Petition for Writ of Certiorari — Willoughby v. Willoughby

Supreme Court brief1992

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"FILED

JAN 3S 1992

OFFICE OF THE Cica&K

In The

SUPREME COURT OF THE UNITED STATES

October Term, 1991

Lonnie E. Willoughby, Jr.

Petitioner

Leona Willoughby

Respondent

Petition for Writ of Certiorari to

Court of Appeals, Fifth District, State of Florida

Lonnie E. Willoughby, Jr.

P.O. Box 127

Mauldin, S.C. 29662

803-288-8924

Acting pro se

QUESTIONS PRESENTED

1. Is it a denial of due process of law when

an Equity Court trial judge shows favoritism to the

Plaintiff and her attorney and a Cross-claim De-

fendant that causes severe prejudice to the other

Defendant?

2. Is it a denial of due process of law for an

Equity Court trial judge to allow the Plaintiff’s

attorney to ambush a co-trustee Defendant during

trial with surprise complaints not noticed to the co-

trustee in Plaintiff’s pleadings?

3. Is it a denial of due process of law for a

trial judge to evaluate a co-trustee’s performance

by the trial judge’s "personal opinions" when his

"opinions" conflict greatly with published trust

administrations standards?

4. Is it a denial of due process of law for

Appellate Court’s "motion panel" to issue orders to

a pro se Appellant that are extremely vague and-

impossible to understand with any reasonable

degree of clarity and specificity?

5. Is it a denial of due process of law when

Appellate Court’s "motion panel" orders Appellant

to stop reporting actions of the trial attorneys and

trial judge that severely prejudiced the case against

Defendant?

6. Is it a denial of constitutionally protected

civil rights when Appellate Court’s "motion panel"

strikes entirely a pro se Appellant’s appeal brief

and then strikes two essential arguments from the

amended brief because the arguments contained

complaints about unfair and unethical actions of

the trial attorneys and trial judge?

Page 1 of 2 pages

Is it a denial of due process of law for

Appeliat Court’s "decision panel" to ignore con-

trolling law regarding appropriate due process

standards?

8. Is it a denial of due process of law for

Appellate Court’s "decision panel" to ignore ap-

plicable published legal standards regarding trust

administration procedures?

Page 2 of 2 pages

TABLE OF CONTENTS

PETITION FOR WRIT OF CERTIORARI TO

THE COURT OF APPEALS, FIFTH DISTRICT,

FLORIDA

NUT EN iin ccccscccnssnssssensssssesnonsensenseeeves 2

I iain cccchesahcnshvicasovscevenouacevancuanas 2

CONSTITUTIONAL AND

STATUTORY ISSUES INVOLVED................... 3

SEATEMENT OF THE CASE...............000000..0000.- 3

REASONS FOR GRANTING THE WRIT......... 13

1. Is it a denial of due process of law

when an Equity Court trial judge shows favorit-

ism to the Plaintiff and her attorney and a

Cross-claim Defendant that causes severe

prejudice to the other Defendant? ...................... 14

2. Is ita denial of due process of law for

an Equity Court trial judge to allow the Plain-

tiff’s attorney to ambush a co-trustee Defend-

ant during trial with surprise complaints not

noticed to the co-trustee in the Plaintiff’s

ET sol ti Vis diavasavukabnasesaaxavsesaasasieasscansnincenaeaes 16

3. Is it a denial of due process of law for

a trial judge to evaluate a co-trustee’s

performance by the judge’s "personal opinions"

when his "opinions" conflict greatly with

published trust administrations standards? ......... 23

4. Is ita denial of due process of law for

Appellate Court’s “motion panel" to issue

orders to a pro se Appellant that are extremely

vague and impossible to understand with any

reasonable degree of clarity and specificity? ...... F

5. Is it a denial of due process of law

when Appellate Court’s "motion panel" oiders

Appellant to stop reporting actions of the trial

attorneys and trial judge that severely preju-

diced case against Defendant? ........................00008 26

6. Is it a denial of constitutionally

protected civil rights when an Appellate

Court’s "motion panel" strikes entirely a pro se

Appellant’s appeal brief and then strikes two

essential arguments from the amended brief

because the arguments contained complaints

about unfair and unethical actions of the trial

StLOTHOVE SOG CLUE TAGRET ov cesisncecescsscesvasesssecccnenss 27

7. Is it a denial of due process of law for

Appellate Court’s "decision panel" to ignore

controlling law regarding appropriate due

PCE WEIN Fac sensaicnnestccvsansicacitasincacetocassas 28

8. Is it a denial of due process of law for

Appellate Court’s "decision panel" to ignore

applicable published legal standards regarding

trust administration procedures?................c.00c000 28

a UN as inninackbeunncastedenaniatausneencneutecetnnes 30

INDEX TO APPENDICES

Appendix Subject Page

A Appellate Court’s Orders 1

Al Per Curiam Affirmed decision

A2 Order denying Rehearing

A3 = Order striking Initial Brief

A4 Order striking Points III, 1V

AS Order deny Clarification

B ~ Trial Court’s Orders 6

Bil _—* Final Judgment

B2 Order deny attorney fees/costs

B3 Order denying Rehearing

B4 Order denying Stay of Execution

C U.S. Constitution 17

Article 4, Section 1, 2

Amendment 1

Amendment 14, Section 1

D Florida Statutes (Trust Admin.) 18

Chapter 737 (selected sections)

