Court Opinion

ID: 9799266
Source: CourtListenerOpinion
Date Created: 2023-08-31 06:56:53.16159+00
Date Added: 2024-06-11T09:17:53.874475
License: Public Domain

CROTHERS, Justice,
concurring in part and dissenting in part.
[¶ 25] I concur with that part of the majority opinion affirming Betty Wick-lund’s right to an elective share. I respectfully dissent from the remainder of the decision.
[¶ 26] The district court ordered that Betty Wicklund recover $15,414 for payment of funeral expenses. The majority affirms. Unfortunately, there does not appear to be a factual or legal basis to obtain the majority’s result.
[¶ 27] A factual basis is lacking because the expenses were actually paid by Betty Wicklund’s daughter, Sandra Miller, out of Miller’s funds. Yet the majority seems to suggest the expenses were paid by or on behalf of Betty Wicklund and are reimbursable to her under N.D.C.C. §§ 30.1-01-06(40) and 30.1-18-01 as expenditures made by an executor or personal representative. Majority opinion at ¶¶ 10-12.
[¶ 28] Uncontroverted evidence establishes that Betty Wicklund was the personal representative but that she did not pay the expenses. Betty Wicklund did not have funds to pay the expenses, so they were paid by Miller. The district court found, “Betty proved by a preponderance of the evidence the basis for, and the explanation of, the funeral and last illness expenses of $15,414.00 (Exhibit 7), and she is entitled to full reimbursement for them.” Exhibit 7 is an expense summary supported by receipts showing payments by Miller rather than Betty Wicklund.
[¶ 29] The district court and the majority jump over the fact the expenses were paid by Miller and not Betty Wicklund on the theory Miller held Betty Wicklund’s power of attorney. Majority opinion at ¶¶ 10-12. However, that justification is unavailing because the power of attorney provided Miller with authority to act for Betty Wicklund. The power of attorney did not grant Miller lawful authority to act instead of Betty Wicklund. The distinction is meaningful. See Stuber v. Taylor, 200 N.W.2d 276, 280 (N.D.1972) (“A power of attorney creates an agency relationship between the principal, the one conferring the power, and the agent, upon whom the power is conferred. It is not necessary for purposes of this discussion to define the myriad legal implications of a power of attorney. Suffice to say that because it is an agency relationship, the agreement by the agent to act on behalf of the principal causes the agent to be a fiduciary.” (citation omitted)).
[¶ 30] Here, the funeral expenses were paid by Miller out of Miller’s funds. Nothing shows the expenses were paid from Betty Wicklund’s funds or on Betty Wicklund’s behalf. Exhibit 7 proves the opposite. Moreover, Miller never contemporaneously claimed she was acting in a representative capacity. As a result, no facts support a finding that Miller paid the expenses on behalf of Betty Wicklund when Miller was exercising authority under the power of attorney. We therefore are left with the unusual, and I submit untenable, result that Betty Wicklund is being permitted to recover $15,414 that she did not spend, so that Betty Wicklund can reimburse a legal stranger to the estate who spent the money but who did not file a claim against the estate.
*575[¶ 31] This brings us to the legal deficiency in the majority opinion. Section 30.1-19-04, N.D.C.C., requires timely filing of creditor claims, which Miller admittedly did not submit. Miller paid funeral expenses which she had no legal duty to pay. She was neither the executor nor the personal representative of Maurice Wick-lund’s estate. Miller did not expend Betty Wicklund’s funds in Miller’s capacity as Betty Wicklund’s power of attorney, nor did Miller pay the expenses while indicating she was acting in a representative capacity for the estate or Betty Wicklund. Therefore, while the district court’s and the majority’s result is eminently “fair,” I am compelled to conclude we have neither the factual nor the legal basis to support it. Instead, because Miller did not file a creditor’s claim, the result in this case is directed by our holdings in Steen and Berg Co. v. Berg, 2006 ND 86, ¶ 6, 713 N.W.2d 87; Estate of Frandson, 383 N.W.2d 807, 809-10 (N.D.1986).
[¶ 32] I also respectfully dissent from the majority’s holding that Betty Wicklund was properly awarded $53,411.03 for administration costs and attorney fees. Majority opinion at ¶¶ 15-20. The evidence here is that many of Betty Wicklund’s efforts in connection with the estate were dedicated to pursuing recovery of her elective share. I agree she was entitled to that relief. See Estate of Wicklund, 2012 ND 29, 812 N.W.2d 359. However, I would join those jurisdictions cited by the majority that hold recovery of fees and expenses is limited because the efforts depleted rather than increase the estate. See Majority opinion at ¶ 17 and the cases cited therein. I therefore would reverse and remand for determination whether Betty Wicklund was entitled to recover any expenses and fees utilized to discover, recover or preserve estate assets, as distinguished from expenses and fees incurred in efforts to secure her elective share.
[¶ 33] Finally, my substantive disagreements with the majority prevent me from agreeing with their rationale for affirming allocation of $45,000 of post-death income from mineral interests. See Majority opinion at ¶22. The question whether and to what extent an elective share includes a percentage of income received during administration of the estate is complex in its own right. The answer here is complicated because Maurice Wick-lund died domiciled in Michigan while his principal asset was in North Dakota. Therefore, Betty Wicklund’s rights to an elective share must be decided under Michigan law. N.D.C.C. § 30.1-05-01(4) (“The right, if any, of the surviving spouse of a decedent who dies domiciled outside this state to take an elective share in property in this state is governed by the law of the decedent’s domicile at death.”).
[¶ 34] Because I dissent, it is unnecessary and perhaps unwise to extensively predict how this issue would be decided were I writing for the majority, especially given the lack of clear Michigan precedent. I do note however that a majority of jurisdictions hold that income realized by an estate during administration generally is included in an elective share. See Charles C. Marvel, Annotation, Extent of Rights of Surviving Spouse Who Elects to Take Against Will in Profits of or Increase in Value of Estate Accruing After Testator’s Death, 7 A.L.R.4th 989, § 2 (1981) (“[T]here appears to be no controversy that the electing survivor is entitled to share in whatever appreciation of the estate assets is realized between the date of the testator’s death and the date of final distribution.” (footnote omitted)).
[¶ 35] The general rule discussed in the annotation appears sprinkled with nuanced applications. For instance, a different ar-*576tide is dedicated to discussing how to calculate, and what charges are properly deducted from, an augmented estate. See John P. Ludington, Annotation, Determination of, and charges against, “augmented estate” upon which share of spouse electing to take against will is determined under Uniform Probate Code § 2-202, 63 A.L.R.4th 1173 (1988). Also, in Green v. Nassif, 426 Md. 258, 44 A.3d 321, 336 (2012), the court distinguished between an elective spouse receiving her statutory share in kind who is entitled to receive a proportionate amount of the appreciated assets, while an elective spouse opting for cash is limited to her percentage of the estate value on the date of election. The court in In re Estate of Jenkins, 8 S.W.3d 277, 286-288 (Tenn.Ct.App.1999), held the surviving wife’s elective share included income generated by the decedent’s property prior to distribution unless that income was attributable to an intellectual property asset that was sold during administration.
[¶ 36] For present purposes, it is sufficient to conclude that on remand I would require following the general rule to calculate the augmented estate. That calculation would include adding back the funeral expenses and whatever sums the district court finds Betty Wicklund did not expend to discover, recover or preserve estate assets, as distinguished from expenses and fees incurred in efforts to secure her elective share.
[¶ 37] Daniel J. Crothers