Court Opinion

ID: 69136
Source: CourtListenerOpinion
Date Created: 2010-04-26 06:41:42+00
Date Added: 2024-06-11T11:50:29.939250
License: Public Domain

[DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS
                                                              FILED
                  FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
                    ________________________ ELEVENTH CIRCUIT
                                                        SEPTEMBER 1, 2009
                           No. 09-11081                 THOMAS K. KAHN
                       Non-Argument Calendar                 CLERK
                     ________________________

               D. C. Docket No. 03-02539-CV-T-17-TBM

HOWARD W. LITTELL,

                                                         Plaintiff-Appellant,

                                versus

LAW FIRM OF TRINKLE, MOODY, SWANSON,
BYRD AND COLTON,
JOHNNIE B. BYRD, JR., individually,
LAW FIRM OF GRAY, HARRIS, ROBINSON,
and JANET M. STUART, individually, f/k/a
LANE TROHN, JOHN DOES 1-10,

                                                      Defendants-Appellees,

                     ________________________

              Appeal from the United States District Court
                  for the Middle District of Florida
                   _________________________
                         (September 1, 2009)
Before CARNES, WILSON and KRAVITCH, Circuit Judges.

PER CURIAM:

      Howard W. Littell, who alleges he was an intended beneficiary of a trust

originally drafted by attorney Johnnie B. Byrd, Jr. (“Byrd”) of the Law Firm of

Trinkle, Moody, Swanson, Byrd and Colton (“Trinkle Moody”) and amended by

attorney Janet M. Stuart (“Stuart”) of the Law Firm of Gray, Harris, Robinson

(“Gray Robinson”), appeals the district court’s order dismissing his legal

malpractice complaint against Byrd and Stuart and their respective law firms.

      The facts of this case, either undisputed or supported by the evidence taken

in the light most favorable to Littell, are as follows. In 1992, spouses Kenneth and

Betty Herman hired Byrd and Trinkle Moody to create an amendable trust on their

behalf, with themselves as settlors and trustees. The Hermans intended for the

trust to provide that, after the death of one spouse, the surviving spouse would

have unfettered control over the trust assets, including the power to change

beneficiaries. Byrd drafted trust documents he believed would carry out the

Hermans’ intent. On April 17, 1992, the Hermans executed “The Herman Family

Revocable Trust Agreement” (the “Trust”). Thereafter, Byrd drafted three

amendments to the Trust.

      On June 30, 1995, Mr. Herman died. At the time of his death, the Trust

                                          2
provided that after the death of the last settlor, all assets were to be distributed to

Michael L. Dyer and Don I. Dyer. Littell was not named in the original Trust or in

any of the amendments prepared by Byrd and Trinkle Moody.

       In 1996, Mrs. Herman hired Stuart of Gray Robinson to execute further

amendments to the Trust. Between 1996 and 2000, Stuart drafted the fourth, fifth,

sixth and seventh amendments to the Trust. In the fourth amendment, Littell was

designated as a joint successor trustee. In each successive amendment, Mrs.

Herman increased Littell’s involvement and share in the Trust, so that, when Mrs.

Herman died on August 31, 2001, Littell was the sole trustee, the beneficiary of a

yacht, and the residual beneficiary of the Trust assets after dispersing $40,000 in

cash gifts and a charitable donation to the University of South Florida.

       After Mrs. Herman’s death, the previously named beneficiaries of the Trust,

the Dyers, brought suit in Florida’s probate court, challenging the validity of the

amendments made to the Trust following Mr. Herman’s death. In a motion for

summary judgment, the Dyers argued that the unambiguous terms of the Trust

required the approval of both Mr. and Mrs. Herman and that therefore the Trust

became irrevocable upon the death of Mr. Herman. The probate court ruled in

favor of the Dyers and held that all amendments to the Trust executed solely by

Mrs. Herman were invalid. Accordingly, the court ordered that the Trust assets be

                                            3
distributed to Michael and Don Dyer, as provided by the Trust in effect at the time

of Mr. Herman’s death.

      Littell filed a legal malpractice action against the attorneys and their law

firms responsible for drafting the original Trust and the amendments naming him

as beneficiary. In brief, Littell’s argument is that Byrd was negligent in drafting a

trust that failed to allow amendments by the surviving spouse, as was intended by

the Hermans, and that Stuart was negligent in failing to counsel Mrs. Herman that

the Trust did not allow amendments by the surviving spouse. He argues that the

settlors’ intent as expressed in the Trust was frustrated by the negligence of these

attorneys and as a direct result of such negligence his share in the Trust was lost.

