Court Opinion

ID: 2782834
Source: CourtListenerOpinion
Date Created: 2015-02-27 13:04:23.107534+00
Date Added: 2024-06-11T12:09:10.053900
License: Public Domain

STATE OF MICHIGAN

                              COURT OF APPEALS

In re STANLEY A. SENEKER TRUST.

MARCELLA SENEKER,                                                   UNPUBLISHED
                                                                    February 26, 2015
               Appellant,

v                                                                   Nos. 317003 & 317096
                                                                    Oakland Probate Court
JP MORGAN CHASE BANK, N.A., Trustee of                              LC No. 2013-348544-TV
the STANLEY A. SENEKER TRUST, STEPHEN
A. SENEKER, MICHAEL J. SENEKER, MARK
G. SENEKER, SARAH M. SENEKER, ANNE E.
DUNLOP, and MARY M. LYNEIS, Successor
Trustee of the STANLEY A. SENEKER TRUST,

               Appellees,

and

LINDA MENNA and MARCELLA LINAHAN,

               Intervenors.

Before: DONOFRIO, P.J., and FORT HOOD and SHAPIRO, JJ.

PER CURIAM.

        In these consolidated appeals, appellant, Marcella Seneker, appeals as of right from the
probate court’s orders holding that it had subject-matter jurisdiction over a trust created by
Stanley A. Seneker and granting a petition for limited supervision to allow the trustee to change
the situs of the trust, remove JP Morgan Chase Bank, N.A., as trustee, and appoint Mary M.
Lyneis as successor trustee. Because the trial court erred in concluding that it had subject-matter
jurisdiction over this case, we reverse.

       The decedent, Stanley A. Seneker, established the Stanley A. Seneker Trust Agreement
(the Trust), dated August 14, 1974. Appellees, the children of Stanley, are named trust
beneficiaries as is appellant, Stanley’s surviving spouse. The Trust was amended on multiple
occasions, in part to account for the Stanley’s marriage to appellant. Stanley had been a resident

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of Florida for approximately 17 years at the time of his death in 2012. Following a dispute
regarding the terms of the Trust, appellees filed a petition in the Oakland County Probate Court
seeking interpretation and instruction of the Trust, as well as removal of JP Morgan Chase Bank,
N.A. (JP Morgan), the successor trustee upon Stanley’s death. Appellant filed a limited
appearance to challenge the probate court’s exercise of jurisdiction, claiming that the principal
place of administration of the Trust was in Florida. The probate court granted the request to
remove JP Morgan as trustee and appoint Mary M. Lyneis as the successor trustee. With regard
to the issue of subject-matter jurisdiction, counsel for appellant argued at the hearing that Florida
statutory law controlled, and the principal place of administration of the trust was not
appropriately removed to Michigan. The probate court held that it had subject-matter
jurisdiction.

        Appellant argues that the probate court erred by concluding that it had subject-matter
jurisdiction.1 We agree.

        “Subject matter jurisdiction in particular is defined as the court’s ability to exercise
judicial authority over that class of cases; not the particular case before it but rather the abstract
power to try a case of the kind or character of the one pending.” Campbell v St John Hosp, 434
Mich. 608, 613-614; 455 NW2d 695 (1990) (citation and internal quotations omitted). “When a
court is without jurisdiction of the subject matter, any action with respect to such a cause, other
than to dismiss it, is absolutely void.” Fox v Bd of Regents, 375 Mich. 238, 242; 134 NW2d 146
(1965). The plaintiffs, in this case, appellees, bear the burden of establishing subject-matter
jurisdiction. Phinney v Perlmutter, 222 Mich. App. 513, 521; 564 NW2d 532 (1997). “Probate
courts are courts of limited jurisdiction. Const 1963, art 6, § 15. The jurisdiction of the probate
court is defined entirely by statute.” In re Wirsing, 456 Mich. 467, 472; 573 NW2d 51 (1998).

        Appellees point out that MCL 700.7203(1) grants Michigan probate courts broad and
exclusive jurisdiction over “proceedings in this state brought by a trustee or beneficiary that
concern the administration of a trust . . . .” However, MCL 700.7205(1) provides that, “[i]f a
party [such as appellant in this case] objects, the court shall not entertain a proceeding under
[MCL 700.7203] that involves a trust that is registered or that has its principal place of
administration in another state[.]”2 (Emphasis added). Appellant argues, and we agree, that the
Trust’s principal place of administration is in Florida and, therefore, the Michigan probate court
was without subject-matter jurisdiction over appellees’ petition.

       Under both Michigan and Florida trust law, a trust’s “principal place of administration” is
defined as the trustee’s usual place of business, or if the trustee has no such place of business, his

1
 “[W]hether a court has subject-matter jurisdiction is a question of law reviewed de novo.” Elba
Twp v Gratiot Co Drain Comm’r, 493 Mich. 265, 278; 931 NW2d 204.
2
  MCL 700.7205(1)(a) and (1)(b) provide two exceptions to this provision. Subsection (1)(a)
applies where “[a]ll appropriate parties could not be bound by litigation in the courts of [Florida]
and subsection (1)(b) applies where “[t]he interests of justice would otherwise be seriously
impaired.” We conclude that neither exception applies in this case.

