Graham v. Boerger

2015 Ohio 3261

• Court: Ohio Court of Appeals
• Decided: August 14, 2015
• Docket: 2014-CA-17
• Status: Published

Opinion

[Cite as Graham v. Boerger, 2015-Ohio-3261.]

IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT DARKE COUNTY

KIMBERLY GRAHAM : : Appellate Case No.2014-CA-17 Plaintiff-Appellant : : Trial Court Case Nos. 10-1-198 v. : Trial Court Case Nos. 12-4-001 : CHRIS H. BOERGER, et al. : (Civil Appeal from Common Pleas : Court, Probate) Defendants-Appellees : :

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OPINION

Rendered on the 14th day of August, 2015.

ANDREW T. WHITE, Atty. Reg. No. 0074041, Dysinger & Patry, LLC, 249 South Garber Drive, Tipp City, Ohio 45371 Attorney for Plaintiff-Appellant

JAMES S. DETLINE, Atty. Reg. No. 0042728, Detling, Harlan & Fliehman, Ltd., 421 Public Square, Greenville, Ohio 45331 Attorney for Defendant-Appellee, Chris H. Boerger

JOSHUA KOLTAK, Atty. Reg. No. 0078164, 100 South Main Avenue, Sidney, Ohio 45365 Attorney for Defendant-Appellee, David Boerger

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FAIN, J.

{¶ 1} The parties, Kimberly Graham, Diane Birt, and Chris, Theodore, Frank,

Jeffrey and David Boerger, are siblings, who shared in the assets of their mother’s trust

and estate as her beneficiaries. Kimberly Graham appeals from an order of the Darke

County Probate Court rejecting her caretaking claim against the estate, after the parties

had reached a settlement of all claims.

{¶ 2} We conclude that the trial court did not err in interpreting the settlement

agreement as a full release of all claims, thus preventing Graham from pursuing

additional claims not identified in the settlement agreement. Accordingly, the judgment of

the Probate Court is Affirmed.

I. The Course of Proceedings

{¶ 3} After Dorothy E. Boerger’s death on June 30, 2010, a case was opened in

Darke County Probate Court for a complete administration of her estate. Pursuant to her

will, Dorothy Boerger directed the payment of all debts of her estate, with the residue

passing to her seven children in equal shares. The will appointed Chris and Theodore

Boerger, as co-executors of the will, which was approved by the trial court in an entry

appointing them as fiduciaries for the estate. Chris and Theodore had previously been

named as co-trustees of the Dorothy E. Boerger Trust established in 1997. In the first

inventory and appraisal, the estate was valued at $238,159.82. On the schedule of

assets, it was noted that payments were being made on two promissory notes for loans to

two of the seven children, which had substantial balances owed to the estate: $102,000 -3- and $92,400. The relationship between the siblings became hostile, and allegations

regarding missing assets and debts of the estate were reported to the court. One of the

executors produced two letters, allegedly signed by the mother two hours before her

death, itemizing advancements and loans, and expressing an intention to reduce certain

indebtedness. More letters were sent to the trial court with allegations of mismanagement

of the estate, which led to a status conference conducted before the court Magistrate. A

Magistrate’s Order described the acrimony between the siblings, detailed the contested

issues, and encouraged the parties to reach a global settlement of all claims. Dkt. 83-87.

Shortly thereafter, Graham filed a motion to remove her brothers as fiduciaries of the

estate and to appoint an attorney as a neutral administrator. The trial court approved the

request to remove the co-executors and approved appointment of an attorney as the

fiduciary of the estate.

{¶ 4} Graham also filed a separate action in the Darke County Probate Court to

remove her brothers as co-trustees of the Dorothy E. Boerger Trust. Chris and

Theodore both filed their resignations as co-trustees, and the court approved

appointment of the same attorney who had been appointed as fiduciary for the estate.

Numerous documents were filed attempting to challenge financial transactions of the

trust, and allegations were made suggesting theft, fraud, conversion and other

misfeasance. In a document itemizing the assets, disbursement, and receipts for the trust

from 6/11/12 to 3/5/13, it was reported that the trust had assets worth $664,314.23. The

parties attempted to engage in discovery, and the matter was set for trial to resolve

contested issues. Graham’s 150-page trial brief attempts to summarize and document

the issues related to each of the siblings, whether the debts should be considered -4- advancements, and whether the law requires reimbursement to an estate of any

advancement to a beneficiary when the amount exceeds that beneficiary’s share of the

estate. After two days of trial, Graham’s attorney prepared a proposed written settlement

agreement, exchanged drafts with opposing counsel, made revisions to the agreement,

and then sent it to the court for approval. On March 6, 2014, a hearing was conducted

before the Magistrate, and Graham’s attorney explained the amount of each sibling’s

advancement to be charged against that sibling’s share of the estate, and that Graham

was reserving the right to file a motion asking for payment of her legal fees from the trust.

