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Norvell v. Norvell

Supreme Court of Alabama

October 19, 2018

William K. Norvell
v.
Carter Norvell and Samuel Norvell

          Appeal from Lauderdale Circuit Court (CV-16-900193)

          BRYAN, JUSTICE.

         William K. Norvell appeals from a summary judgment entered by the Lauderdale Circuit Court ("the circuit court") in the action he filed against Carter Norvell and Samuel Norvell. For the reasons set forth herein, we affirm the judgment in part, reverse it in part, and remand the cause for further proceedings.

         Facts and Procedural History

         The proceedings in this case arose from a dispute between William and his brothers, Carter and Samuel, concerning a transaction in which their mother, Martha Neal Norvell, sold Carter a certain house on lakefront property ("the lake house"). The pertinent facts giving rise to the dispute are as follows.

         In 2007, Martha, to provide for her future care, established a revocable trust ("the trust") and executed a deed transferring title to the lake house to the trust. Carter was both the trustee and the beneficiary of the trust. Also in 2007, Martha executed a will that, because her husband has preceded her in death, divides her estate in equal shares among three of her four sons, Carter, Samuel, and Neal Norvell, expressly excluding William.[1] The will appoints Carter personal representative of Martha's estate.

         However, on May 11, 2012, Martha executed a "revocation of trust agreement" pursuant to which she revoked the trust and expressed her desire to transfer title to the lake house from the trust to herself; shortly thereafter, Carter, as the trustee, executed a deed transferring title to the lake house to Martha. Also on May 11, 2012, Martha executed a codicil to her 2007 will to devise and bequeath her assets to Carter, Samuel, Neal, and William in equal shares and to appoint Carter and William co-personal representatives of her estate.

         On May 13, 2012, Martha executed a durable power of attorney appointing Carter and Samuel her co-attorneys-in-fact ("the POA"). Two days later, Martha executed a second codicil to her 2007 will to appoint Carter and Samuel, rather than Carter and William, co-personal representatives of her estate. However, pursuant to the May 11, 2012, codicil, William remained an equal beneficiary of Martha's estate.

         On August 29, 2012, Martha executed an untitled, notarized document that states, in full:

"For certain value received, as evidenced by Promissory Note dated September 6, 2012, I, Martha [Neal] Norvell, do hereby desire and wish to sell to my son, Carter C. Norvell, [the lake house]. I do this with full knowledge and understanding and it is my intention that Carter C. Norvell be the sole owner of said property. I also authorize my son, Samuel S. Norvell to act as my attorney-in-fact, exercising his authority as power of attorney to execute all necessary documents to complete this transaction."

         On September 6, 2012, Samuel, pursuant to that statement and his authority under the POA, sold the lake house to Carter for $250, 000 and executed a deed effectuating the sale.

         On June 29, 2016, William filed in the circuit court a complaint against Carter and Samuel (hereinafter collectively referred to as "the defendants") in which he alleged that the sale of the lake house to Carter "directly thwart[ed] the intent of [Martha's] estate plan," which, William argued, was "an equal division of [her] assets to her sons upon her death"; that the $250, 000 purchase price Carter paid for the lake house was less than one-third of the appraised value of the property; that the sale of the lake house to Carter, to the extent the sale constituted a gift, was prohibited by the Alabama Uniform Power of Attorney Act, § 26-1A-101 et seq., Ala. Code 1975 ("the AUPAA"); and that the deed conveying title to the lake house to Carter was facially defective. Given those allegations, William sought a judgment declaring that the POA "does not authorize the [defendants] to make any distribution of [Martha's] assets favoring one beneficiary [of her estate] over the other"; that any distribution of Martha's assets by the defendants violates Martha's testamentary intent and is therefore invalid; that the AUPAA requires the defendants to preserve Martha's assets and does not allow the defendants to "waste" the assets by "gifting" them or conveying them for consideration "below fair market value"; and that the deed effectuating the sale of the lake house to Carter is therefore void. William also asserted breach-of-fiduciary-duty and conspiracy claims and sought an accounting of Martha's assets, the nullification of the POA, and the appointment of a conservator of Martha's assets. The defendants filed an answer and, pursuant to the Alabama Litigation Accountability Act, § 12-19-270 et seq., Ala. Code 1975 ("the ALAA"), filed a counterclaim seeking attorney fees and costs.

         On May 2, 2017, William amended his complaint to add claims of "intentional interference with inheritance expectancy" and undue influence. Although it is undisputed that Martha was competent in 2012 when she executed the August 29, 2012, statement expressing her desire to sell the lake house to Carter, William alleged that the defendants had taken advantage of the fact that Martha was "91 years old, frail, and has a weak mind" and that they had "exercised undue influence over her to make inter vivos transfers and/or dispositions contrary to her estate plan and wishes." William's amended complaint withdrew his requests for an accounting of Martha's assets, the nullification of the POA, and the appointment of a conservator of Martha's assets. However, that same day William filed in the Lauderdale Probate Court ("the probate court") a petition seeking the same relief.[2]

         On August 18, 2017, the defendants filed a motion for a summary judgment in which they argued that William lacked standing to prosecute his claims because, they said, he has no ownership interest in Martha's assets; he is not a party to the POA and, thus, the defendants do not owe him a fiduciary duty; any alleged violations of the POA affected only Martha, the principal; and any alleged misconduct with respect to an inter vivos transfer on Martha's behalf affected only Martha. Thus, the defendants argued, William was attempting to "assert the rights of a third party not named in the action." Additionally, the defendants argued that William's undue-influence claim was premature because, they said, Martha's will "must be offered for [p]robate before it can be contested." Likewise, the defendants argued that William's "intentional-interference-with-inheritance-expectancy" claim was premature because, they said, Martha's will "is of no effect until she dies" and argued that, regardless, such a claim "is not a recognized claim under Alabama law." William filed a response to the defendants' summary-judgment motion in which he argued that he did have standing to prosecute his claims. According to William, an agent's fiduciary duty under a power of attorney extends to the principal's beneficiaries. In addition, William cited § 26-1A-116(a), Ala. Code 1975, which provides, in pertinent part:

"(a) The following persons may petition a court to construe a power of attorney, determine the validity of a power of attorney, or review the agent's conduct, and grant appropriate relief:
"....
"(4) the principal's spouse, parent, or descendant ...."

(Emphasis added.) Thus, William argued, as a descendant of Martha, he had standing to prosecute claims challenging the defendants' alleged abuse of their authority under the POA. As to his "intentional-interference-with-inheritance-expectancy" claim, William conceded that there are no Alabama cases expressly recognizing such a tort but argued that the "mere fact that no appellate court has specifically ruled on the merits of the claim does not preclude this Court from considering it." William did not acknowledge or address the defendants' contention that his "intentional-interference-with-inheritance-expectancy" and undue-influence claims were premature.

         On December 13, 2017, the circuit court, without stating its reasons, entered a summary judgment in favor of the defendants.[3] William filed a motion to alter, amend, or vacate the ...


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