Appellate Decisions
| Publication year | 2015 |
| Pages | 29 |
| Citation | Vol. 84 No. 4 Pg. 29 |
All opinion digests are available on the KBA members-only website at www.ksbar.org. We also send out a weekly newsletter informing KBA members of the latest decisions. If you do not have access to the KBA members-only site, or if your email address or other contact information has changed, please contact member and market services at info@ksbar.org or at (785) 234-5696. You may go to the courts' website at www.kscourts.org for the full opinions.
Supreme Court
Civil
BREACH OF FIDUCIARY DUTY AND CLEAR AND CONVINCING EVIDENCE BECKER V. KNOLL FINNEY DISTRICT COURT — AFFIRMED COURT OF APPEALS — REVERSED NO. 105,643 — JANUARY 30, 2015
FACTS: This case involved an action by shareholders in a Kansas irrigation corporation against the president of the corporation (Knoll), alleging breach of a fiduciary duty and seeking removal of the president as an officer and director. The Supreme Court affirmed the Court of Appeals determination that the plaintiffs had made a prima facie case but reversed on the question of whether the facts supported judgment for the defendant. Holding that the courts below had applied incorrect legal standards, this court remanded the case to the district court so that it could reapply the law to the facts before it on the record. On remand, the district court again ruled for the defendant. The court held that Knoll engaged in no self-dealing, no misfeasance, and no malfeasance to the detriment of the corporation. The plaintiffs again appealed to the Court of Appeals. The Court of Appeals reversed, holding that Knoll's failure to maintain employment records undermined his position to such an extent that, as a matter of law, he acted in bad faith. The Court of Appeals remanded the case to the district court for determination of damages.
ISSUES: (1) Breach of fiduciary duty and (2) clear and convincing evidence
HELD: Court held the district court applied the correct standards, which were supported by the evidence, and the Court of Appeals erroneously reversed the district court. Court found that Knoll provided evidence that a rational factfinder could apply to overcome the inference that the missing written data would be adverse to him. The Court of Appeals rejected or ignored the explicit testimony that Morehouse, the corporation's ditch rider, worked far more than the required 40 hours a week. In so doing, the Court of Appeals may have implied that the adverse inference rule is an absolute rule: Knoll's failure to keep hourly records constituted per se proof that Morehouse did not work the required number of hours and that Knoll acted in bad faith detrimental to the corporation. Or the Court of Appeals may have reevaluated Knoll's and Morehouse's testimony and concluded that the testimony was inadequate to overcome the inference of bad faith. Either approach is incorrect. The former analysis is wrong because the adverse inference rule establishes a method of supporting a claim, not a form of strict liability. The failure to produce a record under the party's control does not establish a breach of duty in itself. Knoll introduced substantial, credible evidence tending to show that he did not breach his duty. The latter analysis—which would be based on the quality of the evidence—is also wrong because it requires the appellate court to reweigh the evidence. The testimony regarding the number of hours that Morehouse worked was quite explicit, and the district court explained why it found that evidence credible. The district court properly carried out the task assigned to it on remand, and the Court of Appeals applied an incorrect standard of review. The opinion of the Court of Appeals was reversed. The decision of the district court was affirmed.
STATUTES: No statutes cited
ESTATES, ALLOCATION ORDER, AND JURISDICTION IN RE ESTATE OF BUTLER WYANDOTTE DISTRICT COURT - AFFIRMED COURT OF APPEALS – REVERSED AND APPEAL REINSTATED NO. 108,747 — FEBRUARY 20, 2015
FACTS: This case involved an allocation order and subsequent orders refusing to set it aside, issued in a Wyandotte County probate matter in 2007 and 2008, and whether those were final orders appealable within 30 days. The probate allocation order selected a Colgate-Palmolive Co. severance package on behalf of Kenneth Lee Butler, who was employed at the company's closing Kansas City plant at the time he died intestate in October 2006. The order also divided Colgate-Palmolive's obligations under the selected severance package between Kenneth's father, Leo, and Kenneth's estate. After a federal court interpleader proceeding filed by the administrator of Leo's estate, the amounts allocated by the state pro tem district judge in the probate matter were left intact: $63,640.50 for Leo's estate and $176,359.50 for Kenneth's estate. There was no state court appeal from the allocation order. Nor did Leo or his estate ever file a demand against Kenneth's estate in the state probate proceeding. Four years after the denial of Leo's motion to set aside the allocation order, Kenneth's son and only heir, Franklin Burch, successfully sought a partial distribution from Kenneth's estate. Leo's estate attempted a late appeal of the order of partial distribution, arguing excusable neglect from lack of notice. The district court judge disallowed the late appeal, ruling that Leo's estate had no interest in Kenneth's estate to pursue. Leo's estate filed a timely appeal from that order. The Court of Appeals ultimately dismissed
Appellate Decisions the appeal for lack of jurisdiction, although, along the way, it addressed the propriety of the district court's ruling on the late appeal from the partial distribution order. In re Estate of Butler, 49 Kan. App. 2d 335.
ISSUES: (1) Estates, (2) allocation order, and (3) jurisdiction
HELD: Court held on the facts of this case, an allocation order issued by a pro tem district court judge in a probate matter was final and appealable under K.S.A. 2012 Supp. 59-2401(b) and K.S.A. 60-2102(a)(4), and failure to file a timely appeal eliminated any interest the decedent's father possessed in the assets of his son's estate. Under those circumstances, the district judge did not abuse his discretion by refusing to allow a late appeal for excusable neglect by the father's estate, which was based on failure of notice of proceedings leading to an order of partial distribution of estate assets. Court affirmed the result in the district court that denied relief to the estate of the decedent's father.
STATUTES: K.S.A. 59-2401; and K.S.A. 60-260, -2102, -6103
Criminal
STATE V BETANCOURT SEDGWICK DISTRICT COURT — AFFIRMED NO. 108,944 — FEBRUARY 13, 2015
FACTS: Thirteen-year-old Migeul died from gunshot wounds suffered as he opened the door of his family's home. The state charged four men with crimes related to Miguel's death. One of those...
To continue reading
Request your trial