, Linda was prejudiced by Sandra's purported conflict of interest, since the dispute was resolved by a disinterested party: the county court. For the foregoing reasons, we find no plain error in the county court's permitting Sandra to claim that the Strata stock had been held in joint tenancy. We reject Linda's first assignment of error.