Patsy Gilmore Morehead v. Maxie Ervin Gilmore ( 2003 )

Opinion issued April 10, 2003

  In The

Court of Appeals

For The

First District of Texas

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NO. 01-02-00685-CV

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PATSY GILMORE MOREHEAD, Appellant

V.

MAXIE ERVINE GILMORE; RONA SUE GILMORE REID; JUDITH EARLE GILMORE CLARK; GEORGE EDWARD GILMORE; SHARON ELIZABETH GILMORE ROYALL; SANDRA FAYE GILMORE; AND CANDRA KAY GILMORE, Appellees

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On Appeal from the 113th District Court

Harris County, Texas

Trial Court Cause No. 1999-60557

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MEMORANDUM OPINION

          Appellant, Patsy Gilmore Morehead (Patsy), was sued by seven of her siblings, appellees, in a dispute over non-probate assets previously held by their deceased father. The jury found that Patsy agreed to divide all of their father’s money equally, that Patsy did not divide the money equally, that Patsy breached a fiduciary duty to each of the seven appellees, and that the amount of damages suffered by each appellee was $27,800. The trial court entered a judgment on the verdict and awarded each appellee $27,800.

          In two points of error, Patsy argues that (1) she did not owe appellees a fiduciary duty as a matter of law; and (2) appellees’ breach of fiduciary duty claim should not have been permitted since appellees had alternative remedies at law available to them.

          We affirm.

Facts

          Mr. and Mrs. Gilmore were married in 1933 and raised eight children together. Of the eight children, only Patsy and Maxie, her older brother, had an education beyond high school. Patsy testified at trial that, growing up, her family was very warm and loving toward each other.

          Appellees testified that, in the early 1990's, Mrs. Gilmore began to have memory problems due to Alzheimer’s disease, and Mr. Gilmore’s eyesight and hearing began to fail. In January of 1993, Mr. and Mrs. Gilmore hired an attorney who prepared for each of them a will and durable power of attorney. The wills each provided that all assets would go to the surviving spouse, or, if the spouse did not survive, the assets were to be divided equally among the eight children.

          Patsy, the second oldest, was named as the executor in the wills and was provided with durable power of attorney by both parents. George, a brother of Patsy, testified at trial that Patsy told him that she would tell him whenever she made any transactions with regard to their parents’ finances. George also testified that Patsy told him that their parents wanted George to be involved because he was the second oldest male, and Maxie, the oldest, was too far away.

          Starting in 1993, Mr. and Mrs. Gilmore began transferring assets to Patsy. In January of 1993, Mr. and Mrs. Gilmore executed a deed to their house, transferring title to Patsy as trustee, while retaining a life estate in themselves. Patsy was named as joint tenant with rights of survivorship on one of Mr. Gilmore’s CDs in 1994, and then on another CD in 1998. Mr. Gilmore also named Patsy as joint tenant with rights of survivorship on two bank accounts opened by Mr. Gilmore. In November of 1998, Patsy took $61,000 from one of her father’s CDs and put it in her own bank account. Patsy testified at trial that Mr. Gilmore had told her that she and her husband could use the money however they pleased.

          At a Christmas gathering in 1994, according to appellees’ testimony at trial, Patsy told appellees that she was going to assist her parents in maximizing their investments, and that any money that was available at their deaths would be split equally among the siblings. Pansy Keesee, a friend of Mr. Gilmore’s, testified at trial that Mr. Gilmore told her that his property was going to be split up equally among the children, and that “Patsy would be sure of that.” Hazel Boren, also a friend of Mr. Gilmore, testified at trial that, in 1998, Mr. Gilmore told her that he had worked hard all of his life and that he indicated that his finances were arranged so that his eight children would be taken care of.

          Mrs. Gilmore died in 1998. In 1999, appellees testified that, at Mr. Gilmore’s birthday party, Patsy asked appellees for consent to sell Mr. Gilmore’s house. Everyone agreed to the sale and Patsy sold it for $41,000. Patsy put the proceeds of the sale in her own checking account. On August 30, 1999, Mr. Gilmore died. Two days after the funeral, Patsy called a meeting among the siblings to discuss their father’s estate. Patsy testified that she had intended to divide all of Mr. Gilmore’s assets equally among the siblings, but that she became upset by the tone of the meeting and changed her mind. Mr. Gilmore’s gross probate estate had been left with approximately $11,500. Patsy, however, claimed approximately $286,000 worth of non-estate assets previously held by Mr. Gilmore, and this suit followed.

Evidence of a Fiduciary Duty

          In her first issue, Patsy argues that there is no evidence of a fiduciary duty between her and appellees.

