Court Opinion

ID: 4416077
Source: CourtListenerOpinion
Date Created: 2019-07-12 00:50:59.20523+00
Date Added: 2024-06-11T14:51:35.811619
License: Public Domain

NO. 12-18-00026-CV

                             IN THE COURT OF APPEALS

               TWELFTH COURT OF APPEALS DISTRICT

                                           TYLER, TEXAS

 SUSAN R. WALDRON,                                         §        APPEAL FROM THE 241ST
 APPELLANT

 V.
                                                           §        JUDICIAL DISTRICT COURT
 SUSAN R. WINKING TRUST AND
 RAYMOND W. COZBY, III,
 APPELLEES                                                 §        SMITH COUNTY, TEXAS

                                       MEMORANDUM OPINION
       This is a dispute between Susan R. Waldron, the Susan R. Winking Trust (the Trust), and
Raymond W. Cozby, III, the trustee of the Trust, regarding the appointment of a successor trustee.
We affirm.

                                                 BACKGROUND
       Waldron is the beneficiary of the Trust created by her parents. The trustee appointed by
the grantors resigned. The substitute trustee named in the trust instrument, Southside Bank,
declined to serve.
       Article 4.2 of the Trust reads:

       Successor. If the original trustee fails or ceases to serve for any reason, then Southside Bank, Tyler,
       Texas, shall be successor trustee. If this or any other successor trustee fails or ceases to serve for
       any reason, then any bank or trust company may be appointed successor trustee by delivery of
       written notice to the successor trustee signed by the grantor, or if either grantor is legally disabled
       or deceased, then signed by the other grantor, or if both grantors are legally disabled or deceased,
       then signed by the beneficiary, or the beneficiary’s attorney-in-fact or legal guardian. Each separate
       trust may have a different trustee.

The Trust requires the successor trustee to be a bank or trust company. When Waldron’s sister,
Amy, resigned, the successor trustee named in the trust instrument, Southside Bank, declined to
serve. Waldron could not find a bank or trust company willing to serve. The Trust made no
provision for the appointment of an individual as a successor trustee. On September 12, 2016,
Waldron filed an Application for Appointment of Successor Trustee asking the district court to
appoint Cozby as successor trustee. The trial court appointed Cozby by order signed September
15, 2016.
       On May 19, 2017, Waldron filed a pro se Application for Appointment of a Successor
Trustee asking the court to appoint her as trustee. She alleged that Cozby refused to resign and
that as a result of his conduct she “will be forced to relocate to Tyler, Texas, as my permanent
residence next week bereft, homeless, penniless and needlessly in danger.” The trial court set a
hearing on her motion for July 13, 2017.
       On May 26, 2017, Waldron filed a Request to Have Emergency Hearing in and Immediate
Transfer to Probate Court. On June 7, she filed a Motion to Amend Withdraw Plaintiff’s
Application for Appointment as Successor Trustee and Request for Hearing and Cancel Hearing
Set for July 13, 2017 and Reinstate Request for Emergency Hearing. In her motion, she told the
court that her motion to open the probate case had been denied. She levelled multiple additional
complaints against Cozby.
       On June 22, Cozby filed a response to Waldron’s motion to amend. Cozby stated therein,
“Trustee is willing to resign and/or has no objection to his removal upon appointment of a qualified
trustee as provided for in the Trust or as otherwise determined by the Court.” He asked for a
declaratory judgment and requested a finding that he complied with the Trust’s terms, that he be
removed or allowed to resign, that an appropriate successor trustee be appointed, and that he be
discharged from any further liability.
       Waldron filed a motion again asking the court to appoint her as trustee and requesting the
cancellation of a hearing set for August 31, 2017. She recounted numerous complaints against
Cozby and his attorney, Michael Coker. Next, she filed a “Request for Criminal Investigation,
Motion to appoint Susan R. Waldron Successor Trustee and Cancel Hearing Set for August 31,
2017” in which she reiterated her complaints against Cozby and Coker. The trial court set a hearing
for November 9, 2017.
       On November 16, following a hearing, the trial court signed a judgment stating that
Waldron would have until December 15 to recommend a qualified successor trustee. The court

