Court Opinion

ID: 9929362
Source: CourtListenerOpinion
Date Created: 2024-02-02 15:08:40.679891+00
Date Added: 2024-06-11T10:07:18.909888
License: Public Domain

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
02/02/2024 09:08 AM CST

                                                         - 832 -
                               Nebraska Supreme Court Advance Sheets
                                        315 Nebraska Reports
                                            IN RE TRUST OF LAMPRECHT
                                                  Cite as 315 Neb. 832

                           In re Trust of Betty J. Lamprecht, deceased.
                            Linda J. Haines, Cotrustee, appellant and
                               cross-appellee, v. John M. Lamprecht,
                               Cotrustee, and Byron L. Lamprecht,
                                    appellees, cross-appellants,
                                        and cross-appellees.
                          In re Trust of Mylan L. Lamprecht, deceased.
                            Linda J. Haines, Cotrustee, appellant and
                               cross-appellee, v. John M. Lamprecht,
                               Cotrustee, and Byron L. Lamprecht,
                                    appellees, cross-appellants,
                                        and cross-appellees.
                                                     ___ N.W.2d ___

                                    Filed February 2, 2024.   Nos. S-23-058, S-23-059.

                 1. Trusts: Equity: Appeal and Error. Where a question of equity is pre-
                    sented in a trust administration matter, appellate review of that issue is
                    de novo on the record.
                 2. ____: ____: ____. The removal of a trustee is a question of equity, and
                    therefore, an appellate court reviews the issue de novo on the record.
                    In a review de novo on the record, an appellate court reappraises the
                    evidence as presented by the record and reaches its own independent
                    conclusions concerning the matters at issue.
                 3. Trusts: Final Orders. A proceeding to remove a trustee is a special
                    proceeding, and affects a substantial right.
                 4. Final Orders: Attorney Fees: Appeal and Error. An order granting an
                    attorney fee in an amount to be determined at some future time does not
                    constitute a final, appealable order.

                 Appeals from the County Court for Douglas County: Derek
               R. Vaughn, Judge. Affirmed.
                             - 833 -
         Nebraska Supreme Court Advance Sheets
                  315 Nebraska Reports
                   IN RE TRUST OF LAMPRECHT
                         Cite as 315 Neb. 832

  Gabreal M. Belcastro, James A. Tews, and James F. Cann, of
Koley Jessen, P.C., L.L.O., for appellant.

  Michael W. Milone and David J. Koukol, of Koukol,
Johnson, Schmit & Milone, L.L.C., and Emily Fehringer and
Laura Ortiz, Senior Certified Law Students, for appellee John
M. Lamprecht.

  David A. Domina, of Domina Law Group, P.C., L.L.O., for
appellee Byron L. Lamprecht.

  Heavican, C.J., Cassel, Stacy, Funke, Papik, and
Freudenberg, JJ.

  Heavican, C.J.
                       INTRODUCTION
   Linda J. Haines and her brother, John M. Lamprecht, were
cotrustees of the trusts of their mother, Betty J. Lamprecht,
and their father, Mylan L. Lamprecht. Linda and John have
a brother, Byron L. Lamprecht, who is an interested party to
this litigation.
   Linda and John were incompatible as cotrustees, and each
sought to remove the other. At the hearing on these motions
to remove, John resigned his position as trustee. Following
the hearing, the county court for Douglas County accepted
John’s resignation as trustee and additionally removed Linda
as trustee, finding that she had breached her fiduciary duties
to the trusts. Linda appeals, and John and Byron cross-appeal.
We affirm.

