“A plaintiff may follow any successful claim for a declaratory judgment with a request for supplemental relief. . . . A court may decide whether [plaintiff] is eligible for supplemental monetary relief only after issuing a declaratory judgment in his favor.”
How later courts described this case
- “A plaintiff may follow any successful claim for a declaratory judgment with a request for supplemental relief. . . . A court may decide whether [plaintiff] is eligible for supplemental monetary relief only after issuing a declaratory judgment in his favor.”
Written by the judges who cited it.
The opinion
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
SUSAN A. BROWN,
Defendant/Cross-Claimant,
v. Case No.: 2:20-cv-705-SPC-MRM
PAUL BROWN, individually and as
personal representative of Alfred B.
Brown’s estate, MARK BROWN,
WARREN BROWN, and STEPHEN
BROWN,
Defendants/ Cross-Defendants.
/
ORDER1
Before the Court are cross motions for summary judgment.
Defendant/Cross-Claimant Susan Brown moved for summary judgment (Doc.
93). Defendants/Cross-Defendants Paul, Mark, and Warren Brown (together,
the “Brothers”) also moved for summary judgment (Doc. 101).2 The parties
responded and replied. (Docs. 99; 104; 105; 106). The Court denies both
Motions without prejudice.
1 Disclaimer: Documents hyperlinked to CM/ECF are subject to PACER fees. By using
hyperlinks, the Court does not endorse, recommend, approve, or guarantee any third parties
or the services or products they provide, nor does it have any agreements with them. The
Court is also not responsible for a hyperlink’s availability and functionality, and a failed
hyperlink does not affect this Order.
2 While Defendant/Cross-Defendant Stephen Brown appeared, he neither responded nor
signed onto any briefing. No party addresses his failure to defend. So the Court will assume
(for now) his interests coincide with the Brothers’.
BACKGROUND
This is an interpleader action over life insurance proceeds (the
“Proceeds”). Alfred Brown passed away. At his death, Susan was Alfred’s wife.
And Alfred had four sons from an earlier marriage—the Brothers. Now, Susan
and the Brothers dispute who should get the Proceeds.
On December 27, 1973, Alfred established a revocable trust, purportedly
funding it with life insurance proceeds (the “Trust”). “The Great-West Life
Assurance Company” apparently issued one of the identified policies. (Doc. 27-
1 at 23). Twenty-four years later, “Great-West Life & Annuity Insurance
Company” issued a policy on Alfred’s life (the “Policy”).3 (Doc. 1-2 at 2). The
Policy’s beneficiary designation listed a trust “dated 12/27/93.” (Doc. 27-3 at
2). The parties dispute whether that was a scrivener’s error (i.e., whether “93”
should read “73”).
Susan filed Crossclaims against the Brothers seeking to (1) declare the
Trust is the Policy beneficiary; (2) appoint a trustee; and (3) direct Great-West
to disburse the Proceeds to the Trust. (Doc. 27 at 9-11).
LEGAL STANDARD
“The court shall grant summary judgment if the movant shows that
there is no genuine dispute as to any material fact and the movant is entitled
3 No party makes any argument on the slightly different names of Great-West.
to judgment as a matter of law.” Fed. R. Civ. P. 56(a). A fact is “material” if it
“might affect the outcome of the suit under the governing law.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). And a material fact is in genuine
dispute “if the evidence is such that a reasonable jury could return a verdict
for the nonmoving party.” Id.
The moving party bears the initial burden to show the lack of genuinely
disputed material fact. Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th Cir.
2008). If carried, the burden shifts onto the nonmoving party to point out a
genuine dispute. Beard v. Banks, 548 U.S. 521, 529 (2006). At this stage,
courts view all facts and draw all reasonable inferences in the light most
favorable to the nonmoving party. Rojas v. Florida, 285 F.3d 1339, 1341-42
(11th Cir. 2002).
DISCUSSION
Each side moves for judgment on the Crossclaims. In the briefing, Susan
clarifies she seeks to reform the Policy. Under any law that might apply,
reformation is a cause of action or equitable remedy.4 Either way, reformation
has elements a party must plead and prove. But the Crossclaims don’t allege
4 Compare Schaffner v. 514 W. Grant Place Condo. Ass’n, 756 N.E.2d 854, 864 (Ill. App. Ct.
2001) (cause of action), and Romo v. Amedex Ins., 930 So. 2d 643, 649 (Fla. Dist. Ct. App.
