Kogut v. Marcelli

2012 Ohio 183

• Court: Ohio Court of Appeals
• Decided: January 17, 2012
• Docket: 2011CA00026
• Status: Published

Opinion

[Cite as Kogut v. Marcelli, 2012-Ohio-183.]

COURT OF APPEALS STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

ROSE KOGUT JUDGES: Hon. W. Scott Gwin, P.J. Plaintiff-Appellant Hon. Sheila G. Farmer, J. Hon. Patricia A. Delaney, J. -vs-

THOMAS MARCELLI Case No. 2011CA00026

Defendant- Appellee OPINION

CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Probate Division, Case Nos. 206212, 209601, and 209620

JUDGMENT: Affirmed

DATE OF JUDGMENT: January 17, 2012

APPEARANCES:

For Plaintiff-Appellant For Defendant-Appellee

EDGAR M. MOORE, JR. DAVID DINGWELL TIMOTHY J. MOORE 220 Market Avenue, South 4940 Munson Street, NW 8th Floor P.O. Box 35426 Canton, OH 44702 Canton, OH 44735 Stark County, Case No. 2011CA00026 2

Farmer, J.

{¶1} On May 27, 2009, the Estate of Mary Marcelli was opened (Case No.

206212). Executor of the estate was her son, appellee, Thomas Marcelli. On March

10, 2010, appellee filed an account. On April 5, 2010, Mary's daughter and appellee's

sister, appellant, Rose Kogut, filed exceptions to the account, claiming appellee failed to

disclose over $160,000.00 in cash and other items.

{¶2} On May 19, 2010, appellee filed a complaint against appellant for

concealment of assets (Case No. 209620). On July 30, 2010, appellant filed her own

complaint for concealment of assets against appellee (Case No. 209601). Appellee

filed an amended complaint in Case No. 209620 on August 6, 2010.

{¶3} On October 6, 2010, the trial court held a hearing on six of appellant's

exceptions, appellant's July 29, 2010 motion to remove appellee as executor, and the

parties' cross-complaints for concealment of assets. By judgment entry and findings of

fact and conclusions of law filed January 7, 2011, the trial court found appellee

established a prima facie case for the concealment of assets and appellant did not meet

her burden in establishing joint and survivor accounts between her and Mary (Account

Nos. 473-8 and 465-7). The trial court ordered appellant to pay Mary's estate

$88,872.21 which represented funds she withdrew during Mary's lifetime, and pay the

estate an additional $22,921.22 and $2,573.54 out of the remaining funds in the joint

accounts. The trial court also ordered appellee to pay Mary's estate $37,800.00 which

represented cash he received from his father Nick prior to his death who died prior to

Mary, found appellee concealed $500.00 of Mary's cash, and removed appellee as

executor. Stark County, Case No. 2011CA00026 3

{¶4} Appellant filed an appeal on February 7, 2011 and assigned the following

errors:

I

{¶5} "THE TRIAL COURT ERRED BY NOT APPLYING THE CORRECT

STANDARD FOR THE ESTABLISHMENT OF A PRIMA FACIE CASE FOR

CONCEALMENT OF ASSETS."

II

{¶6} "THE TRIAL COURT ERRED BY PLACING THE BURDEN OF PROOF

ON ROSE TO SHOW THE EXISTENCE OF A JOINT AND SURVIVOR ACCOUNT."

III

{¶7} "THE TRIAL COURT ERRED IN FINDING THAT ABSENCE OF AN

ACCOUNT SIGNATURE CARD IS DETERMINATIVE TO THE ESTABLISHMENT OF A

JOINT AND SURVIVOR ACCOUNT."

IV

{¶8} "THE TRIAL COURT WENT AGAINST THE MANIFEST WEIGHT OF

THE EVIDENCE WHEN IT DETERMINED THE DEFENDANT WAS GUILTY OF

CONCEALING ESTATE ASSETS."

