Court Opinion

ID: 3173009
Source: CourtListenerOpinion
Date Created: 2016-01-28 16:04:34.358434+00
Date Added: 2024-06-11T11:58:49.972390
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                              Jan 28 2016, 8:27 am

regarded as precedent or cited before any
court except for the purpose of establishing
the defense of res judicata, collateral
estoppel, or the law of the case.

APPELLANT PRO SE                                         ATTORNEYS FOR APPELLEES
Jill Yount                                               Richard T. Mullineaux
Scottsburg, Indiana                                      Crystal G. Rowe
                                                         Whitney E. Wood
                                                         Kightlinger & Gray, LLP
                                                         New Albany, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Jill Yount,                                              January 28, 2016
Appellant-Plaintiff,                                     Court of Appeals Case No.
                                                         72A05-1508-CT-1119
        v.                                               Appeal from the Scott Circuit
                                                         Court
Robert L. Houston and Houston                            The Honorable Daniel E. Moore,
& Thompson,                                              Special Judge
Appellees-Defendants.                                    Trial Court Cause No.
                                                         72C01-1406-CT-11

Bradford, Judge.

                                    Case Summary

Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 1 of 8
[1]   In 2014, Appellant-Plaintiff Jill Yount (“Jill”) brought a legal malpractice claim

      against Appellees-Defendants Robert L. Houston (“Houston”) and Houston &

      Thompson. The claim stems from Houston’s representation of Jill’s

      grandmother, Margerie Yount (“Margerie”). Margerie was the settlor of an

      inter vivos trust of which Jill was a beneficiary and trustee for several years. In

      2011, Margerie hired Houston to represent her in an action to remove Jill as

      trustee. Jill ultimately agreed to be removed as trustee. A new trustee was

      never appointed and Margerie died in 2013. In her complaint against Houston,

      Jill claims that Houston was negligent for failing to assure that a suitable trustee

      was appointed following her removal. The trial court granted summary

      judgment in favor of Houston. On appeal, Jill claims that the trial court erred

      in finding that Houston did not owe Jill a duty and so could not be held liable

      for malpractice. We affirm.

                            Facts and Procedural History
[2]   On January 10, 2001, Margerie and her husband, Roy Yount (“Roy”) created a

      revocable inter vivos trust with Margerie as the sole initial trustee. Roy died in

      September of 2011. Margerie subsequently restated the trust, naming it the

      Margerie A. Yount Living Trust (“the Trust”), and appointed her

      granddaughter Jill to be trustee. Upon Margerie’s death, all property in the

      Trust not previously distributed was to be divided in equal 1/6 shares to the

      following beneficiaries: Jill, Gina Hash, Kathy Yount, Toska Feather, Susan

      Yount, and Sonya Glenn.

      Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 2 of 8
[3]   At some point, Margerie and Jill’s relationship became strained and Margerie

      believed that Jill had stolen some personal property from her. As a result, on

      February 16, 2011, Margerie, individually and as settlor of the Trust, filed a

      complaint against Jill to have her removed as trustee and to appoint Kathy.

      Margerie hired Houston to represent her in this action. Eventually, Jill agreed

      to be removed as trustee and the trial court issued an order evidencing her

      removal.

              On February 4, 2011 Margerie A. Yount notified Jill L. Yount of
              her intent to remove Jill as trustee….The interested persons
              appeared for a hearing on April 26, 2011 and agreed to Jill no
              longer serving as trustee. Margerie shall give notice of this trust
              proceeding to the six grandchildren named as remainder
              beneficiaries. All interested persons have thirty (30) days from
              the date hereof to endeavor to agree on a successor trustee. If the
              parties are not able to agree on a successor trustee, any interested
              person can request a hearing with the Court.

              Until a successor trustee is appointed, Margerie and Jill have
              agreed not to pledge, transfer, or distribute any trust property,
              except for payment of medical and nursing home expenses,
              unless all counsel agree to a distribution for payment of
              Margerie’s other expenses. The Court orders this, which order
              shall apply to any person in possession of trust property. In the
              event that the parties cannot agree on a successor trustee or on
              the need for a successor trustee, then any interested party may
              request that the Court schedule the matter for a hearing.

      Appellees’ App. p. 144. A new trustee was never agreed upon and no interested

      party requested the court to have a trustee appointed.

      Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 3 of 8
[4]   On December 21, 2012, the trial court issued an order releasing Trust funds for

      the payment of Margerie’s living expenses and each parties’ attorneys’ fees.

      Margerie died on December 23, 2013. There has been no action regarding the

      Trust since that time.

[5]   On June 2, 2014, Jill pro se filed a complaint against Houston alleging legal

      malpractice. Specifically, her complaint that Houston was negligent in failing

      to assure that a suitable trustee was appointed following her removal as trustee.

      On April 2, 2015, Houston moved for summary judgment arguing, among

      other things, that Jill’s legal malpractice claim must fail because Houston never

      had an attorney-client relationship with Jill and so owed her no duty. The trial

      court granted Houston’s motion for summary judgment on July 10, 2015.

                                 Discussion and Decision
[6]   On appeal, Jill claims that the trial court erred in granting summary judgment

      because there are material issues of fact and because Houston owed a duty to

      her.