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also granted the relief Cozby sought. On December 12, Waldron filed an Application for
Appointment of Successor Trustee asking that the court appoint Catherine E. Seibert trustee.
        On December 15, Waldron filed a Motion for New Trial maintaining that the court erred
in ignoring the trust language that states a trustee can be terminated immediately. She further
contended the trial court erred in “placing the terminated trustee and his attorney in charge of
selecting the successor trustee and by awarding attorney fees in an unknown amount.”
        Cozby then filed an Application for Resignation of Trustee and Appointment of Successor
wherein he agreed to Seibert’s appointment.           Seibert signed a Notice of Appearance and
Acceptance on December 29.
        On February 23, 2018, the trial court signed a judgment in favor of Cozby approving the
appointment of Seibert and approving Cozby’s compensation. Waldron filed a notice of appeal
and an affidavit of inability to pay costs.
        On March 7, Cozby filed a motion for new trial advising the court that, prior to judgment,
he anticipated an additional evidentiary hearing. He also informed the court that he filed a motion
to abate the appeal in this court.
        On March 29, this court issued a per curiam order finding the orders theretofore entered
were not final appealable orders and stating our lack of authority to determine Waldron’s ability
to pay costs. In that order, we abated the appeal and remanded the matter to the trial court.
        The trial court held a bench trial on June 21, 2018. After the presentation of evidence, the
trial court found that the final accounting provided for the Trust fairly and accurately set forth the
Trust’s assets, liabilities, income, and expenses and the court approved it. The trial court further
found that Cozby administered the Trust in accordance with its terms and the applicable law and
was not liable to Waldron on any claims. The judgment appointed Seibert as successor trustee,
her term to begin ten days after the judgment became final or all appeals exhausted, whichever
was later. The trial court also found that all expenses and professional fees paid or incurred by
Cozby were reasonable and necessary. The trial court found that Waldron was not indigent and
awarded appellate fees as requested.

                                      TRIAL COURT FINDINGS
        In her first issue, Waldron contends the trial court erred in ignoring Article 4.3 of the Trust
which provides that the beneficiary may terminate a trustee immediately, without cause, by written

                                                  3
letter if both grantors are legally disabled or deceased. Under this issue, she also claims the trial
court erred in excluding evidence of her termination letter to Cozby. In her second issue, she
maintains that the trial court erred in reappointing Cozby and “appointing the terminated trustee
and his attorney to act on behalf of the Vourt and gave the terminated trustee complete authority
to investigate and approve or disapprove the successor trustee.”
Applicable Law
       The terms of the trust prevail over any provision of the Texas Trust Code with certain
exceptions which are not applicable in this case. TEX. PROP. CODE ANN. § 111.0035(b) (West
2014). The Trust Code provides that the district court has “original and exclusive jurisdiction over
all proceedings by or against a trustee and all proceedings concerning trusts. . ..” Id. § 115.001
(West Supp. 2018). In this case, the Trust provided that the beneficiary could terminate a trustee
by letter and appoint a successor bank or trust company that was willing to serve. But no bank or
trust company was willing to serve. Therefore, the trust instrument did not provide a procedure
for the appointment of a successor trustee under these circumstances. In such situation, the Trust
Code provides that “[i]f for any reason a successor is not selected under the terms of the trust
instrument, a court may and on the petition of any interested person shall appoint a successor in
whom the trust shall vest.” Id. § 113.083(a) (West 2014). A trustee’s fiduciary duties are not
discharged until the trustee has been replaced by a successor trustee. Ashmore v. N. Dallas Bank
& Trust, 804 S.W.2d 156, 159 (Tex. App.—Dallas 1990, no writ) (citing Republic Nat’l Bank &
Trust Co. v. Bruce, 130 Tex. 136, 139-40, 105 S.W.2d 882, 884-85 (1937)).
Discussion
       Waldron contends that she can remove the trustee at any time by written letter. In her view,
Cozby was no longer trustee after the receipt of her termination letter. Therefore, he was not
thereafter entitled to claim reimbursement from the Trust for expenses or professional services.
Although Article 4.3 of the Trust provides for termination by letter, Article 4.2 requires that any
successor trustee be a bank or trust company. Since no bank or trust company could be found that
was willing to serve, Waldron could not appoint a successor and her attempt at removal by letter
without naming a bank or trust company as successor was ineffective. The only procedure
available for the trustee’s replacement under these circumstances was by petition to the district
court for the appointment of a trustee. TEX. PROP. CODE ANN. § 113.083(a). Although ready and
willing to be replaced, Cozby, as trustee, was obligated to continue in the performance of his duties

