Filed: March 15, 2004. UNPUBLISHED OPINION
Appeal from Superior Court of King County. Docket No. 00-2-19370-0. Judgment or order under review. Date filed: 03/11/2002. Judge signing: Hon. James a Doerty.
Counsel for Appellant(s), John Joseph Iv Kannin, Attorney at Law, 1325 4th Ave Ste 535, Seattle, WA 98101.
Randolph O III Petgrave, Attorney at Law, 419 Occidental Ave S Ste 608, Seattle, WA 98104-3810.
Philip Albert Talmadge, Talmadge Stockmeyer, 18010 Southcenter Pkwy, Tukwila, WA 98188-4630.
Counsel for Respondent(s), Frank Arthur Cornelius Jr, Lee Smart Cook Martin Patterson, One Convention Place, 701 Pike St. Ste 1800, Seattle, WA 98101-3929.
Sam Breazeale Franklin, Lee Smart Cook Martin Patterson, 701 Pike St. Ste 1800, Seattle, WA 98101-3929.
Francis X Olding, Betts Patterson Mines PS, 701 Pike St. Ste 1400, Seattle, WA 98101-3927.
A wrongful death claim by a murder victim's estate against the brother of the killer requires the plaintiff to show either that a `special relationship' existed between the brother and the decedent such that the brother was entrusted with the well-being of the decedent, or assumed a `special relationship' of control over the killer which gave rise to a duty to protect the decedent from that third person. Here, the facts show that Casey Morgan assumed a special relationship of control over his brother, Tom Morgan, such that a triable issue existed whether Casey should have protected others from Tom's actions. Reversed and remanded.
Casey and Karen Morgan, husband and wife, died at the hands of Casey's brother, Tom Morgan. Tom experienced severe emotional and mental problems for 25 years. Tom had a fascination with, and collected, guns. He had several unsuccessful suicide attempts. Tom had arguments with Casey and once went after him with a gun. After one outburst, Casey was asked by police officers to take possession of Tom's firearms. Casey did so, but kept the guns unlocked in the bedroom he shared with Karen. In the fall of 1999, after trying to commit suicide by shooting himself in the head, Tom was institutionalized. Tom was released into Casey's care and came to live with Karen and Casey at Casey's invitation.
Although Casey knew Tom was barred from access to guns, he allowed Tom to keep and use an ammunition loading press in his room and kept the guns unsecured. Karen was not comfortable having Tom's guns in the house and expressed to a friend that she was afraid that Tom would hurt her. On December 7, 1999, Tom shot and killed both Karen and Casey with a shotgun. The evidence showed that Tom initially shot Karen twice in the torso and Casey three times in the torso. Tom called 911, told the operator he had shot his brother and sister-in-law, and informed the operator he was mentally ill and highly medicated. During the call Tom stated, `Hey, are you alive? Are you alive?' The 911 transcript reveals faint sounds in the background and then the sound of a final gun shot. Tom informed the operator he had to shoot his brother `once more in the head' because he was still breathing. He then continued to talk to the operator for nearly an hour, indicating several times that he desired medical assistance for his brother and sister-in-law in case they might still be alive.
Tom was killed by Seattle police officers in a shootout. The police officers found a suicide note which indicated that Tom intended to kill both Casey and Karen, burn their house, and then kill himself. Dr. Paul D. Gosink of the King County Medical Examiner's Office viewed the scene of the crime, performed autopsies on Karen and Casey, and issued death certificates that stated the deaths were simultaneous. No one sought review of the information in the certificates.
Casey and Karen Morgan died intestate. Jay and Sue Morgan (the Morgans) are Casey's brother and former sister-in-law and were appointed the personal representatives of Casey's estate in December 1999. Robert and Helen Maki (the Makis) are Karen's parents and were appointed the personal representatives of Karen's estate in January 2000.
