In re Trust of Tary v. Seiple , 2022 Ohio 3773 ( 2022 )

[Cite as In re Trust of Tary v. Seiple, 2022-Ohio-3773.]
IN THE COURT OF APPEALS OF OHIO
SIXTH APPELLATE DISTRICT
LUCAS COUNTY
In re Trust of Linda L. Tary Court of Appeals No. L-21-1256
Tricia Risdon Trial Court No. 2019ADV000548
Appellee
v.
Sandra L. Seiple, Trustee, etc. DECISION AND JUDGMENT
Appellant Decided: October 21, 2022
*****
John P. Lewandowski and Channa Beard, for appellee.
Matthew J. Rohrbacher, J. Mark Trimble, Russell R. Miller,
and Stephen E. House, for appellant.
*****
PIETRYKOWSKI, J.
{¶ 1} Appellant, Sandra L. Seiple, appeals the judgment of the Lucas County
Court of Common Pleas, Probate Division, granting appellee’s, Tricia Risdon, motion to
remove Seiple as trustee of the Third Amended and Restated Trust Agreement of Linda
L. Tary (“Linda Tary Trust”). For the reasons that follow, we affirm.
I. Facts and Procedural Background
{¶ 2} Seiple and Risdon are sisters, and are the only children of their mother,
Linda Tary, and father, Orville Tary. Linda died on December 12, 2018, and was
survived by Orville. Approximately one month prior to her death, Linda amended her
trust, and named Seiple as her successor trustee, replacing prior language that named the
sisters as co-successor trustees.
{¶ 3} The Linda Tary Trust included, among other assets, two lake-house
properties located in Michigan (“Michigan properties”), and farmland located in Fulton
County, Ohio. The trust was established to provide a benefit to Linda and Orville, and
upon the passing of the last of them, to Seiple and Risdon as co-equal residual
beneficiaries.
{¶ 4} After Linda’s death, Risdon attempted to obtain information about the estate
and trust administration from Seiple. On February 22, 2019, Risdon’s counsel wrote to
Seiple’s counsel requesting a copy of Linda’s will and trust documents, and a general
accounting of Linda’s estate and trust assets. Seiple refused to provide the information.
Thereafter, on March 19, 2019, Risdon initiated the present action in the probate court,
seeking to compel Seiple to produce the trust documents and to provide an accounting.
On May 5, 2019, Risdon moved to compel the production of the trust documents.
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{¶ 5} On June 5, 2019, Seiple filed her answer to Risdon’s complaint, and
included two counterclaims, one of which sought to disinherit Risdon pursuant to the In
Terrorem Clause of the Linda Tary Trust. Seiple alleged that Risdon and her husband
were harassing Orville about the trust and its assets, causing him stress that exacerbated
his medical issues. Seiple also alleged that Risdon’s husband had been verbally and
physically threatening to members of the family. In support of her counterclaims, Seiple
attached copies of ex parte civil protection orders against Risdon and her husband that
she obtained on behalf of Orville as his power of attorney.
{¶ 6} On July 22, 2019, Risdon moved to compel discovery of the trust documents
in light of the fact that Seiple had not responded to Risdon’s discovery requests and had
not responded to Risdon’s motion to compel. Simultaneously, Risdon filed the present
motion to remove Seiple as trustee of the Linda Tary Trust.1
{¶ 7} In the motion to remove Seiple as trustee, Risdon argued that Seiple should
be removed because Seiple (1) breached her duties as trustee by failing to provide a copy
of the trust agreement and an accounting; (2) exhibited an extraordinary pattern of
dishonesty by filing false reports with adult protective services and police departments
and by seeking sham ex parte protective orders against Risdon on behalf of Orville; (3)
has a conflict of interest; (4) has a hostile and incurable communication breakdown with
1
Risdon filed a third motion for partial summary judgment on Seiple’s counterclaim to
disinherit Risdon pursuant to the In Terrorem Clause in the Linda Tary Trust. Ultimately,
the probate court ruled against Seiple on her counterclaim to disinherit Risdon. That
portion of the litigation is not before us on appeal.
