Opinion
No. 1 CA-CV 13-0592
03-03-2015
In the Matter of the Estate of: GEORGE W. BROOKS, Deceased. MARK R. GORDON, Appellant, v. SHERI SANBORNE and MARIBEL MAZA, as Co-Personal Representatives of the Estate of George W. Brooks, Deceased, Appellees.
COUNSEL Mark R. Gordon, Phoenix Appellant Tiffany & Bosco, P.A., Phoenix By James A. Fassold, Natalya Ter-Grigoryan Counsel for Appellees
NOTICE: NOT FOR OFFICIAL PUBLICATION. UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL AND MAY BE CITED ONLY AS AUTHORIZED BY RULE. Appeal from the Superior Court in Maricopa County
No. PB2007-000389
The Honorable Brian S. Rees, Judge Pro Tempore
AFFIRMED
COUNSEL Mark R. Gordon, Phoenix
Appellant
Tiffany & Bosco, P.A., Phoenix
By James A. Fassold, Natalya Ter-Grigoryan
Counsel for Appellees
MEMORANDUM DECISION
Judge Peter B. Swann delivered the decision of the court, in which Presiding Judge Kent E. Cattani and Judge Lawrence F. Winthrop joined. SWANN, Judge:
¶1 This appeal arises from the probate court's denial of a motion to reopen a decedent's estate. The appellant contends that the personal representatives closed the estate without accounting for his claim against it. We hold that the appellant failed to present a claim against the estate because he did not timely and clearly demand payment from the estate for a particular claim, and in fact never took any action consistent with pursuit of a claim against the estate. He therefore was not entitled to reopen the estate. Accordingly, we affirm.
FACTS AND PROCEDURAL HISTORY
¶2 The Estate of George W. Brooks ("the Estate") opened for probate in January 2007. Later that year, the Estate's co-personal representatives, Maribel Maza and Sheri Sanborne, sold the decedent's home ("the Property") to Mark R. Gordon. On June 11, 2007, Gordon sent a letter to the escrow agent in which he stated that the sellers had breached their contractual obligation to cure "all known and reported deficiencies [in] Seller Warranted items . . . and items that needed to be serviced," and that he was submitting the payment required to close the sale "under protest . . . because I believe that I am under duress (losing the house, having my earnest money held, and having sublet my apartment) as the Seller's agent has threatened to place a claim on my earnest money . . . in lieu of cooperating in delivering Sellers' compliance with contractual obligations." Three months later, on September 1, 2007, Gordon wrote to Maza. Gordon provided Maza, who lived in the home adjacent to the Property, with bills and estimates related to a fight between the parties' dogs. He also provided a copy of the June 11 letter. He wrote:
Here are my dog's vet bills to date from the dog bite, and the bill for the block wall, since our dogs have to be separated. I am willing to split that cost with you.
Here again is the letter I gave to close under protest. You can look at paragraph 5 of the contract regarding seller warranties
and defects. I continue to claim the full contract price, including the balance I paid at closing. Also, my outlays and estimates are already at $25,000, as I mentioned to you, and the total needs to be paid.
I will let you know if your contractors fully fix the refrigerator and irrigation system as they're still not fully fixed.
¶3 In January 2008, Maza and Sanborne informed the probate court that all estate matters had been concluded. At that time, Gordon's complaints related to the sale had not been resolved: in early 2008, he sought to initiate alternative dispute resolution ("ADR") proceedings with Maza and Sanborne. Maza and Sanborne opposed ADR. In September 2009, Maza and Sanborne's counsel sent a letter to Gordon's counsel stating that (1) the sale was a probate matter and as such was excluded from ADR under the terms of the purchase contract, and (2) Gordon had failed to present a claim in the probate proceedings. Gordon's counsel promptly responded by return letter, asserting that Gordon had "executed the real estate documents under protest with a written notice of his claims known at that time" but had not received formal notice of the probate proceedings, and arguing that ADR was available because the probate proceedings had closed. By letter dated October 1, 2009, Maza and Sanborne notified the probate court of the ADR dispute and asked that the Estate not be closed. In response to this letter, the probate court set a status conference.