On December 8 and 9, 1999, prior to being appointed Casey's personal representatives, the Morgans and their attorney, Rick Bathum, entered Casey and Karen Morgan's residence to secure it. They removed documents, records, and other personal property. Bathum located the Makis' telephone number and informed them of the murders and told them he would remove Karen's jewelry and scrapbooks from the home to protect them. Bathum also returned to the home in an attempt to locate a will or an attorney's name that represented either Karen or Casey. All items removed from the home were copied and disclosed to the Makis' counsel. For a period of time, Jay Morgan received rental income from Karen and Casey's real property and proceeds from the sale of community property, and paid the taxes on Karen and Casey's home.
Prior to being appointed as personal representatives, the Makis contacted Karen's employer, then U.S. West, about the status of her life insurance and employee stock ownership program (ESOP) benefits. Karen had named Casey as the primary beneficiary, and the Makis as secondary beneficiaries if Casey was not living. The Morgans also contacted U.S. West asserting that Casey had survived Karen. U.S. West determined that the Makis were the proper beneficiaries of Karen's ESOP benefits and made a payment of $204,674.86 to them. The Makis paid $49,748 in federal taxes on the benefits.
After commencement of the probate actions, the Morgans again asserted that Casey survived Karen. When disagreement about the timing of the deaths continued, the Makis began an action for Karen's estate in July 2000. The Makis argued that (1) Casey's estate was liable to Karen's estate because Casey recklessly endangered Karen's life by bringing Tom Morgan into their house and failing to keep firearms from him; (2) the Morgans and their attorney wrongfully took possession of property belonging to Karen's estate; and (3) the Morgans and their attorney engaged in civil conspiracy to deprive Karen's estate of property.
The Morgans asserted the Makis' claims were frivolous and counterclaimed for attorney fees and costs. The Morgans' attorney, Bathum, moved to dismiss the conversion and civil conspiracy claims against him individually under CR 12(b)(6) and CR 56. The court granted the motion and dismissed the Makis' claims with prejudice. Bathum then moved for attorney fees. The Makis objected, arguing that the claims were not frivolous. However, the court ruled that the Makis' claims of conversion and conspiracy were frivolous and granted Bathum $11,335 in attorney fees and costs pursuant to RCW 4.84.185. The court also found that the Makis' attorney failed to conduct a reasonable inquiry of the conversion and conspiracy claims, that this failure violated CR 11, and awarded Bathum $3,000 in sanctions.
The probate actions and civil actions were consolidated in September 2001. Thereafter, the Morgans filed a third party complaint against the Makis for conversion, based on benefits paid by U.S. West to the Makis. The Makis denied these claims.
The Morgans abandoned their claim that the Makis converted Karen's life insurance proceeds. The life insurance policy required the beneficiary to survive the decedent by 15 days.
The Morgans moved for summary judgment on the conversion and civil conspiracy claims against them, asserting they acted as personal representatives of Casey's estate. The trial court determined that the Morgans' actions were reasonable and consistent with their duties as personal representatives of Casey's estate, and that the Makis had failed to show any evidence of a conspiracy. The Morgans asked for attorney fees and sanctions. The court found the Morgans were forced to defend the Makis' frivolous lawsuit and awarded $14,155 in attorney fees to the Morgans under RCW 4.84.185. The court also sanctioned the Makis' attorney under CR 11 in the amount of $5,000, ruling that the attorney had not conducted a reasonable inquiry into the Makis' claims.
The Morgans also moved for summary judgment on the Makis' wrongful death claim and asked the court to determine that Karen predeceased Casey. Initially, the trial court denied this motion. On reconsideration, the court granted summary judgment to the Morgans as to the Makis' wrongful death action under RCW 4.20.046. The court then bifurcated the sequence of death issue.
The Morgans' motion on the sequence of deaths was accompanied by the 911 tape transcript and several declarations. The Makis provided the death certificates and a declaration from Dr. Gosnik, the medical examiner who issued the death certificates. Dr. Gosnik declared that it was not possible to prove that Karen predeceased Casey because her injuries were not instantly fatal, and noted that when he examined the bodies at the scene Casey's core body temperature was 63. degrees and Karen's core body temperature an hour later was 96.8 degrees.
Colorado's Uniform Simultaneous Death Act specifies that for nonprobate assets with a `governing instrument,' a person who does not survive the decedent by 120 hours is deemed to have predeceased the decedent. Colo. Rev. Stat. sec. 15-11-702(2).