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Risdon; and (5) has exploited Orville. In support of her motion, Risdon provided her
own affidavit, in which she provided more detail regarding her allegations.
{¶ 8} On September 25, 2020, Risdon filed a supplemental brief in support of her
motion to remove Seiple as trustee. In the supplemental brief, Risdon revealed that
Seiple finally provided a trust accounting on July 27, 2020. As a result of the accounting,
Risdon learned that Seiple transferred the two Michigan properties from the Linda Tary
Trust to Orville, and then into a newly created Orville Tary Trust dated May 6, 2019.
The properties were transferred for no consideration. The Orville Tary Trust identifies
Seiple as the residual beneficiary, and excludes Risdon as a beneficiary. Risdon noted
that the property transfers and Orville Tary Trust documents were prepared by Seiple’s
attorney, Brenda Ray. Risdon also stated that Orville called her on the day that he was to
execute the documents, asking Risdon to be present because he was supposed to be
signing something but did not know what it was. Risdon was unable to drive to her father
on such short notice, but did contact her attorney, who contacted Brenda Ray.
{¶ 9} In addition, Risdon’s supplemental brief also alleged that Seiple failed to sell
and disburse the Fulton County farmland under the terms of the Linda Tary Trust, and
has done nothing with the property other than to collect a $49,000 management fee.
{¶ 10} On October 9, 2020, Seiple filed her opposition to Risdon’s motion to
remove her as the trustee. Seiple generally argued that she had broad discretion as trustee
under the terms of the trust. Regarding Risdon’s specific claims, Seiple argued that her
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alleged failure to respond to Risdon’s demands for the trust documents, and her delayed
provision of the trust agreement were reasonable under the circumstances and did not
constitute a serious breach of the trust agreement. As to the transfer of the Michigan
properties, Seiple argued that the transfer was done for legitimate Medicaid planning
purposes for Orville, who is the current beneficiary of the Linda Tary Trust. Seiple next
argued that the failure to distribute the interest in the Fulton County farmland was
complicated by the fact that the farmland is owned by the Miller Family Limited
Partnership, which has as a managing partner a separate family corporate entity, Linda
Tary Limited. Pursuant to the operating agreement of Linda Tary Limited, Seiple is the
manager of Linda Tary Limited, and as such was entitled to reasonable compensation for
services rendered. Finally, Seiple argued that Risdon’s remaining contentions largely
involved intra-family squabbles that—while unfortunate—had no bearing on Seiple’s
performance as trustee of the Linda Tary Trust.
{¶ 11} Subsequently, on March 5, 2021, Risdon filed a second supplemental brief
in support of her motion to remove Seiple as trustee. In the second supplemental brief,
Risdon alleged that Seiple had effectively cut off all contact between Risdon and Orville
by hiding or turning off Orville’s phone, by not responding to Risdon’s inquiries into
where Orville was located, and by instructing medical providers and his former assisted
living residency staff not to provide any information to Risdon. Risdon stated that until
recently, she had talked with her father every day, and now she does not even know his
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whereabouts, and just wants to make sure that her father is safe. Risdon argued that
Seiple’s actions further demonstrated why she should not be trusted in a fiduciary
position.
{¶ 12} Seiple responded to Risdon’s second supplemental brief, and reiterated her
argument that unfounded intra-family disputes do not demonstrate that she has breached
the terms of the Linda Tary Trust or that she is incapable of administering the trust assets.
{¶ 13} Eventually, on October 27, 2021—following a delay due to Covid-19—the
probate court held a hearing on Risdon’s motion to remove Seiple as trustee. At the
hearing, the parties did not present any new evidence and were content to rely upon the
evidence produced in the extensive briefing on the motion. The parties did, however,
make oral arguments regarding their respective positions.
{¶ 14} Following the hearing, on November 19, 2021, the probate court entered its
judgment removing Seiple as trustee of the Linda Tary Trust. The trial court found by
clear and convincing evidence that four issues combined to warrant Seiple’s removal.