Chapter 738 (selected sections)

E Trial transcript statements 21

F Parol Evidence References 40

G Due Process Citations 42

G1__—U.S. Supreme Court Cases

G2 ‘Florida Cases

PAGE ONE OF TWO PAGES

Appendix

INDEX TO APPENDICES

Subject

Trust Administration Citations

Marion Beacham’s Reports

(selected paragraphs)

"I" 1 August 22, 1989 Affidavit

"I" 1 October 20, 1989 Affidavit

Leona’s Deposition (partial)

Criminal Statutes

Kl 18 U.S.C. 241

K2 Fla. Stat. 839.13

TABLE OF AUTHORITIES

CITED IN PETITION

DUE PROCESS CASES Page

380 U.S. 545, 85 S.Ct. 1187 (1965)... 28

349 So.2d 164 (Fla. 1977) ......... ieee sre 28

TABLE OF AUTHORITIES

CITED IN APPENDICES

DUE PROCESS CASES Appendix

380 U.S. 545, 85 S.Ct. 1187,

14L.Ed.2d 62 (1965) .ccccccccecececeeseeseseeveeeeee 42

| 44

356.5. 247, 98 S.Ct. 1042,

55 1 Bid. 2d 252 (1978) ccciecccovecesssssnsnenecnseees 42

237 U.S. 413, 35 S.Ct. 625,

SOLE. 1027 (1915) ccecececerevevisscsdseceseceaseeceses 44

390 So. 2d 704 (Fla. 1980)....cccccccececeeeseseeee: 45

214 U.S. 71, 29 S.Ct. 580, 53 L.Ed. 914....... 44

734 U.S. 385, 34 S.Ct. 779, 58 L.Ed. 1363 42,

43.44

463 S0.2d 569 (Fla. 1st DCA 1985) «0... 45

189 So. 2d 236 PEER. 19G2) cccoseceresvesceoseneeees 46

vil

341 U.S. 123,71 S.Ct. 624,

QS L-Ed. 817 (1951) ccccccecscocececececececeeseecseees 43

202 So. 2d 810, (Fla. 3rd. DCA 1967)......... 46

446 U.S. 238, 100 S.Ct. 1610,

64 L.Ed. 2d 182, (1980).....c..cccccceseseeeecseeeee. 42

311 U.S. 457, 61 S.Ct. 339,

85 L.Ed. 278, 132 A.L.R. 1357 eccoceccececceceseee 44

339 U.S. 306, 70 S.Ct. 652 (1950)........... 43

348 U.S. 11, 75 S.Ct. 11,

99 L.Ed. 11(1954)..cccccccccecccesecesececeeeceeeeeees 43

108 S.Ct. 896 (1988). ..ccccccccsssesesescececeeeeeseees 44

Priest v. Board of Trustees

of Town of Las Vegas,

232 U.S. 604, 34 S.Ct. 443, 58 L.Ed. 751... 44

vy, Holly,

i176 U.S. 398, 20 S.Ct. 410, 44 L.Ed. 520..... 44

236 S0.2d 108 (Fla. 1980) ..cccccecececesececcevees. 45

Vili

TABLE OF AUTHORITIES

CITED IN APPENDICES

PAROL EVIDENCE CASES Appendix

_ ae

78 F.2d 787 (7th Cir. 1935)....cceccecseseeeeeeees 41

Yer. Civ App., 157 S.W. 2d 946, 947.....0.0000- 40

; j , (Federal)

& oo FG, eres 40

76 Wis.2D 151, 250 N.W.2d 362.............+++ 40

479 So.2d 312 (Fla. Sth DCA 1985)............ 41

296 U.S. 488, 56 S.Ct. 332,

ey an eneneets 41

29 $0.20 21. (1947) .soccecececeserossecesessssseceseess 41

2 Ch. 793 [1902] England.eccccccsccesseceeee 41

360 S0.2d 399 (Fla. 1978)....cccccccscsseseeseeeeees 41

Petition of United States

485 F. Supp. 1222 (D.C. 1980) ........eeee+ 4]

437 Pa. | ut oe 62 Ly i 40

TABLE OF AUTHORITIES

CITED IN APPENDICES

TRUST ADMINISTRATION CASES Appendix

aa 7

eos MBb> &,t eee 47

PF Oe Poets CAND WON F vniskcnncccnencesscnsnennacens 50

92 N.Y. 56, 66 €t S€Q..ccecccsesesesscsceeseseeeseeeees 50

In re Weller’s Estate,

BO iad i, BT Bibs Be iicccccccccscccecccZeconsens 49

Massey v, Stout, 4 Re ee 2 | RS eee S0

Murdock v, Elliot,

gie S yo. He F Sys! eee SO

il atnate ee PRE. TE Fai, 1 aieasenceseassssacsscencaecessene 50

Preston v, Wilcox, 38 Mich. 578, 582.................08. 50

10 NE(2d) 192 (Mass. 1937) ccccccsecesceceeceeee. 49

I 115 S.C. 145, 164,

105 S. FE 378 AA eae RRM RSA oper scr nA nAAe Crear E 50

Smith v. Jones, 162 So. 496 (Fla. 1935)................ 47

Wallervy ‘

B52 LOWS 176, 130 NN. WH. LPS cccccccccscccccececes S50

Wils ! ;