The Morgans' medical examiner, Dr. Reay, disagreed and concluded that Karen could have lived only a few seconds from her injuries, and that since Casey's first wounds were not fatal he lived longer than Karen. The court conducted a two-day hearing and entered findings of fact that Karen died four to six minutes prior to Casey.
The Morgans renoted their summary judgment motion against the Makis on the issue of conversion. The Makis argued that although the ESOP plan was silent on how to treat the death of beneficiaries, the plan provided that it would first be interpreted under federal law, then Colorado law, if federal law was inapplicable. Since Colorado law specified that a person who did not survive the decedent by 120 hours is deemed to have predeceased the decedent,2 the Makis asserted they were the proper beneficiaries of Karen's ESOP benefits even if Casey survived Karen by a few minutes. The trial court held that the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001 et seq., preempted Colorado law, and that if a beneficiary survived an ESOP participant for any amount of time he or she was deemed to have survived for purposes of qualifying as a beneficiary. The trial court then ruled as a matter of law that since Karen had predeceased Casey, the Makis had converted Karen's ESOP proceeds. The court entered judgment against the Makis in the amount of $204,754.82 plus prejudgment interest in favor of Casey's estate. The Makis appeal and request attorney fees.
The trial court declined to give the Makis any credit for the taxes paid on the ESOP benefits or to require Casey's estate to reimburse the Makis for that expense.
DISCUSSION 1. Sequence of Deaths and Conversion Claim.
Even if the trial court had properly determined that Casey survived Karen, it erroneously concluded that the Makis converted Karen's U.S. West ESOP benefits. The tort of conversion is "the act of wilfully interfering with any chattel, without lawful justification, whereby any person entitled thereto is deprived of the possession of it." The Makis did not act willfully in possessing the property, but relied in good faith upon the plan administrator's determination that they were the proper beneficiaries. Further, we conclude that the plan administrator did not abuse its discretion in determining the Makis were the proper beneficiaries. Thus, the Makis were not guilty of conversion in any event.
The provisions of ERISA control Karen's ESOP account. ERISA also supercedes `any and all state laws insofar as they may now or hereafter relate to any employee benefit plan' covered by ERISA. However, ERISA does not define survivorship. In contrast, Colorado law, the law specified by the plan, defines the consequences of the death of a beneficiary and owner of a benefits plan. Colorado law states that for non-probate assets with a `governing instrument,' a person who does not survive the decedent by 120 hours is deemed to have predeceased the decedent.
Colorado law was applicable here and did not violate ERISA. The Makis were clearly the proper beneficiaries of the ESOP benefits, whether Casey and Karen died simultaneously or Casey survived Karen by several minutes. However, because the plan administrator did not appear to rely on the Colorado law, we need not determine that issue.
The Morgans argue that Egelhoff v. Egelhoff, 532 U.S. 141, 121 S.Ct. 1322, 149 L.Ed.2d 264 (2001), prevents Colorado law from applying to determine survivorship here. Engelhoff held that RCW 11.07.010(2)(a), which applied to `all nonprobate assets' and disqualified a divorced spouse from receiving benefits under the terms of nonprobate documents, was expressly preempted by ERISA under 29 U.S.C. § 1144(a) because it bound employee benefit plan administrators to a particular choice of rules for determining beneficiary status, rather than paying beneficiaries identified in plan documents as required by ERISA. Egelhoff, 532 U.S. at 141, 144-47. In contrast, the benefits here have not been given to unidentified beneficiaries. The ESOP plan specifically identified both Casey's and Karen's parents as the beneficiaries. Additionally, the Colorado law here does not unilaterally bind the plan administrators to a particular choice of rules to determine beneficiaries. It merely provides a needed definition for `simultaneous death' and specifies what would happen when a beneficiary failed to survive a participant of a benefit plan. Thus, application of the Colorado law under the plan's provisions does not appear to violate ERISA as did the Washington statute in Egelhoff.
