Opinion
No. CV 05-4003692S
July 25, 2006
MEMORANDUM OF DECISION
This unfortunate family dispute involves the five children of Irene Coombs and it pits four of the children, the plaintiffs, against their sister, the defendant. The plaintiffs seek to impose a constructive trust upon property located in Florida that is titled in the name of the defendant.
I FACTUAL BACKGROUND
In 1979, Irene Combs left Connecticut and relocated to the state of Florida. In 1988, she purchased property located in Auburndale, Florida; however, title was held in the name of her son Raymond DeCormier. The court finds that Mr. DeCormier originally held this property for the benefit of his mother with the understanding that upon her death it would be divided equally among the five children. In 1992, Irene Combs expressed the desire to move from Auburndale to property located on Mango Terrace in Jensen Beach, Florida. To accommodate her wishes, Raymond DeCormier personally "purchased" the Aubumdale property for the sum of $70,000 in September of 1992. That money was used to purchase the Mango Terrace property in November of 1992, and title was held in the name of all five children. It is clear to the court that the children held the Mango Terrace property for the benefit of their mother who had control over the utilization and disposition of the property.
In 1999, Irene Combs decided that she wanted to move from Mango Terrace to property located on Croton Street, also in Jensen Beach, Florida. To accommodate this wish, it was arranged that Carol Balducci, one of the plaintiffs, would personally "purchase" the Mango Terrace property based on a value of $65,000. Accordingly, the other four children, without monetary consideration, conveyed their interest in the property to Ms. Balducci. The property on Croton Street was purchased for $65,000 on or about August 18, 1999, and title was originally held by Ms. Balducci. She held this property for the benefit of her mother, with the understanding that upon her mother's death the property would be divided among the five children.
On December 1, 1999, Ms. Balducci, without monetary consideration, conveyed the Croton Street property to the defendant. The court finds that the defendant received this property under the same terms by which Mr. DeCormier and Ms. Balducci held Irene Combs' prior homes. Specifically, the defendant held the property for the benefit of her mother, her mother maintained control of the property, and upon her mother's death, the property would be used to benefit all of Irene Combs' children. Upon the transfer to the defendant, it was understood between Ms. Balducci and the defendant that the defendant would assume the primary care responsibilities for Irene Combs.
It was Irene Combs' usual practice to spend summer months in Connecticut and visit with her children who lived here. She came to Connecticut in the spring of 2003 and returned to Florida for the period of June 17 through July 13, when she returned to Connecticut. She did not return to Florida in the fall and began to reside with the defendant in November of 2003. On August 9, 2004, while on a trip to Rumford, Maine, Irene Combs died at the age of 82. Additional facts will be provided where required.
II CHOICE OF LAW
The plaintiffs argue that the law of Connecticut regarding constructive trust should apply in this case. They note that four out of the five plaintiffs, as well as the defendant, are residents of Connecticut. The defendant maintains that Florida law should be used, since that is the location of the real estate which is subject of the plaintiffs' claim. In the case of Fisks Appeal, 81 Conn. 433, 71 A. 559 (1908), our Supreme Court held that the law of Illinois, the location of the real estate which was claimed to be the subject of an equitable claim, should be applied by the Connecticut court. This holding is in accord with subsection (1) of § 235 of the Restatement (Second) of Conflict of Laws, which provides: "The existence and extent of an equitable interest in land are determined by the law that would be applied by the court of the situs." See 2 Restatement (Second), Conflict of Laws, § 235 (1971). Therefore, this court concludes Florida law pertaining to constructive trust should be applied to this dispute.
III DISCUSSION
Under Florida law, "[t]he necessary elements for imposition of a constructive trust are: (1) a promise, express or implied; (2) a transfer of the property in reliance thereon; (3) a confidential relationship; and (4) unjust enrichment." Abele v. Sawyer, 750 So.2d 70, 74 (Fla.App. 4 Dist. 1999). In Florida, the party "seeking to impose a constructive trust must prove those factors giving rise to a trust by clear and convincing evidence." Abreu v. Amaro, 534 So.2d 771, 772 (Fla.App. 3 Dist. 1988).