                        BACKGROUND
   Mylan and Betty were married and farmed in Douglas
County, near Waterloo, Nebraska. Of the couple’s three chil-
dren, John and Byron farmed with their father.
   Mylan and Betty had separate trusts detailing the disposal of
their assets. Mylan died in 2010, and Betty had use and ben-
efits of Mylan’s assets. Betty died in 2018. The administration
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         Nebraska Supreme Court Advance Sheets
                  315 Nebraska Reports
                   IN RE TRUST OF LAMPRECHT
                         Cite as 315 Neb. 832

of both trusts was consolidated; all three children are beneficia-
ries of the trusts, and Linda and John were cotrustees.
   The consolidated estate is best described as “land rich and
cash poor.” Generally speaking, John and Byron believe that
Linda failed to distribute the property as provided for by the
trust documents. Linda argues that the estate had debts to pay,
but that John and Byron refused to agree to actions necessary
to free up cash to pay those debts, and that further, part of that
debt was retired using assets that should have gone to Linda.
All three agree that Linda and John are incompatible as cotrust-
ees, and the record shows that administration of the trusts was
chaotic and contentious.
   In December 2021, an evidentiary hearing was held on sev-
eral issues, including the motions to remove both Linda and
John as trustees. The county court removed both Linda and
John, finding:
         The Court finds that Co-Trustees Linda Haines and
      John Lamprecht have violated their fiduciary duties to the
      Trust. The Co-Trustees have engaged in behaviors which
      are detrimental to the Trust. There have been ongoing
      assertions that the Co-Trustees have breached his, her or
      their fiduciary relationship including assertions of mis-
      appropriated property, misuse of Trust resources/funds,
      accusations of deceit, improper dealings, alleged misuse
      not to mention personal animosity between the parties.
      The conduct of the Co-Trustees has resulted in extraor-
      dinary litigation and in light of the enormous expense
      to the Trust, caused by allegations of misconduct and
      dereliction of duty, the Court finds that the best interest
      of the Trust requires radical actions. The record reflects
      that previously, John Lamprecht offered to resign as
      Co-Trustee. Consequently, the Court removes Linda
      Haines as Co-Trustee and accepts the resignation of John
      Lamprecht as Co-Trustee and that the appointment of a
      Successor Trustee is in order.
                                - 835 -
          Nebraska Supreme Court Advance Sheets
                   315 Nebraska Reports
                    IN RE TRUST OF LAMPRECHT
                          Cite as 315 Neb. 832

                  ASSIGNMENTS OF ERROR
   On appeal, Linda assigns that the county court erred in
(1) determining that she had breached her fiduciary duties to
the trusts, (2) removing her as trustee, (3) failing to find that
John’s and Byron’s removal claims were barred by the doc-
trine of unclean hands, and (4) granting Byron’s motion for
attorney fees.
   On cross-appeal, John assigns, renumbered, that the county
court erred in (1) finding that John breached his fiduciary
duties as trustee and awarding Byron fees, to the extent those
fees were to be paid by John; and (2) awarding Byron attor-
ney fees without quantifying the amount awarded and failing
to decide 18 separate issues raised by the parties’ pleadings
and the evidence submitted at trial.
   In his separate cross-appeal, Byron assigns that the county
court erred in failing to address 18 separate issues raised by
his pleadings.
                  STANDARD OF REVIEW
   [1,2] Where a question of equity is presented in a trust
administration matter, appellate review of that issue is de
novo on the record. 1 The removal of a trustee is a question
of equity, and therefore, an appellate court reviews the issue
de novo on the record. 2 In a review de novo on the record, an
appellate court reappraises the evidence as presented by the
record and reaches its own independent conclusions concern-
ing the matters at issue. 3
                        ANALYSIS
      Removal of Linda as Trustee and Acceptance
                  of John’s Resignation
   On appeal, Linda argues that the county court erred in
finding that she had breached fiduciary duties owed to the
1
  In re Trust Created by Fenske, 303 Neb. 430, 930 N.W.2d 43 (2019).
2
  Id.
3
  Id.
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          Nebraska Supreme Court Advance Sheets
                   315 Nebraska Reports
                     IN RE TRUST OF LAMPRECHT
                           Cite as 315 Neb. 832

