Miller v. Miller

1

Janette Marie Miller, Appellee/Cross-appellee, and Mark Benton Miller and Justin Miller, Appellees/Cross-appellants, v. Lawrence Bradley Miller and Amy Starr Miller, Appellants/Cross-appellees, and Caleb Boone, Intervenor/Cross-appellant.

No. 125,952

Court of Appeals of Kansas

October 18, 2024

NOT DESIGNATED FOR PUBLICATION

Submitted without oral argument.

Appeal from Rooks District Court; THOMAS J. DREES, judge.

Todd D. Powell, of Glassman Bird Powell LLP, of Hays, for appellants/cross-appellees Lawrence Bradley Miller and Amy Starr Miller.

Janette Miller, appellee/cross-appellee, pro se.

Chris McGowne, of McGowne Law Offices, P.A., of Hays, for appellee/cross-appellant Mark Benton Miller.

Craig L. Uhrich, of Upshaw, Uhrich, Taylor & Dykema, PLLC, of Oakley, for appellee/cross-appellant Justin Miller.

Caleb Boone, intervenor/cross-appellant, pro se.

Before MALONE, P.J., GREEN and SCHROEDER, JJ.

MEMORANDUM OPINION

MALONE, J.

This case involves an acrimonious and long-running quarrel between five siblings over the administration of the estate of their mother, Sonya Miller. The five children are Lawrence Bradley Miller (Brad), Denise Ann Roenne, Janette Marie Miller, Mark Benton Miller, and Justin Miller. This is the second appeal to this court, following Roenne v. Miller, 58 Kan.App.2d 836, 475 P.3d 708 (2020), rev. denied 312 Kan. 893 (2021). In the prior appeal, we found Brad breached his fiduciary duties to his siblings as the trustee of a testamentary trust created by Sonya's will. We remanded the case for the district court to craft the appropriate remedies for the breach of trust and to consider any defenses raised by Brad and his wife, Amy Starr Miller. Roenne, 58 Kan.App.2d at 851.

Following proceedings on remand, the district court rejected Brad and Amy's defenses including statute of limitations and laches, ordered Brad and Amy to return mineral interests to the trust and to reimburse the trust in the amount of $1,714,300 in damages, removed Brad as trustee and appointed Southwind Bank as successor trustee, and ordered Brad and Amy to pay attorney fees in the amount of $323,338.16.

Brad and Amy now appeal the district court's orders on damages, their various defenses, and its award of attorney fees. More specifically, they allege:

(1) The district court erred in rejecting their statute of limitations defense and in ordering damages dating back before the statute of limitations period began to run;

(2) the district court erred in rejecting their laches-based defense; (3) the district court abused its discretion in calculating the amount of damages;

(4) the district court erred in ordering equal distributions of the trust income to each of the beneficiaries in its damage award;

(5) the district court erred in removing Brad as trustee;

(6) the district court erred by ordering postjudgment interest to begin to run before its judgment was final; and (7) the district court abused its discretion in awarding attorney fees and in calculating the amount of the award.

The other siblings oppose Brad and Amy's claims and have separately filed crossappeals in which they contend:

(1) The district court erred in failing to award them double damages under K.S.A. 58a-1002 and declining to order punitive damages;

(2) the district court erred in awarding a portion of the attorney fee award to Caleb Boone, who withdrew from representing them following the suspension of his license;

(3) the district court erred in waiving the requirement that Brad and Amy post a supersedeas bond; and

(4) the district court abused its discretion in ordering that its award of attorney fees prevented their attorneys from seeking additional reimbursement under their engagement contracts.

Finally Caleb Boone-who previously represented the plaintiffs/cross-appellants in this case, was awarded attorney fees by the district court, and was permitted intervenor status in the case solely to advocate for his attorney fees-filed a brief in which he raised other issues, including:

(1) Whether the district court lacked jurisdiction because it failed to join 19 allegedly indispensable parties;

(2) whether the district court erred in denying his motion for summary judgment in which he asserted a contract-based claim for 40% of the plaintiffs' damage award;

(3) whether the court should have awarded prejudgment interest; and

(4) whether this court should dissolve a protective order sealing certain financial documents so that he could fully brief certain issues on appeal.