In support of his argument, Littell submitted the affidavits of Byrd and Stuart,

which they had submitted in opposition to the Dyers’ motion for summary

judgment in the probate case. In his affidavit, Byrd testified that the Hermans

asked him to draft a trust that would give the surviving spouse the power to amend

the Trust and that he drafted the Trust to satisfy this request. Stuart, in her

affidavit, testified that she believed the original Trust was drafted in a manner that

allowed the Trust to be amended by the surviving settlor.

      Byrd, Stuart and their respective law firms moved for summary judgment.

The district court granted this motion, finding (1) under Florida law, Littell has no

                                            4
standing to sue Byrd and Trinkle Moody because Littell was not an “intended

beneficiary” under any of the documents drafted by Byrd; (2) Stuart and Gray

Robinson were not negligent as a matter of law because the unambiguous terms of

the original Trust did allow the surviving settlor to make amendments, including

changing the beneficiary; and (3) in the alternative, Stuart and Gray Robinson can

not be held negligent because they are protected by the doctrine of judgmental

immunity. Littell appeals.

      We review a district court’s grant of summary judgment de novo. Thomas

v. Cooper Lighting, Inc., 506 F.3d 1361, 1363 (11th Cir. 2007). Summary

judgment is appropriate when the evidence, viewed in the light most favorable to

the nonmoving party, presents no genuine issue of material fact and compels

judgment as a matter of law. Id. “There is no genuine issue of material fact if the

nonmoving party fails to make a showing sufficient to establish the existence of an

element essential to that party’s case and on which the party will bear the burden of

proof at trial.” Jones v. Gerwens, 874 F.2d 1534, 1538 (11th Cir. 1989). “Genuine

disputes are those in which the evidence is such that a reasonable jury could return

a verdict for the non-movant.” Mize v. Jefferson City Bd. of Educ., 93

F.3d 739, 742 (11th Cir. 1996). We can affirm a grant of summary judgment on

any basis supported by the record. Lucas v. W.W. Grainger, Inc., 257 F.3d 1249,

                                          5
1256 (11th Cir. 2001).

A.     Byrd and Trinkle Moody

       Littell asserts that the district court erred in finding that, because Littell was

not named in any documents prepared by Byrd, Littell lacks standing as a third-

party beneficiary to sue Byrd and Trinkle Moody for malpractice. Littell asserts

that the operative document for determining a settlor’s intended beneficiary is the

final, executed version of the trust in existence at the time of the settlor’s death.

Littell argues that he was an intended beneficiary under the final version of the

Trust and that this intended disposition was frustrated by Byrd’s negligent failure

to draft a trust which was amendable by the surviving settlor. Accordingly, Littell

argues that he has standing to bring a malpractice lawsuit against Byrd and Trinkle

Moody as an intended third-party beneficiary of the Trust. To limit standing only

to those beneficiaries named in the documents drafted by Byrd, Littell argues,

would be illogical because the apparent intent of the settlors was to allow for the

beneficiaries to change at any time.

       Under Florida law,1 “[a]n attorney’s liability for negligence in the

performance of his or her professional duties is limited to clients with whom the

       1
         As a federal court sitting in diversity, we must apply Florida law to the state-law
malpractice claims in this case. Erie R. Co. v. Tompkins, 304 U.S. 64 (1938) (noting that federal
courts are constitutionally obligated to apply state law to state claims).

                                                6
attorney shares privity of contract.” See Espinosa v. Sparber, Shevin, Shapo, Rosen

and Heilbronner, 612 So. 2d 1378, 1379 (Fla. 1993) (citing Angel, Cohen and

Rogovin v. Oberon Inv., N.V., 512 So. 2d 192 (Fla. 1987)). Florida recognizes a

limited exception to this privity requirement in the area of trust and will drafting

which applies to those third parties able to demonstrate that the apparent intent of

the client in engaging the services of the lawyer was to benefit that third party.

Espinosa, 612 So. 2d at 1380; Hare v. Miller, Canfield, Paddock & Stone, 743 So.

2d 551, 553 (Fla. Dist. Ct. App. 1999). Intended third-party beneficiaries of such

documents are found to have standing in legal malpractice cases if they are able to

show “that the [settlor]’s intent as expressed in the [trust] is frustrated by the

negligence of the [settlor]’s attorney.” Id. at 1380 (emphasis omitted). “Thus, an

attorney may be held liable for breach of his duties to one who engages his services

or to one who he knows is the intended beneficiary of his services.” Rosenstone v.

Satchell, 560 So. 2d 1229, 1229-30 (Fla. Dist. Ct. App. 1990).