186 Ky. 194, 216 S.W. 129....ccccseseseeceseees 50

Wylie v. Bushnell,

regi) 3 Be ke Seen 50

STATUTES: CITATIONS IN PETITION

Pages

Florida:

Trust Administration

Chapters 737, 738 (selections) see pages 3,15,

23,29

Be RS ok Kk Ser 21

oe.

United States Code

Tithe 1B, SOCUOR 261 ..cescesesscsecscas: pages 21, 28

United States Constitution,

POO, Br. TO. 5... © canncscenccssvennsinsnsuencnaninns 10

Amendments 1 and 14 ....... see pages 2,3,6,27

OTHER: CITATIONS IN APPENDIX F

The Law of Trusts (Scott), Fourth Ed.:

Section 38. The Parol Evidence Rule ....... 38,

OTHER: CITATIONS IN APPENDIX H

76 Am Jur 2d. Trusts:

nes nen ee Sie 2 OS | | acubmenie 47

Sections 653 through 659..............cceeeeeeeeees 48

EE TET, Tk cc cinkiacctasibauseseeenesnueninnaans 47

90 C.J.S. Trusts:

TS 2 EE PT ALON MOA AER

Ra oR SOO AE PARA AE STEN

Restatement of the Law, Second, Trusts, 2d.:

SSNS ST TEL RL EON Te

Sections 178. 244, 245, 246.

and 200 e., 194 a. (2nd para.),

and 167, 251, Zod, 2I4, EIS ©}., BAG CIB sc ccecsvissensess

The Law of Trusts (Scott), Fourth Ed.:

Section 242.3 Lien for compensation.................

Section 246, Liability upon contract.................06

X11

In The

Supreme Court of the United States

October Term, 1991

Lonnie E. Willoughby, Jr.

Petitioner

Leona Willoughby

Respondent

Petition for Writ of Certiorari to

Court of Appeals, Fifth District, State of Florida

To the Honorable, The Chief Justice of the

United States and the Associate Justices of the

Supreme Court of the United States:

Petitioner, Lonnie E. Willoughby, Jr., prays

that a writ of certiorari issue to review the Per

Curiam Affirmed decision rendered by Florida's

Fifth District Court of Appeals that ignored and

refused to decide the extremely serious due process

of law arguments in Petitioner’s appeal briefs.

The extremely unfair Per Curiam Affirmed

decision rendered by the Florida Appellate Court

evaded the issues on appeal and denied all relief

requested by the Appellant and denied him any

sf phar sg to — to Florida’s Supreme Court,

placing the appellate court in the position of Flori-

da’s court of last resort.

OPINIONS BELOW

The appeal decision below, dated October 8,

1991, is presented in Appendix Al. Its operative

language consists of one phrase, "PER CURIAM

AFFIRMED", with no opinion given regarding the

legal basis for the decision.

The combined appeal process encompassed

two related civil appeals - Final Judgment, dated

10/12/89, and the Circuit Court’s Order denying

Petitioner attorney fees and costs, dated 4/23/90.

The Circuit Court’s Final Judgment is shown in

Appendix B1; the Circuit Court’s Order denying

attorney fees and costs is shown in Appendix B2.

JURISDICTION

The Florida Appellate Court’s decision was

filed October 8, 1991. The Petitioner filed a

Motion For Rehearing and then filed a Motion For

Extension Of Time that explained the severe hard-

ship circumstances that caused the Motion For

Rehearing to arrive two days after the very short 15

days normally allowed for filing for a Rehearing.

Although the Appellant had the flu, lived in

South Carolina, and was severely handicapped in

his efforts to conduct legal research concerning

Florida Law, the court denied Lon Jr’s request for a

very short extension of time and struck Lon Jr's

Motion For Rehearing with a single Order dated

11/6/91. (Appendix A2)

The jurisdiction of this Court is based on 28

U.S.C. 1257 (a) since the decision presented for

review is that of the highest Court of Florida in

which a decision could be had and the case con-

cerns civil rights guaranteed to the Petitioner by

the Constitution of the United States, Amend. 1,14.

CONSTITUTIONAL AND STATUTORY

ISSUES INVOLVED

Article 4, Section 1,2, and Amendments 1, 14

of the United States Constitution as set forth in

Appendix C.

This civil litigation was about Florida Trust

Administration; therefore, relevant portions of

Florida’s Trust Administration Statutes, Chapters

737 and 738, are shown in Appendix D. Statute

sections will be cited appropriately in the argu-

ment, referring to specific statute numbers.