Approval of the settlement agreement was verbally verified on the record by all seven

siblings. During the hearing, the Magistrate confirmed the finality of the agreement by

stating, “The whole idea is being no more delay. It’s done. There’s no appeal of my

decision or appeal to the Court of Appeals.” The written settlement agreement prepared

as an “Agreed Judgment Entry” was signed by all siblings, and their attorneys, and

approved by the Magistrate and the trial judge. The Agreed Judgment Entry

acknowledges that the entry was intended to resolve the disputes between the parties

regarding “the amount and nature of the debts and advancements that are properly

chargeable against the share of each beneficiary.” It further states that it was intended

“to bring a resolution to this dispute, to allow for the assets of the Estate and Trust to be

distributed, and for the Estate to be closed and the Trust terminated.” Paragraph 4 of the

entry provides that Diane’s note is adjusted to a zero balance, with no right to any share of

the estate residuary and the remaining six siblings will each receive 1/6 of the estate and

trust residuary, less specific adjustments for advancements, “[a]fter payment of all

outstanding claims, expenses and fees which are properly payable by the Estate and or -5- Trust.” The Agreed Judgment Entry includes a release, in paragraph 5, which states:

Each and every party hereby agrees to irrevocably release and

discharge; each and every Party and his or her agents, representatives,

insurers, successors and assigns; the attorney for every party; the

Co-Executors and Administrator WWA of the Estate of Dorothy E. Boerger;

the Co-Trustees of the Dorothy E. Boerger Trust; and all related persons or

entities from all claims relating to the distribution of assets of the Estate and

Trust of Dorothy E. Boerger. (Emphasis added).

{¶ 5} Subsequent to the filing of the agreed judgment entry, Graham filed a

motion for her attorney fees, which was opposed by Chris and David. After the trustee

filed documents referencing his final fees for administering the trust, and the court

approved an order to pay the final fees owed to the administrator of the estate and his

attorney, Jeff filed a motion to pay Graham a caretaking claim of $12,000 as an

outstanding debt of the estate and trust. To support his motion, Jeff attached a document

drafted by the estate fiduciary recognizing Graham’s claim as part of a proposed

settlement, but that proposal was never filed, accepted, or signed by any of the parties.

The record does not contain any documents to establish whether Graham ever filed a

creditor’s claim against the estate, or presented a written claim to the co-executors or the

administrator, in the manner prescribed by R.C. 2117.06. Chris filed a reply opposing

payment of Graham’s claim, on the basis that all claims of the beneficiaries were settled in

the Agreed Judgment Entry. A Magistrate Report and Suggestion of Settlement was sent

to all parties, recommending a compromise by paying $6,000 to satisfy Graham’s

caretaking claim. All seven siblings objected to the suggested settlement. Five objected -6- on the basis that it was precluded by the terms of the agreed judgment entry, and two

objected to the amount of the compromise.

{¶ 6} On August 14, 2014, the Magistrate overruled the motion for payment of

Graham’s caretaking claim, upon the ground that paragraph 5 of the settlement

agreement irrevocably released and discharged all claims to the distribution of assets of

the Estate and Trust. Graham moved to reconsider payment of her claim and/or

objections to the Magistrate’s Decision. The Magistrate overruled her motion for

reconsideration. On November 10, 2014 the trial court adopted the decision of the

Magistrate and overruled Graham’s objections. From this judgment entry, Graham

appeals.

II. Standard of Review

{¶ 7} The specific issue before us calls for an interpretation of the settlement

agreement executed by all the parties. Because resolution of this issue, the interpretation

of a contract, is a matter of law, we employ a de novo standard of review.

{¶ 8} The Supreme Court of Ohio, when reviewing a case involving the

enforcement of a settlement agreement, declared that “Ohio appellate courts must

determine whether the trial court’s order is based on an erroneous standard or a

misconstruction of the law.” Continental W. Condominium Unit Owners Assn. v. Howard

E. Ferguson, Inc., 74 Ohio St.3d 501, 502, 660 N.E.2d 431 (1996). Therefore, the Court

held that the standard of review to be applied “is whether the trial court erred as a matter

of law in dismissing the motion to enforce the settlement agreement.” Id. See also Kilroy

v. Peters, 2d Dist. Montgomery No. 25547, 2013-Ohio-3384, ¶ 38. -7-

III. The Settlement Agreement Did Preclude Any

Additional Claims by the Beneficiaries of the Estate

{¶ 9} Graham’s sole assignment of error is as follows:

THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT

FOUND THAT A SETTLEMENT AGREEMENT DETERMINING THE

DEBTS AND ADVANCEMENTS TO BE CHARGED AGAINST THE

RESIDUAL SHARES OF THE BENEFICIARIES OF AN ESTATE AND

TRUST PRECLUDED PAYMENT OF A CLAIM OF A BENEFICIARY

AGAINST THE ESTATE AND TRUST.

