In re the Estate of Rich

117 A.D.3d 1103, 985 N.Y.S.2d 297

This text of 117 A.D.3d 1103 (In re the Estate of Rich) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the Estate of Rich, 117 A.D.3d 1103, 985 N.Y.S.2d 297 (N.Y. Ct. App. 2014).

Opinion

McCarthy, J.

Appeals (1) from an order of the Surrogate’s Court of Delaware County (Becker, S.), entered January 27, 2012, which, in four proceedings pursuant to SCPA article 22, among other things, partially granted Lester A. Sittler’s motion to, among other things, limit certain discovery demands made by Katherine M. Rich, (2) from an order of said court, entered February 19, 2013,1 which, in three proceedings pursuant to SCPA article 22, among other things, denied Katherine M. Rich’s motion for partial summary judgment sustaining certain of her objections to accountings of the estate of Walter G. Rich and a related trust, and (3) from an order of said court, entered June 13, 2013, which, in three proceedings pursuant to SCPA article 22, among other things, denied Katherine M. Rich’s motion for partial summary judgment sustaining certain of her objections to accountings of the estate of Walter G. Rich and a related trust.

In 1990, Walter G. Rich (hereinafter decedent) and Katherine M. Rich (hereinafter Rich) entered into an antenuptial agreement that, among other things, provided her with certain benefits if decedent predeceased her. In July 2007, decedent executed a will leaving all of his property to a revocable living trust, the Walter G. Rich Revocable Living Trust (hereinafter the RLT). As relevant here, the RLT provided that, upon decedent’s death, the trustee was required to make distributions to a separate trust, created by the RLT to benefit Rich and entitled, Trust for the Benefit of Katherine M. Rich (hereinafter TBR). Decedent died in August 2007.

[1105]*1105Rich commenced the first of these proceedings seeking to compel an accounting of the estate. Lester A. Sittler, executor of decedent’s estate and trustee of the RLT, petitioned for the judicial settlement of the accounts of the estate and the RLT. Rich made numerous objections to both accounts. The trustees of the TBR also filed a petition to settle the account for that trust.

In response to Rich’s discovery demands related to these proceedings, Sittler moved to deny or limit various discovery demands and to quash or modify various subpoenas (see CPLR 2304, 3103). By order entered in January 2012, Surrogate’s Court partially granted Sittler’s motion, denying Rich certain document discovery and limiting subpoena questions as to certain witnesses to a time period starting with decedent’s death. Rich appeals from that order.

Rich moved for partial summary judgment to sustain her objections to the accountings regarding her claim that she was entitled to separate benefits under the antenuptial agreement and under the RLT. Sittler cross-moved for summary judgment. By order entered in February 2013, Surrogate’s Court denied the motion and cross motion. Rich appeals from that order.

Rich again moved for partial summary judgment, this time on her objections claiming that the amount to fund the TBR to be received from the RLT should not have included the amount of a separate nonprobate asset, a certain 401(k) savings plan that decedent designated, by beneficiary designation form, to be transferred directly to the TBR. Sittler cross-moved for, among other things, specific disclosure deadlines. By order entered in June 2013, Surrogate’s Court denied Rich’s motion and granted the cross motion. Rich appeals from that order as well. We now address all three appeals.

Surrogate’s Court acted within its discretion in limiting disclosure. The court did not abuse its discretion in narrowing the time frame of relevant material to the period after decedent’s death, considering the scope of these proceedings, which are limited to the accounting and administration of the estate and trust—and do not include decedent’s pre-death estate planning (see Matter of Cahn, 161 AD2d 1065, 1066 [1990], lv dismissed 77 NY2d 939 [1991]; Capitol Hitt Twin Towers Corp. v Apcoa Div., ITT Consumer Servs. Corp., 45 AD2d 777, 777 [1974]; see also SCPA 2211; Matter of 425 Park Ave. Co. v Finance Adm’r of City of N.Y., 69 NY2d 645, 648 [1986]). The court also did not err in denying access to the one challenged category of documents, based on Rich’s failure to prove, in her motion submissions, the relevancy and materiality of the demanded documents. Thus, we affirm the January 2012 order.

[1106]*1106In the February 2013 order, Surrogate’s Court correctly denied Rich’s motion for summary judgment on her objections regarding the antenuptial agreement. Rich failed to meet her prima facie burden of submitting proof of a legally operative agreement that was not fulfilled (compare Education Plus, Inc. v Glasser, 112 AD3d 1125, 1125-1126 [2013]). Rich submitted the antenuptial agreement, which provided, as relevant here: “Upon the death of [decedent], if [Rich] shall survive [decedent, Rich] shall receive and accept from [decedent] an amount equal to [33V3%] of [decedent’s] adjusted gross estate which shall be payable to a trust for [Rich’s] benefit from which [Rich] shall be the sole income beneficiary for life. . . . It is the intention of the parties that the trust for [Rich’s] benefit will qualify for the marital deduction for federal estate tax purposes.” Rich also submitted the RLT, which contained the following provision: “If [Rich] survives [decedent], an amount equal to fifty percent (50%) of the residuary trust estate or [$6 million], whichever is greater, shall be held by Trustee, as a separate trust fund, to be known as the [TBR].” The RLT provided that the TBR would pay Rich certain amounts in regular installments “during her lifetime,” in amounts greater than its income, and the TBR had no other beneficiary during her lifetime. Rich acknowledges that the TBR received $6 million, which was more than 50% of the residuary trust estate and also more than 331¡3% of decedent’s gross adjusted estate.

To prevail, Rich had to show that the benefits provided to her under the RLT were a legal obligation separate and distinct from her rights under the antenuptial agreement. We agree with Rich that the antenuptial agreement is a valid contract, but we find that decedent complied with his obligation under that contract. The antenuptial agreement permits the parties to provide additional benefits to the other party through their respective estate planning. Decedent chose to provide Rich more through the RLT than he was required to under the antenuptial agreement, but Rich did not show that decedent intended to provide her benefits through the RLT that were entirely separate and additional to the benefits promised under the antenuptial agreement. In construing a trust agreement, courts are “required to ascertain the intention of the grantor by looking first to the words used in the trust agreement and effectuating that intent as long as it is not contrary to public policy or established rules of law” (Matter of Andrews v Trustco Bank, Natl. Assn., 289 AD2d 910, 911 [2001]; see Matter of Myers, 45 AD3d 955, 957 [2007]; Matter of Clark, 304 AD2d 1034, 1034 [2003]). Aside from some smaller specific bequests and trusts for Rich’s children, decedent’s dual major intent through the [1107]*1107RLT was to provide for Rich and to fund a charitable foundation. Rich asserts that she is entitled to one third of decedent’s estate under the antenuptial agreement plus $6 million from the remaining two thirds of his estate.

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Bluebook (online)
117 A.D.3d 1103, 985 N.Y.S.2d 297, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-estate-of-rich-nyappdiv-2014.