In re ESTATE OF ELWOOD R. DARKEN
Session: October 10, 2016
from the Chancery Court for Williamson County No. P5663 James
G. Martin, III, Chancellor
sons of the decedent challenge the executrix's
administration of the decedent's estate, contending that
she breached her fiduciary duty by, inter alia,
refusing to provide them with certain documents and by
converting personal property they claim their father intended
for them. They also claim that the antenuptial agreement
their father entered into with the executrix prior to their
marriage established a trust that nullifies the specific
bequest in their father's will that gives his tangible
personal property to the executrix. The executrix denied
breaching any of her duties or converting any assets. She
also disputed the contention that the antenuptial agreement
created a trust. The trial court found that the executrix had
not breached her fiduciary duties or converted any assets and
that the antenuptial agreement did not create a trust. The
court also ordered that the estate pay the fees of the
attorney who represented the executrix in her fiduciary
capacity. The decedent's sons appeal, challenging each of
the foregoing rulings. They also contend that the trial court
erred in limiting their cross examination of the executrix at
trial. We affirm in all respects.
R. App. P. 3 Appeal as of Right; Judgment of the Chancery
Michael E. Richardson, Chattanooga, Tennessee, for the
appellants, Eric Darken and Brett Darken, Trustees of The
Elwood R. Darken Trust and The Nancy L. Darken Trust.
T. Nowak, Franklin, Tennessee, for the appellee, Cherry Lane
G. Clement, Jr., P.J., M.S., delivered the opinion of the
Court, in which Richard H. Dinkins and Kenny W. Armstrong,
G. CLEMENT, JR., JUDGE
matters at issue arise from the administration of the estate
of Elwood R. Darken. The parties to this action are Eric
Darken and Brett Darken ("Plaintiffs") and Cherry
Lane Darken ("Defendant"). Plaintiffs are the adult
sons of Elwood Darken, the decedent, and Nancy L. Darken, who
died in 1997. Defendant, who is the decedent's surviving
spouse, served as the executrix of his estate and is the
beneficiary of a specific bequest. The residuary beneficiary
of the decedent's estate is the Elwood R. Darken Living
Trust. Plaintiffs are the successor trustees and sole
beneficiaries of that trust.
1992, during his marriage to Nancy, Mr. Darken executed a
will that appointed his then-wife "Nancy L. Darken"
as the executor of his estate. The will states in pertinent
I give and bequeath to my wife, if she shall survive me, all
the tangible personal effects including any household
furniture and furnishings, automobiles, books pictures,
jewelry, art objects, hobby equipment and collections,
wearing apparel, and other articles of household or personal
use or ornament (excluding cash, choses in action, stocks,
bonds or other incorporeal personal property), which I may
own at the time of my death . . . .
1999, Mr. Darken married Defendant. Prior to the marriage
they executed an antenuptial agreement, the validity of which
is not challenged. The agreement stated that Mr. Darken would
keep sole ownership and control of the assets listed in
"Exhibit A", a collection of documents that
included a schedule of assets titled "Specific items
designated to Brett Darken and Eric Darken on equal
basis" ("Items Schedule"). The Items Schedule
listed 27 items of personal property, including "41 one
ounce gold Eagle coins." Section 9 of the antenuptial
agreement states that "this Agreement shall not be
construed as placing any limitation on the rights of either
party to make voluntary inter vivos and/or testamentary
transfers of his or her assets to his or her spouse."
2004, Mr. Darken executed a codicil that removed references
to Nancy Darken from his will and replaced them with
references to Defendant. In relevant part, the codicil
states: "In all respects, my said Last Will and
Testament is hereby modified such that any references therein
to 'my wife' or to 'NANCY L. DARKEN'
including, but not limited, to any inheritance thereunder or
any fiduciary appointment, shall henceforth be modified to
mean Cherry Lane Darken." (emphasis in original).
Attorney Randle Davis, who served as Mr. Darken's
personal attorney for years, prepared the 1992 will and the
Darken died on April 6, 2010. By order entered on May 20,
2010, his 1992 will and the 2004 codicil were admitted to
probate, and Defendant was issued letters testamentary as the
executrix. Mr. Davis, who drafted and filed the 2010 petition
to open the probate estate, has represented Defendant in her
capacity as the executrix throughout these proceedings.
after their father's death, Plaintiffs began requesting
documents from Defendant including the antenuptial agreement,
all schedules associated with the antenuptial agreement, and
documents concerning various family trusts that Mr. Darken
had managed. In June and July of 2010, Mr. Davis sent three
memoranda to Plaintiffs and Defendant. The first of these
documents is a "flow chart" of Mr. Darken's
assets based on the information that was available at that
time. It states that Mr. Darken was a private person who used
Mr. Davis as a resource to answer specific questions.
