Home of Hope, Inc. v. McDonald

858 S.W.2d 271, 1993 Mo. App. LEXIS 1125
Missouri Court of Appeals·Decided July 22, 1993·No. Nos. 18230 and 18245·Published·Cited by 6 cases

Opinion

CROW, Presiding Judge.

Although involving only an attorney fee, the issues presented by these cross-appeals require a conspectus of the litigation. The sources of most facts are McDonald v. McDonald, 814 S.W.2d 939 (Mo.App.S.D.1991), henceforth referred to as “McDonald-I,” and Matter of Trust of McDonald, 849 S.W.2d 150 (Mo.App.S.D.1993), henceforth referred to as “Me-[273]*273Donald-11.” Anyone preferring a detailed account of the epic may peruse those opinions. In the present opinion, we set forth only the facts pertinent to the issues raised by the instant appeals.

In 1979, Carl E. McDonald established an inter vivos revocable trust. McDonald-I, 814 S.W.2d at 943. The trust provided certain benefits for his wife, Betty, whom he had married in 1974. Id. at 942. At Carl’s insistence, Betty executed deeds conveying several tracts of real estate to the trustee. Id. at 943.

During his lifetime, Carl executed four amendments to the trust indenture: May 15, 1980; November 26, 1983; December 23, 1983; February 12, 1987. Id. In the fourth amendment, Carl purported to eliminate any interest or benefit Betty had under the trust. Id.

Carl died June 18, 1988. Id. at 942. After Carl’s death, the successor trustee filed a petition in the Circuit Court of Jasper County praying that he be allowed to resign and that a second successor trustee be appointed. Id. at 944. We henceforth refer to that proceeding as “the circuit court proceeding.” The Circuit Court appointed C. Ross Rhoades as second successor trustee. Id.

Probate of Carl’s estate was commenced in the Probate Division of the Circuit Court of Jasper County. Id. We henceforth refer to that proceeding as “the probate proceeding.” Carl’s widow, Betty, was appointed Personal Representative in the probate proceeding. Id.

On February 17,1989, in the circuit court proceeding, Betty filed a motion seeking an order declaring the trust void or voidable, that the trust was revoked during Carl’s lifetime, or in the alternative that the property transferred to the trust was transferred in fraud of her marital rights. Id. The trustee filed an answer opposing Betty’s motion. Id.

On February 21,1989, Betty, as Personal Representative of Carl’s estate, filed in the probate proceeding a petition to determine title and right to possession of 32 items of property. Id. The petition averred, inter alia, that some of the properties had reference to the trust which the Personal Representative believed was void or voidable, and such properties were not properly placed in the trust even if it were valid. Id.

Lawyer Ronald E. Mitchell represented Betty in both proceedings.

The circuit court proceeding and the probate proceeding were thereafter consolidated for trial and disposition. Id. at 945.

On February 1, 1990, the lawyer for trustee Rhoades filed a motion for approval of trustee fees and attorney fees. The motion averred, inter alia, that Betty was challenging the validity of the trust. The motion also pled that the trustee and his lawyer had expended considerable time supervising the affairs and property of the trust and defending various suits against the trust in Missouri and Kansas.

On February 6,1990, Betty, through lawyer Mitchell, filed a “Response” to the motion for approval of trustee fees and attorney fees. The Response alleged Home of Hope, Inc., was primary beneficiary of the trust, and the trustee and his lawyer had been “acting as adversaries for the Home of Hope.” Therefore, said the Response, payment of fees for the trustee and his lawyer should come from Home of Hope. Alternatively, the Response prayed that if the trust be found valid, the trust be responsible for all attorney fees incurred by Betty.

The next day, February 7, 1990, trustee Rhoades, lawyer Mitchell, and Grant Scott, counsel for Home of Hope, appeared in court and discussed the attorney fee issue. This parley supplies the basis for the attorney fee award which is the subject of these appeals. We shall set forth the evidence regarding this incident infra, when we address the assignments of error. In the meantime, we continue the narrative in chronological order.

The issues raised by Betty’s motion of February 17, 1989, in the circuit court proceeding, and by her petition of February 21, 1989, as Personal Representative in the probate proceeding, were tried in 1990, sometime after the February 7, 1990, incident referred to in the preceding para[274]*274graph. The trial court entered judgment holding: (1) the trust and first three amendments thereto were valid, (2) the trust assets were not subject to Betty’s marital rights, (3) the fourth amendment to the trust indenture was void, (4) Betty must account to the court and the trustee, and should receive certain compensation, (5) the trust must pay Betty’s lawyer $25,-764.86, (6) the trust must hold Betty harmless from certain creditors, (7) Betty’s challenge to the validity of the trust did not affect her rights as a beneficiary under it. 814 S.W.2d at 941-42.

Three appeals were taken from that judgment — by Betty, trustee Rhoades, and Home of Hope, respectively. Id. at 942.

In McDonald-1, this Court affirmed holdings 1, 2 and 3. 814 S.W.2d at 951. This Court further held the issues adjudicated by holdings 4, 6 and 7 were not before the trial court. Id. at 950. Those holdings were reversed. Id. at 951. As to holding 5, this Court ruled there was nothing in the record to support the award of attorney fees for Betty; consequently, that holding was reversed. Id.

Thereafter, further activity occurred in the trial court. Home of Hope moved for a declaratory judgment enforcing a “forfeiture provision” in the trust indenture against Betty. McDonald-II, 849 S.W.2d at 150-51. The provision stated, in substance, that if Betty were unwilling to accept the benefits provided her by the trust, she should have the share of Carl’s estate to which she was entitled by a prenuptial agreement, i.e., $25,000. Id. at 151.

In response to Home of Hope’s motion for declaratory judgment, Betty filed a “cross-claim and counterclaim” for attorney fees. It alleged, inter alia:

2. The trust assets ... required an extensive amount of legal work and effort and it would have been wasteful and duplicative for [the trustee’s attorney and Betty’s attorney] to work on every issue until the validity of the trust was established.
[[Image here]]
4. On February 7, 1990 the trustee and the attorney for the Home of Hope ... agreed that said attorney fees would be paid from the trust assets if the trust was held to be valid. Likewise Betty ... agreed to pay the attorney fees of the attorney hired by the trustee if the trust was declared to be invalid. Such agreement was fair and reasonable because the efforts of both attorneys protected and safeguarded the assets of the trust and thereby benefited the trust including, but not limited to the following:
a.

Free access — add to your briefcase to read the full text and ask questions with AI

Home of Hope, Inc. v. McDonald, 858 S.W.2d 271, 1993 Mo. App. LEXIS 1125 (Mo. Ct. App. 1993).

858 S.W.2d 271 (Home of Hope, Inc. v. McDonald) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Baker v. Empire District Electric Co.
24 S.W.3d 255 (Missouri Court of Appeals, 2000)
Home of Hope, Inc. v. McDonald
942 S.W.2d 926 (Missouri Court of Appeals, 1997)
In Re McDonald Revocable Trust
942 S.W.2d 926 (Missouri Court of Appeals, 1997)
Boshers v. Humane Society of Missouri, Inc.
929 S.W.2d 250 (Missouri Court of Appeals, 1996)
State Ex Rel. Boshers v. Dotson
879 S.W.2d 730 (Missouri Court of Appeals, 1994)
Woodfill v. Shelter Mutual Insurance Co.
878 S.W.2d 101 (Missouri Court of Appeals, 1994)