Messner v. Mark L. Boon & Boon Shaver Echols Coleman & Goolsby, P. L.L.C.

WENDOLYN MESSNER, AS DEPENDENT ADMINISTRATOR, Appellant v. MARK L. BOON AND BOON SHAVER ECHOLS COLEMAN& GOOLSBY, P.L.L.C., Appellees

No. 06-14-00020-CV

Court of Appeals Sixth Appellate District of Texas at Texarkana

Date Submitted: October 22, 2014

December 19, 2014

On Appeal from the County Court at Law Rusk County, Texas

Trial Court No. 02-043 A

Before Morriss, C.J., Carter and Moseley, JJ.

Opinion by Justice Moseley

OPINION

Wendolyn Messner, as the administratrix of the estate of Delbert M. Messner, filed suit May 14, 2013, against an attorney, alleging that the attorney had been negligent and had breached his fiduciary duty in the attorney's legal representation of both Delbert (during his lifetime) and the executrix of his estate, Juanita Bengel (Delbert's niece), after Delbert's demise. The trial court granted a traditional motion for summary judgment filed by the attorney and his law firm and entered a take-nothing judgment against Wendolyn.¹ Wendolyn appeals.

We find that Wendolyn, as the administratrix of the estate, had the standing to pursue claims belonging to Delbert's estate and that the trial court erred in granting summary judgment on those claims. However, we also find that Wendolyn did not possess the authority to raise legal malpractice claims on behalf of Bengel for the attorney's representation of Bengel. Thus, we affirm the trial court's judgment with respect to claims against the attorney relating to Bengel, but reverse the trial court's judgment with respect to claims raised on behalf of Delbert's estate and remand those claims for further proceedings consistent with this opinion.

I. Factual and Procedural Background

A. The 1996 Trusts

Delbert and his wife, Barbara E. Messner, hired attorney Jennifer Davalos to draft The Delbert M. Messner and Barbara E. Messner Revocable Living Trust Agreement (the Trust Agreement). The Trust Agreement, executed by Delbert and Barbara in 1996, set up the framework for the establishment of three separate trusts designed to accomplish different goals via trusts that would be created upon the death of the first spouse. The first trust, calledSurvivor's Trust A, would be "set up for the Surviving Spouse" and would be revocable during the lifetime of the surviving spouse. The second trust, called Decedent's Trust B, would be irrevocable and was designed to take advantage of the available marital deduction. The third trust, called the Excess Property Trust C, would give the surviving spouse an interest in the entire net income of the trust for life and up to $5,000.00 per year in principal.

With respect to Trust A and Trust C, the Trust Agreement stated that Delbert had "a general power of appointment as is necessary to bring the Trust into compliance with the provisions of Section 2056(b)(5) of the Internal Revenue Code," so that it would qualify for the marital deduction.² The Trust Agreement provided that (1) upon the death of the surviving spouse, all remaining trust assets would be held in trust for the benefit of Barbara and Delbert's only son, Michael T. Messner, and that (2) upon Michael's death, all remaining assets would "go to LE TOURNEAU UNIVERSITY to establish the Dell and Barbara Messner ScholarshipEndowment." The Trust Agreement also named Jim Hughey, an employee of Le Tourneau University (University), as the successor trustee upon the death of both spouses.

Barbara died in 2000. While "[t]here were assets that had been titled in the name of the revocable living trust[,] . . . there were no assets titled in those specific [A, B, and C] trusts" that were created upon Barbara's death. Thus, in his capacity as the trustee, Delbert hired Neil Joseph, Ronald Stringer, and Ron Stringer & Associates, a CPA firm (collectively referred to as Stringer), to assist him in assigning a value to the estate's assets and in filing Barbara's estate tax returns. Because the marital deduction in 2000 was $675,000.00, Trust B was to be funded with property valued at that amount. The remaining property was to be divided between Trust A and Trust C, with ten percent of the remaining property being allocated to Trust A and the other ninety percent of the remaining property to be placed into Trust C in accord with the terms of the Trust Agreement. Stringer went to work to value Barbara's property in preparation of her estate tax return.

