Plunkett v. Plunkett

Present: Hassell, C.J., Lacy, Keenan, Koontz, and Lemons,

JJ., and Carrico and Russell, S.JJ.

LINDA B. PLUNKETT

v. Record No. 050329 OPINION BY JUSTICE DONALD W. LEMONS

January 13, 2006

PETER SAMUEL PLUNKETT, ET AL.

FROM THE CIRCUIT COURT OF BOTETOURT COUNTY

Michael S. Irvine, Judge

This appeal concerns the proper construction of a marital

agreement and two mutual and reciprocal wills, all of which

were executed simultaneously.

I. Facts and Proceedings Below

The marital agreement (“Agreement”) at issue was executed

by Linda and Carroll H. (“Pete”) Plunkett about five years

into their marriage. The Agreement provided in paragraphs 1

and 2:

1. Testamentary Disposition of Separate

Estates. The parties each agree that in

light of the fact that this was a second

marriage for each of them, and that Pete has

children from his previous marriage, that

their separate property be devised and

bequeathed to his children.

Accordingly, the parties agree that

they will execute the wills, copies of which

are attached to this Agreement, and make no

subsequent changes in testamentary

disposition of their separate property to

Pete’s children.

2. Testamentary Disposition of Marital

Estate. The parties agree that they will

execute the wills, copies of which are

attached to this Agreement, and make no

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subsequent changes . . . in contravention

[of] their intent to leave their marital

property as set forth and described in this

Agreement first to the survivor and then

equally to all of Pete’s children.

Attached to the Agreement are two wills, one signed by Pete and

one signed by Linda. All three documents were executed

simultaneously.1

Upon Pete’s death, Linda submitted his will to probate.

Article IV of the will states in pertinent part: “I give and

bequeath my jewelry, personal effects, automobiles and other

tangible personal property, to my spouse, if said spouse

survives me; and if not, to my children.” The residuary

clause, contained in Article V states: “My Residuary Estate, I

give, devise, and bequeath to my spouse, if [she] survives me.

If said spouse shall not survive me, I give, devise, and

bequeath said property to my children and their descendants.”

The will further provided that “[i]f . . .any share of my

[r]esiduary [e]state becomes distributable to my son, Peter”

such share would be held in a separate trust until Peter

reached a certain age or completed college. There is no other

provision in the will regarding disposition of Pete’s property.

Upon submission of the will to probate, Pete’s three

children, appellees herein, alleged that Pete had, "upon

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information and belief, significant separate property,

including . . . real estate, stocks, and . . . items of

personal property" with a value "greater than the federal and

state estate tax exemption amount." They also asserted that

the language of the will was inconsistent with his intent, the

Agreement, and Pete’s “prior relationship with and devotion to

his children.” They filed a bill of complaint seeking

imposition of a constructive trust on Pete’s separate property.

Linda argued to the trial court that the terms of the Agreement

are not ambiguous, the will conforms to the Agreement, and

conforms to the intent she shared with Pete in executing the

Agreement.

After reviewing the Agreement and hearing testimony, the

trial court imposed a constructive trust upon Pete’s separate

property for the benefit of the children. In its opinion

letter, the trial court reasoned that the language of the

Agreement and the extrinsic evidence “considered together” are

sufficient to support the interpretation offered by Pete’s

children.2 Linda appealed to this Court, and assigns error to

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A fourth document, a deed, was also executed the same

day. The deed was neither referred to nor incorporated in any

manner into the Agreement, so it will not be discussed here.

2

The trial court’s opinion letter does not expressly

state that the Agreement is ambiguous or that resort to

extrinsic evidence was necessary. Nonetheless, the fact that

such evidence was considered and was apparently deemed

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the trial court’s admission of extrinsic evidence and the

imposition of the constructive trust.

II. Analysis

A. Standard of review

The construction of a marital agreement is subject to the

rules of contract construction generally. Southerland v.

