Court Opinion

ID: 9931241
Source: CourtListenerOpinion
Date Created: 2024-02-08 18:02:45.103941+00
Date Added: 2024-06-11T12:17:36.225893
License: Public Domain

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
                AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

                                   IN THE
            ARIZONA COURT OF APPEALS
                               DIVISION ONE

                               In the Matter of:

                     CORNER STONE LAND TRUST

                  SAMUEL SEMILIA, Petitioner/Appellee,

                                       v.

               CYNTHIA SEMILIA, Respondent/Appellant,

                                      and

            SUNDAY SEMILIA, et al., Respondents/Appellees,

                                      and

                      L. PAUL MCINTYRE, Appellee.

                            No. 1 CA-CV 23-0354
                              FILED 2-8-2024

          Appeal from the Superior Court in Maricopa County
                         No. PB2022-001235
              The Honorable Melody G. Harmon, Judge

                                 AFFIRMED
                                   COUNSEL

Erika M. Weiler, Attorney at Law, Scottsdale
By Erika M. Weiler
Counsel for Petitioner/Appellee

Provident Law, Scottsdale
By Mary T. Hone
Counsel for Respondent/Appellant

                      MEMORANDUM DECISION

Judge Michael J. Brown delivered the decision of the Court, in which
Presiding Judge Samuel A. Thumma and Judge Jennifer B. Campbell
joined.

B R O W N, Judge:

¶1            Cynthia Semilia (“Wife”) appeals the probate court’s order
granting summary judgment in favor of her ex-husband Samuel Semilia
(“Husband”) on various disputes about the validity of a trust. Because the
court did not err, we affirm.

                              BACKGROUND

¶2             While living in Virginia in 1997, Husband and Wife created
the Corner Stone Land Trust (“the Trust”). The declaration of trust stated
that the Trust was an “irrevocable complex trust,” but was also in the form
of a “pure trust.” The initial trustees were L. Paul McIntyre (Wife’s father)
and Ronald Swonger.          The couple’s four children were listed as
beneficiaries, and each of them were allocated 25 units of beneficial interest;
McIntyre was allocated 100 units.1 The Board of Trustees (“Board”) later
agreed the children would become eligible to serve as trustees once they

1     The Trust contemplated there would be “at least on[e] passive
holder” of units of beneficial interest. Wife does not dispute that McIntyre
served in that role.

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were of age, depending on their “competence, experience, and business
understanding.”

¶3            In 2001, Husband and Wife bought a home in Phoenix, which
they placed in the Trust, and the Board changed the Trust’s address to that
property a year later. In 2005, Swonger died and was replaced as a trustee
by Lorraine Bell (Husband’s sister) the following year, but otherwise the
Trust and property remained undisturbed until 2014 when Wife and
Husband divorced. During the dissolution proceeding, the family court
determined it could not award either party the home because it belonged
to the Trust and suggested their dispute would have to be resolved in
probate court. Wife continued to live in the home after entry of the divorce
decree and was responsible for maintenance and taxes. By at least 2014,
McIntyre no longer attended Board meetings as a trustee and did not sign
the minutes for Board meetings. At two Board meetings, the couple’s two
children born after the Trust’s creation were added as beneficiaries, and the
four children initially named as beneficiaries were added as trustees.

¶4             Despite his apparent lack of involvement with the Trust for
several years, in December 2017 McIntyre executed a warranty deed (“the
Deed”) purporting to transfer the home from the Trust to Husband and
Wife, recognizing they were no longer married. In 2018, the trustees
determined that McIntyre “ha[d] refused to participate in annual Trust
Meetings” since 2014, that he had “conspired with [Wife]” to remove the
home from the Trust, and that McIntyre would be removed as a trustee and
his units of beneficial interest (as a passive holder) would be held by Bell.

¶5             Husband petitioned the probate court to declare that the 2017
property transfer was void, that McIntyre was only a passive interest holder
in the Trust property, and that he was no longer a trustee. Alternatively,
Husband sought to remove McIntyre as a trustee. Both Wife and McIntyre,
who were self-represented, opposed the petition. Wife claimed that the
Trust’s designation as a “pure trust” showed that the Trust was created to
avoid tax obligations. Wife then filed a cross-petition, asking the court to
declare the Trust void as a fraudulent alter ego of Husband and to equitably
divide the home. Wife alleged that for more than seven years she was solely
responsible for the home, and that Husband was seeking to deprive her
from the benefits from their community property. But Wife did not request
an initial hearing on her cross-petition as required by Arizona Rule of
Probate Procedure (“Probate Rule”) 15(c), and the probate court took no
action on it for nearly a year.

