Court Opinion

ID: 4153138
Source: CourtListenerOpinion
Date Created: 2017-03-16 07:10:03.463287+00
Date Added: 2024-06-11T14:33:35.782085
License: Public Domain

STATE OF MICHIGAN

                            COURT OF APPEALS

In re Estate of VANDECAR.

MARCIA LYNNE BROWN,                                                UNPUBLISHED
                                                                   March 14, 2017
               Appellant,

v                                                                  No. 330786
                                                                   Ingham Probate Court
BARBARA SCHNATTER, Personal                                        LC No. 14-000743-DE
Representative of the Estate of MARY
ELIZABETH VANDECAR,

               Appellee.

Before: CAVANAGH, P.J., and SAWYER and SERVITTO, JJ.

PER CURIAM.

       Appellant appeals by right an order of the probate court denying her request to remove
appellee as personal representative under MCL 700.3713(2), ordering the sale of estate property,
and awarding attorney fees and costs to appellee under MCR 5.313(A). We affirm.1

                                           I. FACTS

       The decedent’s will named appellee as personal representative of the decedent’s estate
and devised the decedent’s house to appellant, and then to the decedent’s nieces “[i]f [appellant]
predeceases me or does not want the house.” The decedent’s two nieces are appellee’s
daughters.

       Appellee chose to work with a title insurance company to effectuate the transfer of the
house to appellant. According to appellee, the title insurance company required “an agreement
between the parties.” Appellant took exception to the transfer agreement drafted by appellee’s
attorney, as well as appellee’s enlistment of a title insurance company, and all subsequent

1
 After appellant filed her claim of appeal, appellee resigned as personal representative and her
daughter was named successor personal representative.

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attempts made to reach agreement and file the necessary transfer document were futile. After a
series of pleadings were filed, the court ultimately denied appellant’s petition to have appellee
removed as personal representative, ordered that the home be sold, and ordered that appellant
should bear the “reasonable costs and attorney fees above the $3,000 expected costs of
administration.”

                                         II. ANALYSIS

                                     A. ATTORNEY FEES

        Appellant raises several arguments challenging the award of attorney fees to appellee.
Appellant argues that under MCR 5.313, if an attorney charges fees to an estate, the personal
representative must file a notice of fee agreement using form SCAO PC 576, and deliver a copy
to interested parties. Appellant asserts that appellee did not comply with this procedure. Related
to this argument is appellant’s assertion that the court erred when it awarded attorney fees as
reasonable estate expenses because the required notice was not filed. Additionally, appellant
argues that, because the petition for attorney fees was in reality a claim against appellant for
damages, appellee was required to initiate a civil action under MCR 5.101(C)(1), which appellee
failed to do.

                                         1. MCR 5.313

        Appellant claims that appellee failed to send the required notice that she had hired an
attorney to help with the administration of the estate; thus, attorney fees should not have been
awarded. A trial court’s decision ordering the payment of attorney fees is reviewed for an abuse
of discretion and its findings of fact on which the award is based are reviewed for clear error.
Stallworth v Stallworth, 275 Mich App 282, 288; 738 NW2d 264 (2007). “An abuse of
discretion occurs when the court’s decision falls outside the range of reasonable and principled
outcomes.” Ypsilanti Charter Twp v Kircher, 281 Mich App 251, 273; 761 NW2d 761 (2008).

         MCR 5.313(A) provides that “[a]n attorney is entitled to receive reasonable
compensation for legal services rendered on behalf of a personal representative, and to
reimbursement for costs incurred in rendering those services.” The rule goes on to provide that,
once the attorney begins representing the personal representative, the two “must enter into a
written fee agreement signed by them. A copy of the agreement must be provided to the
personal representative.” MCR 5.313(B). The personal representative is required to “mail to the
interested persons whose interests will be affected by the payment of attorney fees, a notice in
the form substantially approved by the State Court Administrator and a copy of the written fee
agreement.” MCR 5.313(D). This must be done “[w]ithin 14 days after the appointment of a
personal representative or the retention of an attorney by a personal representative, whichever is
later[.]” Id.

