Court Opinion

ID: 5600860
Source: CourtListenerOpinion
Date Created: 2022-01-11 03:13:36.722864+00
Date Added: 2024-06-11T08:36:43.480500
License: Public Domain

Hunstein, Presiding Justice,
dissenting.
While, as a matter of policy, I agree with the majority that “equity cases” should go to the Court of Appeals, I disagree that our precedent mandates that result in this case. This Court has two competing lines *236of authority concerning the proper appellate court to hear appeals concerning express trusts. The majority follows our decisions holding that we look at the issue on appeal and transfer the case to the Court of Appeals if the equitable relief sought is ancillary to the legal relief. As a practical matter, this analysis means that the default is for every “equity case” to be heard in the Court of Appeals because underlying the question of equity is a question of law. Assuming our jurisdiction over equity cases in the Constitution means something, I would follow a different line of cases that have exercised jurisdiction over appeals involving the internal affairs of trusts.
Our State Constitution gives this Court appellate jurisdiction over all equity cases. See Ga. Const, of 1983, Art. VI, Sec. VI, Par. III (2). “Whether an action is an equity case for the purpose of determining jurisdiction on appeal depends upon the issue raised on appeal.” Beauchamp v. Knight, 261 Ga. 608, 609 (2) (409 SE2d 208) (1991). In Beauchamp, we defined “equity cases” as “those in which a substantive issue on appeal involves the legality or propriety of equitable relief sought in the superior court — whether that relief was granted or denied.” Relying on Beauchamp, we have held that the imposition of an implied trust as an equitable remedy is not an equity case that triggers this Court’s jurisdiction when the issues on appeal did not relate to the propriety of the implied trust. See Reeves v. Newman, 287 Ga. 317, 318-319 (695 SE2d 626) (2010); accord Davis v. Davis, 287 Ga. 897 (700 SE2d 404) (2010). Similarly, we transferred a case where the issue on appeal involved the question of standing under a statute that granted the Attorney General or district attorney exclusive authority to enforce the terms of a charitable trust. Warren v. Bd. of Regents of the Univ. System of Ga., 272 Ga. 142 (527 SE2d 563) (2000). In Warren, we rejected “the argument that the denial of standing to assert the requested equitable remedy is itself a decision of equity that creates an equitable issue on appeal.” Id. at 144.
Historically, this Court has retained appeals involving the administration and internal affairs of an express trust under our equity jurisdiction. See Snook v. Sessoms, 256 Ga. 482 (350 SE2d 237) (1986) (holding beneficiaries may file lawsuit against trustees to seek enforcement of trust provisions without violating the in terrorem clause); Miller v. Walker, 270 Ga. 811 (514 SE2d 22) (1999) (holding rights of beneficiaries under their grandfather’s inter vivos trust terminated on their adoption outside the family). Even after our decisions in Beauchamp and Warren, this Court has reviewed and retained jurisdiction because the appeal involved the internal affairs of an express trust. See Ludwig v. Ludwig, 281 Ga. 724 (642 SE2d 638) (2007) (rejecting beneficiaries’ claims that trustees mismanaged *237inter vivos trust or breached their fiduciary duties). We have exercised appellate jurisdiction in cases in which beneficiaries have brought claims against trustees for violating a written trust agreement, see id. at 725, as well as in cases like this one in which trustees have sought a declaration of the beneficiaries’ rights under specific clauses of the trust. See Miller, 270 Ga. at 813; Snook, 256 Ga. at 482.
This jurisdiction is based on the long-standing principle of law that trusts “are peculiarly subjects of equity jurisdiction” and the “trustee is amenable to the court of equity for faithful administration of trust.” Hardware Mut. Cas. Co. v. Dooley, 193 Ga. 882 (1) (20 SE2d 420) (1942) (Citation and punctuation omitted); see OCGA § 53-12-6 (a). The Restatement (Third) of Trusts states that “the remedies of trust beneficiaries are equitable in character and enforceable against trustees in a court exercising equity powers.” Restatement (Third) of Trusts § 95 (2011); see also 76 AmJur2d Trusts, § 597 (“the remedies available to a trust beneficiary, as against the trustee, may be exclusively equitable, unless the trustee’s duty is to immediately and unconditionally pay money or transfer a chattel to the beneficiary”). As the Restatement (Second) of Trusts explains, “[t]he creation of a trust is conceived of as a conveyance of the beneficial interest in the trust property rather than as a contract [and] questions of the administration of trusts have always been regarded as of a kind which can adequately be dealt with in a suit in equity.” Restatement (Second) of Trusts § 197 cmt. b (1959).