¶4 At the November 4, 2009 status conference, at which Gordon appeared, the probate court filed Maza and Sanborne's October 1 letter and announced that it would not close the Estate. The court explained:
You guys wouldn't want me to close [the Estate] until all the real estate stuff is done. . . . This way you still have the authority to go to that [ADR proceeding], argue whether it's barred . . . . If I close the estate, in some ways you don't have authority to act as personal representatives anymore, and you wouldn't be authorized to go to this mediation, it'd be a one-sided mediation and you lose.In its minute entry the court identified Gordon as an "[i]nterested party."
¶5 No further activity occurred in the probate case until February 2012, when the court ordered the personal representatives to file either a closing statement or a status report detailing the tasks to be completed for closure of the estate. In response to this order, Maza and Sanborne promptly filed closing statements in which they indicated that the Estate had been fully administered, with all claims resolved.
¶6 In June 2013, over three and a half years after the events of Fall 2009, Gordon filed a motion to reopen the Estate. Gordon argued that he had an open claim against the Estate that had been allowed but not paid and that he had not been mailed copies of the closing statements. After holding oral argument, the probate court entered a signed order denying Gordon's motion. The court held that Gordon had timely presented a claim against the Estate, but the personal representatives had disallowed the claim and Gordon had failed to preserve it by filing a petition for allowance.
¶7 Gordon filed a motion for reconsideration of the court's order. Before the court ruled on the motion, Gordon timely filed a notice of appeal from the order denying reopening. The court subsequently denied the motion for reconsideration and Gordon filed a second notice of appeal. We have jurisdiction under A.R.S. § 12-2101(A)(9) to consider the court's denial of the motion to reopen. But we do not review the court's purported denial of the motion for reconsideration, because Gordon's initial notice of appeal divested the court of jurisdiction to rule on the motion. See In re Marriage of Flores & Martinez, 231 Ariz. 18, 21, ¶ 10, 289 P.3d 946, 949 (App. 2012) ("[T]he filing of a notice of appeal, even one ultimately determined to be a nullity, divests the trial court of jurisdiction to proceed other than to issue orders in furtherance of the appeal and to address matters unrelated to the appeal.").
DISCUSSION
¶8 We review the probate court's factual findings for clear error, and review its legal conclusions de novo. In re Estate of Zaritsky, 198 Ariz. 599, 601, ¶ 5, 12 P.3d 1203, 1205 (App. 2000). In interpreting the probate statutes, we may look to analogous sections of the Uniform Probate Code ("UPC") and to case law from other jurisdictions that have adopted versions of the UPC. See In re Estate of Wood, 147 Ariz. 366, 368, 710 P.2d 476, 478 (App. 1985). We will affirm the probate court's result if it is correct for any reason. See City of Phoenix v. Geyler, 144 Ariz. 323, 330, 697 P.2d 1073, 1080 (1985).
¶9 A claim against a decedent's estate that arises from a post-death contract with the personal representative must be presented within four months after the personal representative's performance comes due, by either a statement to the personal representative or by the commencement of proceedings against the personal representative. A.R.S. §§ 14-3803(C)(1), -3804(1)-(2). Presentation of the claim by statement requires the delivery or mailing to the personal representative of "a written statement of the claim indicating its basis, the name and address of the claimant and the amount claimed." A.R.S. § 14-3804(1). Upon receipt of such statement, the personal representative may either allow or disallow the claim. "[T]he personal representative may mail a notice to [the] claimant stating that the claim has been disallowed. . . . Failure of the personal representative to mail notice to a claimant of action on his claim for sixty days after the time for original presentation of the claim has expired has the effect of a notice of allowance." A.R.S. § 14-3806(A). But even if the personal representative initially allows a claim, she may later disallow it if, "prior to payment, but not later than six months after presentation of the claim, [she] rescind[s] the allowance of [the] claim and notif[ies] the claimant of the change to a disallowance . . . ." A.R.S. § 14-3806(B). If the personal representative disallows the claim, either initially or upon reconsideration, the claim is extinguished unless the claimant seeks judicial relief, by either "fil[ing] a petition for allowance in the court or commenc[ing] a proceeding against the personal representative not later than sixty days after the mailing of the notice of disallowance . . . ." A.R.S. § 14-3806(A), (B). If the personal representative allows the claim, it shall be paid -- with interest, if applicable, see A.R.S. § 13-3806(E) -- in accordance with its level of priority, A.R.S. § 14-3807(A). If an allowed claim is not paid, the claimant may file a petition or motion for an order directing payment to the extent estate funds are available. Id.