The plan administrator did not indicate reliance on Colorado law in determining that the Makis were the proper beneficiaries. Rather, the administrator exercised the `full power' under the specific terms of the plan to determine eligibility. The plan also specified that the administrator would retain discretion to determine beneficiaries even if some provisions of the plan were deemed unenforceable. This discretionary power is permitted under ERISA and limits our review. When an ERISA plan vests the plan administrator or fiduciary with discretionary authority to determine benefit eligibility, as does the ESOP plan here, the administrator's decision will not be reversed absent an abuse of discretion.
Firestone Tire Rubber Co. v. Bruch, 489 U.S. 101, 111, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989) (A denial of benefits challenged under ERISA provisions is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.).
Here, the plan administrator relied on death certificates filled out by the medical examiner who examined both Casey's and Karen's body. Those death certificates indicated that both died simultaneously. The administrator concluded that the Makis were the appropriate beneficiaries. Thus, the plan administrator exercised discretion under the terms of the plan, viewed the evidence provided, and gave benefits to individuals designated by the plan. This exercise of discretion is what ERISA anticipates and requires. Because the Makis relied upon the plan administrator's initial determination that they were the proper beneficiaries, they did not willfully interfere with chattel without lawful justification. Further, because there was no abuse of discretion, we decline to reverse the plan administrator's determination that the Makis were the proper beneficiaries under the plan. We hold that the Makis were not guilty of conversion. The court erred in finding them so.
2. Wrongful Death Claim.
The Makis also sued Casey's estate for the wrongful death of Karen, asserting that Casey had a duty to protect Karen from Tom's criminal behavior and negligently failed to do so. The trial court determined that Casey had neither a special relationship with Tom, nor a special relationship with Karen, which would trigger an actionable duty to protect others from Tom's acts or to protect Karen from any third party's criminal acts. Thus, the court dismissed on summary judgment the Makis' wrongful death action under RCW 4.20.046. We apply the usual standard of review. Generally, `a private person does not have the duty to protect others from criminal acts of third parties.' Washington recognizes an exception to the general rule where (1) a special relation exists between the actor and the third person that imposes a duty upon the actor to control the third person's conduct, or (2) a special relation exists between the actor and the other which gives to the other a right to protection.
Nivens v. 7-11 Hoagy's Corner, 133 Wn.2d 192, 200-01, 943 P.2d 286 (1997) (citing Restatement (Second) of Torts sec. 315; Petersen v. State, 100 Wn.2d 421, 671 P.2d 230 (1983)); Folsom, 135 Wn.2d at 674-75 (citing Hutchins, 116 Wn.2d at 227-28).
Several specific relationships have been recognized in Washington which give rise to an affirmative duty to act. `[I]n all cases imposing a duty based on a `special relationship,' the courts have found that the relationship involved an element of `entrustment'; i.e., one party was, in some way, entrusted with the well-being of the other party.' However, no `special relationship' exists between relatives, solely due to their status as members of the same family, such that would give rise to a duty to protect those relatives from harm. Further, no Washington case holds that a `special relationship' exists between a married couple solely because of the marital relationship. In fact, Washington cases appear to hold otherwise.
Gurren v. Casperson, 147 Wn. 257, 259, 265 P. 472 (1928) (duty of hotel to protect guests against violent acts of other guests); Nivens, 133 Wn.2d at 203 (business and an invitee); Niece v. Elmview Group Home, 131 Wn.2d 39, 50, 929 P.2d 420 (1997) (institution has duty to protect resident from sexual assault by staff); Hutchins, 116 Wn.2d at 228 (duty of common carrier to its passengers); Petersen v. State, 100 Wn.2d 421, 671 P.2d 230 (1983) (the special relationship between a psychotherapist and patient creates a duty); McLeod v. Grant County Sch. Dist. 128, 42 Wn.2d 316, 319-22, 255 P.2d 360 (1953) (school owes duty of care to student); Byerly v. Madsen, 41 Wn. App. 495, 503, 704 P.2d 1236 (1985) (hospital owes an independent duty of care to its patients); Bartlett v. Hantover, 9 Wn. App. 614, 621, 513 P.2d 844 (1973), rev'd on other grounds, 84 Wn.2d 426, 526 P.2d 1217 (1974) (employer has a duty to make reasonable provision against foreseeable dangers of criminal misconduct to which the employment exposes the employee).