According to this memo, "[o]ther than [Mr. Darken]
himself, there is not one person who knows [his] overall
plan." Mr. Davis concluded the June 2010 memo by
suggesting that the parties have a meeting soon.
meeting never occurred. In an email exchange between
Plaintiffs and Mr. Davis on July 13, 2010, Brett Darken
stated that: "In order to have an informed conversation,
we all need to be working from the same set of facts. Once we
get this documentation, we can then set a time and agenda for
the meeting." Mr. Davis sent a follow-up memo on July
16, 2010, again seeking to organize a meeting between
Plaintiffs and Defendant. On July 21, 2010, Mr. Davis sent
another memo that included additional charts of Mr.
that same month, Defendant gave Plaintiffs a handwritten list
of the assets of the trusts Mr. Darken had managed. This list
included account numbers, account balances, and contact
information for the various financial institutions that
controlled the listed assets.
Plaintiffs continued to request additional documentation. In
2011, Defendant provided Plaintiffs with a copy of the
antenuptial agreement that did not include any of the
exhibits to the agreement. Additionally, Mr. Davis, with the
consent of Defendant, made his entire estate file available
to Plaintiffs' counsel, who reviewed the file and was
permitted to make copies of it.
August 15, 2012, Defendant filed a motion for executor fees
and attorney fees, and she submitted her final accounting to
the court on September 11, 2012. One week later, Plaintiffs
timely filed an Objection to Application for Fees. Following
a hearing on September 28, 2012, the Clerk and Master awarded
Randle Davis over $33, 000 in attorney's fees and
expenses for services in connection with the administration
of the estate through August 14, 2012. The Clerk and Master
also recommended that the trial court approve the final
accounting, following which Plaintiffs filed an exception to
the final accounting.
December 27, 2012, Plaintiffs filed a Motion to Remove
Executrix, Appoint Successor Co-Executors and Require Return
of Certain Assets. On January 28, 2013, the Clerk and Master
entered an Order finding that the duties of the executrix
were completed but noting that the estate could not be closed
pending resolution of Defendant's Motion for Executor
Fees and Plaintiffs' Exceptions to Final Accounting and
Motion to Remove Executrix. The Clerk and Master directed
Defendant to retain counsel to represent her in an individual
capacity because Mr. Davis could only represent her in her
capacity as the executrix of the estate. The order
reserved ruling on all other pending motions and claims.
Subsequently, Plaintiffs filed a motion to remove Mr. Davis
as the attorney for the estate.
1, 2013, the trial court held a hearing on the pending
motions and the recommendations of the Clerk and Master. In
the order that followed, the trial court instructed
Plaintiffs to file an amended complaint setting forth all
civil claims against Defendant; ordered the depositions of
Defendant and Mr. Davis; and reserved ruling on all other
motions. In a separate order, the trial court denied the
motion to remove the executrix and to disqualify and remove
Mr. Davis as attorney for the estate.
18, 2013, Defendant filed a motion for court approval of Mr.
Davis' final attorney's fees, requesting over $37,
000 in supplemental fees for the period from August 15, 2012
through August 7, 2013.
23, 2013, Plaintiffs filed their amended complaint alleging,
inter alia, breach of fiduciary duty, breach of
contract, conversion of trust assets, and attempted
conversion of estate assets. Plaintiffs alleged that
Defendant refused to disclose trust documents and the
antenuptial agreement. Plaintiffs also contended that the
personal property identified in the Items Schedule, including
the gold coins, was property of an express trust created in
the antenuptial agreement of which they were the sole
order entered on August 26, 2013, the court found that the
executrix had completed her duties of administration and
relieved her from all further duties except for the
liability, if any, for her actions as executrix. The
remaining motions for fees, objections to the final
accounting regarding personal property and issues related to
the antenuptial agreement were reserved.
case was tried on July 2 and 3, 2014. Mr. Davis testified
that he made his legal files regarding Mr. Darken available
to Plaintiffs' first attorney, Paul Hayes. Mr. Hayes was
allowed to review the file and choose which documents he
wanted to copy. According to Mr. Davis, Mr. Hayes
"tagged a little over 100 pages, " and Mr. Davis
made copies of them. Mr. Davis did not review the pages Mr.
Hayes marked. Instead, he gave them to his administrative
assistant so that they could be copied.
Davis also testified that Mr. Darken was "very private
when it came to financial information and data." Mr.
Darken provided Mr. Davis with limited information and asked
questions about specific issues based on that information.
According to Mr. Davis, "no one individual had all of
the information" about Mr. Darken's finances and
Darken testified that he used the handwritten list of trust
assets to contact many of the financial institutions. He
stated that Plaintiffs did not ask these institutions for
backup copies of the trust documents because they
"wanted to get the originals from [Defendant]."