STATEMENT OF THE CASE

NOTE: The symbols used in this petition to

identify litigation records are the same symbols that

were used in all of Lon Jr’s appeal briefs.

Petitioner Lonnie E. Willoughby, Jr. (Lon Jr)

is a resident of Greenville County, South Carolina.

He is the eldest son (currently age 55) of the

Respondent, Leona Willoughby (currently age 76)

who is a resident of Putnam County, Florida.

Larry Willoughby, a resident of New Hanover

County, North Carolina, is the brother of Lon Jr

and they are the only children in the family of

Leona and Lonnie E. Willoughby Sr. (Lon Sr).

Lon Sr died on November 22, 1986, leaving

an A-B type trust estate that was initiated in

January 1983 as a Revocable Inter Vivos Trust. The

Grantor, Lon Sr, appointed Lon Jr. and Larry as

joint co-trustees for his trust estate. An identical

Trust Instrument was initiated simultaneously for

Leona and she also appointed Lon Jr and Larry as

her two joint co-trustees.

A civil lawsuit was filed on February 24, 1989,

in Putnam County, Florida by Leona’s legal coun-

sel, Tito Smith, due to a dispute and an impasse

between the two co-trustees about the distribution

of the trust estate’s "net income” to the income

beneficiaries (Leona, Lon Jr, and Larry).

Leona’s complaint alleged that Lon Jr had

stopped making income distributions to the Plain-

tiff and had submitted bills to the Trust for his

services as Trustee that were totally without merit.

The complaint also alleged that Lon Jr had taken

the position that he would allow no further income

distributions until his trustee fee bills were paid,

and that such action constituted mismanagement

that warranted removal. Leona asked the court to

remove Lon Jr as trustee and review his trustee fee

Statements to determine whether or not he should

be paid anything for his trustee services.

The appeal records show that Lon Jr was

unable to locate any "local" Putnam County attor-

ney to represent him in this case during the initial

30 day period allowed for filing an Answer to the

Plaintiff’s complaint. Lon Jr, in S.C., contacted

numerous "local" Palatka, Florida law firms by

telephone, but they all insisted on talking to the

Plaintiff’s attorney (Tito Smith) before they would

discuss the case in depth with Lon Jr. After talking

with Tito Smith, each attorney summarily declined

to discuss representing Lon Jr in the case.

Tito Smith’s conversations prevented Lon Jr

from obtaining "local" legal counsel to help him file

an Answer to Leona’s Complaint; therefore, Lon Jr

was forced to file an Answer pro se, without any

prior legal training or experience. Lon Jr also tried

to obtain legal counsel in nearby counties, but each

attorney declined involvement in this case because

the trial would be held in "Putnam County".

Lon Jr filed a pro se Answer to Leona’s

complaint denying her complaints, and reported

relevant facts regarding the trust estate. Lon Sr’s

trust estate contained two separate and independ-

ent trusts, the Marital Trust and the Family Trust.

Although he was a co-trustee of both trusts, Lon Jr

could not act independently with regard to the

distribution of "net income". All trust checks re-

quired joint co-signatures of both co-trustees.

Lon Jr also explained that he had not person-

ally stopped making "net income" distributions to

Leona; she was blaming the wrong co-trustee for

the income distribution impasse. Larry caused the

impasse when he repeatedly refused to co-sign any

trust "net income" distribution checks that were

written for properly reduced amounts (amounts

that gave due consideration to Lon Jr’s trustee

management fee expenses). The term "net income”

was defined as the remaining amount from gross

income after all trust administration expenses had

been deducted.

Lon Jr reported that he had provided sub-

stantial services for the trust estate in a competent

manner, and he believed his trustee fees were

reasonable and necessary expenses of trust admin-

istration, considering the extremely difficult condi-

tions created by Larry and Leona in their collusive

efforts to force Lon Jr to resign as co-trustee so

they could control the $640,000.00 trust estate.

Lon Jr also denied that he had stopped all

income distributions until his trustee fees were

paid; he reported that he had prudently insisted

that Larry take those legitimate expenses into

consideration when the "net income" distributions

were calculated in order to prevent overpaying the

beneficiaries. However, Larry had repeatedly

refused to deduct those expenses from gross income

before writing monthly "net income" checks.

The Answer also reported that Lon Jr had

suffered a large loss of personal business income in

1987 and 1988 due to the many extra co-trustee

actions required by Larry’s irresponsible and

extremely ania 2 ene co-trustee actions and

Leona unreasonable actions as beneficiary. Lon Jr

believed that he should be fairly compensated for at

least a part the time that those actions forced Lon

Jr to spend on extra co-trustee duties.

Lon Jr finally obtained "local" Putnam

County legal counsel about three months after

Leona’s complaint was filed (Alan B. Fields, Jr).

After reviewing the pleadings and the relevant

facts, Mr. Fields assured Lon Jr that Leona had no

legitimate case against him, but he recommended

that Lon Jr commission a professional trust admin-

istration expert to evaluate his co-trustee actions

regarding Leona’s complaints.

