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Ruckelshaus v. Cowan

United States District Court, S.D. Indiana, Indianapolis Division

August 16, 2019



          James Patrick Hanlon United States District Judge.

         Elizabeth Ruckelshaus sued Gerald Cowan, Kent Emswiller, and the law firm Emswiller, Williams, Noland & Clark P.C. for malpractice after they allegedly failed to carry out her wishes when terminating her father's trust. Both parties have moved for summary judgment. Dkt. 129; dkt. 137. Because Ms. Ruckelshaus filed her complaint after the statute of limitations elapsed, her claim is time-barred. Defendants' motion is GRANTED, and Ms. Ruckelshaus's motion is DENIED.

         I. Facts and Background

         Because Defendants have moved for summary judgment, the Court views and recites the evidence in the light most favorable to Ms. Ruckelshaus and draws all reasonable inferences in her favor. Zerante v. DeLuca, 555 F.3d 582, 584 (7th Cir. 2009). Since Mr. Ruckelshaus has also moved for summary judgment, the Court would normally interpret the evidence in a light most favorable to Defendants when considering her motion. See Family Mut. Ins. v. Williams, 832 F.3d 645, 648 (7th Cir. 2016). That's not necessary here, however, because even when all evidence is interpreted in Ms. Ruckelshaus's favor, Defendants are entitled to summary judgment.

         Ms. Ruckelshaus's father, Conrad Ruckelshaus, created a trust (the “Trust”) in which his two children, Thomas and Elizabeth (“Ms. Ruckelshaus”), would each receive income for life upon his death. Dkt. 124-4 at 3-5. Under the terms of the Trust, the surviving sibling would receive the deceased sibling's share of the Trust if the deceased sibling had no children. Id. at 4.

         Around 1998, shortly after Conrad and his wife died, Thomas asked Ms. Ruckelshaus if she would agree to modify the Trust. Dkt. 124-1 (Ruckelshaus Dep.) at 25:7-17, 29:10-13. Specifically, Thomas wanted to leave his portion of the Trust to his wife, Polly, after he died instead of letting it pass to Ms. Ruckelshaus. Id. at 29:10-13, 32:2-8. Ms. Ruckelshaus was sympathetic to Thomas's wishes, dkt. 1-1 ¶ 10, so she orally agreed that if Thomas died before Polly, Polly would get a “life estate” in his interest in the Trust. Dkt. 124-1 at 33:22-34:4. Polly's interest in the Trust funds would last only for her life- once she died, any remaining funds from Thomas's distribution would go to Ms. Ruckelshaus. Id. at 34:3-6; dkt. 1-1 ¶ 9; dkt. 107 ¶ 9.

         In December 1998, Ms. Ruckelshaus retained Kent Emswiller and Gerald Cowan from Emswiller, Williams, Noland & Clark to help her terminate or modify the Trust in a manner that would accomplish this goal. Dkt. 124-1 at 54:19-55:3; dkt. 138 at 18 ¶ 6; dkt. 136-2. Defendants' retention letter stated in relevant part: “[t]he purpose of this engagement is to achieve the termination of your father's, Conrad R. Ruckelshaus' Revocable Trust.” Dkt. 124-6 at 8. The retention letter did not mention creating a life estate for Polly or having any of Thomas's portion of the Trust ever revert to Ms. Ruckelshaus. Id. Ms. Ruckelshaus signed the letter. Dkt. 124-1 at 45:3-11.

         Mr. Emswiller and Mr. Cowan then prepared a Petition Requesting Termination of Trust (the “Petition”) and a Conditional Settlement Agreement (the “Agreement”) that would terminate the Trust. Dkt. 124-6 at 10-33. The phrase “life estate” does not appear in the Petition or the Agreement, and neither document contains language that could be construed to have created a life estate-only interest in Thomas's share of the Trust funds for Polly. The Agreement did not place any restrictions on how Thomas or Polly could spend the Trust funds, or how the remaining Trust funds would be distributed upon their deaths. Rather, the Agreement divided the proceeds of the Trust between Thomas and Ms. Ruckelshaus (and a few other beneficiaries) and stated in part that there were “no other written or oral agreements among the parties concerning the subject matter of the Conditional Settlement Agreement.” Id. at 22.

         On March 29, 1999, Mr. Emswiller sent the Petition and the Agreement to Ms. Ruckelshaus. Dkt. 124-2 at 7. She read both documents and signed them. Dkt. 124-6 at 10-33; dkt. 124-1 at 49:11-13. On June 21, 2000, the probate court granted the Petition. Dkt. 124-6 at 36. The next month, the Trust was dissolved, giving Ms. Ruckelshaus and Thomas more than a million dollars each without any restrictions or instructions that would limit how each could use their respective shares of the Trust funds. Dkt. 124-1 at 64:14-16, 65:12-16.

         Thomas died on July 1, 2009. Id. at 55:13-16. There is no designated evidence showing how Thomas spent his share of the Trust over the nine years after the Trust's termination. Dkt. 124-15 at 9-10. In October 2015, Polly died, leaving her entire estate to her children. Dkt. 124-1 at 60:21-22, 62:19-21. There is no designated evidence showing how Polly spent the remaining Trust funds (if any) over the six years between Thomas's death and her death. Dkt. 124-15 at 10.

         Shortly after Polly's death, Ms. Ruckelshaus learned that the remainder of Thomas's portion of the Trust would not revert back to her. Dkt. 124-1 at 61:9-62:2. In May 2017, Ms. Ruckelshaus sued Defendants for malpractice, alleging that they failed to carry out the request she made in 1998 that the Agreement require Polly's interest in the Trust funds revert back to her upon Polly's death. Dkt. 1-1 at 6-7.

         Defendants have moved for summary judgment on all of Ms. Ruckelshaus's claims. Dkt. 129. Ms. Ruckelshaus has moved for partial summary judgment on Defendants' affirmative defenses that Ms. Ruckelshaus's personal lawyer is liable for the alleged errors and that Ms. Ruckelshaus released Defendants from liability when she signed the Agreement. Dkt. 138 at 44-45.

         II. Applicable Law

         Summary judgment shall be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(a). The moving party must inform the court of the basis for its motion and specify evidence demonstrating “the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party meets this burden, the nonmoving party must ...

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