Southerland, 249 Va. 584, 588, 457 S.E.2d 375, 378 (1995)

(applying general contract rules of construction to property

settlement agreements). Marital agreements written “for the

purpose of settling the rights and obligations of either or

both [spouses]” have the same effect and are subject to the

same conditions as premarital agreements. Code § 20-155. The

parties may contract with respect to “the making of a will.”

Code § 20-150(3)-(5).

On appeal, the Court reviews a trial court's

interpretation of a contract de novo. Eure v. Norfolk

Shipbuilding & Drydock Corp., 263 Va. 624, 631, 561 S.E.2d

663, 667 (2002) (citing Wilson v. Holyfield, 227 Va. 184, 313

S.E.2d 396 (1984)) (“we have an equal opportunity to consider

the words of the contract within the four corners of the

instrument itself”). The question whether contract language

is ambiguous is one of law, not fact. Tuomala v. Regent

necessary to the trial court’s judgment implicitly indicates

that such a finding occurred.

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University, 252 Va. 368, 374, 477 S.E.2d 501, 505 (1996).

Thus, the trial court’s conclusion regarding ambiguity is

accorded no deference on appeal. See id.

B. Analytical framework

At the outset, the proper analytical framework for this

case must be clarified. Pete’s children urge this Court to

find that Pete’s will violates the terms of the Agreement.

They cite certain prior decisions dealing with a similar

question as guidance for resolution of this case. See, e.g.,

Black v. Edwards, 248 Va. 90, 445 S.E.2d 107 (1994); Williams

v. Williams, 123 Va. 643, 96 S.E. 749 (1918). These cases

stand for the general proposition that an agreement to make

mutual and reciprocal wills, where properly proven, will be

enforced against a breach of the agreement by a subsequent

non-conforming will.

We do not find it necessary or proper to consider these

decisions because, as a matter of law, this will cannot

“breach” this Agreement. It is axiomatic that a party cannot

breach a contract in the formation of the contract itself.

Accordingly, this case does not raise the question of a breach

of contract. This particular Agreement incorporates the wills

by reference, and we must consider all of the terms of this

Agreement, including the terms contained in the incorporated

wills together.

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We must utilize general rules governing contract

construction in the interpretation of the integrated

Agreement.

Contracts are construed as written, without

adding terms that were not included by the

parties. Wilson, 227 Va. at 187, 313 S.E.2d at

398. Where the terms in a contract are clear and

unambiguous, the contract is construed according

to its plain meaning. Bridgestone/Firestone v.

Prince William Square Assocs., 250 Va. 402, 407,

463 S.E.2d 661, 664 (1995); Ross v. Craw, 231 Va.

206, 212, 343 S.E.2d 312, 316 (1986). A contract

is not ambiguous merely because the parties

disagree as to the meaning of the terms used.

[Ross, 231 Va.] at 212-13, 343 S.E.2d at 316.

Furthermore, contracts must be considered as a

whole "without giving emphasis to isolated

terms." American Spirit Ins. Co. v. Owens, 261

Va. 270, 275, 541 S.E.2d 553, 555 (2001).

TM Delmarva Power, L.L.C. v. NCP of Virginia, L.L.C., 263 Va.

116, 119, 557 S.E.2d 199, 200 (2002).

Paragraphs 1 and 2 of the Agreement set forth seemingly

distinct treatment of the “separate” and “marital” property.

“When two provisions of a contract seemingly conflict, if,

without discarding either, they can be harmonized so as to

effectuate the intention of the parties as expressed in the

contract considered as a whole, this should be done.” Ames v.

American Nat’l Bank of Portsmouth, 163 Va. 1, 39, 176 S.E.

204, 217 (1934) (citing Phoenix Ins. Co. v. Shulman Co., 125

Va. 281, 291, 99 S.E. 602, 605 (1919)). Accord Hutchison v.

King, 206 Va. 619, 624-25, 145 S.E.2d 216, 220 (1965).