B. Boon's Involvement

After Barbara's death, Delbert also hired Mark L. Boon and Boon Shaver Echols Coleman & Goolsby, P.L.L.C. (collectively referred to as Boon), to assist Delbert with probating Barbara's will as a muniment of title and in his capacity as trustee of the living trusts. After Delbert died, Boon represented the personal representative of Delbert's estate. Because Delbert believed that he had supported the University sufficiently throughout his life, he decided not to leave additional sums to the University. Thus, Delbert also hired Boon (1) to help him understand and assess his responsibilities under the Trust Agreement, (2) to prepare a document revoking Trust A, and (3) to prepare a will exercising Delbert's general power of appointment inTrust C in favor of other beneficiaries. Boon prepared a document revoking Trust A. He also drafted a will for Delbert containing the following language:

All references in my Will to my "Residue" shall mean all the remainder of my property, of whatsoever kind . . . and wheresoever situated . . . not specifically disposed of herein, and also including all property over which I am given a general power of appointment remaining in that certain trust known as the Excess Property Trust "C," said trust established under Article Three, Section 3.04 of The Delbert M. Messner and Barbara E. Messner Revocable Living Trust Agreement dated July 11, 1996 . . . .

Under Delbert's will, (1) forty percent of his residue went to the "Michael Taylor Messner [testamentary] Trust" for Michael's sole benefit during his lifetime, (2) another forty percent of his residue went to the "Michele Suzanne Diaz [testamentary] Trust" for Michael's daughter's sole benefit during her lifetime, and (3) five percent of his residue went to each of the following organizations: the Masonic Lodge #404 in Longview, Texas (Masonic Lodge); the Masonic Home for Aged Masons in Arlington, Texas (Masonic Home); the Masonic Home and School of Texas in Fort Worth, Texas (Masonic School); and the Perritte Memorial Methodist Church in Nacogdoches, Texas (Church). Delbert's will appointed Bengel to be the independent executrix of the will and the trustee of the testamentary trusts created by the will.

In early February 2002, Delbert filed Barbara's estate tax return, which showed (1) that the total value of her estate was $911,675.00, (2) that $675,000.00 was allocated to Trust B, (2) that $20,954.00 was allocated to Trust A, (3) that $188,586.00 was allocated to Trust C, and (4) that $27,135.00 was allocated to expenses. Although Delbert had assigned pecuniary values to the three trusts, Delbert died on February 28, 2002, before he had the opportunity to fund the specific trusts with Barbara's property. According to the terms of the Trust Agreement, Hugheythen became the successor trustee of the non-testamentary trusts and was charged with the responsibility of distributing the trust assets.

Bengel became the executrix of Delbert's estate and the trustee of Delbert's testamentary trusts. She hired Boon to help her execute her duties and hired Stringer to prepare Delbert's estate tax return. Stringer completed an accounting in 2005 to determine what assets belonged to the estate and what assets remained in the trust. Even though Trust A had been terminated and Trust C's power of appointment had been exercised under Delbert's will, the accounting showed that property used to fund Trust A and Trust C had been mistakenly placed into a scholarship trust for the benefit of the University. Nevertheless, Boon wrote on the accounting, "Per [Stringer], this takes into account that Delbert exercised his GPOA over Trust C." In 2005, Bengel wrote a check to the University for $293,241.77 from an account labeled "Estate of D.M. or Barbara Messner." Although Boon was unclear why the check was written, he later testified that the check was for Trust C assets.

C. The Newly Discovered Mineral Interest and the 2006 Releases

On July 25, 2006, it was discovered that Barbara had additional separate property assets—mineral interests situated in Nacogdoches County, Texas—that had not been previously taken into account. In a letter dated September 21, 2006, on which Bengel was copied, Boon wrote to Hughey to inform him of the mineral interests. The letter stated, "Since the trust of which you are the trustee was the ultimate owner of this property, I am sending it on to you for handling as you deem appropriate."

In late August through November 2006, beneficiaries of Delbert's estate executed releases containing the following language:

The undersigned hereby acknowledges that Juanita Bengel, the independent executrix of this estate, has taken care of and managed this estate in compliance with the standards of the Texas Probate Code and the provisions of the Will of Delbert M. Messner and is entitled to an executor's fee under the provisions of the Will . . . but that she has waived her right to be paid said fee.

The undersigned further hereby acknowledges that Juanita Bengel has the right to seek a judicial discharge by filing an action for declaratory judgment under Chapter 37, Texas Civil Practice and Remedies Code, pursuant to the provisions of Section 149D though G of the Texas Probate Code. If Juanita Bengel filed this action, there would be a delay in the undersigned receiving the final distribution from the estate and an increase in the expenses of administration, thereby reducing the value of the assets which the undersigned would receive from the estate.

The undersigned further hereby acknowledges that the undersigned has received any and all accountings...