{¶ 15} The first and second issues were that Seiple did not timely produce the trust
documents that were originally requested in February 2019, and did not timely provide an
accounting. The court found that while Seiple relied on Article IV, Section 17 of the trust
to permit her not to disclose the trust documents, the failure to provide the documents
was not in accordance with Ohio law as required by Article IX of the trust. Further, the
trial court was not persuaded by Seiple’s argument that the request for documents was
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difficult to comply with because it was made so close to Linda’s death and because the
documents it sought were voluminous. The court noted that by early May 2019, Seiple
was actively administering the trust as evidenced by the transfer of the Michigan
properties. However, the trust documents were not produced until September 2019, and
an accounting was not provided until July 27, 2020.
{¶ 16} The third issue was Seiple’s failure to distribute the Fulton County
farmland as mandated by the trust agreement. The probate court noted that Seiple stated
that she listed the property for sale in September 2019. However, the court found that the
pertinent fact was that the property has not been transferred in the over two and one-half
years since Linda’s death, and Article V(7) of the trust prohibits the withholding of
distributions.
{¶ 17} Lastly, the fourth issue, which the probate court found was “perhaps the
most troubling of the actions taken by the trustee,” was the transfer of the Michigan
properties. The court found that while the explanation that the transfer was done for
Medicaid purposes was facially reasonable, “the true intention of this act is extremely
suspect.” The court noted that the properties were transferred in May 2019 directly to
Orville, and then moments later into a newly created irrevocable trust for his own benefit.
The newly created trust named Seiple as the sole residual beneficiary, to the exclusion of
Risdon. The court found that Seiple knew the effect of these transfers because Seiple’s
own attorney, Brenda Ray, prepared, witnessed, and recorded both the quit claim deeds
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and the newly created Orville Tary Trust, after she had already entered her appearance as
Seiple’s attorney in the present litigation. Thus, Brenda Ray was representing Seiple, as
trustee of the Linda Tary Trust, at the same time that she was representing Orville Tary.
In addition, although the Linda Tary Trust provides Seiple with the authority to sell trust
property for “cash or credit,” in this case Seiple gave the property away for no
consideration. Even if it was conceded that Seiple had the authority to gift trust property
to the primary beneficiary for no consideration, the court found that Seiple could not do
so in a manner that violated the terms of the trust. The court found that had the newly
created Orville Tary Trust named Risdon as a co-residual beneficiary, then the transfer of
the Michigan properties would not have been an issue. Because that was not the case,
however, the court summarized:
As trustee of the Linda Tary Trust, Seiple had a duty to all potential
beneficiaries, including Risdon. Through her previous attorney, she
violated that duty for her own benefit. Becoming the sole residual
beneficiary of the Michigan property had no positive impact on her father’s
Medicaid planning; it only excluded her sister - in contravention of her
mother’s intentions.
{¶ 18} In light of those four issues—and expressly not because of the acrimony
between the parties—the trial court found that removal of Seiple as the trustee was
warranted.
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II. Assignment of Error
{¶ 19} Seiple has timely appealed the judgment of the probate court, and now
asserts one assignment of error for our review:
1. The trial court abused its discretion by granting the motion of
Plaintiff/Appellee, Tricia Risdon, to remove Defendant/Appellant, Sandra
L. Seiple, as Trustee of the subject “Third Amended and Restated Trust
Agreement of Linda L. Tary.”
III. Analysis
{¶ 20} Removal of a trustee is governed by R.C. 5807.06, which provides,
(A) The settlor, a cotrustee, or a beneficiary may request the court to
remove a trustee, or the court may remove a trustee on its own initiative.
(B) The court may remove a trustee for any of the following reasons:
(1) The trustee has committed a serious breach of trust;
(2) Lack of cooperation among cotrustees substantially impairs the
administration of the trust;
(3) Because of unfitness, unwillingness, or persistent failure of the
trustee to administer the trust effectively, the court best determines that
removal of the trustee serves the interests of the beneficiaries.