Irene Combs was the beneficial owner of the Auburndale, Florida property. This property was originally held by Mr. DeCormier as a de facto trustee for the benefit of Irene Combs during her life, and for the benefit of all five of her children upon her death. While she resided at the Aubumdale property, Irene Combs controlled its disposition. This is evidenced by the fact that when she wanted to move, Mr. DeCormier, as an individual purchaser, bought the Aubundale property at a price she set so she would have funds to purchase the property at Mango Terrace in Jensen Beach. Irene Combs then became the beneficial owner of Mango Terrace and title was held in the names of all five children. As an incident of her beneficial ownership of Mango Terrace, Irene Combs arranged to sell the property to Ms. Balducci, at a price Irene Combs set, $65,000.00. The money from the sale of Mango Terrace permitted the purchase of the property located at Croton Street, where Irene Combs moved to next. The title to the Croton Street property was held by Ms. Balducci, as a de facto trustee, for the benefit of Irene Combs while she was alive, and upon her death, for the benefit of her five children. The court finds that the defendant was aware of this arrangement when the Croton Street property was transferred to Ms. Balducci, just as the defendant had been aware of the same arrangement for the Mango Terrace and Auburndale properties. The defendant was also aware of this arrangement when she received title to the Croton Street property on December 1, 1999. The defendant testified that the Croton Street property was transferred to her by Ms. Balducci free from any future obligations to her siblings in return for assuming the caretaking responsibilities Irene Combs. The court does not find this testimony credible.
The court finds the following facts have been proven by clear and convincing evidence. There was an implied promise, based upon the established de facto trustee arrangement, that the defendant would also hold the Croton Street property for the benefit of her mother and her siblings. Ms. Balducci transferred Croton Street to the defendant in reliance upon this promise. There was a confidential relationship between Ms. Balducci, who was acting as a de facto trustee, and her sister, the defendant.
The District Court of Appeal of Florida, Third District, reviewed the definition of confidential relationship and applied it in the case of Blades v. Ward, 475 So.2d 935 (Fla.App. 3 Dist. 1985). There, the court provided: "The leading case in Florida defining `confidential relationship' is Quinn v. Phipps, 93 Fla. 805, 113 So. 419 (1927). Therein, the supreme court held: `The term . . . confidential relation, is a very broad one . . . The origin of the confidence is immaterial. [It] embraces both technical fiduciary relations and those informal relations which exist wherever one man trust in and relies upon . . . The relation and duties involved need not be legal; they may be moral, social, domestic or personal.'" Blades v. Ward, supra, 937. In the Blades case, the court went onto provide that "the first consideration is that the decedent and Ward were related as grandmother and granddaughter. Although the existence of a family relationship does not necessarily mean that a confidential relationship exists, such is the case where there is a `close' relationship between the relatives and trust or confidence of some kind is shown to exist." Id.
Here, Ms. Balducci and the defendant were both involved in the care of their mother. Ms. Balducci trusted the defendant enough to transfer primary care responsibility for Irene Combs to her. Earlier, the defendant trusted Ms. Balducci enough to transfer her one-fifth interest in Margo Terrace to Ms. Balducci, with the expectation that Ms. Balducci would pay over money to be used for the purchase of a home on Croton Street for Irene Combs. It is clear both parties trusted and relied on one another. Having found there was a promise, transfer and a confidential relationship the court finds by clear and convincing evidence that the defendant would be unjustly enriched if she retained for her sole benefit the Croton Street property. The court will impose a constructive trust upon the Croton Street property; however, the extent of the plaintiffs' interest in the property must be determined.
In the recent case of Collinson v. Miller, 903 So.2d 221 (Fla.App. 2 Dist. 2005) the District Court of Appeal of Florida, Second District, dealt with the nature of a constructive trust and relied on an opinion written by Justice Cardoza. The Florida court noted: "Justice Cardoza stated, `A constructive trust is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial equity converts him into a trustee.' . . . He added, ` A court of equity in decreeing a constructive trust is bound by no unyielding formula. The equity of the transaction must shape the measure of the relief.'" (Citation omitted; emphasis added), Collinson v. Miller, supra, 228 (Fla.App. 2 Dist. 2005).
Irene Combs established an arrangement under which the title to her homes was held by one or more of her children, but she actually controlled the utilization and disposition of these properties. When she wanted to move to another place, she set the price of her current residence and one of her children paid her for it. This money was used to buy the next property. Under these circumstances, the court finds that it is appropriate to consider Irene Combs' expressed intentions regarding the Croton Street property, the last property in which the lived.
Irene Combs executed three wills dated June 19, 2002, June 17, 2003 and November 20, 2003. The June 19, 2002 and November 20, 2003 wills contained identical provisions. These two wills named the defendant as the residuary beneficiary of the estate and the executrix of the will. The wills also contained the following provision:
"ITEM THREE: I further direct, understanding full well that this provision may be difficult to enforce, that the value of my home in Jensen Beach, Florida, previously given to my daughter, Grace Baril, shall be considered to of had a value of $65,000.00. It is my intention that from said sum any expenses paid on my behalf by Grace Baril shall be deducted from the $65,000.00 and the remaining balance shall be cashed out by Grace Baril paying to each of her four siblings 20% of the remaining amount."