{¶ 10} Arguments presented within this assignment of error include an argument

that the trial court erred in overruling objections to the Magistrate’s Decision, and that the

trial court erred by concluding that Graham’s caretaker claim had been waived.

{¶ 11} “Where the parties enter into a settlement agreement in the presence of

the court, such an agreement constitutes a binding contract.” Spercel v. Sterling

Industries, 31 Ohio St.2d 36, 285 N.E.2d 324 (1972). “It is axiomatic that a settlement

agreement is a contract designed to terminate a claim by preventing or ending litigation

and that such agreements are valid and enforceable by either party.” Continental W.

Condominium Unit Owners Assn. v. Howard E. Ferguson, Inc., 74 Ohio St.3d 501, 502,

660 N.E.2d 431 (1996). “Further, settlement agreements are highly favored in the law.”

Id., citing State ex rel. Wright v. Weyandt , 50 Ohio St.2d 194, 363 N.E.2d 1387 (1977).

{¶ 12} In view of these policies favoring settlement agreements, we must look to

the terms of the agreement to determine whether the parties agreed to a final resolution of -8- all claims of the beneficiaries and intended to preclude any further claims against the

estate or trust, other than the amounts listed in the agreement. In the case before us, the

trial court relied on the express language in the settlement agreement that all parties,

including Graham, agreed to irrevocably release and discharge all claims relating to the

distribution of assets of the Estate and Trust of Dorothy E. Boerger.

{¶ 13} “Generally, courts presume that the intent of the parties to a contract

resides in the language they chose to employ in the agreement.” First Capital Corp. v. G &

J Industries, Inc., 131 Ohio App.3d 106, 115, 721 N.E.2d 1084 (8th Dist.1999), citing Kelly

v. Med. Life Ins. Co., 31 Ohio St.3d 130, 509 N.E.2d 411 (1987). “When the terms in a

contract are unambiguous, courts cannot in effect create a new contract by finding an

intent not expressed in the clear language employed by the parties.” Alexander v.

Buckeye Pipe Line Co., 53 Ohio St.2d 241, 246, 374 N.E.2d 146 (1978). “[I]f no ambiguity

exists, the terms of the contract must simply be applied without resorting to methods of

construction and interpretation.” Buckeye Check Cashing, Inc. v. Madison, 8th Dist.

Cuyahoga No. 90861, 2008-Ohio-5124, ¶ 12.

{¶ 14} As explained by the Eighth District Court of Appeals,

A release ordinarily operates to extinguish a right in exchange for

some consideration and effectively operates as an estoppel or a defense to

an action by the releasor. As such, it is a contract between parties,

enforceable at law subject to the rules governing the construction of

contracts. Whether a release operates upon a certain liability depends

entirely upon the intention of the parties, which is to be gathered from the

language of the release and the state of facts then existing. If the parties to a -9- release intend to leave some things out of a release, then “their intent to do

so should be made manifest.” When the terms of a contract are

unambiguous, courts will not, in effect, create a new contract by finding an

intent not expressed in the language employed by the parties. Moreover,

when the parties have negotiated the release with the assistance of legal

counsel, and both sides have agreed to the language included in the

release, there is an assumption that the parties are fully aware of the terms

and scope of their agreement. (Internal citations omitted).

Weisman v. Blaushild, 8th Dist.Cuyahoga No. 88815, 2008-Ohio-219, ¶ 24.

{¶ 15} We conclude that the language of the release was unambiguous, and was

intended to terminate all claims and end the protracted and hostile litigation between the

Boerger siblings. The intent of the release was identified in the opening paragraph, which

specifically stated that it was “to bring a resolution to this dispute, to allow for the assets of

the Estate and Trust to be distributed, and for the Estate to be closed and the Trust

terminated.” Any claim against the estate assets would necessarily have a direct effect

on the amount of each beneficiary’s share, prevent distribution of assets, and delay the

termination of the estate until the claim’s resolution. Graham does not suggest that her

caretaking claim was new, so that it was not contemplated at the time the settlement

agreement was executed. If her caretaking claim was intended to be left out of the

agreement, it should have been identified in the same manner as the outstanding legal

fee claims that were expressly excluded from the scope of the agreement. To except her

caretaking claim from the release, the trial court would have had to rewrite the contract or

add words that were not written or agreed to by all of the parties. We conclude that the -10- court did not err as a matter of law in its interpretation of the contract in a manner that

gives effect to the parties’ clear intent to release all claims that any of the parties had

against the estate or trust. Graham’s sole assignment of error is Overruled.

IV. Conclusion

{¶ 16} The sole assignment of error having been overruled, the judgment of the

trial court is Affirmed.

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DONOVAN and WELBAUM, JJ., concur.

Copies mailed to:

Andrew T. White James S. Detling Joshua Koltak Diane Birt Frank Boerger Gary Brown Jeffrey Boerger Theodore Boerger Thomas Guillozet Hon. Jason R. Aslinger