¶10 The probate court held that the letters Gordon sent to Maza in September 2007 constituted a timely claim against the Estate. The court next held that though Maza and Sanborne did not provide Gordon a written notice of disallowance within sixty days, the applicable statute did not require a mailed notice and there was no doubt that the claim was being disputed. Despite this analysis, the court decided that for purposes of ruling on the motion, it would assume that the claim was initially allowed. The court then held that such allowance was rescinded by "the status report filed with the court on January 18, 2008 in which it states that there is still a disputed claim to be resolved so the estate should not be closed." The court concluded that the claim was barred because Gordon did not thereafter file a petition to resolve the claim.
¶11 The probate court's analysis was flawed. As a matter of law, Gordon's letters to Maza did not present a claim against the Estate. To be sure, the letters were presented within four months after the sale of the Property closed, and they set forth Gordon's name and address. They did not, however, sufficiently describe the basis for a claim or indicate that Gordon sought payment from the Estate.
¶12 A.R.S. § 14-3804(1) establishes a broad standard for claim description. The statute requires only that the claimant identify the claim's "basis," a term that does not prescribe any exact level of specificity. See State v. Korzep, 165 Ariz. 490, 493, 799 P.2d 831, 834 (1990) (holding that we generally construe statutory language in accord with commonly understood meanings); State ex rel. Morrison v. Anway, 87 Ariz. 206, 209, 349 P.2d 774, 776 (1960) (holding that we will not read into a statute requirements not within the legislature's manifest intent as gathered from the statute); Merriam-Webster's Collegiate Dictionary 102 (11th ed. 2003) (defining "basis" to mean, as relevant, "the bottom of something considered as its foundation[,] . . . the principal component of something[,] . . . something on which something else is established or based[,] . . . an underlying condition or state of affairs[, and] . . . the basic principle"). The statement of claim need not be drafted with precision and completeness, Estate of Page v. Litzenburg, 177 Ariz. 84, 89, 865 P.2d 128, 133 (App. 1993), and may be generously construed in view of the parties' independent knowledge, see Strong Bros. Enters., Inc. v. Estate of Strong, 666 P.2d 1109, 1112 (Colo. App. 1983). The statement of claim must, however, provide notice sufficient to allow the personal representative to evaluate the claim's merits. See In re Estate of Barry, 184 Ariz. 506, 510, 910 P.2d 657, 661 (App. 1996); Estate of Page, 177 Ariz. at 89, 865 P.2d at 133. Further, it must "sho[w] a plain intention to look to the estate for payment." Barry, 184 Ariz. at 510, 910 P.2d at 661; see also Burnett v. Hitching Post Lodge, Inc., 101 Ariz. 488, 491, 421 P.2d 507, 510 (1966) ("The purpose of the requirement to file claims [once they have been disallowed] and of the limitations of time thereon is to inform the personal representative and the court of the valid claims against the estate to the end that the estate be administered expeditiously."). We agree with the Colorado Supreme Court's construction of identical statutory language:
[A] creditor need not comply strictly with each of the formal requirements of section 15-12-804. The General Assembly has not required creditors to describe their claims with absolute precision . . . .
Nevertheless, we find that section 15-12-804 does require that a creditor provide a personal representative with reasonable notice that it is making a claim against an estate. Notice to a personal representative that a creditor could bring a claim against an estate is different from notice that the creditor in fact is bringing that claim. At a minimum a written claim must contain (1) a request or demand for payment from the estate, and (2) sufficient information to allow the personal representative to investigate and respond to the claim.
. . . .
