Court Opinion

ID: 7826045
Source: CourtListenerOpinion
Date Created: 2022-09-07 18:07:13.353161+00
Date Added: 2024-06-11T16:30:52.045967
License: Public Domain

Tom Glaze, Justice, concurring. The suggestion that equity has no subject-matter jurisdiction in this case wholly ignores settled law and the facts. Although the majority opinion concludes the chancery judge here had jurisdiction of this case, I write to explain why the chancellor had the authority to rule as he did. Melissa and Mellonie Conrad were ages eight and nine years old when their mother, Betty, died in August of 1983. Betty had a life insurance policy with The Prudential Insurance Company of America which provided $30,519.60 in proceeds to the two girls. After Betty’s death, Melissa and Mellonie went to live with their uncle, Jerry Reid, who was appointed their guardian on October 25, 1983. The guardianship order provided a “bond shall be determined,” but none was. Nonetheless, Prudential sent the insurance proceeds to Reid, stating the proceeds were “for the person and estates of Melissa and Mellonie Conrad,” and Reid concedes he knew those proceeds belonged to the two girls. He also began receiving Melissa’s and Mellonie’s social security payments, totalling $847.00 a month. Reid initially placed the life insurance proceeds in certificates of deposit issued for the girls’ benefit. Reid testified that he became disabled sometime in 1983 and did not work, and while he made claims for workers’ compensation and social security benefits, he only commenced receiving them between 1986 and 1988. Meanwhile, Reid purchased a bigger house in 1984 and admitted he used some of the girls’ life insurance proceeds to do so. In the same year, he adopted Melissa and Mellonie, and said that he understood when he became their adopted father “their assets were ours and our assets were theirs.” Nevertheless, Reid asserted “the house does not contain money that belongs to the two young ladies.” Reid claimed he used the two girls’ monies to care for them, as well as his other four children. Melissa and Mellonie brought this action, alleging Reid was their appointed guardian when he received their life insurance proceeds from Prudential. They averred Reid, as guardian, breached his fiduciary duty and perpetrated fraud upon them by failing to disclose, protect, and deliver the assets, and such acts on Reid’s part were intentional with knowledge of his fiduciary duty. The two women asked for a full accounting from Reid and Prudential, alleging Prudential, too, had failed to account for the life insurance proceeds or to require proof of bond when it paid Reid the proceeds. After a trial and being informed of Melissa’s, Mellonie’s and Reid’s allegations and testimony of what occurred, the chancellor awarded damages to Melissa and Mellonie. As is set out clearly and succinctly in A & P’s Hole-in-One, Inc. v. Moskop, 38 Ark. App. 234, 832 S.W.2d 860 (1992), the court of appeals stated that an accounting is an equitable remedy designed to provide a means for compelling one, who because of a confidential or trust relationship has been entrusted with property of another, to render an account of his actions and for the recovery of any balance found to be due. As this court said in Walters-Southland Institute v. Walker, Trustee, 217 Ark. 602, 232 S.W.2d 448 (1950), the existence of a fiduciary relation is one of the well-recognized grounds for equity jurisdiction of a suit for an accounting. An accounting may be had against a fiduciary to determine whether there is, in fact, anything due the plaintiff. Here, Reid, as guardian of Melissa’s and Mellonie’s estate, was a fiduciary. Omohundro v. Erhart, 228 Ark. 910, 311 S.W.2d 309 (1958). Consequently, Melissa and Mellonie, as wards and plaintiffs, have every right to ask equity to make Reid and Prudential account for those monies or assets that might be due the women, and chancery courts clearly had the authority to grant such relief.