Court Opinion

ID: 3004848
Source: CourtListenerOpinion
Date Created: 2015-09-25 19:10:18.706696+00
Date Added: 2024-06-11T15:03:03.043311
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
                          AT KNOXVILLE
                                 June 29, 2015 Session

                    IN RE ESTATE OF VIDA MAE MCCARTT

                Appeal from the Chancery Court for Morgan County
                  No. P-6-12   Frank V. Williams, III, Chancellor

           No. E2014-02185-COA-R3-CV-FILED-SEPTEMBER 25, 2015

This case involves an agreement among most of the heirs of Vida Mae McCartt
(Decedent) regarding the distribution of the assets of her estate. After Decedent’s will
was admitted to probate, five of her grandchildren filed an action to contest its validity.
Following mediation, the grandchildren and Decedent’s three living children entered into
a settlement agreement, which the trial court approved and incorporated into an agreed
order distributing the assets of the estate. Thereafter, Sara Shannon Armes, the daughter
of Decedent’s deceased son, J.D. McCartt, Sr., brought this action alleging that she was
entitled to a share of the estate under the terms of the agreed order. Armes, who was not
a party to the settlement agreement, also alleged that her siblings perpetrated a fraud by
representing to the court that J.D. McCartt, Sr. had only three children and heirs at law
when he actually had four, including Armes. The trial court granted the defendants’
Tenn. R. Civ. P. 12.02(6) motion to dismiss for failure to state a claim upon which relief
could be granted. We vacate the judgment of the trial court and remand for further
proceedings.

      Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
                            Vacated; Case Remanded

CHARLES D. SUSANO, JR., C.J., delivered the opinion of the Court, in which D. MICHAEL
SWINEY and THOMAS R. FRIERSON, II, JJ., joined.

Robert W. Wilkinson, Oak Ridge, Tennessee, for the appellant, Sara Shannon Armes.

David H. Dunaway, LaFollette, Tennessee, for the appellees, Kelly McCartt, Joe
McCartt, Nancy McCartt Wilson, and Susan McCartt Collins.

Joseph H. Van Hook, Oliver Springs, Tennessee, for the appellees, G.M. McCartt and
Betty Jane McCartt Newman.
                                            1
Jack H. McPherson, Jr., Kingston, Tennessee, Administrator CTA for the estate of Vida
Mae McCartt.

                                         OPINION

                                              I.

       On February 2, 2012, Decedent died testate at the age of 102. Decedent had five
children: Betty Jane McCartt Newman, Mary Elizabeth McCartt Sanders, G.M. McCartt,
A.K. McCartt, and J.D. McCartt, Sr. When she executed her will on May 18, 1994, her
son, A.K. McCartt, was deceased. The will bequeathed $5,000 to each of the two
children of A.K. McCartt, i.e., Kelly McCartt and Ginger McCartt West. To J.D.
McCarrt, Sr., who died after the will was executed, the will bequeathed a mobile home
and pickup truck. The remainder of Decedent’s property, including real estate holdings
worth more than $1,000,000,1 was split evenly among her three surviving children.

       On February 23, 2012, a will contest action was filed by these five grandchildren:
Kelly McCartt and Ginger McCartt West, children of the deceased A.K. McCartt; and
Susan Collins, Nancy Wilson, and Joe McCartt, children of the deceased J.D. McCartt,
Sr. (collectively, the contestants). The contestants alleged, among other things, as
follows:

              That on or about February 14, 2012, a paper writing
              purporting to be the Last Will and Testament of Vida Mae
              McCartt, deceased, was admitted to probate in common form
              at the instance of GM McCartt, who being named the
              executor therein, took out letters testamentary.

              The legatees and devisees under said writing are:

                     GM McCartt
                     Betty Jane McCartt Newman
                     Mary Elizabeth McCartt Sanders
                     Kelly McCartt
                     Ginger West
                     JD McCartt Sr. (deceased survived by the [sic]
                     Susan Collins, Nancy Wilson and Joe McCartt)

       1
         The order admitting the will to probate states that “decedent owned personal and real
property in Tennessee at her death . . . worth approximately $1,651,000.00.”
                                              2
             Plaintiffs assert that said instrument is not the Last Will and
             Testament of Vida Mae McCartt, deceased, because she was
             . . . of unsound mind at the time said paper was executed and
             she was incompetent to make a valid Will. Moreover, Vida
             Mae McCartt, was unduly influenced to make the Last Will
             and Testament by GM McCartt.