Lon Jr obtained the services of Mr. Marion

Beacham, the Senior Trust Officer with NCNB

Bank in nearby Greenville, S.C. Mr. Beacham is an

attorney, member of the S.C. Bar, and in charge of

an 18 employee trust department, one of the largest

in the state. He had over 18 years experience as a

per reinee trust officer. Mr. Beacham evaluated

on Jr’s and Larry’s individual co-trustee actions in

detail. He also participated in a Deposition exami-

nation and cross-examination in Greenville, S.C.

Mr. Beacham then completed a written, sworn,

witnessed, notarized affidavit report of his "trust

administration expert" evaluation; he mailed the

affidavit report directly to Mr. Fields for use in the

upcoming trial. (30 hours of his time at $50.00 per

hour = $1,575.00; paid by Lon Jr as co-trustee).

Mr. Beacham’s deposition testimony was very

complimentary about Lon Jr’s co-trustee work, and

his affidavit report stated that Lon Jr had done a

“super-human” job as co-trustee, but ie had

been an uncooperative co-trustee. (Appendix I 1)

The case went to trial in a non-jury Equity

Court on September 6, 1989, with Circuit Court

Judge Robert R. Perry presiding. Lon Jr’s "local"

Putnam County legal counsel, Alan Fields, Jr.,

had filed a motion on June 6, 1989 requesting

permission to amend Lon Jr’s th se pleadings to

include Larry as an indispensable party and make

other improvements in the interest of justice. Mr.

Fields filed amended pleadings on June 22, 1989

and had them served on Larry as a cross-claim

Defendant. However, Judge Perry did not allow a

hearing for the amended pleadings, and his actions

prevented Lon Jr from obtaining discovery informa-

tion from Larry prior to trial.

The judge also denied a verbal motion at the

beginning of trial, by attorney Alan Fields, that the

amended pleadings (that had been filed and served

three months earlier) be allowed by the court.

Larry had not provided an Answer to Lon Jr’s cross-

claim pleadings, but Larry was present and willing

to submit himself to the jurisdiction of the court.

However, Judge Perry denied Mr. Fields’ verbal

motion although Larry, as co-trustee, was obviously

an indispensable party to this cause.

Immediately thereafter, Judge Perry offered

to join Larry in the suit by agreement of the parties,

rather than by allowing Lon Jr’s amended plead-

ings. Judge Perry’s unfair actions forc-d Lon Jr to

agree to join Larry in the suit without benefit of his

amended pleadings which contained —

cross-claims against Larry. Judge Perry also

denied Mr. Fields’ motion to introduce Mr. Bea-

cham’s affidavit report into evidence although it

was the best evidence available regarding the indi-

vidual actions of the two co-trustees during the

income distribution impasse period. Mr. Bea-

cham’s affidavit report was the only professional

expert evaluation made of the co-trustee’s actions.

Although Judge Perry had refused to allow

Lon Jr to amend his pleadings months before trial

to include an indispensable party and present cross-

claims against him, Judge Perry repeatedly allowed

Tito Smith to make de facto amendments to the

Plaintiff’s pleadings during trial to bring in surprise

complex technical complaints against Lon Jr.

The judge allowed Tito Smith to introduce

testimony about several surprise "ambush" com-

plaints against the Defendant (Lon Jr) over four

Separate objections by defense attorney, Alan

Fields. Mr. Fields repeatedly objected to testimo-

ny being introduced about complaints outside the

Sap page st but Judge Perry overruled all objections.

udge Perry failed to act in a fair and impartial

manner toward the Defendant prior to trial, and he

repeatedly failed to protect the Defendant’s right

to due process during trial. (Appendix C,G)

Throughout the all day trial, Tito Smith

introduced much testimony about three surprise

complex technical complaints against Lon Jr, and

dominated the trial with this testimony. Mr. Smith

then brought in two additional surprise complaints

against Lon Jr during the closing argument al-

though no testimony or evidential documents had

been introduced to support those new surprise

complaints. Mr. Smith self-serving statements

about the surprise complaints were not evidence,

and Lon Jr was given no opportunity to defend

himself against the two new complaints introduced

during Mr. Smith’s closing argument.

Tito Smith introduced a total of five surprise

complaints during trial that had not been properly

noticed to the Defendant in the Plaintiff’s plead-

ings. Argument Issue 2 will identify the surprise

complaints and expose Mr. Smith’s fraud scheme.

The trial judge cooperated with Tito Smith

throughout the day long trial and allowed him to

ruthlessl ‘agibuah” Lon Jr with surprise com-

ome The judge prevented Lon Jr from having a

air opportunity to defend himself against the two

complaints in Leona’s pleadings because the judge

allowed the trial to be dominated by testimony

about the surprise "ambush" complaints. The trial

transcript shows that Judge Perry did not want to

hear Lon Jr’s defense testimony about the two

complaints noticed to him in Leona’s pleadings.

Judge Perry’s extremely unfair actions

toward Lon Jr caused Fundamental Error and fata!-

ly flawed the initial trial and all further litigation in

this cause. Defense counsel’s objections during

trial and other relevant trial statements are shown

in Appendix E.