{¶9} Appellee filed a cross-appeal on February 15, 2011 and assigned the

following errors:

CROSS-ASSIGNMENT OF ERROR I

{¶10} "THE TRIAL COURT ERRED BY ORDERING TOM TO PAY MARY'S

ESTATE $37,800.00 REPRESENTING THE CASH GIFT MADE BY NICK OF HIS

CASH TO TOM PRIOR TO HIS DEATH." Stark County, Case No. 2011CA00026 4

CROSS-ASSIGNMENT OF ERROR II

{¶11} "THE TRIAL COURT ERRED BY FINDING THAT TOM CONCEALED

$500.00 OF MARY'S CASH."

CROSS-ASSIGNMENT OF ERROR III

{¶12} "THE TRIAL COURT ERRED BY REMOVING TOM AS THE EXECUTOR

OF MARY'S ESTATE."

{¶13} This matter is now before this court for consideration.

I, II, III, IV

{¶14} Appellant's assignments of error challenge the trial court's decision,

claiming the trial court did not hold appellee to his burden of meeting the requirements

of Silcott v. Prebble, Clermont App. No. CA2002-04-028, 2003-Ohio-508, shifting the

burden to her to establish the existence of joint and survivor accounts, misapplying

Wright v. Bloom, 69 Ohio St.3d 596, 1994-Ohio-153, and the decision was against the

manifest weight of the evidence. We note appellant is not challenging the order that

she pay $88,872.21 to Mary's estate, but is challenging the order that she pay Mary's

estate $22,921.22 and $2,573.54 out of the joint accounts, Nos. 473-8 and 465-7,

respectively.

{¶15} R.C. 2109.50 and 2109.52 provide for the filing of a complaint for the

concealment of assets and the procedures for such action:

{¶16} "[R.C. 2109.50] Upon complaint made to the probate court of the county

having jurisdiction of the administration of a trust estate or of the county wherein a

person resides against whom the complaint is made, by a person interested in such

trust estate or by the creditor of a person interested in such trust estate against any Stark County, Case No. 2011CA00026 5

person suspected of having concealed, embezzled, or conveyed away or of being or

having been in the possession of any moneys, chattels, or choses in action of such

estate, said court shall by citation, attachment or warrant, or, if circumstances require it,

by warrant or attachment in the first instance, compel the person or persons so

suspected to forthwith appear before it to be examined, on oath, touching the matter of

the complaint.***

{¶17} "The probate court may initiate proceedings on its own motion.

{¶18} "The probate court shall forthwith proceed to hear and determine the

matter.

{¶19} "The examinations, including questions and answers, shall be reduced to

writing, signed by the party examined, and filed in the probate court.

{¶20} "If required by either party, the probate court shall swear such witnesses

as may be offered by either party touching the matter of such complaint and cause the

examination of every such witness, including questions and answers, to be reduced to

writing, signed by the witness, and filed in the probate court.

{¶21} "[R.C. 2109.52] When passing on a complaint made under section

2109.50 of the Revised Code, the probate court shall determine, by the verdict of a jury

if either party requires it or without if not required, whether the person accused is guilty

of having concealed, embezzled, conveyed away, or been in the possession of moneys,

chattels, or choses in action of the trust estate. If such person is found guilty, the

probate court shall assess the amount of damages to be recovered or the court may

order the return of the specific thing concealed or embezzled or may order restoration in

kind. The probate court may issue a citation into any county in this state, which citation Stark County, Case No. 2011CA00026 6

shall be served and returned as provided in section 2109.50, requiring any person to

appear before it who claims any interest in the assets alleged to have been concealed,

embezzled, conveyed, or held in possession and at such hearing may hear and

determine questions of title relating to such assets. In all cases, except when the

person found guilty is the fiduciary, the probate court shall forthwith render judgment in

favor of the fiduciary or if there is no fiduciary in this state, the probate court shall render

judgment in favor of the state, against the person found guilty, for the amount of the

moneys or the value of the chattels or choses in action concealed, embezzled,

conveyed away, or held in possession, together with ten per cent penalty and all costs

of such proceedings or complaint; except that such judgment shall be reduced to the

extent of the value of any thing specifically restored or returned in kind as provided in

this section.

{¶22} "If the person found guilty is the fiduciary, the probate court shall forthwith

render judgment in favor of the state against him for such amount or value, together

with penalty and costs as provided in this section."