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Upon de novo review of the Agreement including the wills

at issue, we hold that the provisions may be harmonized

“without discarding any of its provisions or doing violence to

any of its language.” Ames, 163 Va. at 39-40, 176 S.E. at

217. First, we note that the Agreement incorporates Linda’s

will, which contains provisions reciprocal to those found in

Pete’s will. Articles IV and V of Linda’s will, read

together, leave her entire estate to Pete, and then to his

children if he does not survive her. The practical effect is

that all assets in Linda’s estate will pass to Pete’s children

upon her death. She is not free to make changes to this will,

as paragraphs 1 and 2 of the Agreement require that there be

“no subsequent changes” to the testamentary disposition. As a

result, any children who survive Linda will receive an equal

share of the entire estate upon Linda’s death.

We also note that paragraph 1, which appears to be the

real center of this controversy, refers to “their separate

property” rather than “his” or “her” separate property. Such

language is not frequently used when referring to separate

property, and we think it is significant that the separate

property is referred to in plural rather than singular form.

The use of the plural form demonstrates the intent of both

parties that the separate property of each spouse will be

joined together and then devised to the children. This can

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only occur upon the deaths of both spouses, rather than each

spouse. Clearly, paragraph 1 does not mean that the separate

property of both Linda and Pete will be devised to the

children upon his death. Alternatively, if the language is

supposed to mean “each” set of separate property owned by each

spouse, and Linda had predeceased Pete, it would be most

unusual for Linda to devise only her separate property to

Pete’s children while devising all other property to Pete

first, which would be the result reached if we were to adhere

to the trial court’s interpretation of this language.

A far more reasonable interpretation is that the spouses

intended this language to reflect what was actually provided

in the wills. On this point, we reject the contention that

paragraph 1 must necessarily mean that Pete’s separate

property would be devised to the children upon Pete’s death.

The language of paragraph 1 does not refer specifically to

“his” separate property, nor to “his” death, and we are not

permitted to add language to that which already exists on the

face of the Agreement. Wilson, 227 Va. at 187, 313 S.E.2d at

398. The language used, “their separate property,” therefore

leads to the conclusion that it must have referred to some

combination of the separate property owned by Linda and Pete.

Most significantly, we cannot ignore the language

requiring the simultaneous execution of the wills and the

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circumstances under which this was accomplished. The

Agreement states specifically “that they will execute the

wills, copies of which are attached to this Agreement.” This

language required the spouses to read and execute these

particular wills in conjunction with the Agreement. The wills

employed specific language regarding the identification of

Pete’s three children, appointment of the named Executor,

disposition of property, appointment of a guardian for Peter

during his minority, and the trust to be established for

Peter. Surely if the spouses intended an estate plan that

split the marital and separate property apart, then the

failure to include this language in these particular wills

would have been readily apparent. The simultaneous execution

of all these documents demonstrates that the Agreement and the

incorporated wills accomplish precisely what the spouses

intended. Cf. Shevel’s Inc. v. Southeastern Assocs., Inc.,

228 Va. 175, 183, 320 S.E.2d 339, 344 (1984) (“The burden on a

party seeking to impeach an instrument he has approved by his

signature is a heavy one”) (citing Gibbs v. Price, 207 Va.

448, 450, 150 S.E.2d 551, 552 (1966)).

Upon these considerations, we conclude that Linda and

Pete intended to leave their property first to the surviving

spouse, and then to Pete’s children. The terms of this

Agreement and the wills incorporated therein are not ambiguous

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and can be harmonized in a reasonable manner. There is no

need to resort to extrinsic evidence to resolve the questions

raised here.

III. Conclusion

We hold that the trial court erred in considering

extrinsic evidence pertaining to the Agreement, and erred in

imposing a constructive trust in favor of Pete’s children. We

will reverse the judgment of the trial court and enter final

judgment in favor of Linda.

Reversed and final judgment.

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