The trial transcript was completed about five

weeks after trial, and Lon Jr immediately commis-

sioned Mr. Marion Beacham, as a trust administra-

tion expert, to review the 267 page transcript and

evaluate the surprise "ambush" technical com-

plaints raised at trial against Lon Jr.

The final judgment was filed on October 19,

1989, six weeks after trial, and it contained four of

the five surprise "ambush" complaints as the basis

for removing Lon Jr as co-trustee. The judgment

also used those surprise complaints as the basis for

making drastic modifications to the Trust Instru-

ments directives regarding the way the trust income

and principal assets would be distributed between

the two independent trusts. Those actions were

extreme violations of the Parol Evidence Rule

regarding Express Trusts (written Instruments).

Appendix F citations show that the written

Trust Instrument is the best evidence of the Gran-

tor’s intent and purposes. Defense counsel raised

proper objections at trial regarding Parol Evidence

requirements. (Appendix E: 1T. 167)

Mr. Beacham promptly completed a detailed

sworn, witnessed, notarized affidavit report of his

findings regarding the technical trust issues raised

at trial. His report concluded that CPA Stanley’s

testimony at trial was clearly erroneous regarding

trust issues; he did not understand the fine details

of estate planning using multiple trusts. The report

also confirmed that the estate oo, had been

done properly, and the Federal Form 706 Estate

Tax Report had properly allocated assets between

the two trusts involved, contrary to CPA Stanley’s

Surprise testimony at trial that he now believed that

ad calculated the Form 706 Report improperly

in August 1987. Mr. Beacham’s report also con-

firmed that Lon Jr’s testimony at trial about those

Surprise technical complaints had been correct

(testimony required by judge over objections).

Mr. Beacham’s "trust expert" report cost Lon

Jr $1,475.00, and he paid for this with his personal

funds, as he had done with the previous report. Lon

Jr had no access to trust funds except through Larry

as co-trustee. Lon Jr expected to be reimbursed

from trust funds at the end of this litigation.

Lon Jr timely filed a I I

pro se, lege his own sworn, witnessed, nota-

rized affidavit documentary report that showed all

of the surprise "ambush" complaints were false

complaints. He included Mr. Beacham’s "trust

expert” affidavit report to further substantiate that

Lon Jr had been ambushed at trial with false testi-

mony and statements about false surprise com-

plaints. Lon Jr requested a hearing regarding the

Surprise "ambush" complaints.

Judge Perry issued a sarcastic order contain-

ing false information that denied Lon Jr’s Motion

For Rehearing. (Appendix B3) His order was a

violation of U.S. Constitution, Article IV, Section

1,2. He did not honor sworn, witnessed, notarized

affidavits from another state as he should have

done (public acts, records). As a non-resident co-

trustee in S.C., Lon Jr had no other way of present-

ing documentary reports to a Florida Court. The

evidential documents provided as exhibits with Lon

Jr’s motion were from the trusts’ official records.

Judge Perry ignored Lon Jr’s affidavit report

and the evidential documents attached that proved

that the trial contained false and perjured testimo-

ny and false attorney statements about the surprise

"ambush" complaints. Lon Jr’s documents were the

best evidence available anywhere to prove the truth

about the "ambush" complaints. However, Judge

Perry denied Lon Jr a fair chance to defend himself.

Lon Jr then filed a detailed Motion To Stay

The Execution (pro se) and also filed a Notice of

Appeal. Judge Perry denied Lon Jr’s Motion To

Stay The Execution with another sarcastic order

containing false statements. (Appendix B4)

After careful analysis of the 267 page trial

transcript, Lon Jr could see clearly that Alan Fields

had deliberately betrayed him at trial in numerous

ways, and his actions helped Tito Smith and Judge

”

Perry collusively "ambush" Lon Jr at trial with

surprise complaints not noticed properly to Lon Jr.

Mr. Fields, with 23 years experience as a trial

attorney, allowed his client (Lon Jr) to be brutally

and ruthlessly ambushed at trial all day long when

all he had to do to stop that sauchioal tad illegal

scheme was simply object on the basis of prejudice.

In addition, Mr. Fields refused to introduce

most of Lon Jr’s best evidential documents at trial;

he failed to cross examine CPA Stanley about his

obviously false testimony about Leona’s gross

income and needs for additional income from the

trust estate (as Lon Jr requested during trial); Mr.

Fields failed to use Leona’s Deposition testimony

and Interrogatories to impeach her false and per-

jured testimony at trial on several important issues;

and he failed to allow Lon Jr any opportunity to

testify in his own behalf about the CPA’s false and

perjured testimony about Leona’s gross income

during 1987, 1988. Lon Jr was ambushed at trial

with false Surprise complaints, and his defense

attorney cooperated with that unfair, unethical,

and illegal scheme.