      Applying this law to the case at hand, we conclude that Littell does not have

third-party beneficiary standing to bring a malpractice action against Byrd and

Trinkle Moody. Florida’s narrowly defined exception to the privity requirement

limits an attorney’s professional liability to foreseeable plaintiffs, namely, to clients

and to those persons that the client apparently intended to be third party

                                             7
beneficiaries of the attorney’s services. See Rosenstone, 560 So. 2d at 1230

(limiting privity exception to “one who [the attorney] knows is the intended

beneficiary of his services”) (emphasis added); Angel, Cohen & Rogovin, 512 So.

2d at 193 (noting that attorney’s professional liability is limited to clients and to

those who can demonstrate that the apparent intent of the client in engaging the

services of the lawyer was to benefit that third-party); see also Machata v. Seidman

& Seidman, 644 So. 2d 114 (Fla. Dist. Ct. App. 1994), rev. denied, 654 So. 2d 919

(Fla. 1995) (liability of an accountant for negligence is expanded beyond persons in

privity to include those persons the accountant knows intend to rely on the

accountant’s opinion for a specific purpose). Littell’s error is that he conflates the

services performed by the two attorneys involved in this case. Although the final

amended version of the Trust was relevant to determine the intent of the settlor for

probate purposes, these amendments – drafted by Stuart – are irrelevant to the

determination of Byrd’s professional liability. Rather, for purposes of determining

the liability of each individual attorney, we must look at the services provided by

Byrd and Stuart separately and consider whether these services, by themselves, give

Littell third-party beneficiary standing to pursue a malpractice action against either.

In this case, Littell points to no evidence indicating that he was an apparent

intended beneficiary of the services Byrd provided to the Hermans or that the

                                            8
Hermans engaged Byrd intending to benefit Littell. At best, Littell was only an

incidental third-party beneficiary of Byrd’s services and the “Florida courts have

refused to expand [the privity] exception to include incidental third-party

beneficiaries.” Angel, Cohen & Rogovin, 512 So. 2d at 194. Although Stuart knew

Littell was a beneficiary of her services, Littell was not an apparent third-party

beneficiary of Byrd’s services. For this reason, the district court properly found that

Littell has no standing to bring a malpractice action against Byrd and Trinkle

Moody.

B.     Stuart and Gray Robinson

       Littell also asserts that the district court erred in finding that the Trust was

amendable by the sole surviving settlor and that therefore Stuart and Gray Robinson

were not negligent in executing amendments to the Trust.2 Littell, citing the Florida

cases of L’Argent v. Barnett Bank, N.A., 730 So. 2d 395 (Fla. Dist. Ct. App. 1999)

and Roberts v. Sarros, 920 So. 2d 193 (Fla. Dist. Ct. App. 2006), asserts that Florida

courts would interpret the unambiguous terms of the Trust as providing that an

amendment could only be accomplished by both settlors during their lives because

       2
         Although the probate court reached the opposite conclusion, the district court properly
found that because Stuart and Gray Robinson were not parties in the probate case, the probate
court’s decision has no preclusive effect in this case. See Albrecht v. State, 444 So. 2d 8 (Fla.
1984) (noting that issue preclusion applies only when the identical parties wish to relitigate
issues that were actually litigated as necessary and material issues in a prior action).

                                                 9
it states that “[d]uring the lifetime of the Settlors” the right to “alter or amend” the

Trust is “to be exercised jointly.” (Emphasis added).

      The original Trust contains the following provisions which are relevant to our

discussion. Article IV provides that “[d]uring the lifetime of the Settlors the Settlor

shall have and possess, and hereby reserves, the following rights and powers, to be

exercised jointly, at any time and from time to time without the consent of the

Trustee, in writing and effective when delivered to the Trustee hereunder: . . . [t]o

revoke this Trust Agreement and Trust established hereunder[;] . . . [t]o alter or

amend this Trust Agreement in any and every particular; . . . [t]o change the identity

and/or number of the Trustees, Successive Trustees, or Beneficiaries hereunder[;]

. . . [t]o reside upon any real property placed in the Trust as their permanent

residence during their lives.” Article VII provides: “Upon the death of both of the

Settlors, the Trust shall become irrevocable and the remaining Trust Estate,

including additions made by bequest or devise under Settlor’s Last Will and

Testaments, shall be held in trust to be administered by the Successor Trustee . . . .”

Also, Article XI includes the following provision: “Throughout the Trust

Agreement, unless the context requires otherwise, the singular includes the plural,

the plural includes the singular, the masculine includes the feminine, and the

feminine includes the masculine.”

