Court Opinion

ID: 9950599
Source: CourtListenerOpinion
Date Created: 2024-03-14 15:24:02.241064+00
Date Added: 2024-06-11T14:37:30.033403
License: Public Domain

FILED
                                                            MARCH 14, 2024
                                                      In the Office of the Clerk of Court
                                                     WA State Court of Appeals, Division III

          IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                             DIVISION THREE

In the Matter of:                           )        No. 38979-1-III
                                            )
MADELINE M. THIEDE TRUST                    )
                                            )
                                            )
GERALD VERHAAG, a beneficiary               )
of Madeline M. Thiede Trust,                )
                                            )
                     Respondent,            )
                                            )
   v.                                       )        UNPUBLISHED OPINION
                                            )
GORDON FINCH, a beneficiary and             )
Trustee of Madeline M. Thiede Trust,        )
                                            )
                     Respondent.            )
                                            )
                                            )
ROBERT E. KOVACEVICH,                       )
                                            )
                     Appellant.             )

        PENNELL, J. — Robert Kovacevich appeals from superior court orders arising out

of his notice of mediation under the Trust and Estate Dispute Resolution Act (TEDRA),

chapter 11.96A RCW, including an award of attorney fees to Gordon Finch and Gerald
No. 38979-1-III
In re Madeline M. Thiede Tr.

Verhaag. We affirm the superior court and grant the request of Mr. Finch and

Mr. Verhaag for attorney fees and costs on appeal.

                                         FACTS 1

       After Gordon Finch was replaced as trustee of a trust created by his mother,

he made several distributions of trust funds to himself and his then-attorney, Robert

Kovacevich, based on advice received from Mr. Kovacevich. When the distributions were

challenged through a civil contempt motion, Mr. Finch retained new counsel and returned

all the funds he had paid to himself. Mr. Kovacevich did not return the funds he had

received.

       Mr. Finch later entered into a TEDRA agreement (the Agreement) with the other

trust beneficiaries. Under the terms of the Agreement, the beneficiaries settled all disputes

between themselves and agreed to a distribution of trust assets. Mr. Finch assumed all

expenses and losses in connection with the improper distributions and took an assignment

of claims against Mr. Kovacevich. The superior court approved the Agreement in an

order dated June 13, 2019.

       1
        Our statement of facts is taken from our decision in Mr. Kovacevich’s prior
consolidated appeal. See In re Madeline M. Thiede Tr., No. 36940-4-III (Wash. Ct. App.
May 25, 2021) (unpublished), https://www.courts.wa.gov/opinions/pdf/369404_unp.pdf.
Additional details are set forth in that opinion.

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No. 38979-1-III
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       Based on the Agreement’s assignment of claims, Mr. Finch obtained judgments

against Mr. Kovacevich for unsatisfied contempt awards and related attorney fees.

Mr. Kovacevich unsuccessfully challenged the judgments in the superior court and on

appeal. A mandate on the prior appeal was issued on December 29, 2021.

       Despite losing on appeal, Mr. Kovacevich still failed to comply with the

outstanding judgments. Instead, in January 2022, he filed a notice of mediation in the

TEDRA case.

       Mr. Finch filed a motion to quash the notice of mediation. 2 Among other things,

he argued Mr. Kovacevich lacked standing. Mr. Finch also sought sanctions. The superior

court agreed Mr. Kovacevich lacked standing to compel mediation and imposed sanctions

against Mr. Kovacevich and his attorney, Aaron Lowe. Mr. Kovacevich filed a motion to

reconsider, which was denied.

       Mr. Kovacevich now appeals. 3

       2
           The new trustee, James Spurgetis, and Gerald Verhaag later joined in Mr. Finch’s
motion.
       3
         While Mr. Kovacevich in his appellate briefing identifies both himself and Aaron
Lowe as appellants, there is no mention of Mr. Lowe in Mr. Kovacevich’s notice of
appeal, and the notice is signed only by Mr. Kovacevich. We deem Mr. Kovacevich as the
only appellant on review. See RAP 5.2.

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No. 38979-1-III
In re Madeline M. Thiede Tr.

                                         ANALYSIS

Standing

       The primary issue in this case is whether Mr. Kovacevich has standing to bring

a claim under TEDRA. “Standing is a threshold issue, which we review de novo.”

In re Est. of Becker, 177 Wn.2d 242, 246, 298 P.3d 720 (2013) (citing Knight v. City

of Yelm, 173 Wn.2d 325, 336, 267 P.3d 973 (2011)).

       TEDRA was enacted “to encourage the prompt and early resolution of disputes

in trust, estate, and nonprobate matters” through nonjudicial dispute resolution.

RCW 11.96A.260. Under TEDRA, a “party” to a dispute arising in trust, estate, or

nonprobate matters may require the parties to go to mediation prior to involving the

court. RCW 11.96A.280.