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¶6            A few months after Wife filed her cross-petition, Husband
moved for summary judgment on his petition. Wife and McIntyre
responded by submitting a memorandum opposing summary judgment.
The filing contained a “Statement of Facts” consisting of a single paragraph
which cited no evidence in the record, though the filing included a list of
exhibits Wife believed “may be relevant in this matter.” Wife did not file a
controverting statement of facts as required by Arizona Rule of Civil
Procedure (“Rule”) 56(c)(3), nor did she specifically respond to the facts
included in Husband’s statement of facts.

¶7            The probate court granted Husband’s motion. Relying on
Rule 56(e), the court deemed Husband’s statement of facts as admitted, as
Wife “did not submit a controverting statement of facts, nor affidavits or
evidence to support their propounded facts.” The court also found that the
Trust was valid under Arizona law, the Deed was void, that McIntyre had
only a passive beneficial interest in the Trust property, and that he was
appropriately removed as a co-trustee at the 2018 Board meeting.

¶8            Wife then hired legal counsel, who moved to vacate the
court’s ruling. Wife argued that entry of summary judgment effectively
denied her cross-petition, which had yet to be addressed or dismissed,
without providing her an opportunity for a hearing. Wife also argued the
court erred by deeming Husband’s facts as admitted, while ignoring
evidence she presented which demonstrated there were genuine disputes
of material fact. The court denied Wife’s motion and, after entry of a partial
final judgment, she timely appealed.2 We have jurisdiction under A.R.S.
§ 12-2101(A)(1) and (9).

                               DISCUSSION

    I.    Due Process

¶9            By ruling on Husband’s summary judgment motion and
expressly declining to consider her cross-petition, Wife argues the probate
court effectively denied her cross-petition without giving her a meaningful
opportunity to be heard. See Matthews v. Eldridge, 424 U.S. 319, 332 (1976).

2      In the order denying Wife’s motion to vacate, the probate court also
noted that she still had not requested an initial hearing on her
cross-petition, and that it would be dismissed within 30 days from the
order. Nearly a month later, Wife requested an initial hearing, and the
court stayed any further action on the cross-petition pending resolution of
this appeal.

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We review claims of denial of procedural due process de novo. Emmett
McLoughlin Realty, Inc. v. Pima Cnty., 212 Ariz. 351, 355, ¶¶ 16–17 (App.
2006).

¶10            According to Wife, the court never allowed her to present
evidence or sworn testimony in defense of her claims before entering
judgment against her. However, she fails to acknowledge that her own
inaction prevented her from obtaining a hearing. Probate Rule 15(c) states
that “[t]he petitioner must obtain from the court a date, time, and location
for an initial hearing on [a] petition,” and that failure to obtain such a
hearing “may result in dismissal of the petition.” (Emphasis added.) The
cross-petition was not dismissed under Probate Rule 18, and there was
nothing preventing Wife from requesting an initial hearing on her
cross-petition.

¶11           Moreover, Wife had opportunities to present relevant
evidence and testimony in responding to Husband’s petition and motion
for summary judgment. A party who has the opportunity to be heard and
fails to exercise it cannot later claim they were denied due process.
Watahomigie v. Ariz. Bd. of Water Quality Appeals, 181 Ariz. 20, 27 (App. 1994).
This is true for both parties represented by counsel and those, like Wife
here, who are self-represented. Wife has not shown she was denied due
process.

   II.        Summary Judgment

         A.     Genuine Disputes of Material Fact

¶12            Wife argues the court erred in granting summary judgment
because it ignored the facts she presented. She contends the court needed
to consider all her filings, and the facts she presented show there are several
material factual disputes that could not be resolved by summary judgment.
We review the court’s grant of summary judgment de novo. Coulter v. Grant
Thornton, LLP, 241 Ariz. 440, 447, ¶ 23 (App. 2017).