{¶23} In Silcott at ¶34, our brethren from the Twelfth District stated the following:

{¶24} "In her fifth assignment of error, Lana argues that the probate court erred

by awarding judgment only against Roger and Robert, the attorneys-in-fact. Lana

argues that judgment should also have been entered against the other six appellees for

receiving funds improperly from the attorneys-in-fact. We disagree. Unlike Roger and

Robert, the other six appellees were not attorneys-in-fact in charge of Lowell's assets.

In addition, although claiming in her complaint that all of appellees had concealed,

embezzled, or conveyed away $126,800, Lana failed to produce any evidence to trace Stark County, Case No. 2011CA00026 7

any assets to those six appellees. It is well established that in a proceeding for

concealment of assets, the burden of proof is upon the complainant to establish a prima

facie case by direct evidence. Maag, Troy, and Barlow, 2002 Ohio Probate Practice

and Procedure, 144, Section 12.08; see, also, In re Estate of Woods (1959), 110 Ohio

App. 277, 167 N.E.2d 122. Lana has failed to meet her burden."

{¶25} In its judgment entry filed January 7, 2011, the trial court found the burden

rested upon appellee. It is appellant's position that her testimony alone was sufficient to

establish joint and survivor accounts, and no other extrinsic evidence should have been

permitted under Wright, supra.

{¶26} In Wright, at 607, former Justice Alice Robie Resnick included a historical

analysis of the joint-survivorship account law in Ohio. Although appellant stresses the

syllabus language of the opinion, the final conclusion of the case is more specific:

{¶27} "We hold that the opening of an account in joint and survivorship form

shall, in the absence of fraud, duress, undue influence or lack of mental capacity on the

part of the depositor, be conclusive evidence of the depositor's intention to transfer to

the survivor the balance remaining in the account at the depositor's death. (Thompson,

supra, paragraph two of the syllabus, overruled.)

{¶28} "On the other hand, in order to maintain consistency in the treatment of

survivorship rights, we hold that the opening of the account in joint or alternative form

without a provision for survivorship shall be conclusive evidence, in the absence of

fraud or mistake, of the depositor's intention not to transfer a survivorship interest to the

joint party in the balance of funds contributed by the depositor remaining in the account

at the depositor's death. Such funds shall belong exclusively to the depositor's estate, Stark County, Case No. 2011CA00026 8

subject only to claims arising under other rules of law. (Bauman, supra, overruled in

part.)

{¶29} "We stress, however, that today's decision does not change the

ownership-during-lifetime presumption set forth in Thompson, supra, at paragraph one

of the syllabus, utilized in determining the rights of the parties and others to joint and

survivorship funds in controversies arising during the parties' lifetimes."

{¶30} A review of the hearing in and of itself establishes that the trial court

acknowledged appellee's burden in the case, causing that case to be put on first.

Appellee's August 8, 2010 complaint for concealment alleged, "Rose Kogut has

concealed or conveyed away monies and jewelry belonging to the estate of the

decedent in fraud of its rights." Therefore, extrinsic evidence was available under

Wright.

{¶31} Appellant testified the accounts were joint and survivor accounts, and

Mary understood what joint accounts were. T. at 16, 30, 42. However, on the issue of

fraud per the dicta of Wright, Mary's mental capacity at the time of the opening of the

accounts was in question.

{¶32} The testimony is undisputed that Mary suffered from dementia. T. at 91,

113. The testimony is also undisputed as to Mary's capacity when her spouse was

alive. Mary did not participate in any financial issues and merely assented to her

husband's wishes. T. at 107-109. After Mary's husband Nick died, she complained of

being afraid at night, and there were "ghosts" in the house disturbing her things.

{¶33} Although both parties portrayed themselves as the true protector of Mary's

assets, it is clear that after the death of their parents, their actions were self-serving. Stark County, Case No. 2011CA00026 9

They even secretly discussed removing a bag of money so the other siblings would not

know of the money, and set up a safety deposit box in their joint names to keep estate

assets. T. at 38. Uncontested in this appeal is the secreting away of $88,872.21 from

the safety deposit box into appellant's name alone.