                                                 4
until replaced by a successor trustee. See Ashmore, 804 S.W.2d at 159. The trial court correctly
interpreted the trust instrument and correctly applied the pertinent provisions of the Texas Trust
Code. The trial court’s judgment is supported by the evidence.
       Regarding Waldron’s claims that the trial court erred in excluding evidence of her letter of
June 2017 to Cozby attempting to terminate his trusteeship, we can find no record that she
attempted to introduce the letter into evidence. Thus, the record does not demonstrate that the trial
court excluded evidence of the letter.
       Waldron also cites several undisputed principles of trust law regarding the duties of trustee.
But nowhere in her argument does she relate these general propositions to the case at hand or
demonstrate how they support her contention that she had a right to terminate Cozby by letter or
that the court erred in appointing Cozby. See TEX. R. APP. P. 38.1(i) (appellant’s brief must contain
clear and concise argument for the contentions made, with appropriate citations to authorities).
       In her argument, Waldron complains generally that because of the trial court’s rulings, her
“rights have been effectively obstructed and tremendous loss of time and damage has occurred to
both the appellant and the Susan R. Winking Trust.” Waldron’s aim was to replace Cozby as
trustee of the Trust. The unnecessary delay and consequent extra expenses in the appointment of
a successor trustee were not caused by the court or the trustee, but by Waldron herself. Waldron
filed numerous motions and requested hearings, only to move for their postponement. Further
delay resulted from a pointless and unsuccessful effort to move the case to the probate court. She
failed to attend a properly scheduled deposition. In her pleadings she made numerous accusations
of misconduct, but she produced no evidence to substantiate them. Accordingly, for the above
reasons, Waldron’s first issue is overruled.
       With respect to Waldron’s second issue, Cozby was appointed at her request. He was not
reappointed. The court never appointed Cozby and his lawyer “to act on behalf of the court.” Nor
did the court give Cozby “complete authority to investigate and improve or disapprove the
successor trustee.” Nothing in the record supports these claims. See TEX. R. APP. P. 38.1(i). Thus,
Waldron’s second issue is overruled.

                                           DISPOSITION
       We have overruled both of Waldron’s issues. The judgment is affirmed.

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                                                                               BILL BASS
                                                                                Justice

Opinion delivered July 10, 2019.
Panel consisted of Worthen, C.J., Hoyle, J., and Bass, Retired J., Twelfth Court of Appeals, sitting by assignment.

                                                   (PUBLISH)

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                                   COURT OF APPEALS

      TWELFTH COURT OF APPEALS DISTRICT OF TEXAS

                                           JUDGMENT

                                             JULY 10, 2019

                                          NO. 12-18-00026-CV

                            SUSAN R. WALDRON,
                                  Appellant
                                     V.
             SUSAN R. WINKING TRUST AND RAYMOND W. COZBY, III,
                                 Appellees

                                 Appeal from the 241st District Court
                          of Smith County, Texas (Tr.Ct.No. 16-1880-C)

                       THIS CAUSE came to be heard on the appellate record and briefs filed
herein, and the same being considered, it is the opinion of this court that there was no error in the
judgment.
                       It is therefore ORDERED, ADJUDGED and DECREED that the judgment
of the court below be in all things affirmed, and that all costs of this appeal are hereby adjudged
against the Appellant, SUSAN R. WALDRON, for which execution may issue, and that this
decision be certified to the court below for observance.
                    Bill Bass, Justice.
                    Panel consisted of Worthen, C.J., Hoyle, J., and Bass, Retired J., Twelfth Court of Appeals,
                    sitting by assignment.