                                    *      *      *

             [The contestants] are the grandchildren of Vida Mae McCartt,
             deceased. If the purported Last Will and Testament is not the
             valid Last Will [and] Testament of Vida Mae McCartt, then
             [contestants] will share proportionately in all real estate
             owned by Vida Mae McCartt.

(Numbering in original omitted.)

       On November 20, 2012, the trial court entered an agreed order distributing the
assets of the estate and stating in pertinent part as follows:

             [T]he parties . . . participated in mediation on September 24,
             2012 and executed an agreement resolving all issues between
             the parties. The mediated agreement has been filed with the
             Court and is incorporated herein by reference.

                                    *      *      *

             [T]he real properties which were vested in Vida Mae McCartt
             as of the death of J.H. McCartt in 1989 are vested in the
             parties as tenants in common in the following proportion:

                    Betty Jane Newman 1/5
                    Mary Elizabeth Sanders 1/5
                    GM McCartt 1/5
                    The heirs of A.K. McCartt (Kelly McCartt &
                    Ginger McCartt) 1/5
                    The heirs of JD McCartt (Joe McCartt, Susan
                    Collins & Nancy Wilson) 1/5

                                    *      *      *
                                           3
[A]ll deeds which were executed by or on behalf of Vida Mae
McCartt transferring parcels of real property to GM McCartt,
Betty Jane Newman, and Mary Elizabeth Sanders, are hereby
set aside. G.M. McCartt, Betty Jane Newman and Mary
Elizabeth Sanders shall execute deeds vesting title in these
parcels of real property in the parties as tenants in common in
the following proportion:

      Betty Jane Newman 1/5
      Mary Elizabeth Sanders 1/5
      GM McCartt 1/5
      The heirs of A.K. McCartt (Kelly McCartt &
      Ginger McCartt) 1/5
      The heirs of JD McCartt (Joe McCartt, Susan
      Collins & Nancy Wilson) 1/5

                       *      *      *

That all assets of the estate shall be divided in equal shares
among the parties in the following proportion:

      Betty Jane Newman 1/5
      Mary Elizabeth Sanders 1/5
      GM McCartt 1/5
      The heirs of A.K. McCartt (Kelly McCartt &
      Ginger McCartt) 1/5
      The heirs of JD McCartt (Joe McCartt, Susan
      Collins & Nancy Wilson) 1/5

                       *      *      *

[F]rom the net proceeds payable to GM McCartt and Betty
Jane Newman as their proportionate share of real property
sold at auction, the sum of $65,000.00 shall be withheld from
their net proceeds and paid over to Mary Elizabeth Sanders,
the heirs of AK McCartt and the heirs of JD McCartt, as
follows:

      Mary Elizabeth Sanders      $15,000.00
      AK McCartt Heirs            $25,000.00
                              4
                    JD McCartt Heirs             $25,000.00

                                      *      *      *

             [I]f any claims are filed by individuals asserting an interest as
             an illegitimate child of JD McCartt, then the heirs of JD
             McCartt agree to indemnify and hold harmless all other heirs
             of Vida Mae McCartt from any claims which may be pursued
             by purported heirs at law of JD McCartt.

(Numbering in original omitted.)

       On November 4, 2013, Armes filed the complaint in the instant action, alleging in
pertinent part as follows:

             On February 23, 2012 a Complaint to Contest Will was filed
             with this honorable Court in behalf of several of the
             decedent’s grandchildren. In the Complaint, it is asserted that
             J. D. McCartt, Sr., one of Vida Mae McCartt’s children,
             predeceased his mother and left surviving him three (3)
             children, Susan Collins, Nancy Wilson, and Joe McCartt. In
             fact, J. D. McCartt had four (4) children, one of whom is Sara
             Shannon Armes.