{¶34} Further, as the trial court noted, the signature cards for the joint and

survivor accounts were not presented as evidence. The signature account cards are

not determinative of the issue. In re Svab's Estate (1967), 11 Ohio St.2d 182. The

exhibits presented only show joint accounts and do not designate them as survivor

accounts. See, Defendant's Exhibits E, K, M, O, Q, R, S, and U.

{¶35} Based upon the evidence, we are left with appellant's statement that the

accounts were joint and survivor accounts.

{¶36} The weight to be given to the evidence and the credibility of the witnesses

are issues for the trier of fact. State v. Jamison (1990), 49 Ohio St.3d 182, certiorari

denied (1990), 498 U.S. 881. The trier of fact "has the best opportunity to view the

demeanor, attitude, and credibility of each witness, something that does not translate

well on the written page." Davis v. Flickinger, 77 Ohio St.3d 415, 418, 1997-Ohio-260.

{¶37} Given the great dearth of the evidence on Mary's dementia and the trial

court's ability to decide issues of credibility, we cannot find that the trial court erred in

finding that the accounts were not joint and survivor accounts.

{¶38} Assignments of Error I, II III, and IV are denied.

CROSS-ASSIGNMENTS OF ERROR I AND II

{¶39} In these cross-assignments of error, appellee claims the trial court erred in

determining the $37,800.00 he received from his father prior to his death was not a gift, Stark County, Case No. 2011CA00026 10

and appellee concealed $500.00 which was found in Mary's kitchen cabinet. We

disagree.

{¶40} A judgment supported by some competent, credible evidence will not be

reversed by a reviewing court as against the manifest weight of the evidence. C.E.

Morris Co. v. Foley Construction Co. (1978), 54 Ohio St.2d 279. A reviewing court must

not substitute its judgment for that of the trial court where there exists some competent

and credible evidence supporting the judgment rendered by the trial court. Myers v.

Garson, 66 Ohio St.3d 610, 1993-Ohio-9.

{¶41} Appellee argued the $37,800.00 was a gift from his father Nick prior to his

death. Mary was the sole beneficiary of Nick's estate. In her complaint filed July 30,

2010, appellant claimed appellee concealed "cash in excess of $125,000 from various

places in decedent's house." Appellee raised jurisdiction and argued the issue of the

$37,800.00 should have been litigated in his father's estate which was finalized on July

29, 2009. See, Defendant's Exhibit Z. If in fact the sum was not a gift, the funds should

have been included in the father's estate.

{¶42} Given the trial court's findings of fact, we find all parties treated the

$37,800.00 sum as funds for Mary "for her care" and "for keeping your mom in the

house." T. at 110-111. In his own testimony, appellee stated he held the funds for his

mother per his father's request. We conclude the jurisdictional issue is moot.

{¶43} In its judgment entry filed January 7, 2011, the trial court found the

following:

{¶44} "Tom testified that simultaneously with the $37,800.00, Nick and Mary

gave Tom bonds of $17,000 and $52,000 from the safe where the $37,800.00 in cash Stark County, Case No. 2011CA00026 11

came from. Tom stated that he deposited the bond funds into a joint checking account

of Rose and Mary's because the bonds were for Mary's care and that the bond funds

and $37,800.00 in cash did not go together. Tom testified that he did not file a gift tax

return in Nick's estate for the $37,800.00 because he did not know he needed to file

such a return and testified that he did not include the amount of his own 2008 income

tax return. The bonds that Tom was given by Mary and Nick on the same day as the

$37,800.00 in cash are listed on the Inventory in Mary's estate in Case No. 206212.

{¶45} "***

{¶46} "Tom's assertion that this issue could only have been brought in Nick's

estate is overcome by his own actions of listing the bonds that Nick and Mary gave Tom

simultaneously with the $37,800.00 in cash on Mary's Inventory and Accounting rather

than in Nick's Inventory and Accounting. Tom's claim that only Nick gave him the

$37,800.00 cash gift and that Rose could only object to the gift in Nick's estate is

inconsistent with Tom's own testimony that the bonds given to him by Nick were

deposited into Mary's accounts only. Further, Tom testified that both Mary and Nick

were in the room when the cash and bonds were given to him and that Mary approved

of Nick's giving of the bonds and cash to Tom. Thus, Rose's exception and

concealment action is properly before this Court in Mary's estate case."