2006), and James River-Pennington Inc. v. CRSS Cap., Inc., No. 13870, 1995 WL 106554, at
*6-7 (Del. Ch. Mar. 6, 1995), with Deutsche Bank Nat’l Tr. Co. v. Dolci, No. 2-11-1275, 2012
WL 6969135, at *3-4 (Ill. App. Ct. June 28, 2012) (equitable remedy), and Schroeder v.
Gebhart, 825 So. 2d 442, 446 (Fla. Dist. Ct. App. 2002), and Libeau v. Fox, 892 A.2d 1068,
1072 (Del. 2006).
a reformation cause of action, list facts in support, or seek that remedy. So
whether one calls reformation a claim or remedy, Susan wants summary
judgment on an unalleged theory. Courts generally cannot grant unpled relief.
Gilmour v. Gates, McDonald and Co., 382 F.3d 1312, 1314-15 (11th Cir. 2004).
And there is no reason to do so here.
Susan brought claims aimed at declaring rights under the Trust and
appointing a trustee—not reforming a separate contract (i.e., the Policy). Her
effort to confuse the line between the two falters.
Count 2 is a Florida dec action. Because Susan filed in federal court,
however, the Federal Declaratory Judgment Act (the “Act”) governs. E.g.,
Cent. Fla. Bakery, Inc. v. Depositors Ins., No. 6:21-cv-961-CEM-EJK, 2021 WL
4958787, at *2 n.1 (M.D. Fla. Oct. 25, 2021) (explaining the Florida Declaratory
Judgment Act is procedural). Under the Act, the Court may declare the parties’
rights—but there is no obligation to do so. Ameritas Variable Life Ins. v. Roach,
411 F.3d 1328, 1330 (11th Cir. 2005). And a dec action (on its own) is not the
vehicle to reform a separate contract. Compare 28 U.S.C. § 2201(a) (creating
a remedy for courts to “declare the rights and other legal relations”), with id.
§ 2202 (allowing further relief “based on a declaratory judgment . . . against
any adverse party whose rights have been determined by such judgment”). In
short, Susan’s request has the issue backwards: her desired declaration is
based on the Court first granting other relief through reformation. So for
Count 2, she must seek and obtain Policy reformation before the Court can
make any declaration. Mack v. USAA Cas. Ins., 994 F.3d 1353, 1357-58 (11th
Cir. 2021) (“A plaintiff may follow any successful claim for a declaratory
judgment with a request for supplemental relief. . . . A court may decide
whether [plaintiff] is eligible for supplemental monetary relief only after
issuing a declaratory judgment in his favor.”).
Count 1 is a claim under the Florida Trust Code. That statutory scheme
empowers courts to resolve disputes “concerning trusts.” Fla. Stat.
§ 736.0201(1). A court may determine trust beneficiaries, declare their rights,
and even appoint trustees. Interested parties may sue to reform a trust
instrument too. See Giller v. Grossman, 327 So. 3d 391, 394-95 (Fla. Dist. Ct.
App. 2021); Fla. Stat. § 736.0415. But Susan does not ask to reform the Trust
itself. Instead, she wants to reform a separate contract. Notably absent from
the Trust Code is any signal this scheme enables courts to assume jurisdiction
over and alter any legal relationship that might ultimately benefit a trust. No
matter who the benefits inure to; the fact remains Susan wants to reform the
Policy—not the Trust. What’s more, she provides no law supporting her
apparently sweeping Trust Code interpretation. Instead, every case Susan
cites concerned an express claim to reform a contract or an estate proceeding
to reform trust documents.
If Susan argues the Trust Code allows reforming the Policy because it
broadly grants power to “[a]scertain beneficiaries,” the Court is unconvinced.
Fla. Stat. § 736.0201(4)(e). Read naturally, this provision indicates courts may
ascertain beneficiaries of a trust (not some separate contract). Again, however,
Susan does not ask the Court to determine who are the Trust beneficiaries.
Instead, she wants a declaration on who is the Policy beneficiary.
Exacerbating this issue, Susan ignores whether the Trust’s choice of law
provision conflicts with Count 1. The parties go back-and-forth on what law
governs Policy reformation. But they overlook the Trust provision’s effect on
the claim alleged. The Trust says, Delaware law governs “all questions” on
“construction and administration” of the Trust. (Doc. 27-1 at 20-21). Susan
sues ostensibly for construction and administration of the Trust. Yet she does
so under the Trust Code. It is unclear whether any differences between Florida
and Delaware law impact Susan’s ability to sue.5
To sum up, neither Crossclaim seeks reformation. And given the issues,
the Court sees no reason to grant that unpled relief right now. So the parties’
argument, which focuses almost exclusively on reformation, is beside the point.