             Pursuant to Final Order dated December 7, 2004, in the
             matter styled In re: Estate of Joseph D. McCartt, docket
             number P-14-02, this honorable Court determined that Sara
             Hickman (now Sara Armes) is the daughter of Joseph D.
             McCartt. A copy of the Final Order is attached hereto and
             made a part hereof. Further, pursuant to Final Settlement of
             Administrator dated March 1, 2005, Sara Hickman (now Sara
             Armes) was entitled to a child’s share of the residuary estate
             of her father, equal to that of Susan V. Collins, Joseph D.
             McCartt, Jr., and Nancy K. McCartt.

             On November 20, 2012 an Agreed Order was entered in this
             cause of action which approved and incorporated a mediated
             agreement. This Agreement resolved the issues between the
             parties relative to the will contest and determined that the
             heirs of J. D. McCartt should receive a twenty percent (20%)
             interest in certain liquid assets . . . and certain specified real
                                             5
             property from the Estate of Vida Mae McCartt, deceased.
             The heirs of J. D. McCartt are listed as Joe McCartt, Susan
             Collins, and Nancy Wilson.

             Sara Shannon Armes avers that she, by law, should be
             included as an heir of J. D. McCartt and therefore entitled to
             one-fourth (1/4) of the distribution of assets passing to the
             heirs of J. D. McCartt.

             Sara Shannon Armes further avers that Joe McCartt, Susan
             Collins, and Nancy Wilson have perpetrated a fraud on this
             honorable Court by asserting that J. D. McCartt had only
             three (3) heirs-at-law when each and every one of them knew
             that J. D. McCartt had four (4) heirs-at-law.

             PREMISES      CONSIDERED,                        PETITIONER
             RESPECTFULLY REQUESTS

                                     *      *      *

             That upon a hearing in this cause, this Court determine that
             Sara Armes is entitled to receive an equal share of the
             distribution of assets passing to the heirs of J. D. McCartt
             from the estate of Vida Mae McCartt.

             Further that the Court award damages to Petitioner as a result
             of the fraud of Joe McCartt, Susan Collins, and Nancy
             Wilson.

(Numbering omitted; italics and capitalization in original.) Attached to the complaint
was a copy of the final order of the Morgan County Chancery Court in the matter of J.D.
McCartt’s estate, entered on December 8, 2004, stating:

             This cause came to be heard . . . upon the Petition for Elective
             Share filed by [Armes], the Answer filed in behalf of the
             estate [of J.D. McCartt, Sr.], the testimony of witnesses, [and]
             the Parentage Testing Report from Molecular Pathology
             Laboratory Network, Inc., a copy of which is attached hereto
             and made a part hereof, and the record as a whole from all of
             which the Court finds as follows:

                                            6
             Based on the proof introduced in this cause, the Court is of
             the opinion that [Armes] is the daughter of the decedent, J. D.
             McCartt.

The results of the DNA test referenced by the court’s order established a 99.9586%
probability that Armes is the daughter of J.D. McCartt, Sr.

       The contestants filed a motion to dismiss Armes’ complaint for failure to state a
claim upon which relief could be granted, pursuant to Tenn. R. Civ. P. 12.02(6), in which
they asserted,

             The Complaint should be dismissed on the basis [of] Res
             Judicata. The original litigation is a will contest and an In
             Rem proceeding. A Final Order has been entered and it is a
             conclusive adjudication upon all heirs; and Sara Shannon
             Armes is bound[] by the ruling.

             At best, any claim of Sara Shannon Armes is limited to the
             next of kin of J.D. McCartt and has no impact, whatsoever,
             and fails to state a claim as to any other heirs, other than Joe
             McCartt, Susan Collins and Nancy Wilson; and it fails to state
             a claim even as to those three heirs.

(Italics in original.) Betty Jane Newman and G.M. McCartt also filed a motion to
dismiss, arguing that “Armes’ lawsuit is in the nature of a lawsuit to contest the will; or
more specifically the probation of the will,” and because “Armes did not join in the
original lawsuit to contest the will, (which she should have under the law), she is bound
by the ruling in the previous lawsuit, and her current petition must fail, and must be
dismissed.”

       The trial court granted the respective motions. In the order, the court stated only
that “the complaint is dismissed for failure to state a cause of action upon which relief
can be granted.” Armes timely filed a notice of appeal.

                                            II.