[Here, t]he [purported claimant] did not request or demand payment from the Estate. [The personal representative]'s mere knowledge that [the purported claimant] could demand payment
from the Estate does not excuse [the purported claimant]'s failure to demand such payment.In re Estate of Ongaro, 998 P.2d 1097, 1100-1101 (Colo. 2000).
¶13 Based on the specific facts of this case, we conclude that Gordon's letters failed to satisfy § 14-3804(1). Gordon's description of a failure to fully cure unspecified warranty defects was overly vague even in view of Maza's participation in the sale process. Further, Gordon presented this description in conjunction with complaints regarding the dog-fight incident, a matter that did not involve the Estate, and he never stated or implied that any payment was demanded from the Estate. Gordon's letters did not provide notice that he was bringing a specific claim for payment against the Estate. Nor did he take any other action to provide such notice until filing his motion to reopen the Estate. His claim was therefore barred. See A.R.S. § 14-3803(C)(1). Accordingly, any failure by Maza and Sanborne to respond to Gordon's letters had no effect with respect to the Estate. See A.R.S. § 14-3806(A).
According to Gordon, Maza and Sanborne did not inform him that the Property was being sold by the Estate or that probate proceedings existed. But this is not a case where a claimant mistakenly sought payment from a personal representative instead of an estate and then, upon learning that the claim should have been presented against the estate, sought to do so. See Ariz. R. Civ. P. 15(c).
¶14 Gordon points out that the probate court referred to him as an "[i]nterested person" in the minute entry for the November 2009 status conference. Section 14-1201(28) provides that an
"[i]nterested person" includes any trustee, heir, devisee, child, spouse, creditor, beneficiary, person holding a power of appointment and other person who has a property right in or claim against a trust estate or the estate of a decedent, ward, or protected person. . . . Interested person, as the term relates to particular persons, may vary from time to time and must be determined according to the particular purposes of, and matter involved in, any proceeding.(Emphasis added.) At the time of the November 2009 hearing, it was Gordon's position that he had presented a claim but the dispute was subject to ADR outside of the probate proceedings, and it was Maza and Sanborne's position that the dispute was a probate matter that would have been subject to resolution in the probate court had it been properly presented as a claim against the Estate. At the hearing, Sanborne reiterated: "we believe that asserted claim is barred." The parties did not, however, present any argument regarding whether Gordon had an open claim, and the court did not resolve the issue. The court specifically explained that it was holding the Estate open so that in the ADR proceedings, Maza and Sanborne could argue on the Estate's behalf that Gordon's claim was barred. In these circumstances, the court's identification of Gordon in its minute entry as an "[i]nterested person" merely recognized that he was a potential claimant -- it was not a judicial determination that he had an allowed claim. For three and a half years thereafter, Gordon neither filed a petition to preserve a disallowed claim, see A.R.S. § 14-3806, filed a petition to receive payment on an allowed claim, see A.R.S. § 14-3807(A), nor took any other action consistent with having a claim against the Estate. The facts support the probate court's finding that "it [is] incredulous that the claimant can believe the claim went from 2007 to 20012 [sic] and was an accepted or allowed claim."
Similarly, Maza and Sanborne's later acquiescence to Gordon's November 2009 designation as an "interested party" was not a concession that he had an allowed claim.
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¶15 Because Gordon's claim against the Estate was barred, Maza and Sanborne appropriately excluded the matter from their closing statements and did not err by failing to provide copies of the statements to Gordon. See A.R.S. § 14-3933(A) (providing that personal representative may close an estate by filing and mailing to "all distributees of the estate and to all creditors or other claimants of whom the personal representative is aware whose claims are neither paid nor barred" a verified statement representing that all claims have been resolved). The probate court properly denied Gordon's motion to reopen the Estate.
CONCLUSION
¶16 We affirm for the reasons set forth above. Maza and Sanborne request an award of attorney's fees and costs on appeal under ARCAP 25 and A.R.S. §§ 12-341, -341.01, and -349. In exercise of our discretion, we deny the requests for fees. Maza and Sanborne are entitled to an award of costs under A.R.S. § 12-341 upon compliance with ARCAP 21.