“The removal of a trustee is generally considered a drastic action and the party seeking to
remove a trustee must show a basis for removal by clear and convincing evidence.”
9.
Tomazic v. Rapoport, 2012-Ohio-4402, 977 N.E.2d 1068, ¶ 33 (8th Dist.), citing Diemert
v. Diemert, 8th Dist. Cuyahoga No. 82597, 2003-Ohio-6496, ¶ 15-16.
{¶ 21} “In general, it is well-settled that a probate court’s decision regarding the
removal of a trustee is reviewed for an abuse of discretion.” Delp v. Delp, 2017-Ohio-
7774, 97 N.E.3d 1174, ¶ 21 (6th Dist.), citing Ulinski v. Byers, 9th Dist. Summit No.
27267, 2015-Ohio-282, ¶ 14. “When applying the abuse of discretion standard, a
reviewing court is not free to merely substitute its judgment for that of the trial court.” In
re Jane Doe 1, 57 Ohio St.3d 135, 137-138, 566 N.E.2d 1181 (1991). An abuse of
discretion connotes that the trial court’s attitude is unreasonable, arbitrary, or
unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140(1983).
{¶ 22} Although not explicitly stated by the probate court, the court’s judgment
entry clearly indicates that it found that Seiple’s conduct constituted a serious breach of
trust under R.C. 5807.06(B)(1), in that it found that Seiple, for her own benefit, breached
a duty to the residual beneficiary Risdon. In Kidd v. Alfano, 2016-Ohio-7519, 64 N.E.3d
1052, ¶ 37 (2d Dist.), the Second District recognized that the “serious breach of trust”
reason for removal of a trustee is the same under R.C. 5807.06 as it is under the Uniform
Trust Code § 706. Under the Uniform Trust Code,
[N]ot every breach of trust justifies removal of the trustee. The breach
must be “serious.” A serious breach of trust may consist of a single act that
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causes significant harm or involves flagrant misconduct. A serious breach
of trust may also consist of a series of smaller breaches, none of which
individually justify removal when considered alone, but which do so when
considered together. A particularly appropriate circumstance justifying
removal of the trustee is a serious breach of the trustee’s duty to keep the
beneficiaries reasonably informed of the administration of the trust or to
comply with a beneficiary’s request for information as required by Section
813. Failure to comply with this duty may make it impossible for the
beneficiaries to protect their interests. It may also mask more serious
violations by the trustee.
Kidd at ¶ 37, quoting the Official Comment to Unif.Trust Code § 706. Upon review, we
hold that the probate court’s determination that Seiple committed a serious breach of trust
was not arbitrary, unreasonable, or unconscionable.
{¶ 23} The record shows that Seiple refused to provide a copy of the trust
documents and an accounting to Risdon, necessitating the initiation of these proceedings.
R.C. 5808.13(A) provides that “A trustee shall keep the current beneficiaries of the trust
reasonably informed about the administration of the trust and of the material facts
necessary for them to protect their interests. Unless unreasonable under the
circumstances, a trustee shall promptly respond to a beneficiary’s request for information
related to the administration of the trust.” Further, R.C. 5808.13(B)(1) states, “A trustee
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shall do all of the following: (1) Upon the request of a beneficiary, promptly furnish to
the beneficiary a copy of the trust instrument.”
{¶ 24} On appeal, Seiple argues that her delayed provision of the documents was
reasonable under the circumstances because of the proximity to Linda’s death and
because of the voluminous nature of the request. Additionally, Seiple argues that once
the litigation began, the disclosure of documents was governed by the discovery process,
and her discovery responses were timely. Seiple also argues that her duty to provide the
documents was narrowed by Article IV, Section 17 of the Linda Tary Trust, which
waived the trustee’s obligation to notify the beneficiaries to the fullest extent permitted
by law.