                                            7
       The issue presented is whether the trial court correctly dismissed the complaint
under Tenn. R. Civ. P. 12.02(6) for failure to state a claim upon which relief could be
granted. Our standard of review is as stated by the Supreme Court:

              A Rule 12.02(6) motion challenges only the legal sufficiency
              of the complaint, not the strength of the plaintiff’s proof or
              evidence. The resolution of a 12.02(6) motion to dismiss is
              determined by an examination of the pleadings alone. A
              defendant who files a motion to dismiss admits the truth of all
              of the relevant and material allegations contained in the
              complaint, but asserts that the allegations fail to establish a
              cause of action.

              In considering a motion to dismiss, courts must construe the
              complaint liberally, presuming all factual allegations to be
              true and giving the plaintiff the benefit of all reasonable
              inferences. A trial court should grant a motion to dismiss
              only when it appears that the plaintiff can prove no set of
              facts in support of the claim that would entitle the plaintiff to
              relief. We review the trial court’s legal conclusions regarding
              the adequacy of the complaint de novo.

Webb v. Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422, 426 (Tenn. 2011)
(internal citations, quotation marks, and ellipsis omitted).

                                            III.

       According to the transcript of the motion hearing, the trial court found and held in
pertinent part as follows:

              All I got was a mediated agreement, but I’ve yet to hear
              anything that would make out a cause of action against the
              Estate of Vida Mae McCartt by the heirs of J. D. McCartt.

                                      *      *       *

              I don’t think [Armes is] estopped. I don’t ‒ I don’t know that
              she’s time bound. . . . I think in terms of the statute of
              limitations that ‒ that if there’s been something wrong done
              to her thus far, that the date on which she gained knowledge
              of that would ‒ might be, I’m not saying would be, but I
                                             8
             would want to see some law on it, a determinative factor
             insofar as when she had ‒ how long she had to file suit. But
             I’m inclined to think that . . . the complaint does not state a
             cause of action.

                                     *      *      *

             And at this point, there’s nothing stopping the Plaintiff. I
             don’t think she can bring the suit in this way, attacking the
             mediated agreement, because they got whatever they could by
             hook or by crook [but] I don’t think this stops her in any way
             from bringing a separate lawsuit, because she wasn’t a party
             to the other lawsuit. And that would be ‒ that part of the
             lawsuit, that was extraneous to the Will contest itself that
             resulted in the mediated agreement. And, so, it could be that
             she still has a lawsuit if she cares to bring it.

                                     *      *      *

             But at this point, I’m inclined to agree with the Defendants
             and hold it ‒ the complaint does not state a cause of action for
             which relief can be granted. And leave it up to her at this
             point to decide whether or not she wants to file a ‒ not to – to
             intervene or to set aside the previous lawsuit, but to file one
             on her own and see what the results of that might be. And I
             don’t think that there’s anything stopping her from doing that.

(Emphasis added.)

        The defendants – arguing that Armes’ action should be held to be time-barred –
rely on a pair of decisions from this Court and an opinion from the Supreme Court. The
first, In re Estate of Sutton, No. E2013-00245-COA-R3-CV, 2013 WL 6669385 (Tenn.
Ct. App. E.S., filed Dec. 17, 2013), dealt with the attempt of an heir, who was unnamed
in a first will contest that had been finally concluded, to file a second will contest. We
stated:

             Ms. Chennault . . . filed a Complaint to Contest Will on April
             26, 2010. The complaint alleged that the will was invalid due
             to the Decedent’s incompetency at the time it was signed and
             due to its procurement by undue influence or fraud. . . . On
             August 7, 2012, the trial court entered an order dismissing
                                            9
             Ms. Chennault’s complaint “with prejudice to the refiling of
             same.” Ms. Chennault timely appealed the dismissal of her
             complaint. This Court entered an Order dismissing Ms.
             Chennault’s appeal . . .

             The plaintiff in the instant will contest, Sky Sutton, filed her
             complaint to contest the will on April 24, 2012, alleging the
             same grounds as those previously attested by Ms. Chennault.
             The Executrix filed a motion to dismiss Ms. Sutton’s
             complaint on May 31, 2012, arguing that Ms. Sutton was
             precluded from initiating a will contest proceeding by reason
             of the trial court’s earlier dismissal of Ms. Chennault’s
             previous will contest proceeding. . . . [T]he trial court granted
             the Executrix’s motion to dismiss Ms. Sutton’s complaint[,
             finding] that the previous will contest dismissal was binding
             on all heirs of the estate even without notice to such heirs of
             the prior contest’s filing. See [Petty v. Call,] 599 S.W.2d 791,
             793 ([Tenn.] 1980) (“In Tennessee, the right to intervene in a
             will contest is not accompanied by the right to notice of its
             filing”).