See, e.g., Cox v. Malcolm, 60 Wn. App. 894, 900, 808 P.2d 758 (1991) (relationship between step-grandparent and step-grandchild is insufficient by itself to create a `special relationship' requiring protection of the step-grandchild from injury). See also, Hansra v. Superior Court, 7 Cal.App.4th 630, 645-47, 9 Cal.Rptr.2d 216 (1992) (because brother and mother of husband had no ability to control husband, no `special relationship' existed that required family of mentally ill husband who killed wife and then self to either protect wife or protect others from husband's action); Petersen v. Heflin, 163 Mich. App. 402, 407, 413 N.W.2d 810 (1987) (where individual negligently shot and killed his son-in-law, court held that wife of killer had no `special relationship' with the husband solely because of the marital relationship, nor could she control his conduct to an extent to give rise to a `special relationship' to protect others from injury by him).
Karen's estate has not shown that Casey was, solely due to his marriage to Karen, entrusted with the well-being of Karen. They also have not shown that Casey was entrusted with the well-being of Karen for any other reason. Although marriage may not preclude the existence of a `special relationship,' no `special relationship' between Casey and Karen existed for purposes of their negligence action. Thus, we hold that the court did not err in dismissing this claim on summary judgment on this basis. Although the Morgans argue that the evidence does not show whether Tom was officially released from the mental facility into Casey's care with conditions, a special supervisory relationship may evolve where no official custodial relationship exists. The court in Webstad v. Stortini noted that even when no `special relationship' originally existed, a duty may arise when a defendant interjects himself or herself into a situation and creates a special relationship of control.
Taggart v. State, 118 Wn.2d 195, 219, 223, 822 P.2d 243 (1992) (special supervisory relationship may arise when parole officers have taken charge of parolees they supervise, even though there is no custodial relationship, where they controlled parolees access to guns or alcohol and controlled movements of the parolees).
Webstad, 83 Wn. App. at 869.
However, the question remains whether a special relationship existed that gave rise to a duty to protect others from Tom's behaviors. The facts suggest a special relationship existed between Casey and Tom because Casey undertook Tom's care and exercised some control over his behavior. The facts show that Tom was mentally disturbed and had an obsession with guns. After an episode that involved a gun, Casey voluntarily took Tom into his home and apparently assumed his care. Casey also assumed control over Tom's weapons. For summary judgment purposes, the material facts are in dispute over whether Casey interjected himself into a situation and created a relationship of control over Tom.
In addition, whether Tom's actions in murdering Karen were foreseeable is a question of fact for the jury unless the circumstances of the injury are so highly extraordinary or improbable to be wholly beyond the range of expectability. The facts show that Tom had a history of mental illness, a fixation with firearms, had gone after his brother with a gun, had attempted suicide by using a firearm, and Casey kept Tom's firearms unlocked in the bedroom he shared with Karen. The Morgans countered that at least one of Tom's acquaintances did not consider Tom to be a violent person; one of Karen's friends did not believe Tom would harm Karen. They asserted that Tom was suicidal, not homicidal.
This is a reasonable argument, but it does not convince this court that Tom's actions were so highly extraordinary or improbable to be wholly beyond the range of expectability. Whether Tom's actions were foreseeable is a question for the jury. Viewing the evidence in a light most favorable to the Makis, the nonmoving party, we hold that the court erred by dismissing on summary judgment the Makis' wrongful death claims against Casey's estate.
Funkhouser, 89 Wn. App. at 662.
3. CR 11 and RCW 4.84.185 Sanctions.
The Makis claim that the trial court abused its discretion when it imposed sanctions under CR 11 and RCW 4.84.185 against the Makis and their counsel for their conversion and civil conspiracy claims against the Morgans and their attorney, Mr. Bathum. The Makis are partially correct.