Our trust code has codified the principle that the remedies for trust beneficiaries are exclusively equitable. See OCGA § 53-12-6 (actions concerning the “construction, administration, or internal affairs of a trust shall be maintained in superior court”). Similarly, we have relied on the official comment, now codified at OCGA § 53-12-6, that “[c]auses of action that involve the ‘internal affairs’ of a trust are generally the subject of equity jurisdiction” to exercise appellate jurisdiction over cases involving express trusts. Consistent with this official comment, we have exercised jurisdiction in an appeal if the substantive issue on appeal involves the administration or internal affairs of an express trust. See Lewis v. Van Anda, 282 Ga. 763 (653 SE2d 708) (2007) (deciding equitable claims to set aside inter vivos trust on grounds of undue influence under equity jurisdiction); Ludwig, 281 Ga. at 725-726; Miller, 270 Ga. at 811; see also Snook, 256 Ga. at 482 (granting interlocutory application to appeal under equity jurisdiction to review trial court’s decision that beneficiaries had violated trust’s in terrorem clause).
In this case, the issue in the trial court and on appeal is whether any of the residual beneficiaries are prohibited from recovering property under their mother’s trust due to their past actions in filing *238lawsuits in Evans and Tattnall Counties. The trustee sought a declaration from the superior court on how he should distribute the trust’s property among the trust donor’s four children. In his prayer for relief, the trustee asked the trial court to order that three of the children forfeited their interests in the estate and to transfer their shares to the fourth child. In response, the three children asserted that they did not violate the in terrorem clause and remained trust beneficiaries. As a result, the substantive issues on appeal are which beneficiaries are entitled to recover under the trust and the share of property, if any, to which they are entitled. Because these questions concern the administration and internal affairs of the trust, I conclude that we have subject matter jurisdiction over this appeal as an equity case.
Although the majority opinion is correct that we must interpret the in terrorem clause in light of the beneficiaries’ actions in filing the lawsuits in Evans and Tattnall Counties, our construction of that specific clause cannot be separated from the trustee’s request for guidance on the key question involving the trust — how to distribute the remaining trust property among the four children of donor Majorie Durham. To separate out the two issues, as the majority does, means that every case involving the propriety of the trustee’s actions in conducting the internal affairs of the trust will go to the Court of Appeals because the underlying issue on appeal will involve the interpretation of one or more specific provisions in the trust agreement. Unlike our decision in Warren, where we determined that standing to seek equitable relief is not a question within our equitable jurisdiction, the issues here involve the internal workings of the trust and propriety of the equitable relief sought to be granted the beneficiaries. See Ludwig, 281 Ga. at 725-726; Miller, 270 Ga. at 811; Snook, 256 Ga. at 482.
While the majority opinion treats our equity jurisdiction as one straight, seamless line of authority, this Court has struggled over how to define our jurisdiction in equity cases. See, e.g., Kemp v. Neal, 288 Ga. 324 (704 SE2d 175) (2010); Redfearn v. Huntcliff Homes Assn., 271 Ga. 745, 746 (524 SE2d 464) (1999) (definition of equity “has been the subject of confusion and frustration for the Georgia bar as well as both of Georgia’s appellate courts”). In this case, I would retain jurisdiction for two reasons. One, if the term “equity cases” means anything today, then it should include appeals in express trust cases where the remedies to beneficiaries are exclusively equitable and the issue on appeal is the legality or propriety of that equitable relief. Second, if we continue our recent practice of narrowly defining the issue on appeal, the result will be the same as in this case — a transfer to the Court of Appeals — even in. subject matter areas that have in *239the past been exclusively within our jurisdiction. See Boyd v. JohnGalt Holdings, LLC, 290 Ga. 658 (724 SE2d 395) (2012) (transferring a case involving title to land to Court of Appeals).
Decided June 18, 2012.
Dubberly & McGovern, Bruce D. Dubberly, Jr., for appellant (case no. S12A0537).
Callaway, Neville & Brinson, William J. Neville, Jr., for appellant (case no. S12A0607).
Bryan Cave, Luke A. Lantta, Nicole J. Wade, Spivey, Carlton & Edenfield, J. Franklin Edenfield, for appellees.
Because express trusts are a creature of equity and by their nature involve equitable remedies, I would hold that we continue to have jurisdiction over appeals when the case involves the internal affairs of an express trust.
I am authorized to state that Justice Benham and Justice Melton join in this dissent.