                                      *      *      *

             Ms. Sutton . . . argues that the trial court erred in dismissing
             her will contest based on the prior dismissal of Ms.
             Chennault’s complaint because the court did not have
             authority to proceed in the original will contest without
             joining as parties all of the Decedent’s heirs. The Executrix
             contends that because a will contest is an in rem proceeding,
             its adjudication is conclusive upon all heirs and that therefore
             the probate court is not required to join all heirs in a will
             contest proceeding. We agree with the Executrix.

                                      *      *      *

             [I]t is not necessary that every heir of a decedent be made a
             party to a will contest proceeding in order for the trial court to
             determine the validity of a will. See Petty, 599 S.W.2d at
             793-94.

2013 WL 6669385 at *1, *5-6 (footnote omitted).
                                            10
       In In re Estate of Snapp, No. E2009-00551-COA-R3-CV, 2010 WL 1924017, at
*1 (Tenn. Ct. App. E.S., filed May 13, 2010), the petitioners filed a motion to intervene
and stay the distribution of an estate, claiming that they were not aware of the
proceedings, nor that they were heirs at law, until after the issues regarding the estate had
been finally resolved. We held as follows:

              [T]the trial court held that Petitioners’ claims were untimely
              because the claims were filed after the expiration of the one-
              year statute of limitation. Thereafter, Petitioners filed this
              appeal challenging the trial court’s determination that they
              were creditors of the Estate and that their claims were
              untimely filed.

                                      *      *       *

              Addressing this issue in Bilbrey v. Smithers, the Tennessee
              Supreme Court held:

                     [A] child born out of wedlock, whose paternity
                     was not adjudicated prior to the death of the
                     father, can establish the right to inherit by
                     intestate succession by asserting that right
                     against the estate of the deceased owner of the
                     property in which an interest is claimed within
                     the time allowed for creditors to file claims
                     against the estate and by establishing paternity
                     by clear and convincing proof.

              Bilbrey, 937 S.W.2d at 808.

                                      *      *       *

              It is well settled that non-marital children claiming a share in
              an estate must file their claims within the one-year statute of
              limitations. See Bilbrey, 937 S.W.2d at 808; In re Estate of
              Bennett, No. E2004–02007–COA–R3–CV, 2005 WL
2333597, at *5 (Tenn. Ct. App. E.S., Sept. 23, 2005).

                                      *      *       *

                                             11
             Further, Petitioners’ contention that their cause of action did
             not arise until this court determined that the residuary estate
             would pass by intestate succession is without merit. To
             interpret the statute as Petitioners urge would undermine the
             Legislature’s intent to limit claims against an estate to twelve
             months from the date of a decedent’s death. As evidenced by
             the language of Tenn. Code Ann. § 30–2–307(a)(1)(B) and §
             30–2–310, claims not filed within twelve months of the
             decedent’s death are barred. See In re Estate of Bennett,
             2005 WL 2333597, at *5; see also In re Estate of Tanner,
             295 S.W.3d 610, 620 (Tenn. 2009) (citing In re Estate of
             Luck with approval and observing that applying the limitation
             of Tenn. Code Ann. § 30–2–307(a)(1)(B) “regardless of
             whether a representative is appointed, is the most natural
             interpretation of the statutory scheme.”)

             We agree with the trial court and hold that Petitioners were to
             proceed as creditors of the Estate. The statute of limitations
             [provides that] a creditor’s claim against an estate must be
             filed one-year from the decedent’s death.

Estate of Snapp, 2010 WL 1924017, at *2-5.

        In the present case, the answer to defendants’ reliance on Estate of Sutton and
Estate of Snapp lies in a brief discussion of what Armes’ lawsuit is not. A careful
reading of her complaint shows that her action is not a second will contest. Neither is it
an attack on the validity of the agreed order approving the settlement agreement, nor is it
a claim against the estate. Armes asked the trial court to interpret the agreement and
order in a manner that provides her a portion of the estate, and to enforce and uphold the
agreement and order according to that interpretation. Specifically, Armes alleges that she
is an heir of J.D. McCartt, Sr., and is “therefore entitled to one-fourth (1/4) of the
distribution of assets passing to the heirs of J.D. McCartt” as provided in the agreement
and order. Consequently, Estate of Sutton and Estate of Snapp are distinguishable, and
the trial court correctly held that her action is not time-barred.