{¶ 25} Ultimately, we need not decide whether Seiple reasonably provided the
documents as required under R.C. 5808.13 because the delay, whether reasonable or not,
masked the truly serious breach of trust involving the transfer of the Michigan properties.
During the months between when Risdon requested the trust documents and Seiple
provided them in the litigation, Seiple caused the Michigan properties to be transferred
from the Linda Tary Trust to Orville for no consideration, thereby diminishing the assets
of the trust significantly. Orville then transferred the properties into his own newly
created trust. We will assume, for purposes of this decision, that the transfer to Orville
and then into Orville’s trust constituted a legitimate strategy to protect the Michigan
properties as part of his Medicaid planning. The trial court recognized that had Orville’s
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trust named both Seiple and Risdon as co-residual beneficiaries, then the transfer of the
Michigan properties would not have been an issue. However, because Orville’s trust
only named Seiple as a residual beneficiary, and excluded Risdon, the net effect of the
transfer was that Seiple, to her own benefit, extinguished any interest that Risdon had in
the Michigan properties, contrary to the wishes of their mother as expressed in the terms
of the Linda Tary Trust.
{¶ 26} Seiple now argues that the trial court erred when it determined that “[t]here
is no doubt that Seiple knew the effect of these transfers and that they would violate the
terms of the Linda Tary Trust, which required an equal residual distribution between the
sisters.” In making this argument, Seiple effectively suggests that she bears no
responsibility for Orville’s decision to name her and not Risdon as a residual beneficiary
of his trust. We find that this argument strains all credulity. The record reveals that
Seiple has power of attorney and controls all of Orville’s finances. The real estate
transfers and all of Orville’s estate planning documents were done by Seiple’s attorney,
Brenda Ray. Orville expressed confusion and concern to Risdon regarding the fact that
Seiple wanted him to sign some documents, but he did not know what they were.
Finally, there is clearly discord and a fractured relationship between Seiple and Risdon.
From all of this, we find that it was entirely reasonable for the probate court to conclude
that Seiple knew the effects of her actions when she directed the transfer of the Michigan
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properties from the Linda Tary Trust ultimately into Orville’s trust, thereby benefitting
herself to the exclusion of Risdon.
{¶ 27} In sum, the probate court found that Seiple breached her duty to all
potential beneficiaries of the Linda Tary Trust, specifically Risdon as a residual
beneficiary. The court further found that Seiple personally benefitted from this breach by
excluding Risdon from sharing with her in any interest in the Michigan properties, in
contravention of Linda Tary’s wishes. The court concluded that this conduct, combined
with Seiple’s actions to delay providing a copy of the trust agreement and an accounting,
and combined with Seiple’s failure to distribute the Fulton County farmland, constituted
sufficient reason to remove Seiple as trustee. We find that the trial court’s decision was
not arbitrary, unreasonable, or unconscionable. Indeed, we think that Seiple’s conduct in
transferring the Michigan properties constituted a serious breach of trust by itself.
Therefore, we hold that the trial court did not abuse its discretion in granting Risdon’s
motion to remove Seiple as trustee of the Linda Tary Trust.
{¶ 28} Accordingly, Seiple’s assignment of error is not well-taken.
IV. Conclusion
{¶ 29} For the foregoing reasons, we find that substantial justice has been done the
party complaining, and the judgment of the Lucas County Court of Common Pleas,
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Probate Division, is affirmed. Seiple is ordered to pay the costs of this appeal pursuant to
App.R. 24.
Judgment affirmed.
A certified copy of this entry shall constitute the mandate pursuant to App.R. 27.
See also 6th Dist.Loc.App.R. 4.
Mark L. Pietrykowski, J. ____________________________
JUDGE
Gene A. Zmuda, J.
____________________________
Myron C. Duhart, P.J. JUDGE
CONCUR.
____________________________
JUDGE
This decision is subject to further editing by the Supreme Court of
Ohio’s Reporter of Decisions. Parties interested in viewing the final reported
version are advised to visit the Ohio Supreme Court’s web site at:
http://www.supremecourt.ohio.gov/ROD/docs/.
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