¶13           As noted more than 40 years ago by the Arizona Supreme
Court, a court has no duty to independently review the entire record to try
to seek out disputed issues of material fact. See Mast v. Standard Oil Co. of
Cal., 140 Ariz. 1, 2 (1984) (“It is also the policy of the court that neither we,
the trial court, nor the court of appeals should be required to perform
counsel’s work by searching the record to attempt to discover facts which
establish or defeat the motion.”). Moreover, nothing that Wife or McIntyre
filed with the court would have provided sufficient evidence to create any
genuine issue of material fact.

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¶14           Wife contends that her opposition to Husband’s petition and
her cross-petition are the equivalent of affidavits, or a controverting
statement of facts, because she verified that they were “true to the best of
her knowledge.” Setting aside whether the filings meet the requirements
of an affidavit under Rule 56(c)(5), the plain text of Rule 56(e) forecloses
Wife’s attempt to convert them into affidavits. After a party properly
moves for summary judgment,

       an opposing party may not rely merely on allegations or denials
       of its own pleading. The opposing party must, by affidavits or
       as otherwise provided in this rule, set forth specific facts
       showing a genuine issue for trial. If the opposing party does
       not so respond, summary judgment, if appropriate, shall be
       entered against that party.

Ariz. R. Civ. P. 56(e) (emphasis added). The rule is clear: A party’s
allegations are insufficient to rebut summary judgment. Allowing Wife’s
filings to stand in as de facto affidavits would require either a contradictory
interpretation of Rule 56(e) or a complete disregard for the clause
prohibiting a party from relying solely on their own pleadings. We cannot
embrace either construction. See Premier Physicians Grp., PLLC v. Navarro,
240 Ariz. 193, 195, ¶ 9 (2016) (explaining that courts “seek to . . . avoid
interpretations that result in contradictory provisions”); State v. Aguilar, 209
Ariz. 40, 47, ¶ 23 (2004) (noting that principles of statutory construction also
apply to court rules).

¶15            Because Wife failed to submit a controverting statement of
facts with numbered paragraphs responding to Husband’s statement, her
memorandum opposing summary judgment failed to create a genuine
dispute of material fact under Rule 56(c)(3).3 Wife’s memorandum, which
included only a brief paragraph titled “Statement of Facts,” contained no
citations to any portion of the record she relied on. Though she did attach
several exhibits, emails, text messages, home valuations, trustee meeting
minutes, and documents discussing the validity of “pure trusts,” she stated
only that she believed the exhibits “may be relevant in this matter.”
Nothing she presented would have rebutted Husband’s Statement of Facts.
Because Wife did not properly respond to Husband’s motion for summary
judgment as required under Rule 56(e), and because the exhibits she

3     Wife also suggests that her cross-petition was “a verified
controverting statement of facts” because it had “separately numbered
paragraphs.” But Wife does not explain how the cross-petition could
controvert a document Husband had not yet filed.

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                        SEMILIA v. SEMILIA, et al.
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provided do not create a genuine issue of material fact, the probate court
correctly based its summary judgment ruling on the facts Husband
presented. See Choisser v. State ex rel. Herman, 12 Ariz. App. 259, 261 (App.
1970) (“[A]n adverse party who fails to respond [to a motion for summary
judgment] does so at his peril because uncontroverted evidence favorable
to the movant, and from which only one inference can be drawn, will be
presumed to be true.”).

       B.     Entitlement to Judgment as a Matter of Law

¶16             Wife’s failure to properly oppose Husband’s motion, by itself,
did not require the court to award him summary judgment. See Schwab v.
Ames Constr., 207 Ariz. 56, 59, ¶ 15 (App. 2004) (“A failure to respond to a
motion for summary judgment with a written memorandum or opposing
affidavits cannot, by itself, entitle the moving party to summary
judgment.”). Summary judgment is still a final judgment on the merits,
Tilley v. Delci, 220 Ariz. 233, 238, ¶ 13 (App. 2009), and the moving party
must carry their burden of showing no genuine disputes of material fact
and entitlement to judgment as a matter of law, Ariz. R. Civ. P. 56(a).