          In a legal sufficiency challenge, the reviewing court must view the evidence in a light that tends to support the finding of the disputed fact and disregard all evidence and inferences to the contrary. Lenz v. Lenz, 79 S.W.3d 10, 13 (Tex. 2002). If there is more than a scintilla of evidence, the evidence is legally sufficient to support the finding. Star Houston, Inc. v. Shevack, 886 S.W.2d 414, 417 n.3 (Tex. App.—Houston [1st Dist.] 1994, writ denied).

          Fiduciary relationships are not lightly created. Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 176 (Tex. 1997). There are two types of fiduciary relationships in Texas: (1) a formal fiduciary relationship arising as a matter of law, such as between partners or an attorney and a client; and (2) an informal or confidential fiduciary relationship, arising from a moral, social, domestic, or merely personal relationship where one person trusts in and relies upon another. Crim Truck & Tractor v. Navistar Int’l Transp. Corp., 823 S.W.2d 591, 594 (Tex. 1992). The determination of the existence of a confidential relationship is normally for the trier of fact. R.R. Street & Co., Inc. v. Pilgrim Enter., Inc., 81 S.W.3d 276, 305 (Tex. App.—Houston [1st Dist.] 2001, no pet.).

          A confidential relationship may exist where influence has been acquired and abused, or where confidence has been reposed and betrayed. Texas Bank & Trust Co. v. Moore, 595 S.W.2d 502, 508 (Tex. 1980). Where parties have dealt with each other for a long time, and the parties are justified in expecting the other to act in its best interest, a fiduciary relationship may exist. R.R. Street, 81 S.W.3d at 305. A family relationship, while it is considered as a factor, does not by itself establish a fiduciary relationship. Moore, 595 S.W.2d at 508. In Moore, the court found, as a matter of law, that a fiduciary relationship existed between a 96-year-old woman and a nephew that was helping handle her financial affairs. Id. In so holding, the court stated that when the nephew accepted transfers from his aunt to him as joint tenant with rights of survivorship, he consented to have his conduct “measured by the standard of finer loyalties.” Id.

          At trial, the evidence presented showed that appellant was the sibling of the seven appellees. George testified that Patsy told him that she was going to keep him informed about every transaction she made with regard to her parent’s finances, and that he trusted her to do so. Appellees also testified that, at a Christmas gathering in 1994, Patsy told them that she was assisting their parents in investing their money, and that it would be split equally at their deaths. Patsy’s sister, Judith, testified that their father had told her that Patsy was in control of the money, and that when he and Mrs. Gilmore died, the kids would be able to divide up the money. Appellees testified that they trusted Patsy to take care of their parents’ money for them.

          The evidence suggests that Mr. Gilmore and appellees relied on Patsy’s assertions that she would assist Mr. and Mrs. Gilmore with their finances, and that the assets were to be managed by Patsy for the benefit of all of the children. We hold that, in this situation, where the evidence shows that, in a family setting, Patsy encouraged appellees to rely on her management of their parents’ assets, and where there is evidence that appellees did rely on Patsy to manage the assets, there is some evidence of a fiduciary relationship. See Moore, 595 S.W.2d at 507; R.R. Street, 81 S.W.3d at 305. In holding that the testimony at trial amounted to more than a scintilla of evidence that Patsy had a confidential, fiduciary relationship with appellees, we accordingly hold that the evidence was legally sufficient to support the jury’s finding that Patsy owed a fiduciary duty to appellees.

          We overrule issue one.

Propriety of a Fiduciary Duty Cause of Action

          In her second issue, Patsy argues that appellees should not have been permitted to bring a claim for breach of fiduciary duty because appellees had other alternative remedies available at law.

          Patsy cites some cases suggesting that equitable remedies should not be used unless legal remedies are unavailable, but cites no Texas case that holds that a breach of fiduciary duty claim cannot be brought until all available legal remedies have been exhausted. Further, Patsy failed to bring her objection to appellees’ claim to the attention of the trial court. Patsy did not object to the fiduciary duty claim being included in the jury charge, and did not raise the issue in any motions to set aside the jury’s answers. Accordingly, Patsy has waived her right to complain about the issue on appeal. See Dreyer v. Greene, 871 S.W.2d 697, 698 (Tex. 1993) (“As a rule, a claim, including a constitutional claim, must have been asserted in the trial court in order to be raised on appeal.”); Pirtle v. Gregory, 629 S.W.2d 919, 920 (Tex. 1982).

          We overrule Patsy’s second issue.

Conclusion

We affirm the trial court’s judgment.

                                                             Sherry Radack

                                                             Chief Justice

Panel consists of Chief Justice Radack and Justices Nuchia and Hanks.