RCW 4.84.185 assesses fees against the party, not the party's attorney, and requires the judge to consider the action as a whole prior to awarding attorney fees for a frivolous action. Under this statute, even where three of the plaintiffs' four claims are frivolous, attorney fees against the non-prevailing party are improperly granted. Here, at least one of the Makis' claims, the wrongful death action, was not frivolous. The trial court also awarded fees on the other claims before it dismissed the Makis' wrongful death action. The court's order for dismissal did not find that this final claim was frivolous and, in fact, it was not. Thus, the court abused its discretion in granting attorney fees under RCW 4.84.185. In contrast, CR 11 authorizes a court to assess fees against an attorney who files an action not well-grounded in fact, not warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law, and the attorney signing the pleading fails to conduct a reasonable inquiry into the factual or legal basis of the action. The decision to award attorney fees as a sanction for a frivolous action is left to the discretion of the trial court, and the court's decision will not be disturbed absent a showing of abuse of discretion. Here, the trial court did not abuse its discretion.
Lockhart, 66 Wn. App. at 744.
The Makis' conversion and civil conspiracy claims were based on their contention that the Morgans and Bathum attempted to misrepresent the sequence of Casey and Karen's deaths and took property, records, and documents belonging to Karen's estate. However, after a hearing, the court found that no evidence supported the Makis' contention, the Morgans acted in good faith as personal representatives of Casey's estate, and Bathum's actions were consistent with his lawful duties as the Morgans' representative. The record supports the court's findings.
The Makis alternatively assert their theories were not groundless; that if the trial court agreed with them on the sequence of deaths their claims would have been legitimate. The Makis also assert that CR 11 sanctions are unavailable because the issue of how to interpret RCW 11.05.010 with regard to the burden of proof in a simultaneous death action is a question of first impression in Washington. However, the Makis' conversion and civil conspiracy claims were made months prior to the Morgans' motion for the court to address the sequence of death issue. Further, the court specifically found that the Makis' attorney failed to conduct a reasonable inquiry of the conversion and conspiracy claims against Bathum and the Morgans. The court's determination that their initial claims violated CR 11, and subsequent award of sanctions, was not an abuse of discretion. Finally, both the Makis and the Morgans assert they are entitled to attorney fees on appeal. The Makis also claim they were entitled to attorney fees at trial. Since neither the Makis nor the Morgans are the prevailing party on appeal, neither is entitled to fees. We also decline to award the Makis attorney fees for the trial.
Moorman v. Walker, 54 Wn. App. 461, 773 P.2d 887 (1989) (petitioner's claim that respondent misrepresented her inability to become pregnant, and thus he was not liable for child support when child was conceived out of wedlock, was an issue first impression that was not frivolous).
We note that the Makis' appeal is unclear about whether they abandoned their civil conspiracy and conversion claims against Bathum. As a consequence, Bathum was forced to file a reply brief and defend on appeal. As discussed above, the trial court did not err in dismissing the Makis' claims of civil conspiracy and conversion against Bathum. Thus, the Makis' pursuit of these frivolous claims justifies an award of sanctions on appeal pursuant to RAP 18.9. Sanctions are awarded to Bathum on these frivolous claims only.
The Makis argue in another portion of their opening brief that if this court determines that the deaths were simultaneous, then the court should find that the Morgans' and Bathum's conduct in seizing Karen's community assets and treating them as property of Casey's estate amounted to conversion. It is unclear whether they are arguing that the trial court erred in dismissing their conversion and civil conspiracy claims against the Morgans and Bathum. Their argument is neither supported by argument or citation to authority. Thus, it is waived. Weems v. North Franklin School Dist., 109 Wn. App. 767, 778-79, 37 P.3d 354 (2002); RAP 10.3(a)(5).
In sum, we reverse and remand for further proceedings on the wrongful death claim, reverse the trial court's determination that the Makis converted Karen's ESOP benefits, and reverse the trial court's order for attorney fees pursuant to RCW 4.84.185. We affirm the trial court's dismissal of the claims for civil conspiracy and conversion against the Morgans and Bathum, affirm the trial court's CR 11 sanctions, and award sanctions to Bathum on appeal pursuant to RAP 18.9.
COLEMAN and APPELWICK, JJ., concur.