The will dated June 17, 2003 was executed when Irene Combs was visiting her daughter Joyce DeCormier, a named plaintiff in this action. This will names all five children as the residuary beneficiaries and appoints Ms. Balducci as the executrix of the will. The will also contains the following provision: "ARTICLE III. I direct my Executrix to sell my home in Jensen Beach Florida, which home is not held in my name. My Executrix shall offer my home for sale to my daughter Grace Baril at fair market value at the time of my death. The net proceeds from the sale of my home shall be paid to my five children equally. In the event that my daughter, Grace Baril, declines to purchase my home for fair market value, then I direct my Executrix to sell my home and to pay net proceeds from the sale of my home equally to my five children."
The plaintiffs' trial counsel, George W. Kramer, prepared the June 17, 2003 will and executed the affidavit of the witnesses to the execution of the will. The court is at a loss to understand how an executrix can be directed to sell property that is not owned by the testatrix. The court is not persuaded that the intentions expressed in this will should be considered in fashioning equitable relief in this case.
The wills of June 19, 2002 and November 20, 2003 were prepared by Attorney Thomas A. Borner who also executed the affidavits for the witnesses for both wills. A letter written by Attorney Borner to the defendant dated March 7, 2005, was admitted by agreement, as a full exhibit (Defendant's Exhibit F). Attorney Borner did not testify at the trial. The March 7, 2005 letter states:
Dear Grace:
This letter will serve to confirm my involvement in connection with my preparation and the execution of two Wills by your late Mother, Irene Combs.
It is my recollection that I first met with your Mother in June of 2002 and at that time I prepared a Living Will, a Power of Attorney from your Mother to you, and a Last Will and Testament. The Will, in essence, left all of your Mother's assets to you with the direction that you should settle-up with your siblings based upon the $65,000.00 value of your Mother's former home in Jenson Beach, Florida, less any expenses you paid on her behalf between the conveyance of the property and the date of her death. At that time I met solely with your Mother as if my practice which I have maintained over 25 years when preparing Wills.
I subsequently met with your Mother in November of 2003 and prepared a similar Will since your Mother had expressed to me her concern that sometime over the past year she may have been persuaded to sign another document which was not consistent with the Will I prepared for her in June of 2002. The 2003 Will was identical to the Will I prepared in 2002.
At the time your Mother executed both of these Wills I was confident that she was aware of the nature of the document she was executing. I met with one-on-one so that I could be comfortable that she had testamentary capacity. I am of the opinion that she was aware of the normal objects of her bounty and the nature of the instrument and the effect thereof of the document which she executed.
I am confident that both Wills were executed as required by law and manifest your Mother's intentions at the time of execution.
Very truly yours, Thomas A. Borner
The statements made in this letter conform to the evidence adduced at the trial and the court will utilize them in reaching its conclusions. The plaintiffs' constructive trust interest in the Croton Street property should be determined by the expressed intentions of Irene Combs that are contained in her last will, the will dated November 20, 2003, which was executed approximately ten months before her death.
Under these expressed intentions, expenses paid by the defendant for the benefit of Irene Combs must be deducted from the $65,000 which is to be shared by all of the children. The court notes that the defendant has filed special defenses alleging set-off for expenses paid by the defendant or the benefit of Irene Combs. These expenses include improvements of the Croton Street property, renovations at the defendant's home in Woodstock, Connecticut, medical and funeral expenses, and compensation to the defendant for care provided to Irene Combs.
The defendant's husband, Richard Baril, testified as to the expenses claimed by the defendant.
He stated that the defendant paid approximately $4,500.00 for a porch that Irene Combs wanted built onto the Croton Street property. He also stated that the Baril family added a bedroom and a bathroom to their home in Connecticut to accommodate Irene Combs and members of the family who were misplaced when Irene Combs came to live with them. The court notes that any equity in the Croton Street property that is over the $65,000 value assigned by Irene Combs will remain with the defendant. The court also notes that the bathroom and bedroom added to the defendant's Connecticut home will be utilized by her and the members of her family. Under these circumstances the court concludes it is not appropriate to consider these items expenses incurred for Irene Combs' benefit.
The defendant also claims she incurred expenses for caring and providing for her mother. Irene Combs received Social Security and other income in the approximate amount of $2,000.00 per month. The defendant controlled this income for several years prior to Irene Combs' death. At the trial, the defendant did not provide an accounting of the income received by Irene Combs when she presented her claims for expenses. Under these circumstances, the court cannot find the claimed expenses exceeded Irene Combs' income for the period in question. The court also finds that it is inappropriate and inequitable under the circumstances of this case to allow the defendant to "charge" for her time in caring for her mother. The defendant has failed to prove, even by the lesser standard of preponderance of the evidence, that she has incurred expenses for the benefit of Irene Combs which should be deduced from the $65,000.00 value assigned by Irene Combs.
Based upon the forgoing findings and conclusions, each of the four plaintiffs is entitled to receive from the defendant 20% of $65,000, or $13,000. The defendant is ordered to pay each of the four plaintiffs the sum of $13,000 within sixty days of the date of this memorandum. Judgment may enter accordingly.