        The probate court found that the personal representative, appellee, filed the appropriate
form and delivered a copy to appellant. This is supported by the record, as appellee appended
the notice to her brief in response to appellant’s motion to remove. The notice is on SCAO PC
576, the same form appellant asserts should have been used. Appellant introduced no evidence

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to suggest that appellee did not in fact send the notice. Accordingly, the probate court did not
clearly err when it found that appellee complied with MCR 5.313(D). See Stallworth, 275 Mich
App at 288.

                                       2. MCR 5.101(C)(1)

        Appellant’s assertion that the fee award was in error because appellee did not bring a
civil action pursuant to MCR 5.101(C)(1) was not raised below, and thus will be reviewed for
plain error affecting substantial rights. See Kern v Blethen-Coluni, 240 Mich App 333, 336; 612
NW2d 838 (2000). “To avoid forfeiture under the plain error rule, three requirements must be
met: 1) the error must have occurred, 2) the error was plain, i.e., clear or obvious, 3) and the
plain error affected substantial rights.” Id. (citation omitted).

        Appellant relies on MCR 5.101(C)(1) as authority for the proposition that a fiduciary
must file a civil action to recover “damages” consisting of attorney fees. MCR 5.101(A)
instructs that “[t]here are two forms of action, a ‘proceeding’ and a ‘civil action,’ ” and subrule
(C) provides that “any action against another filed by a fiduciary or trustee” is a civil action that
must be “commenced by filing a complaint.” MCR 5.101(C)(1). “A proceeding is commenced
by filing an application or a petition with the court.” MCR 5.101(B).

        In December 2014, appellee requested that the probate court direct appellant to “sign the
Transfer Agreement so the house may be transferred to her or return the house to the estate so it
may be transferred to alternate devisees.” In May 2015, appellee filed a motion to authorize
transfer, in which she stated that appellant and her attorney had not responded to numerous
communications regarding effectuating the transfer. Also in May 2015, appellee filed a motion
to find appellant in contempt of court, assess attorney fees, and authorize a transfer and lien, all
predicated on the failure to effectuate a transfer of the real estate.

       Subsequently, appellant petitioned the probate court to remove appellee as personal
representative under MCL 700.3611(2)(c)(iv), which was also predicated on the dispute
regarding transfer. And after responding to appellant’s motion to have her removed as personal
representative, appellee filed a petition to sell the house, stating the “amount of attorney fees
now accumulated as a result of attempting to work with [appellant’s] attorney equals or exceeds
the amount of monies left in the estate account.” Appellee further requested that the court
“[d]educt the fines, costs and attorney fees awarded to [appellee] from the Motion to Find
Devisee in Contempt of Court from [appellant’s] proceeds from the sale of the house.”

       None of appellee’s filings constitute an “action against another filed by a fiduciary.”
MCR 5.101(C)(1). Rather the various motions and responses all centered on the transfer of the
house, which was properly addressed through “[a] proceeding . . . commenced by filing an
application or petition[.]” MCR 5.101(B). See also In re Beatrice Rottenberg Living Trust, 300
Mich App 339, 356 n 12; 833 NW2d 384 (2013).

        The Estates and Protected Individuals Code (EPIC), MCL 700.1101 et seq., provides that
“[i]f a personal representative or person nominated as personal representative defends or
prosecutes a proceeding in good faith, whether successful or not, the personal representative is
entitled to receive from the estate necessary expenses and disbursements including reasonable

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attorney fees incurred.” MCL 700.3720. On the record evidence, the probate court reasonably
found that appellee “has attempted to expedite the matters pertaining to the estate in a diligent
manner and in good faith,” while appellant had failed “to follow Court orders, show a
meaningful intent to settle this claim, or work effectively with opposing counsel to compromise.”
Appellant has not shown plain error affecting her substantial rights.

                                B. SALE OF REAL PROPERTY

        Next, appellant argues that the probate court erred when it granted appellee the authority
to sell the house without filing SCAO PC 681, as mandated by MCR 5.207. To resolve this
issue, we consider the meaning of the cited court rule. We review de novo the interpretation and
application of a court rule as a question of law. Wilcoxon v Wayne Co Neighborhood Legal
Servs, 252 Mich App 549, 553; 652 NW2d 851 (2002). Our goal is to give effect to the intent of
the authors; thus, when language is clear and unambiguous, it must be enforced as written. Id.