                                            10
      Once created, a valid trust cannot be altered, amended, or revoked except by

the exercise of a power identified in the trust. L’Argent, 730 So. 2d at 396 (citing

MacFarlane v. First Nat’l Bank, 203 So. 2d 57 (Fla. Dist. Ct. App. 1967)).

Accordingly, the issue in this case is whether Article IV, which grants the power to

amend or revoke the trust, is exercisable following the death of one of the two

settlors. Under Florida law, “[t]he polestar of trust interpretation is the settlors’

intent.” L’Argent, 730 So. 2d at 397. If the trust language is unambiguous, the

settlors’ intent as expressed in the trust controls and the court cannot resort to

extrinsic evidence. Id.; Ludwig v. AmSouth Bank of Fla., 686 So. 2d 1373, 1376

(Fla. Dist. Ct. App. 1997). In determining the settlors’ intent, the court should not

“resort to isolated words and phrases”; instead, the court should construe “the

instrument as a whole,” taking into account the general dispositional scheme.

Pounds v. Pounds, 703 So. 2d 487, 488 (Fla. Dist. Ct. App. 1997); see Sarros, 920

So. 2d at 195. Furthermore, “no word or part of an agreement is to be treated as a

redundancy or surplusage if any meaning, reasonable and consistent with other

parts, can be given to it.” Sarros, 920 So. 2d at 196 (citations omitted).

      Applying these principles of interpretation, we conclude that the district court

correctly found that Article IV, when considered in the context of the entire

document, unambiguously expresses the settlors’ intent to give the surviving settlor

                                            11
the power to amend the trust, including changing the beneficiary. Considered

alone, Article IV’s instruction that “[d]uring the lifetime of the Settlors the Settlor

shall have and possess [the power to revoke, alter, change the beneficiaries, and

reside in the homestead], to be exercised jointly, at any time and from time to

time . . .” is ambiguous. It could be read either as always requiring the joint action

of both settlors to exercise the enumerated powers or as only requiring such joint

action “during the lifetime” of both settlors, after which the surviving settlor may

exercise these powers alone. When considered in conjunction with Article VII and

Article XI, however, it becomes clear that the settlors intended the latter

interpretation. First, Article VII, which provides that the Trust becomes irrevocable

“upon the death of both Settlors”, would add nothing to the meaning of the Trust if

Article IV were construed as making the Trust irrevocable upon the death of the

first settlor. Florida law instructs us to interpret a trust so as to avoid such a

surplusage when such an interpretation is reasonable. In addition, Article XI

instructs that the singular and plural forms of words be used interchangeably where

appropriate. Applying this singular/plural clause in the Trust, we conclude that the

provision allowing the “Settlor” to amend from time to time “during the lifetime of

the Settlors” can also allow the surviving settlor to exercise these powers. See

Sarros, 920 So. 2d at 196 (noting that, when faced with a similar singular/plural

                                            12
clause, the context does not require that “Grantors” be construed to mean only the

plural form of the word unless the Trust states “both Grantors”). As the district

court noted, the Trust would not comport with the settlors’ dispositional scheme

unless the surviving settlor continued to have the power to exercise the rights

granted under Article IV. If, as suggested by Littell, the settlors’ power to exercise

their rights under Article IV was limited to “the lifetime of the Settlors,” then the

surviving settlor’s power to “reside upon any real property placed in the Trust as

their permanent residence during their lives” would end upon the death of one

settlor. We would therefore have to conclude that the settlors intended to revoke

Mrs. Herman’s right to live in her home after the death of her husband. Such a

result is contrary to the stated purpose of the Trust, which is “to provide for the

proper health, maintenance, and support” of the Hermans “during [their] lifetime

and during the lifetime of the survivor of them.” Accordingly, after considering the

Trust instrument as a whole and applying the singular/plural clause to Article IV,

we conclude that the settlors intended for the powers granted in Article IV to be

exercised jointly while both Mr. and Mrs. Herman were alive, and thereafter by the

surviving settlor.

      Because we agree with the district court that the Trust documents prepared by

Byrd were amendable by Mrs. Herman as the surviving settlor, we conclude that

                                           13
Stuart and Gray Robinson did not neglect their professional duty by drafting and

executing amendments to the Trust after Mr. Herman’s death. For this reason,

summary judgment in favor of Stuart and Gray Robinson was properly granted.

      Littell also disputes the district court’s alternative finding that Stuart and

Gray Robinson are protected by the doctrine of judgmental immunity. Because we

conclude that Stuart and Gray Robinson were not negligent as a matter of law, we

need not reach the merits of the district court’s alternative holding.

      For the reasons as stated herein, the district court’s well-reasoned order is

AFFIRMED.

                                           14