trusts and, accordingly, erred in removing her as trustee. John
contends that Linda does not appeal from a final order. John
also cross-appeals, arguing that the county court erred in find-
ing that he, too, breached fiduciary duties owed to the trusts.
But we need not address, and do not consider, the underlying
issue of whether Linda or John breached their fiduciary duties
because, in any case, the county court did not err in removing
Linda or in accepting John’s resignation.
   [3] As an initial matter, we reject John’s assertion that
Linda does not appeal from a final order. We have held that
a proceeding to remove a trustee is a special proceeding, and
affects a substantial right, 4 and thus is final. Because the trusts
here were registered in the county court, 5 that court had sub-
ject matter jurisdiction, 6 venue was proper there, 7 and each
proceeding before the court was independent of any other
proceeding involving the same trust. 8 The proceedings here to
remove trustees constituted a discrete phase of the litigation 9
and thus qualified as an order affecting a substantial right in a
special proceeding.
   An appellate court reviews the removal of a trustee de
novo on the record. Neb. Rev. Stat. § 30-3862 (Reissue 2016)
addresses the removal of trustees:
         (UTC 706) (a) The settlor, a cotrustee, or a beneficiary
      may request the court to remove a trustee, or a trustee
      may be removed by the court on its own initiative.
4
  See In re Trust of Rosenberg, 269 Neb. 310, 693 N.W.2d 500 (2005). Cf.
  In re Estate of Seidler, 241 Neb. 402, 490 N.W.2d 453 (1992).
5
  See Neb. Rev. Stat. § 30-3816 (Reissue 2016).
6
  See Neb. Rev. Stat. § 30-3814(a) (Reissue 2016).
7
  See Neb. Rev. Stat. § 30-3815(c) (Reissue 2016).
8
  See § 30-3814(c).
9
  See, Paxton v. Paxton, 314 Neb. 197, 989 N.W.2d 420 (2023); In re
  Hessler Living Trust, 313 Neb. 607, 985 N.W.2d 589 (2023); Schreiber
  Bros. Hog Co. v. Schreiber, 312 Neb. 707, 980 N.W.2d 890 (2022); In re
  Estate of Anderson, 311 Neb. 758, 974 N.W.2d 847 (2022); In re Estate of
  Severson, 310 Neb. 982, 970 N.W.2d 94 (2022).
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             Nebraska Supreme Court Advance Sheets
                      315 Nebraska Reports
                       IN RE TRUST OF LAMPRECHT
                             Cite as 315 Neb. 832

        (b) The court may remove a trustee if:
        (1) the trustee has committed a serious breach of trust;
        (2) lack of cooperation among cotrustees substantially
     impairs the administration of the trust;
        (3) because of unfitness, unwillingness, or persistent
     failure of the trustee to administer the trust effectively, the
     court determines that removal of the trustee best serves
     the interests of the beneficiaries; or
        (4) there has been a substantial change of circum-
     stances or removal is requested by all of the qualified
     beneficiaries, the court finds that removal of the trustee
     best serves the interests of all of the beneficiaries and is
     not inconsistent with a material purpose of the trust, and a
     suitable cotrustee or successor trustee is available.
        (c) Pending a final decision on a request to remove a
     trustee, or in lieu of or in addition to removing a trustee,
     the court may order such appropriate relief under subsec-
     tion (b) of section 30-3890 as may be necessary to protect
     the trust property or the interests of the beneficiaries.
  Prior to the 2003 enactment of the Nebraska Uniform Trust
Code, which included the above provision relating to the
removal of trustees, Nebraska case law holds that trustees may
be removed under similar circumstances. We have held:
     “A court of equity . . . has power and authority to remove
     a trustee from his office, when any personal disability
     exists in the trustee, when he fails to perform the duties
     of his position, when he has misconducted himself in
     office or mismanaged the trust property, when hostile
     relations exist between the trustee and his . . . beneficia-
     ries, such as to interfere with the execution of the trust,
     or under any other conditions which render his removal
     necessary for the best interests of the trust estate.” 10
10
     Burnham v. Bennison, 121 Neb. 291, 299, 236 N.W. 745, 749 (1931).
     See, also, Reed v. Ringsby, 156 Neb. 33, 54 N.W.2d 318 (1952); Pavel v.
     Hotovy, 131 Neb. 373, 268 N.W. 297 (1936).
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           Nebraska Supreme Court Advance Sheets
                    315 Nebraska Reports
                     IN RE TRUST OF LAMPRECHT
                           Cite as 315 Neb. 832

