The Indiana Supreme Court will hear an appeal from a Spencer County woman who claims she was disinherited by her stepmother from her father’s estate, from which her stepmom’s son later derived more than $3 million in mineral rights revenue from West Virginia properties he inherited.
The case of Brenda Sue Gittings and Marc Richmond Gittings v. William H. Deal, 74A01-1611-TR-2551, deals with changes made to trusts established in 1985 by Brenda’s father, Nile D. Richmond, and her stepmother, Georgia L. Richmond, who had a prior child, William Deal. Nile and Georgia Richmond established equal trusts with substantially identical terms. The trusts generally provided that when the Richmonds died, one-third each of the residual estate would pass equally to Brenda, William, and their children.
After Nile Richmond died in 1995, Georgia eliminated Brenda as a beneficiary and trustee that same year without telling her. After consulting with an attorney, Brenda signed amendments that year transferring the West Virginia properties to Georgia’s trust, but the attorney was not provided copies of Georgia’s trust that showed Brenda had been eliminated as a beneficiary.
Georgia died in 1997, and a second amendment left the residual of her trust to only her son and his descendants. When Brenda learned that she and her son, Marc, had been eliminated as beneficiaries after Georgia’s death, “William told Brenda and her husband that ‘there wasn’t anything left [of the inheritance] after they paid the medical bills, the nursing home bills, and the funeral bills,’” according to the record. “Brenda believed that all of the money put into the trusts had been used to care for Georgia. However, in December 1997, William deeded the West Virginia properties, which were held by (Georgia’s) Trust, to himself.”
By 2010, William had collected more than $3 million in oil and gas royalties, rental payment and lease payments from the West Virginia properties. An attorney contacted Brenda in 2011 and informed her that Deal had transferred the properties to himself. In May 2013, William sought to docket the execution, delivery and recording of the West Virginia deeds. Brenda brought a counter-claim alleging breach of a mutual estate plan/implied trust, self-dealing, conversion, and breach of fiduciary duty, among numerous other claims.
But the trial court ruled in favor of Deal, and the Indiana Court of Appeals affirmed in October, finding the statute of limitations barred Gittings’ claims, even though the appeals court found the conduct underlying her claims was improper and perhaps illegal.
“While the result here is extremely regrettable and the behavior concerning these trust assets is disturbing, we simply cannot say that the trial court’s findings and conclusions regarding the statute of limitations are clearly erroneous,” COA Judge Michael Barnes wrote for the panel in affirming the trial court. Georgia, the court wrote, “was not given the authority to breach her fiduciary duties and transfer property in violation of statutory authority, and the discretion given to her under the agreement does not excuse her improper conduct.”
The COA affirmed the trial court “despite our reservations concerning the transfer of trust assets here.”
The case is one of two the Indiana Supreme Court granted transfer last week, while justices denied two dozen petitions to transfer. Supreme Court transfer decisions may be read here.