Court of Appeals of Ohio, Sixth District, Sandusky
Charles R. Hutchings Appellee
John Hutchings, Individually and as Trustee of the Hutchings Family Trust Appellant
Court No. 20169001
E. Robinson, for appellant.
Jennifer J. Antonini, for appellee.
DECISION AND JUDGMENT
1} This matter is before the court on appeal from
the judgment of the Sandusky County Court of Common Pleas,
Probate Division, following a jury trial. Because we find the
verdict contrary to law and unsupported by the evidence, we
Facts and Procedural Background
2} The parties in this dispute are brothers,
appellant John Hutchings and appellee Charles (Chip)
Hutchings. Chip filed suit to challenge the distribution of
trust assets, placed in an irrevocable trust by their father
Charles Hutchings. Both Charles and his wife Elise Hutchings
passed away in 2014, shortly after creation of the
3} During Charles' and Elise's lives, John
managed their finances. His parents chose him because he
worked as a financial advisor and had the training,
education, and experience to manage their affairs. Chip never
objected to this arrangement, and even approved of John's
efforts on their parents' behalf.
4} In 2012, Elise exhibited signs of dementia, and
Charles soon became her full-time caregiver. While Elise was
still competent to do so, she and Charles executed durable
power of attorney documents, granting John broad authority
over his parents' affairs. The durable power of attorney
revoked all prior financial powers of attorney, and granted
John the authority to act in each parent's name and on
their behalf in matters including real property transactions,
banking, retirement transactions, fiduciary transactions, and
estate, trust, and other beneficiary transactions.
5} Relevant to this appeal, the durable power of
attorney specifically provided John with authority with
respect to amending or creating trusts, permitting John to
"create a new revocable or irrevocable inter vivos
trust, under whatever terms my attorney-in-fact deems
advisable[.]" The durable power of attorney expressly
permitted self-dealing, providing, "My Agent can enter
into transactions with me or in my behalf in which my Agent
is personally interested, notwithstanding any law prohibiting
acts of self-dealing."
6} Charles' attorney, Louis Borowicz, drafted
the power of attorney documents after consulting with Charles
by phone. Chip never challenged the validity of the power of
attorney, or disputed the broad authority granted to John.
Instead, Chip argued that John exceeded this broad authority
by having a gift-balancing clause included in the otherwise
proper irrevocable trust.
7} Both sons received gifts and money from their
parents throughout their adult lives, and Elise was a
meticulous record-keeper. She tracked funds given to John and
Chip, as well as any money received back as repayment on
loans. Elise preserved her ledgers in a lock box, and John
indicated she called the ledgers her "bread
crumbs," intended for John's use in sorting out the
estate when she and Charles were gone. By 2013, Elise's
health and mental state had deteriorated, and she moved into
a nursing home. At this point, Elise required more care than
Charles was able to provide, and Charles became concerned
about the cost of long-term nursing home care. Charles'
health also began to fail at this time, and eventually he,
too, required nursing home care.
8} After speaking with his father, John consulted
with Borowicz, who recommended an irrevocable trust. Borowicz
did not speak with Charles regarding the trust, but John
indicated he shared all details with his father. As part of
preparations for the trust, John ran a credit report for his
parents and discovered several student loans taken out by
Chip's daughter, totaling around $100, 000. All but one
of these loans listed Charles as cosigner without
Charles' knowledge or consent, and all were in default.
Fearing Sallie Mae would attach assets of the estate,
Borowicz recommended quick execution of the
trust. On August 12, 2013, John executed the
irrevocable trust, drafted by Borowicz, on behalf of Charles
as expressly authorized by the power of attorney. Borowicz
directed John to execute the trust on his father's behalf
to avoid delay, because Charles lived a distance from
9} The new trust identified John and Chip as
beneficiaries, but unlike prior estate plans, included a
gift-balancing clause, requiring offset of any distribution
after the death of both parents, according to amounts already
given to John or Chip during their parents' lifetimes.
Both John and Chip were aware of gifts and money received by
the other, but there was no evidence that either knew the
exact amounts each had received, prior to execution of the
trust. Borowicz indicated this clause was standard where
there have been lifetime gifts given to the beneficiaries.
Chip argued this new provision did not reflect his
parents' intent, but did not otherwise seek to void the
trust. Chip also never claimed that John exerted undue
influence over their father.
10} The terms of the irrevocable trust designated
John as trustee, and granted him the authority to make
distributions of principal and interest, during the lifetimes
of Charles and Elise, with "absolute discretion."
As trustee, John could make these discretionary distributions
to himself, to Chip, and to his father's financial
advisor. At trial, John testified that the goal of
the irrevocable trust was, first, to take care of his
parents, who were expending large sums each month for nursing
home care. As structured, John indicated the trust assets
would have depleted over time had his parents lived longer,
taking them through the Medicaid look-back period. A second
goal of the trust was creditor protection, and John testified
that the surprise of the student loan debt acted as an
impetus for quick execution of the documents. Based on the
evidence and testimony, John authorized distributions of both
income and principal, as expressly permitted, to care for his
parents until they passed away.
11} Chip asserted no claim based on distributions,
during his parents' lifetime. Chip, furthermore, did not
dispute the authority granted to John as trustee, to make
distributions while their parents lived, solely at John's
discretion. Chip also cited no provision within the trust
language that granted him ownership or a right to possession
of trust assets, prior to the deaths of both parents.
Instead, the trust provided for distribution after death, as
Distributions following the Death of the Survivor.
the death of the second to die of my spouse and me, all of
the remaining principal and accumulated income, if any, of
this Trust shall be divided into as many shares, allocated as
hereinafter provided, as are necessary to provide one such
share for each then living child of mine.
Funding Each Child's Trust Share. The Trustee shall
fund such separate shares so as to provide as nearly equal
shares as practicable after crediting to the value of such
separate shares the amount of all gifts made by the Grantor
to, or for the benefit of, the beneficiaries of each such
separate share, or to, or the benefit of, the spouse or
descendant of any such beneficiary. It is the Grantor's
intention that the family units represented by such separate
shares be treated equally by aggregating all such gifts to
the members of such family units as provided above and
allocating the amounts used to fund the separate shares
hereunder, so that the total amount of funds benefiting each