As a result of Alan Fields’ betrayal of his

client at trial and again after trial with post trial

actions, Lon Jr refused to pay Mr. Fields the re-

maining amount billed for his services. Alan

Fields then filed a Notice of Intent to Claim Charg-

ing Lien to try to obtain funds from the trust estate

to pay the remaining balance on his legal "services"

While Lon Jr was involved in the appeal

process for the Final Judgment, additional hearings

were held regarding Alan Fields’ charging lien, and

a brief trial was held on April 17, 1990. Judge

Perry also took an adversary position to Lon Jr

throughout that trial. Attheend of the trial he

issued a verbal opinion and again used Tito Smith’s

previous ambush complaint of “conflict of interest"

to deny Lon Jr any reimbursement for his legal

expenses as co-trustee during this litigation. tudes

Perry also ruled that Alan Fields’ charging lien was

inappropriate for this situation; he recommended

that Alan Fields file a separate lawsuit against Lon

Jr to collect his attorney fees. The judge was

openly hostile and adversarial toward Lon Jr during

trial as he presented his own case pro se.

Lon Jr filed a pro se Noti f al re-

garding Judge Perry’s Order denying Lon Jr any

reimbursement from trust assets for his co-trustee

litigation expenses. The judge’s written order was

different from the judgment rendered at trial; he

now claimed Lon Jr’s legal defense provided no

benefit to the Trust. (Order shown in Appendix B2)

The two appeals were later combined by

agreement of the parties. After a protracted

appeal process that included numerous motions

and briefs from both parties, a single PER

CURIAM AFFIRMED decision was rendered on

October 8, 1991. The decision provided no opinion

on any of the numerous argument issues on appeal;

thus, no insight was provided for the legal basis

used for the decision. (Appendix Al)

Lon Jr filed a Motion for Rehearing and a

belated Motion for Extension of Time explaining

that he had been sick with the flu and had been

seriously handicapped by being unable to conduct

expedient and efficient legal research regarding

Florida Law in a South Carolina Law Library

(which did not have West’s Florida Statutes Anno-

tated or West’s Florida Digest series). The court

summarily denied both motions. (Appendix A2)

The Per Curiam Affirmed decision denied

Lon Jr any opportunity to appeal to the Florida

Supreme Court; he was left with no recourse

except to file this petition in a determined effort to

expose the fraud and injustice in this litigation.

REASONS FOR GRANTING THE WRIT

The argument issues presented herein will

show that the Trial Court and the Appellate Court

ignored U.S. Supreme Court case law and Florida

Supreme Court case law regarding due process.

Lon Jr’s appeal brief arguments reported

several serious due process violations and also

proved that the trial court’s Final Judgment directly

conflicted with Florida’s Trust Administration

Statutes, conflicted with the Grantor’s Trust In-

strument’s directives, conflicted with Florida

Supreme Court case law, conflicted with Florida

Appellate Court case law, conflicted with other

State’s Supreme Court case law, and conflicted with

several leading, nationally recognized trust admin-

istration legal reference standards.

In spite of all of that, the Florida Appellate

Court grossly abused its judicial authority and

discretion and issued a Per Curiam Affirmed deci-

sion (without opinion) that evaded the due process

violations and other legal issues on appeal. The

decision denied the Petitioner the opportunity to

appeal to Florida’s Supreme Court.

This petition exposes extreme abuse of judi-

cial authority and discretion by two Florida Courts;

extensive research shows that such abusive actions

appear to be routine in many Florida Courts. Thus,

it is tremendously important that this case be

reviewed by the U.S. Supreme Court.

This complex litigation is a classic example of

how trustees and other litigants can be subjected to

abusive judicial tyranny in Equity Courts through-

out America. Lon Jr’s extensive case law research

found that many Florida judges ignored due process

of law standards during Equity Court actions.

A U.S. Supreme Court decision is badly

needed to prohibit due process abuse by trial attor-

neys and trial judges during Equity Court actions.

l. /tis a denial of due process of law

when an Equity Court trial judge shows favor-

itism to the Plaintiff and her attorney and a

cross-claim Defendant that causes severe

prejudice to the other Defendant.

The entire Statement Of The Case is includ-

ed herein by reference; the detailed chronological

order of those events will not be duplicated again.

As related previously, and as reported in

great detail in Lon Jr’s appeal briefs for the second

appeal, Judge Robert Perry was extremely unfair

toward Defendant Lon Jr. Judge Perry personally

assisted Tito Smith in numerous ways to prevent

Lon Jr from having a fair and impartial trial that

was restricted to the two complaints properly no-

ticed to Lon Jr in Leona’s pleadings.

Judge Perry personally prevented Lon Jr

from being able to obtain discovery information

about Larry as an indispensable cross-claim De-

fendant. He would not allow a hearing for Lon Jr’s

amended pleadings which were properly filed and

served on Larry by the sheriff's office in New

Hanover County, N.C., about three months before

the case went to trial.

Lon Jr’s appeal briefs show that Judge Perry

repeatedly allowed testimony about false surprise

"ambush" complaints, over objections, that de-

stroyed the fairness and impartiality of the trial.

Judge Perry allowed the one day trial to be totally

dominated by testimony about surprise "ambush"

issues raised by Tito Smith. Only a small part of

the trial testimony was about the two complaints in

Leona’s pleadings, which is what the trial was

supposed to be about. Argument Issue 2 will identi-

fy the five surprise "ambush" complaints.