¶17            Wife contends the court ignored genuine disputes of material
fact. She claims the Trust was an alter ego of Husband and was created as
a result of undue influence. However, both claims arise solely from
allegations contained in Wife’s filings, with no link to evidence in the
record. As to the alter ego claim, Wife first raised it in opposition to
Husband’s petition. She claimed that Husband’s use of a kit from a “tax
protestor” was proof he intended the Trust to be a tax shelter, and because
he prepared the meeting minutes every year for the trustees to sign, it was
proof that he controlled the property. She repeated these points verbatim
in her opposition to summary judgment but did not provide any record
evidence in support of those allegations. Likewise, the only “evidence”
Wife provided about undue influence was assertions that Husband used
“extreme pressure” and false promises to persuade her and McIntyre to
become involved with the Trust. These vague assertions, raised more than
20 years after formation of the Trust, lack any factual support in the record.
Thus, they create no genuine dispute as to any material fact.

¶18           Wife also claims that Husband did not establish a factual basis
on whether the Trust was established for a lawful purpose, asserting that
statements in Husband’s own declarations on the point were “self-serving”

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                        SEMILIA v. SEMILIA, et al.
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and “conclusory.” 4 Affidavits “that only set forth ultimate facts or
conclusions of law can neither support nor defeat a motion for summary
judgment.” Florez v. Sargeant, 185 Ariz. 521, 526 (1996) (noting also that
self-serving assertions lacking factual support are not enough to defeat
summary judgment). But the statements Wife takes issue with are neither
conclusory nor devoid of factual support. Husband’s declaration states that
the Trust was created “for the protection of our property and to leave any
property to our children.” The declaration of trust corroborates this
statement, as the couple’s children were named as beneficiaries, and upon
termination of the Trust, its assets would be allocated among the
beneficiaries. Husband’s statements are not conclusory; nor are they void
of support in the record.

¶19             In granting Husband’s motion, the probate court relied on
several tax documents, submitted with a supplemental statement of facts
attached to his reply, to support his position that the Trust did not have any
illicit tax-related purposes. Husband provided documentation from the
Internal Revenue Service showing he did not obtain an Employer
Identification Number for the Trust until 2018. He also avowed that tax
returns for the Trust were subsequently filed. But Wife fails to show how
the delayed filing of tax returns—for an entity that had generated no
income—or the failure to timely obtain an EIN means that the Trust is void
or otherwise unenforceable. Evidence that provides only a scintilla of
doubt as to asserted facts is not enough to defeat summary judgment. Orme
Sch. v. Reeves, 166 Ariz. 301, 309 (1990).

¶20            Finally, Wife challenges whether the couple’s children, who
agreed to remove McIntyre at the 2018 Board meeting, were properly
appointed as trustees. She points to the Trust’s declaration, which states
that “no Beneficiary, as such, shall be empowered to control the TRUSTEES
in any way or dictate management or investment policies to the Trust, or
determine the disbursement of Trust income or corpus.” (Emphasis
added.) In her reading, this language prevents beneficiaries from serving
as trustees in any capacity. But the Trust only prevents beneficiaries, when
acting in that role, from exerting control over trustees. It does not prevent

4      Wife argues the Trust was invalid because she could not notarize the
document under Virginia law and there was an insufficient quorum at the
Board meeting at which the couple’s children became trustees. She also
questions whether the funds from the sale of property in Virginia were
properly used to buy the Arizona home. These arguments are waived
because Wife did not raise them in this court until her reply brief. See
Dawson v. Withycombe, 216 Ariz. 84, 111, ¶ 91 (App. 2007).

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                       SEMILIA v. SEMILIA, et al.
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beneficiaries from serving as trustees. Finally, even if the children were
prohibited from serving as trustees, Wife has not offered any explanation
why that would render the Trust void or unenforceable, or otherwise
disqualify the children from exercising their rights as beneficiaries under
the Trust.

                              CONCLUSION

¶21            We affirm the probate court’s grant of summary judgment
and denial of Wife’s motion to vacate. We deny Husband’s request for
attorneys’ fees, made pursuant to A.R.S. § 14-11004, because the statute
limits recovery of fees to “[a] trustee or a person who is nominated as a
trustee.” As the successful party on appeal, Husband is awarded taxable
costs subject to compliance with ARCAP 21.

                         AMY M. WOOD • Clerk of the Court
                         FILED: AA

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