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Konrardy v. Vincent Angerer Trust

Supreme Court of Iowa

April 5, 2019

SERENA KONRARDY and CARRIE RIGDON n/k/a CARRIE BURMEISTER, Appellees,
v.
VINCENT ANGERER TRUST, DATED MARCH 27, 1998, and DEWITT BANK & TRUST COMPANY, as Trustee of the VINCENT ANGERER TRUST, DATED MARCH 27, 1998, Appellants.

          Appeal from the Iowa District Court for Clinton County, Mark R. Lawson, Judge.

         On review from the Iowa Court of Appeals.

          Elliott R. McDonald III of McDonald, Woodward & Carlson, P.C., Davenport, for appellants.

          Harold J. DeLange II, Davenport, for appellees.

          CHRISTENSEN, JUSTICE.

         The appellants seek further review of a court appeals decision that affirmed the district court order denying their motion for summary judgment concerning the distribution of trust assets to appellees.

         The plaintiffs are two beneficiaries of a trust who filed an action asking the district court to resolve a dispute with the defendants concerning the valuation date of the defendant trust. The defendants filed a motion for summary judgment, arguing the plaintiffs' action was untimely and the terms of the trust clearly provided the valuation date. The district court denied this motion on both grounds, and the court of appeals affirmed the district court's denial on interlocutory appeal. For the reasons explained below, we vacate the court of appeals' decision, reverse the district court judgment, and remand to the district court for entry of summary judgment in favor of the defendants because the plaintiffs' action is untimely.

         I. Background Facts and Proceedings.

         Vincent Angerer established the Vincent Angerer Trust (the trust) on March 27, 1998. The trust created equal shares for each of his five siblings. According to the terms, each share would be placed in individual trusts for his siblings and the spouse of a deceased sibling. However, when both a sibling and the sibling's spouse died, the trust instructed the trustee to distribute that trust share to the living descendants of that sibling.

         Angerer died on May 30, 2010. Angerer was not married and had no direct descendants. He was survived by three siblings and one spouse of a deceased sibling. A fifth sibling, Cecelia Howard, predeceased Angerer with no surviving spouse. Howard's descendants were her daughter, Rita Goedken, and Serena Konrardy and Carrie Burmeister, the daughters of Howard's predeceased son and plaintiffs in this case. Because Howard and her spouse predeceased Angerer, their shares of the trust were immediately distributable to their descendants.

         The net value of the trust's assets at the time of Angerer's death was $1, 751, 260.98. By the time the trustee paid Konrardy and Burmeister their distributions in October 2011, the value of the trust had significantly increased due to rapid appreciation in the value of farmland. Nevertheless, the trustee determined Konrardy's and Burmeister's shares based on the net value at the time of Angerer's death. Thus, each of them received $85, 089.74 for their share, plus $1250.00 for their pro rata share of the trust income that accrued before these distributions were made. On October 19, 2011, each signed the "Waiver, Receipt and Release as to Final Distribution of Assets for a Beneficiary of the Vincent Angerer Trust" to "confirm[], approve[] and ratif[y] each and every act of the Trustee." The document also stated, "The undersigned hereby specifically waives notice [and] waives any and all accounting and production of vouchers . . . ."

         On August 11, 2015-nearly four years after distribution-an attorney representing Konrardy and Burmeister sent a letter to DeWitt Bank & Trust Company concerning the distribution of the assets to Konrardy and Burmeister. The letter stated Konrardy and Burmeister "were seemingly treated differently than the remaining trust beneficiaries." It also declared, "It would appear that their proportionate and share of the trust [was] paid out on a significantly reduced basis and that they were not fully advised of the potential value of the real estate involved." The letter questioned whether the trustee fulfilled the fiduciary duty to protect Konrardy's and Burmeister's interests. Consequently, Konrardy and Burmeister requested "a full rationale of why [they] were treated differently from all other beneficiaries under the trust."

         Roger Hill of DeWitt Bank & Trust Company sent a response dated August 19, explaining the distributions to Konrardy and Burmeister were based on the language of the trust directing the trustee to "immediate[ly] pay out of any share to the descendants when both the sibling and spouse have passed away." Hill enclosed accountings for the years 2010, 2011, and 2012. The attorney for Konrardy and Burmeister acknowledged he received Hill's letter and enclosures in a letter to Hill dated September 9, again claiming Konrardy and Burmeister were treated differently.

         On March 15, 2017-approximately eighteen months after the correspondence exchanged between the trustee and attorney for Konrardy and Burmeister-Konrardy and Burmeister filed a petition in equity against the trust and DeWitt Bank & Trust Company (the defendants), claiming their distributions should have been valued as of the date of distribution in October 2011 rather than the date of Angerer's death in May 2010. The defendants filed a motion for summary judgment on September 1, arguing the action was untimely because Konrardy and Burmeister failed to initiate it within one year of receiving an accounting of the trust estate and the language of the trust requires the distribution to them be based on the value of the trust's assets at the date of Angerer's death. The district court denied the motion, noting it could not "determine as a matter of law that the defendants' interpretation of the trust language is correct" and a genuine issue of material fact exists "as to whether the plaintiffs received an accounting adequately disclosing the ...


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