Considering this pleading deficiency, the Court denies both Motions.
5 The Court does not imply Delaware law applies to the entire dispute. It’s possible Delaware
law applies to Trust administration, and Illinois law governs Policy reformation.
That said, the parties mediate next month. This will be a global
mediation to hopefully resolve their various suits between several courts.
Because it may help negotiations, the Court will make its current view clear.
Even if properly pled, the crux of this suit is declaratory judgment. That is not
the best way to resolve disputed facts (like whether Alfred created competing
trusts or renewed insurance policies). Nor is it proper when a declaration
serves no useful purpose. Wilton v. Seven Falls Co., 515 U.S. 277, 286-88
(1995); Rhea v. Dist. Bd. of Trs. of Santa Fe Coll., 109 So. 3d 851, 859 (Fla.
Dist. Ct. App. 2013). As the Court understands it, the Brothers’ argument on
prematurity is perhaps mislabeled—but well taken.
It seems the state-court probate proceedings could be dispositive on this
case for at least two reasons. First, Alfred purportedly signed a will in 2007
that revoked the Trust. If determined true in state court, then the Trust could
not be a Policy beneficiary as it would not exist. Second, the parties dispute
whether Susan gets anything based on pre- and post-nuptial agreements.
Again, depending on how a state court rules, Susan may not be entitled to any
Trust property. In other words, the answer here (at least for Susan) would be
irrelevant.
Susan disagrees, saying the issues are separate. Not so. She wants the
Court to appoint a trustee and disburse the Proceeds to the Trust. All the
while, state courts are deciding if Alfred revoked the Trust and Susan forfeited
any right to benefits. In other words, she wants the Court to send almost
$700,000 to a potentially defunct legal entity that will start distributing money
to someone who may not be entitled to anything.
At bottom, this action appears tangential to the parties’ core disputes
and reliant on rulings in the probate proceedings. And this Court would likely
hesitate to parachute into what seems a complicated probate matter—
unfolding between three active cases in two state courts—unless there is a
useful purpose for a declaration that would not interfere.
A recent decision is instructive: Gold-Fogel v. Fogel, 16 F.4th 790 (11th
Cir. 2021). As here, Fogel concerned an interpleader crossclaim for a
declaration on life insurance proceeds. It too had parallel state-court
proceedings between the parties. And the state court’s decision on questions
about a marital settlement agreement would answer who got the insurance
money. So the Eleventh held it proper to stay the federal action pending a
state-court resolution.
The Court will not stay sua sponte. But it will set a status conference
after mediation to get a handle on this case and how the parties intend to
proceed. In the meantime, the parties should confer on their planned course.
If they ultimately believe a state court should resolve the dispute, the Court
will entertain a stipulation to disburse the Proceeds to the appropriate registry
and await resolution. See In re $165,388.23 in Interpleaded Funds, No. 5:20-
CV-05068, 2020 WL 7083957, at *5 (W.D. Ark. Dec. 3, 2020) (staying
interpleader action and ordering the parties to show cause why the funds
should not be turned over to state court).6 As Judge Kovachevich explained, if
the parties file their claims in the relevant probate matter, the Court could
dismiss this action and transfer the Proceeds. See Espat v. Espat, 56 F. Supp.
2d 1877, 13885 (M.D. Fla. 1999); see also Transamerica Life Ins. v. Smith, No.
4:18-CV-4045-LLP, 2021 WL 4295212, at *3 (D.S.D. Sept. 21, 2021).
Accordingly, it is now
ORDERED:
1. Defendant/Cross-Claimant’s Motion for Summary Judgment (Doc.
93) is DENIED without prejudice.
2. Defendants/Cross-Defendants’ First Amended Cross Motion for
Summary Judgment (Doc. 101) is DENIED without prejudice.
3. The Clerk is DIRECTED to SET this case for a status conference
under separate cover.
DONE and ORDERED in Fort Myers, Florida on March 28, 2022.
UNITED STATES DISTRICT JUDGE
Copies: All Parties of Record
8 While not published, the court ultimately sent the disputed stake to state court on the
parties’ stipulation. Interpleaded Funds, No. 5:20-CV-05063 at (Doc. 34).