       MCR 5.207(A) provides as follows:

               Any petition to approve the sale of real estate must contain the following:
               (1) the terms and purpose of the sale,

               (2) the legal description of the property,

               (3) the financial condition of the estate before the sale, and

               (4) an appended copy of the most recent assessor statement or tax
       statement showing the state equalized value of the property. If the court is not
       satisfied that the evidence provides the fair market value, a written appraisal may
       be ordered.

        The term “sale” means: “the act of selling” and “opportunity of selling or being sold.”
Merriam-Webster’s Collegiate Dictionary (11th). Clearly the court rule speaks to what a
fiduciary must provide when seeking approval for a negotiated sale of real estate. The rule was
originally made effective as of January 1, 2002. 464 Mich cxxxi (2001). That version contained
subrules (A)(1) through (3). Subrule (A)(4) was added in 2005. 474 Mich ccxxxvii (2005). The
comment provided by the 2000 Probate Rules Committee on the purpose of the rule states that it
“permits, but does not require, obtaining prior approval of a decision to sell.” Thus, a fiduciary
is permitted to sell without notifying the probate court, but if the fiduciary seeks approval, it is
not of the right to sell but of the decision to sell according to terms agreed upon by seller and
buyer. The staff comment regarding the 2005 amendment states that it “allows for better court
oversight when real property is sold” (emphasis added), not when the fiduciary seeks authority to
sell. Until a sale has been negotiated, there is nothing for the court to approve under MCR
5.207(A). Indeed, the form cited by appellant, SCAO PC 681, includes sections to inform the
probate court of the name of the buyer, the sale price, and terms of the sale. SCAO PC 681, § 2.
This information—particularly the name of the buyer—would not be known until a sale had been
negotiated and a “meeting of minds” reached. Thus, this argument is without merit.

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                C. PETITION TO REMOVE PERSONAL REPRESENTATIVE

        Last, appellant argues that the probate court erred when it refused to remove appellee as
personal representative because she had a conflict of interest. A court’s decision on the removal
of a fiduciary is reviewed for an abuse of discretion. In re Kramek Estate, 268 Mich App 565,
576; 710 NW2d 753 (2005).

        Appellant cites MCL 700.3713(2) as authority for her contention that appellee had a
conflict of interest. That section provides in part as follows:

              A sale, encumbrance, or other transaction involving the investment or
       management of estate property is presumed to be affected by a conflict between
       personal and fiduciary interests if it is entered into by the personal representative
       with any of the following:

                                             * * *

              (b) The personal representative’s descendant, sibling, or parent or the
       spouse of the personal representative’s descendant, sibling, or parent.

Appellant proffers no evidence that appellee entered into a “sale, encumbrance, or other
transaction” with her daughters with respect to the house. Instead, appellant raises a speculative
argument based on conjecture about the motivation of appellee in taking actions that appellant
alleges caused her to not want to take the house under the will. However, appellee’s actions
were fully compliant with the commands of the will. Indeed, appellee asserted that she “is and
always has been ready and willing to transfer the house” to appellant and many of the various
motions brought by appellee were to effectuate that transfer by requiring appellant to sign a
transfer agreement. Further, it was the testator who set forth the provision providing for transfer
of the house to appellee’s daughters (the testator’s nieces) “with the residue of my estate” in the
event that appellant decided she did not want the house. The testator also expressed that she
wanted the estate’s personal representative, appellee, “to have maximum flexibility.” Therefore,
the trial court did not abuse its discretion when it refused to remove appellee as personal
representative pursuant to an unsubstantiated conflict of interest allegation.

       Affirmed. Appellee is entitled to tax costs as the prevailing party. See MCR 7.219(A).

                                                             /s/ Mark J. Cavanagh
                                                             /s/ David H. Sawyer
                                                             /s/ Deborah A. Servitto

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