We have thoroughly reviewed the extensive record on appeal and the arguments made by the parties in their briefs. For the reasons explained below, we find no reversible error and affirm the district court's judgment.

FACTUAL AND PROCEDURAL BACKGROUND

Sonya died in 1995. She was survived by five children: Brad Denise, Janette, Mark, and Justin. At the time of her death, Sonya owned royalty interests in several oil leases in Rooks County; farmland in Osborne County and Russell County; a house in Natoma, Kansas; cattle; farm equipment; and other personal property. In her will, Sonya left her farm real estate to Brad and Mark-the will explicitly excluded her other children from ever having any interest in the farm property. Sonya also left her livestock, some farm machinery, and personal property to Brad and Mark. She left the remainder of her estate, which consisted solely of the oil royalty interests, to a trust to be managed "'for the benefit of all of her children.'" 58 Kan.App.2d at 849. Sonya named Brad as trustee and named Mark to replace Brad in the event of his death, incapacity, or disqualification. Brad was appointed and swore an oath to become the trustee.

In what would become the focus of the Roenne panel's analysis, the testamentary trust provided its trustee with "'uncontrolled'" and "'exclusive' discretion" over the trust and authorized the trustee's use of the income and principle of the trust for many activities. 58 Kan.App.2d at 839-40. For reference, the trust stated, in part:

"'The net income may be paid to, or applied for the benefit of, any or all of the beneficiaries from time to time, in such amount or amounts as the said trustee, in his uncontrolled discretion may determine; any net income in any year which is not paid to, or applied for the benefit of, any of said beneficiaries, shall be added to the principal at the end of the year; and in addition, the principal may be paid to, or applied for the benefit of, any of the said beneficiaries, from time to time, in such amount or amounts as the said trustee in his uncontrolled discretion may determine.

"'The said trustee, in his uncontrolled discretion, may at any time he deems it advisable and for the best interests of the said beneficiaries, distribute such income and principal to any of the beneficiaries designated herein at any time and in any amount. I want it made clear however that it is strictly within the discretion of the said trustee as to what income is paid to each of the beneficiaries entitled thereto as well as what principal may be provided to any of the beneficiaries entitled thereto. ....

"'. . . At all times, the entitlement of the beneficiaries to the income or principal shall be in the sole and exclusive discretion of the trustee named herein and his successors and at all times, his decision concerning distribution shall be final both as to the amount to be received by each of the said beneficiaries, as well as which beneficiary shall receive. At no time shall any of the beneficiaries named have the absolute right or entitlement to any of the income or principal or either of them, except for the right of the grandchildren of the said decedent for distribution upon liquidation of the said trust.'" 58 Kan.App.2d at 839.

While Sonya granted the trustee unlimited authority to decide what to do with the trust's assets, the trust specified that the trustee was to only act in a fiduciary capacity:

"'All powers given to the trustee or trustees by this instrument are exercisable by the trustees only in a fiduciary capacity. No power given to the trustee or trustees hereunder shall be construed to enable any person to purchase, exchange, or otherwise deal with or dispose of the principal of the income therefrom for less than adequate consideration in money or money's worth.'" 58 Kan.App.2d at 840.

The trust also required that the trustee "'shall each year render an account of his administration of the trust funds hereunder that the same shall be available for inspection by any of the beneficiaries at any reasonable time.'" 58 Kan.App.2d at 840. Finally, the trust provided: "'Each trustee and each successor trustee shall be liable only for failure to exercise reasonable care, prudence and due diligence in the discharge of his duties hereunder, but not for errors of judgment made in good faith.'" 58 Kan.App.2d at 840.

Turning to the events giving rise to this lawsuit, starting from the time Brad was made trustee, he began to display "a clear pattern of conduct" and "treated [the] trust as his own property with no regard or consideration to the other beneficiaries." 58 Kan.App.2d at 840. As the Roenne panel summarized:

"As trustee, Brad distributed the income generated from the trust's oil leases to himself personally from 1996 through 2015. He never set up a bank account for the trust. Instead, Brad deposited the oil income directly into his personal checking account which he jointly owned with Amy. Brad testified the gross production of the oil leases during the life of the trust was about $1,300,000.

"Brad testified that he used the oil income to pay down the large debts on Sonya's farm real estate, which was not part of the trust. He acknowledged that this land was

...