              When reviewing a grant or denial of a motion for summary
              judgment our standard of review is the same as it is for the trial
              court. Kroger Co. v. Plonski, 930 N.E.2d 1, 4 (Ind. 2010). The
              moving party “bears the initial burden of making a prima facie
              showing that there are no genuine issues of material fact and that
              it is entitled to judgment as a matter of law.” Gill v. Evansville
              Sheet Metal Works, Inc., 970 N.E.2d 633, 637 (Ind. 2012).
              Summary judgment is improper if the movant fails to carry its
              burden, but if it succeeds, then the nonmoving party must come
              forward with evidence establishing the existence of a genuine

      Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 4 of 8
              issue of material fact. Id. In determining whether summary
              judgment is proper, the reviewing court considers only the
              evidentiary matter the parties have specifically designated to the
              trial court. See Ind. Trial R. 56(C), (H). We construe all factual
              inferences in the non-moving party’s favor and resolve all doubts
              as to the existence of a material issue against the moving party.
              Plonski, 930 N.E.2d at 5.

      Reed v. Reid, 980 N.E.2d 277, 285 (Ind. 2012).

                     I. Whether Houston Owed a Duty to Jill
[7]   “Under Indiana law, the elements of legal malpractice are: (1) employment of

      an attorney, which creates a duty to the client; (2) failure of the attorney to

      exercise ordinary skill and knowledge (breach of the duty); and (3) that such

      negligence was the proximate cause of (4) damage to the plaintiff.” Clary v. Lite

      Mach. Corp., 850 N.E.2d 423, 430 (Ind. Ct. App. 2006). Jill concedes that

      Houston has never represented her, she never considered Houston to be her

      attorney, and in the litigation concerning her removal as trustee Houston

      represented her grandmother and Jill was represented by her own counsel.

      However, Jill nevertheless argues that Houston owed her a duty as a beneficiary

      based on In re Estate of Lee, 954 N.E.2d 1042 (Ind. Ct. App. 2011) and the

      Indiana Prudent Investor Rule, Indiana Code chapter 30-4-3.5 et seq. Despite

      citing these two authorities, Jill fails to explain how they apply to this case.

[8]   First, we note that the Prudent Investor Rule, which governs a trustee’s “duty to

      the beneficiaries of the trust” to properly manage trust assets, “applies to a

      trustee or escrow agent.” Ind. Code § 30-4-3.5-1. Houston was the attorney

      Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 5 of 8
       representing Margerie, as the settlor of the trust, to remove Jill as trustee. We

       fail to see how the Prudent Investor Rule is relevant here, as Houston was

       neither a trustee nor an escrow agent.

[9]    In Lee, this court addressed a situation in which an attorney, Colussi,

       represented an estate and was sued for malpractice for allegedly failing to

       properly oversee and manage the estate’s assets. 954 N.E.2d at 1045. The trial

       court granted summary judgment in favor of Colussi but this court reversed that

       determination on appeal. Id. We found that Colussi owed a duty to the estate

       and that there was a material issue of fact regarding whether the Colussi’s

       failure to monitor an estate bank account constituted a breach of that duty. Id.

       at 1048.

[10]   Lee is distinguishable from the instant case. In Lee, it was the estate that

       brought the malpractice claim against Colussi as opposed to an individual

       beneficiary. Colussi was hired following Lee’s death to represent her estate and

       “there [was] no question that Colussi owed a general duty to the Estate” as his

       client. Id. Here, Houston was hired to represent Margerie personally, as settlor

       of the Trust, in an action against the trustee. Houston was never a

       representative of Margerie’s estate following her death. Accordingly, his duty

       was solely to Margerie.

[11]   As a general rule, attorneys do not owe a duty to non-client third parties except

       in the context of third-party beneficiaries. Hacker v. Holland, 570 N.E.2d 951,

       955 (Ind. Ct. App. 1991) (citing Walker v. Lawson, 526 N.E.2d 968 (Ind. 1988)

       Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 6 of 8
       (held that action will lie by beneficiary under will against attorney who drafted

       will on basis that beneficiary is known third party). The scope of Houston’s

       work for Margerie was not intended to confer a benefit to any third-party and

       Houston did not draft or amend the Trust. Certainly, Jill was not a third-party

       beneficiary of Houston’s arrangement with Margerie and in fact was directly

       adverse. As such, we find that the trial court did not err in finding that Houston

       did not owe a duty to Jill.

                                   II. Material Issues of Fact
[12]   The only cognizable issue of fact Jill raises in her brief is the scope of Houston’s

       representation of Margerie. In a March 31, 2015 affidavit, Houston stated that

       the scope of his representation “was only to represent Margerie A. Yount as

       Settlor of the [Trust] in her effort to remove Jill Yount as Trustee.” Appellant’s

       App. p. 14. In her own affidavit, Jill states that Houston’s representation

       extended beyond this scope when he prepared an emergency order to release

       funds from the trust in order to pay Margerie’s expenses, which included his

       and Jill’s attorney fees. Houston concedes that he prepared the motion for

       emergency hearing in his appellate brief.

[13]   Even assuming the trial court found the affidavits to conflict so as to create an

       issue of fact, that fact is not material for purposes of Trial Rule 56(C) to

       preclude summary judgment. A fact is “material” for summary judgment

       purposes if its resolution affects the outcome of the case or the determination of

       a relevant issue. Penwell v. W. & S. Life Ins. Co., 474 N.E.2d 1042, 1044 (Ind. Ct.

       Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 7 of 8
Ohio App. 1985). Even if the original scope of Houston’s representation of Margerie

       was extended to assist her in acquiring funds from the Trust, such an expansion

       of scope is not material to determine whether Houston owed a duty to Jill.

[14]   The judgment of the trial court is affirmed.

       Pyle, J., and Baker, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 72A05-1508-CT-1119 | January 28, 2016   Page 8 of 8