       Defendants also argue that the outcome of this appeal is controlled by Petty v.
Call, 599 S.W.2d 791, 796 (Tenn. 1980), in which the Supreme Court said:

             A will contest may be brought by any one interested party,
             and all other interested parties are free to join the contestant,
             join the proponent, or stand aloof. Those who are cast in the
                                            12
              litigation may settle, if they do so in good faith, but any
              compromise of the contest will not inure to the benefit of the
              non-participating heirs, but on the other hand, if trial of the
              issue results in an adjudication that the will is invalid, the
              non-participating heirs take their respective shares of the
              intestate decedent’s estate.

(Emphasis added.) In this case, the record contains no indication of when Armes became
aware of the will contest or the settlement agreement. Thus, in the current posture of the
case, it is impossible to say whether Armes had the opportunity to make any conscious
decision whether to “join the contestant, join the proponent, or stand aloof.” Id. More
importantly, Petty observes that a settlement of a will contest must be done “in good
faith,” and we believe that the allegations of the complaint raise a legitimate issue of
whether the settling heirs acted in good faith.

        Armes’ complaint includes a claim that her siblings defrauded both her and the
trial court by representing that J.D. McCartt had only three surviving children and heirs,
and not four as Armes has alleged. Construing the complaint liberally, presuming all of
Armes’ factual allegations to be true and giving her the benefit of all reasonable
inferences, her complaint alleges, in effect, that the settling heirs deliberately concealed
Armes’ existence and status as J.D. McCartt’s heir, in order to purposely cut her out of
the settlement agreement, despite being fully aware that she was J.D. McCartt’s daughter
and heir as established by a prior court order. The Supreme Court in Petty also addressed
a fraud claim that had been dismissed under Rule 12.02(6), and vacated the dismissal,
allowing the claim to go forward and stating in pertinent part:

              The complaint . . . alleged that contestants knew the address
              and telephone number of Everett Petty and knew that he
              could supply the whereabouts of all other Petty heirs, if they
              were unknown to contestants, but that no effort was made to
              inform plaintiffs of the will contest or the settlement. It is an
              alleged and undisputed fact that less than forty days after the
              settlement by exchange of deeds, the judgment in the will
              contest was final and conclusive against plaintiffs and
              effectively deprived them of any share of the estate of Cora
              Crabtree.      The complaint alleges that the settlement
              agreement and the manner in which it was consummated was
              a deliberate fraudulent scheme having as its purpose and
              design to circumvent or deprive plaintiffs of any right, title or
              interest in the real property in the estate of Cora Crabtree.

                                             13
             Gibson’s Suits in Chancery, Fifth Edition, Section 980 reads
             in part as follows:

                    “All frauds grow out of relations, and are those
                    violations of the duties arising from relations,
                    caused by bad faith.”

             Among the relations specified in the section are those
             imposed by “kinship, law, or social duty. . . .”

             Of course, the trier of fact may find that both contestants and
             proponents acted in the utmost good-faith and settled the case
             solely for the purpose of terminating expensive and uncertain
             litigation. But, in our view, plaintiffs’ complaint alleges a
             state of facts and a fraudulent “condition of mind” that
             produced a result detrimental to them and beneficial to
             contestants and proponents, all with sufficient particularity to
             state a cause of action sounding in fraud.

Petty, 599 S.W.2d at 795 (quotation marks in original). We similarly hold that the
complaint states a viable claim for fraud.

                                           IV.

      The judgment of the trial court is vacated, and the case is remanded for further
proceedings consistent with this opinion. Costs on appeal are assessed to the appellees,
Kelly McCartt, Joe McCartt, Nancy McCartt Wilson, Susan McCartt Collins, G.M.
McCartt and Betty Jane McCartt Newman.

                                          _____________________________________
                                          CHARLES D. SUSANO, JR., CHIEF JUDGE

                                           14