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Janet J. Jeanes v. Bank of America

March 8, 2013

JANET J. JEANES, AS ADMINISTRATOR C.T.A. OF THE ESTATE OF MAXINE J. ANTON, DECEASED, APPELLANT,
v.
BANK OF AMERICA, N.A.; BANK OF AMERICA CORPORATION; RUDY WRENICK; AND SHARON KUNARD, APPELLEES.



Appeal from Shawnee District Court; DAVID E. BRUNS, judge.

SYLLABUS BY THE COURT

SYLLABUS BY THE COURT 1. In a case before the Kansas Supreme Court on a granted petition for review, any issue not presented in the petition for review or fairly included therein generally will not be considered. 2. Interpretation of a statute is a question of law, and an appellate court's review is unlimited. 3. To decide whether a cause of action survives the death of the plaintiff, a court must first determine when the cause of action accrued. Generally a cause of action accrues as soon as the right to maintain a legal action arises. 4. Under the facts of this case, the cause of action accrued when the decedent died because the alleged injury-excessive taxes on the estate-did not arise until after her death. 5. A cause of action does not survive in favor of a personal representative of a decedent unless it accrued in favor of the decedent in his or her lifetime. 6. Under the facts of this case, because the cause of action did not accrue during the lifetime of the decedent, it does not qualify as a survival claim under K.S.A. 60-1801.

Per curiam.

Review of the judgment of the Court of Appeals in 40 Kan. App. 2d 281, 191 P.3d 325 (2008).

Judgment of the Court of Appeals affirming the district court on the single issue subject to our review is affirmed. Judgment of the district court on the single issue subject to our review is affirmed.

We are asked to determine if the personal representative of a decedent's estate may maintain a malpractice cause of action against the decedent's attorney for substandard estate planning that resulted in increased tax liability. We answer this question "no" because the cause of action arose after the decedent's death which means it does not qualify as a survival claim under K.S.A. 60-1801.

Accordingly, we affirm the judgment of the Court of Appeals and the district court on this issue.

FACTS

On June 13, 1991, Maxine J. Anton created an inter vivos revocable trust. From the trust's inception to her death, Anton served as its sole trustee. Upon her death, the vast majority of the assets was to pass to her niece, Janet Jeanes, with the remainder funding charitable trusts for Anton's stepson and her personal assistant.

At Anton's request, Topeka attorney Sharon Kunard drafted the trust documents and a pour-over will. All later amendments were prepared by Kunard, who was last contacted by Anton for legal services in June 2000.

Bank IV, the predecessor of Bank of America (the Bank), was named successor trustee of Anton's trust and helped Anton serve as trustee by acting as her agent. Under a written agency agreement, Anton deposited her common stock and securities with the Bank and the Bank performed certain tasks for her. Since 1998, Rudy Wrenick helped manage Anton's account.

Anton died on April 25, 2003. Her estate tax return revealed a gross estate of $39,491,806. On January 24, 2004, her estate paid estate and inheritance taxes of $21,860,864.61.

On November 24, 2004, in Jeanes' capacity as administrator C.T.A. of Anton's estate, she sued the Bank, its parent company Bank of America Corporation (BAC), Wrenick, and Kunard. Against the Bank, BAC, and Wrenick, the petition alleged claims of negligence-and of breaches of fiduciary duty, contract, and trust. Against attorney Kunard, the petition alleged claims of negligence and breaches of fiduciary duty and contract. These claims were based on the alleged failure of all the defendants to protect Anton's assets from tax liability. Specifically, Jeanes alleged that setting up a family limited partnership would have saved more than $6 million in death and estate taxes.

The Bank, BAC, and Wrenick moved for summary judgment. While noting that Jeanes had withdrawn her claims against BAC, the district court granted the motions. Kunard moved separately for summary judgment, which the district court likewise granted. Specifically, the court held that Jeanes' tort claims for legal malpractice did not survive Anton's death.

Jeanes appealed only the grant of summary judgment to Wrenick and Kunard to the Court of Appeals.

The Court of Appeals panel reversed part of the summary judgment for Wrenick, but affirmed it for Kunard. More particularly, the panel held:

"[S]ubstantial injury resulting from Kunard's alleged malpractice would have been the estate taxes imposed against Anton's estate, which did not arise until after Anton's death. Therefore, the cause of action for legal malpractice did not accrue in Anton's lifetime and did not survive her death." Jeanes v. Bank of America, 40 Kan. App. 2d 281, 299, 191 P.3d 325 (2008).

In her petition for review to this court, Jeanes only requests review of the panel's affirmation of the district court's grant of summary judgment to Kunard. Neither Wrenick nor Kunard filed a cross-petition. Accordingly, we now consider only whether the summary judgment for Kunard was correct. See Cohen v. Battaglia, 296 Kan. __, 293 P.3d 752 (2013).

ANALYSIS

Issue: Administrator Jeanes' malpractice claim on behalf of Anton's estate for Kunard's negligent estate planning does not survive Anton's death under K.S.A. 60-1801.

As a threshold matter, we observe that administrator Jeanes' first amended petition alleged that Kunard committed "professional negligence," breached her fiduciary duty owed to Anton and her estate, and breached her contract with Anton. In the district court's order granting Kunard summary judgment, the court determined that all of Jeanes' causes of action against Kunard "sound[ed] in tort." The Court of Appeals panel specifically affirmed that part of the order. Jeanes, 40 Kan. App. 2d at 288 ("Consequently, the trial court correctly ...


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