Session September 12, 2017
from the Chancery Court for Greene County No. 20140158
Douglas T. Jenkins, Chancellor.
appeal involves the interpretation and construction of a
trust agreement. John Marion Reed and his wife Willie Kate
Reed, in the process of their estate planning, executed a
revocable living trust agreement. They conveyed approximately
204.61 acres of real property to the trust. Shortly
thereafter, Mr. Reed died testate. The trust was the sole
residual beneficiary of his will. Mrs. Reed, the successor
trustee, distributed all of the real estate in the trust to
herself by way of a quitclaim deed. She then terminated the
trust. Bobby Reed, her son and a beneficiary of the trust,
filed this action alleging that Mrs. Reed exceeded her
authority under the terms of the trust agreement. He asked
the trial court to order an accounting of the assets of the
trust that had been distributed by Mrs. Reed since her
husband's death. He sought the return to the trust of the
assets wrongfully distributed. The trial court held that Mrs.
Reed did not have the authority to transfer all of the real
estate in the trust. Accordingly, the court voided the
quitclaim deed, and granted the requested relief of Bobby
Reed. We affirm the trial court's judgment.
R. App. P. 3 Appeal as of Right; Judgment of the Chancery
Court Affirmed; Case Remanded
E. LaNasa and Mark W. McFall, Johnson City, Tennessee, for
the appellant, Willie Kate Reed, Executrix of the Estate of
John Marion Reed and Trustee of the John Marion Reed and
Willie Kate Reed Living Trust, and Cindy Kinley.
W. Laughlin, Greeneville, Tennessee, for the appellee, Bobby
Charles D. Susano, Jr., J., delivered the opinion of the
court, in which D. Michael Swiney, C.J., and Thomas R.
Frierson, II, J., joined.
CHARLES D. SUSANO, JR., JUDGE.
Reeds executed the trust agreement on November 15, 2000. Mr.
Reed executed his will the same day. On January 3, 2001, the
Reeds conveyed a total of approximately 204.61 acres of real
estate to the trust by four quitclaim deeds. Two of the deeds
were executed jointly. Mr. and Mrs. Reed each executed one
deed separately. Mr. Reed died on May 27, 2001. His will
designates Mrs. Reed as executor and further provides in
pertinent part as follows:
I give any interest I have in all personal automobiles,
clothing, jewelry, china, silver, books, pictures, and other
works of art, household furniture and furnishings and all
other items of domestic, household or personal use to wife,
if she survives me.
All the rest, residue and remainder of my estate, both real
and personal, . . . including all of my separate property, if
any, and my share of the jointly held property of my wife and
myself, I give, devise and bequeath to the individual or bank
then acting as Trustee under the certain Trust Agreement
designated as The John Marion Reed and Willie Kate Reed
Trust, signed earlier this day and bearing the same date as
this Last Will and Testament, of which my wife and I are
Co-Trustors and Co-Trustees, to be combined with the other
assets of the trust and held, administered and distributed as
a part of that trust, according to the terms thereof and any
amendments made to it prior to my death.
March 27, 2002, Mrs. Reed, purporting to act in her capacity
as executor, transferred an additional 76 acres of real
estate to the trust. A week later, she conveyed all of the
real property held by the trust to herself individually. She
then terminated the trust.
brought this action on December 5, 2014, alleging that Mrs.
Reed "wrongfully, and without authority, conveyed to
herself all of the real estate in [the] Trust, worth hundreds
of thousands of dollars." Also named as a defendant was
Cindy Kinley, his sister and holder of a power of attorney
for Mrs. Reed. He further alleged that
[t]he Plaintiff, as one of the vested remainder beneficiaries
of the Trust . . . is entitled to an accounting of the
disposition of the assets of John Marion Reed at the time of
his death as well as the assets then in The John Marion Reed
and Willie Kate Reed Living Trust, and to the return to said
Trust of any assets that have been wrongfully ...