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residence. FSA 736.0108(2); MCL 700.7209(1). Appellant does not dispute that, at the time the
Trust was created in 1974, Stanley, as the sole trustee, resided in Michigan and, therefore, the
principal place of administration of the trust was in Michigan. In July 1997, however, Stanley
amended and completely restated the Trust. By this time, Stanley had become a resident of
Florida, as stated in the preamble to the restated 1997 Trust, which refers to “STANLEY A.
SENEKER, of Naples, Florida.” This amendment and restatement was prepared, executed,
witnessed, and notarized in Florida, where, at the time, both Stanley and appellant resided.
Stanley remained the sole trustee and, therefore, the principal place of administration of the Trust
was relocated to Florida. Subsequent to this occurrence, Stanley amended the Trust on multiple
occasions prior to his death in 2012. Each amendment took place entirely in Florida, where
Stanley continued to reside, and retained Stanley as the sole trustee. The Trust did not explicitly
specify a principal place of administration and appellees do not contend that Stanley had a “usual
place of business” in any other jurisdiction during the relevant times. Thus, at the time of
Stanley’s death, the principal place of administration of the Trust was in Florida.

        Appellees assert, however, that as successor trustee upon Stanley’s death, JP Morgan
validly transferred the principal place of administration of the Trust to Michigan, thus providing
the Michigan probate court with subject-matter jurisdiction.3

       The provision of the Trust (the ninth and final amendment) concerning the transfer of the
principal place of administration provides in relevant part:

               Changing Situs of Trust. The TRUSTEE shall have the power to transfer
       or relocate the Trust’s principal place of administration and the situs of the
       property of any trust created under this Agreement to another county or state or to
       a jurisdiction outside of the United States. If necessary, the TRUSTEE may
       commence appropriate judicial proceedings to effectuate a transfer of situs. . . .

Appellant does not contend that JP Morgan was completely without authority to transfer the
principal place of administration. Rather, appellant asserts that JP Morgan was required to
comply with FSA 736.0108(6) and (7), which require that a trustee seeking to transfer provide
notice to all qualified beneficiaries and suspends the trustee’s authority to transfer should one of
those beneficiaries object within 60 days.4 JP Morgan did not provide such notice in this case.

3
 “We review de novo the proper interpretation of a trust.” In re Stan Estate, 301 Mich. App. 435,
442; 839 NW2d 498 (2013). Issues of statutory interpretation are also reviewed de novo. Id.
       4
           FSA 736.0108 provides in relevant part:

                (6) The trustee shall notify the qualified beneficiaries of a proposed
       transfer of a trust’s principal place of administration not less than 60 days before
       initiating the transfer. The notice of proposed transfer must include:

              (a) The name of the jurisdiction to which the principal place of
       administration is to be transferred.

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Appellees argue that such notice was not required because the above provision of the Trust
trumped the notice requirements of FSA 736.0108(6) and (7).

        “When interpreting a trust, the [] court’s objective is to ascertain and give effect to the
intent of the settlor. The intent of the settler is to be carried out as nearly as possible.” Stan
Estate, 301 Mich. App. at 442 (quotation marks and citation omitted). As appellees note, the
requirements of FSA 736.0108(6) and (7) are not always mandatory and only apply “[e]xcept as
otherwise provided in the terms of the trust[.]” FSA 736.0105(1). See also FSA 736.0105(2)(f).
Thus, we are charged with determining whether Stanley intended that the above Trust provision
should override the notice provisions of FSA 736.0108(6) and (7). We conclude that he did not.

        First, as discussed, the notice requirements apply “except as otherwise provided” in the
Trust and there is no language in the ninth and final amendment of the Trust explicitly providing
that the requirements did not apply. Second, the final version of the Trust modified the provision
that appellees rely upon as controlling. Specifically, an earlier version of the Trust stated that the
trustee could maintain the situs of the property of the Trust and transfer the situs at any time “in
the Trustee’s absolute discretion.” (Emphasis added). Stanley’s removal of this language in the
final version of the Trust demonstrates an intent to limit the discretion of the trustee in
transferring the principal place of administration so that said discretion would no longer be
“absolute.” Third, Stanley clearly contemplated that a transfer might require the resort to judicial
process, as evidenced by the language, “If necessary, the TRUSTEE may commence appropriate
judicial proceedings to effectuate a transfer of situs.”5 Fourth, although not dispositive, we note
that in the ninth amendment of the Trust, Stanley changed the Trust’s definition of “state” from
Michigan to Florida and included a provision stating, “This agreement shall be governed by and

               (b) The address and telephone number at the new location at which the
       trustee can be contacted.

               (c) An explanation of the reasons for the proposed transfer.

               (d) The date on which the proposed transfer is anticipated to occur.

               (e) The date, not less than 60 days after the notice is provided, by which
       the qualified beneficiary must notify the trustee of an objection to the proposed
       transfer.

               (7) The authority of a trustee to act under this section without court
       approval to transfer a trust’s principal place of administration is suspended if a
       qualified beneficiary files a lawsuit objecting to the proposed transfer on or before
       the date specified in the notice. The suspension is effective until the lawsuit is
       withdrawn.

5
  While this clause was contained in earlier amendments of this provision, it does not alter the
fact that Stanley contemplated that judicial process might be necessary to transfer the principal
place of the Trust’s administration.

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construed in accordance with the law of the State, as defined above . . . .” Thus, based on the
language of the relevant Trust provision and the surrounding circumstances, we conclude that the
relevant Trust provision did not override JP Morgan’s responsibility to comply with the notice
requirements of FSA 736.0108(6) and (7) prior to transferring the Trust’s principal place of
administration to Michigan.

       In sum, at the time of Stanley’s death, the principal place of administration of the Trust
was in Florida and JP Morgan, as successor trustee, was not allowed to transfer that principal
place of administration without complying with the requirements of FSA 736.0108(6) and (7).
Thus, the trial court was without subject-matter jurisdiction to entertain appellees’ petition under
MCL 700.7205. Accordingly, the probate court’s conclusion to the contrary is reversed,
rendering all its subsequent rulings in this case void. See Fox, 375 Mich. at 242.

       Reversed.

                                                             /s/ Pat M. Donofrio
                                                             /s/ Karen Fort Hood
                                                             /s/ Douglas B. Shapiro

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