We have continued to cite this general proposition with approval
as recently as our decision in In re Estate of Stuchlik, 11 even in
light of the adoption of § 30-3862 and the Nebraska Uniform
Trust Code.
   Section 30-3862 allows for the removal of a trustee, either
on the request of a cotrustee or a beneficiary, or on the court’s
own “initiative.” In addition to a “serious breach of trust,”
removal is permitted if a “lack of cooperation among cotrust-
ees substantially impairs the administration of the trust” or
if “removal is requested by all of the qualified beneficiaries,
. . . best serves the interests of all of the beneficiaries[,]
and is not inconsistent with a material purpose of the trust.”
Our case law additionally provides that a trustee may be
removed when “hostile relations exist between the trustee and
his . . . beneficiaries.” 12
   A de novo review of the record supports a finding that
“hostile relations” 13 existed between Linda and her brothers
and that there was a “lack of cooperation” 14 between Linda
and John. Finally, both John and Byron have requested that
Linda be removed as trustee. Removal is supported in this
case without a need for a determination of whether underlying
fiduciary duties to the trust were breached.
   There is no merit to Linda’s and John’s respective first
assignments of error.
      Attorney Fees Award, Byron’s Cross-Appeal,
          and Remaining Assignments of Error
   Linda also assigns, and John assigns on cross-appeal, that
the county court erred in awarding attorney fees to Byron.
Following the order removing Linda as trustee and accepting
John’s resignation, Byron filed a motion to alter or amend
11
   In re Estate of Stuchlik, 289 Neb. 673, 857 N.W.2d 57 (2014).
12
   Burnham v. Bennison, supra note 10, 121 Neb. at 299, 236 N.W. at 749.
13
   See id.
14
   See § 30-3862.
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             Nebraska Supreme Court Advance Sheets
                      315 Nebraska Reports
                       IN RE TRUST OF LAMPRECHT
                             Cite as 315 Neb. 832

that portion of the county court’s earlier judgment where the
court declined to address 18 claims raised by Byron. In that
order, dated December 30, 2022, the county court denied the
motion to alter or amend but, as relevant, granted Byron’s
motion for attorney fees (which it had earlier denied). However,
the court did not include an amount of fees.
   [4] We have held that “an order granting an attorney fee
in an amount to be determined at some future time” does
not constitute a final, appealable order. 15 This order did not
include an amount; thus, it was not final. As such, we lack
jurisdiction to entertain that portion of Linda’s appeal and
John’s cross-appeal.
   As for Byron’s cross-appeal, he argues that this court should
remand the cause to the county court for a determination of
18 issues, which he says he raised but that the court declined
to address. Those issues include any surcharge of Linda or
John for malfeasance or misfeasance; whether Linda should
have been ordered to distribute the real property not yet dis-
tributed to the beneficiaries, as required by the trust docu-
ments; whether an easement over the “South Place” should be
granted; whether the “South Place” should be sold; a deter-
mination of expenses; and myriad other issues relating to the
administration of the trusts both thus far and going forward.
   Byron conceded at oral argument that we lack jurisdiction
to hear his cross-appeal because we lack a final order. We
agree, and accordingly, we dismiss his cross-appeal.
                       CONCLUSION
  The decision of the county court that removed Linda as
cotrustee is affirmed.
                                              Affirmed.
  Miller-Lerman, J., not participating.
15
     State ex rel. Fick v. Miller, 252 Neb. 164, 165, 560 N.W.2d 793, 795
     (1997).