{¶47} In Bolles v. Toledo Trust Company (1936), 132 Ohio St. 21, paragraph

one of the syllabus, the Supreme Court of Ohio defined an inter vivos gift as follows:

{¶48} "The essentials of a valid gift inter vivos are (1) an intention on the part of

the donor to transfer the title and right of possession of the particular property to the

donee then and there, and (2) in pursuance of such intention, a delivery by the donor to Stark County, Case No. 2011CA00026 12

the donee of the subject-matter of the gift to the extent practicable or possible,

considering its nature, with relinquishment of ownership, dominion, and control over it."

{¶49} We conclude the record clearly supports the trial court's findings on the

$37,800.00.

{¶50} Relative to the $500.00 found in the kitchen, the trial court found appellee

did not deposit the money into Mary's safety deposit box:

{¶51} "Tom and Gale [Tom's wife] both admit that Gale took $500 from Mary's

kitchen. Tom and Gale do not agree on when the money was found, as Tom testified it

was found in May of 2009 and Gale testified it was found prior to April 2009. Rose

testified that Tom told her that he put the money in the estate account. Tom's testimony

is conflicting, as he first stated that he put the $500 in the KeyBank safety deposit box in

May of 2009, then changed the date to June of 2009 after being shown Exhibit T, then

changed the date again to March of 2009. Tom has no record of depositing the money

at any point. Tom took the $500 in cash and cannot provide a clear account of when

the funds were deposited into the KeyBank safety deposit box. Accordingly, the Courts

finds that Tom concealed $500 from Mary's estate and SUSTAINS Rose's Exception

No. 7 and Concealment Complaint regarding the $500."

{¶52} The evidence supports this decision. Appellee admitted they were

consistently finding funds throughout the house. The bank records do not support

appellee's position that the $500.00 found in the kitchen was deposited.

{¶53} Cross-Assignments of Error I and II are denied. Stark County, Case No. 2011CA00026 13

{¶54} Appellee claims the trial court erred in removing him as executor. We

{¶55} The removal of an executor rests within the trial court's sound discretion.

In re Estate of Jarvis (1980), 67 Ohio App.2d 94. In order to find an abuse of discretion,

we must determine the trial court's decision was unreasonable, arbitrary or

unconscionable and not merely an error of law or judgment. Blakemore v. Blakemore

(1983) 5 Ohio St.3d 217.

{¶56} It is clear from the testimony that both parties engaged in self-serving

activity with their mother's funds. Because of some misguided philosophy, appellee

stopped paying his real estate taxes, and failed to grasp the seriousness of his position

as a fiduciary (he failed to fulfill his tax duties, permitted a non-fiduciary to pay estate

bills, and improperly wrote a distribution check to his wife). T. at 126-130, 151.

{¶57} Given the evidence presented, we find the trial court's action in removing

appellee as executor was appropriate to protect the other beneficiaries apart from the

parties sub judice.

{¶58} Cross-Assignment of Error III is denied. Stark County, Case No. 2011CA00026 14

{¶59} The judgment of the Court of Common Pleas of Stark County, Ohio,

Probate Division is hereby affirmed.

By Farmer, J.

Gwin, P.J. and

Delaney, J. concur.

s/ Sheila G. Farmer_________________

s/ W. Scott Gwin____________________

s/ Patricia A. Delaney_________________

JUDGES

SGF/sg 1207 [Cite as Kogut v. Marcelli, 2012-Ohio-183.]

IN THE COURT OF APPEALS FOR STARK COUNTY, OHIO

FIFTH APPELLATE DISTRICT

ROSE KOGUT : : Plaintiff-Appellant : : -vs- : JUDGMENT ENTRY : THOMAS MARCELLI : : Defendant-Appellee : CASE NO. 2011CA00026

For the reasons stated in our accompanying Memorandum-Opinion, the

judgment of the Court of Common Pleas of Stark County, Ohio, Probate Division is

affirmed. Costs to be divided equally between the parties.