       Mr. Finch and Mr. Verhaag argue Mr. Kovacevich is not a party under TEDRA

and thus lacks standing to compel mediation. We agree.

       “The standing doctrine requires that [an individual] must have a personal stake

in the outcome of the case in order to bring suit.” Sabey v. Howard Johnson & Co., 101

Wn. App. 575, 584, 5 P.3d 730 (2000). At the time Mr. Kovacevich filed his notice of

mediation, he did not have a personal stake in resolution of the Madeline M. Thiede

Trust. The trust beneficiaries had already settled all internal disputes and the trust assets

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No. 38979-1-III
In re Madeline M. Thiede Tr.

had been disbursed. Pursuant to the Agreement, all claims regarding Mr. Kovacevich

were assigned to Mr. Finch and were no longer of concern to the trust. To the extent

Mr. Kovacevich disagreed with the validity of the Agreement, his claims were rejected

by our prior unpublished decision.

       Mr. Kovacevich lacked any basis in fact or law to compel mediation under

TEDRA. We therefore affirm the superior court’s order quashing Mr. Kovacevich’s

notice of mediation based on lack of standing.

Sanctions

       Mr. Kovacevich also appeals the superior court’s award of attorney fees in favor of

Mr. Finch, Mr. Verhaag and Mr. Spurgetis. “We review an award of fees and costs under

[TEDRA] for abuse of discretion.” In re Survivor’s Tr. of Blankenship, 18 Wn. App. 2d

686, 704, 493 P.3d 751 (2021). “A court abuses its discretion if it exercises it in a manner

that is manifestly unreasonable, on untenable grounds, or for untenable reasons.” Id.

(citing In re Est. of Lowe, 191 Wn. App. 216, 239, 361 P.3d 789 (2015)).

       The superior court did not abuse its discretion in awarding attorney fees. The

TEDRA statute allows for an award of attorney fees “to any party . . . from any party to

the proceedings.” RCW 11.96A.150(1). Although, as set forth above, Mr. Kovacevich

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No. 38979-1-III
In re Madeline M. Thiede Tr.

was not a party to the proceedings, he frivolously represented himself as such when he

sought to compel mediation. In so doing, he subjected himself to liability for attorney fees

as if he were a party. See K&W Children’s Tr. v. Est. of Fay, 20 Wn. App. 2d 862, 874,

503 P.3d 569 (2022) (“When a person not a party of record has been the ‘moving party,’

although [they] lack[] standing, [they] render[] [themselves] liable for the costs that [they

have] caused to be incurred.”).

       Mr. Kovacevich complains the superior court failed to abide by the lodestar

method in assessing fees. However, adherence to the lodestar method is not required in

the TEDRA context. See Survivor’s Tr., 18 Wn. App. 2d at 705; see also In re

Guardianship of Decker, 188 Wn. App. 429, 447, 353 P.3d 669 (2015) (“[If] the primary

considerations for the fee award are equitable, courts are not required to apply the

lodestar method to determine an award of fees.”). RCW 11.96A.150 affords discretion to

award attorney fees based on equitable considerations.

       Mr. Kovacevich contends the superior court failed to enter written findings of

fact to support its fee award. But the court’s letter ruling dated May 31, 2022, clearly

identifies its legal and equitable basis for granting fees. The court reasonably found

Mr. Kovacevich’s motion for reconsideration to be baseless and frivolous.

       The award of fees is affirmed.

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No. 38979-1-III
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                           APPELLATE ATTORNEY FEES

       The parties have both submitted requests for appellate attorney fees. Under

RAP 18.1(a), this court may award attorney fees and costs on appeal “[i]f applicable law”

allows. RCW 11.96A.150 allows superior courts and appellate courts to order a party to a

TEDRA action to pay another party’s reasonable attorney fees “to be paid in such amount

and in such manner as the court determines to be equitable. In exercising its discretion

under this section, the court may consider any and all factors that it deems to be relevant

and appropriate.”

       We agree with Gordon Finch and Gerald Verhaag that this is an appropriate case

for an award of fees. Mr. Kovacevich had no standing to file a notice under TEDRA

compelling mediation. His arguments on appeal are based on frivolous theories that have

been previously rejected by this court and others. Fees and costs against Mr. Kovacevich

and in favor of the Mr. Finch and Mr. Verhaag are appropriate.

                                     CONCLUSION

       The orders on appeal are affirmed. We award reasonable attorney fees and costs

on appeal to Gordon Finch and Gerald Verhaag subject to their timely compliance with

RAP 18.1(d).

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No. 38979-1-III
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       A majority of the panel has determined this opinion will not be printed in

the Washington Appellate Reports, but it will be filed for public record pursuant to

RCW 2.06.040.

                                          _________________________________
                                          Pennell, J.

WE CONCUR:

______________________________
Fearing, C.J.

______________________________
Cooney, J.

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