Similarly, Brett Darken testified that Plaintiffs were able
to transfer or obtain control of "60 to 80 percent of
the trust stuff . . . " within six months of receiving
the handwritten list of assets. When asked what trust
documents Plaintiffs needed but were not provided, Brett
stated: "What did I need that I wasn't provided --
the close of Plaintiffs' proof, Defendant moved for
involuntary dismissal under Tenn. R. Civ. P. 41.02(2). The
trial court granted the motion regarding the claim for breach
of fiduciary duty because Plaintiffs had not submitted
competent proof of damages. The trial court stated that trial
would continue regarding the other issues. When Defendant
elected to rest her case without presenting additional
evidence, the trial court called Defendant as a witness for
the purpose of examining her concerning the circumstances
regarding the execution of the antenuptial agreement. Prior
to calling Defendant as a witness, the trial court gave each
party the opportunity to object to its decision to call
Defendant, and both parties stated that they had no
trial court questioned Defendant about the antenuptial
agreement and the property listed on the Items Schedule.
Defendant testified that she and Mr. Darken "mutually
agreed to end the prenuptial agreement" after five years
of marriage. According to Defendant, she did not have a copy
of the agreement because she and Mr. Darken had destroyed
August 21, 2014, the trial court entered an order reiterating
its decision to grant Defendant's motion for involuntary
dismissal and making other findings about the merits of the
case. Plaintiffs filed a motion to alter or
amend, which the court granted because it had signed the
August 2014 order without allowing Plaintiffs to file a
competing order and because it had not allowed the parties to
cross-examine Defendant. Subsequently, the parties entered an
agreed order stating that Defendant would be recalled to the
witness stand for cross-examination "limited to the
scope of the direct examination by the Court at trial."
January 2015, the court recalled Defendant to the stand and
allowed both parties' attorneys to examine her. As
provided in the agreed order, the scope of the parties'
cross-examination of Defendant was limited to the scope of
the trial court's direct examination. Once again,
Defendant testified that she did not have a copy of the
antenuptial agreement and that after five years of marriage
she and Mr. Darken "decided, mutually, to put aside all
of this prenuptial agreement, to merge our properties."
According to Defendant, executing the 2004 codicil was an
easy way to merge Mr. Darken's property with hers.
March 2016, the court entered a final order in which it
reaffirmed the findings in its previous orders and rejected
the claims in the amended complaint. The court found that
Defendant had not breached her fiduciary duty because the
antenuptial agreement and trust documents were not property
of the estate; thus, Defendant had no duty to provide them to
Plaintiffs. Moreover, the trial court found that even if
Defendant had such a duty, she did not have a copy of the
antenuptial agreement or schedules to produce because Mr.
Darken and she revoked the agreement in 2004 by destroying
the documentation. Regarding the trust documents, the court
found that Defendant's July 2010 handwritten statement
was sufficient disclosure because Plaintiffs were able to use
that statement to obtain control of the relevant trust assets
and could have asked various financial institutions for the
trust documents they sought.
court also rejected Plaintiffs' argument that their
damages for breach of fiduciary duty were the costs of this
litigation. The court found that Plaintiffs received a copy
of the antenuptial agreement in 2011 and another copy that
included all exhibits in 2013. Moreover, the trial court
found that "[a]ccess to the complete document had no
deterrent effect on Plaintiffs' decision to continue
incurring 'enormous time and expense' in proceeding
the claim that Defendant converted the coin collection and
other personal property, the court found that the decedent
made a testamentary gift of the property listed on the Items
Schedule to Defendant. The court rejected Plaintiffs'
argument that the antenuptial agreement established an
express trust concerning tangible personal property listed on
the Items Schedule. The court noted that Section 9 of the
antenuptial agreement allowed the decedent to make such
testamentary gifts to her and that the decedent did just that
when he executed the 2004 codicil, which altered his will by
replacing every reference to Nancy with Defendant. As a
result, Mr. Darken specifically bequeathed to Defendant
"all tangible personal effects . . . (excluding cash,
choses in action, stocks, bonds, or other incorporeal
personal property)." Further, the court found that the
definition of "all tangible personal effects"
encompassed everything listed in the Items Schedule,
including the gold coins, which "are not cash and are
not legal tender." Thus, the property at issue was
specifically bequeathed to Defendant pursuant to the 2004
the trial court ordered the estate to pay the balance of the
attorney's fees charged by Mr. Davis for representing
Defendant in her capacity as executrix. However, the trial
court denied Defendant's request for an additional $23,
000 in attorney's fees that she incurred defending claims
against her in an individual capacity. This appeal
cases such as this where the action is "tried upon the
facts without a jury, " Tenn. R. Civ. P. 52.01 states
that the trial court shall find the facts specially and shall
state separately its conclusions of law and direct the entry
of the appropriate judgment. The underlying rationale for the
Rule 52.01 mandate is that it facilitates appellate review by
"affording a reviewing court a clear understanding of
the basis of a trial court's decision, " and
enhances the authority of the trial court's decision.
In re Estate of Oakley, No. M2014-00341-COA-R3-CV,
2015 WL 572747, at *10 (Tenn. Ct. App. Feb. 10, 2015)
(quoting Lovlace v. Copley, 418 S.W.3d 1, 34 (Tenn.
2013)). In the absence of findings of fact and conclusions of
law, "this court is left to wonder ...