The appeal records show that Lon Jr’s

competent estate planning efforts helped his family

avoid over $150,000.00 in federal estate taxes and

avoid over $50,000.00 in probate expenses on the

joint estates of his parents and provided other

important benefits to the family.

The appeal records also showed that Lon Jr

had served without any trustee fees until 1988 when

he charged an annual fee of $2,400.00 for his 1987

co-trustee services due to the extensive time and

extremely stressful efforts required to deal with the

collusive efforts of Larry and Leona trying to force

Lon Jr out of his co-trustee position. (1R. 690)

Larry, as co-trustee, acted in an irresponsible

manner for several months before Lon Jr finally

started charging for his co-trustee time, as had been

authorized by the Trust Instrument at all times.

The records also show that Lon Jr suffered a loss of

income in 1987 in excess of $50,000.00 due to the

problems created by Larry and Leona for Lon Jr, as

co-trustee. After Larry obstinately refused to pay

Lon Jr’s $2,400.00 trustee management fee, Lon Jr

started billing the trust for all extra time required

of him by either Larry or Leona other than the

routine monthly trustee duties. (1R. 36 -67)

By the time the case went to trial on Septem-

ber 6, 1989, Lon Jr’s trustee fee statements had

accumulated to more than $15,000.00. However,

Larry had refused to pay Lon Jr for any of those

fees from trust funds, and Lon Jr had received no

compensation at the time of trial. (1R. 679)

Although the evidence at trial clearly proved

that Lon Jr had been an exceptionally competent

and responsible co-trustee, the trial judge ruled

against him as if he was personally responsible for

Larry’s extremely foolish and irresponsible actions.

The record proved that Lon Jr had repeatedly tried

to get Larry to cooperate with him and conduct the

trust estate affairs in an efficient and cost effective

manner; however, the trial judge punished Lon Jr

for Larry’s extremely poor performance as co-trus-

tee. That unfair action was a serious violation of

Florida Statute 737.404. (Appendix D)

15S

Lon Jr’s appeal briefs reported Judge Perry’s

extremely unfair actions that showed favoritism to

the Plaintiff, her attorney, and Larry, and showed

how the trial judge’s unfair actions severely preju-

diced the case against Lon Jr. The appeal briefs

also proved that Judge Perry repeatedly denied Lon

Jr due process of law; the judge totally ignored U.S.

Supreme Court case law, Florida Supreme Court

case law, and other Florida legal standards regard-

ing due process. (Appendix G)

2. It is a denial of due process of law

for an Equity Court trial judge to allow the

Plaintiff’s attorney to ambush a co-trustee

Defendant during trial with surprise com-

plaints not noticed to the co-trustee in Plain-

tiff’s pleadings.

The Statement Of The Case and Argument

Issue 1 are included herein by reference.

As shown in Statement of the Case, page 4,

there were only two complaints in Leona’s plead-

ings against Lon Jr. During pretrial deposition

testimony, more than 12 weeks after the complaint

was filed, Leona admitted that she had no com-

plaint against Lon Jr, stating that Lon Jr had not

mismanaged the trust. She simply wanted more

income from the trust estate. (Appendix J)

About 12 weeks after that deposition, during

trial, without any prior notice to Lon Jr, Leona’s

legal counsel introduced five additional complaints

against Lon Jr alleging that he had made all sorts of

ross errors in trust management and had prevent-

ing Leona from receiving the proper amount of

income from the trust estate. This was a blatantly

fraudulent effort to win at trial with false "ambush"

complaints what Tito Smith knew he could not win

in an ethical, professional, and responsible manner.

Tito Smith immediately attacked Lon Jr on

direct examination, as the first witness called. with

Surprise issues not included in the pleadings.

Mr. Smith dominated the all day trial with his

surprise "ambush" complaints. The two complaints

in Leona’s pleadings received little consideration.

1) Mr. Smith alleged that Lon Jr had not

interpreted the Trust Instruments properly regard-

ing the asset distributions between the Marital

Trust and the Family Trust (the 27% v. 34% sur-

prise issue).

Mr. Beacham’s post trial "trust expert’

analysis reviewed the entire 267 page trial tran-

script. Mr. Beacham’s affidavit report exposed this

as a false complaint, and he used a detailed mathe-

matical calculation model of the dollar amounts

involved to prove his analysis. Mr. Beacham

also proved that LonJr’s understanding of the Second

Amendment and the CPA’s original understanding

were both correct. However, the CPA’s trial testi-

mony was in error when he conveniently "changed

his mind" at trial to help his client (Leona).

2) Tito Smith also claimed that the asset

value transferred to Lon Sr’s trust was not the right

value; alleging that the value of Lon Sr’s trust

estate and Leona’s trust estate should have been

equalinvalue. This was the "50% : 50%" surprise

issue that Lon Jr knew nothing about prior to trial.

Tito Smith totally ignored the fact that Leona

had fully agreed to the asset transfers to Lon Sr’s

trust estate; she signed all of the property transfer

documents in December 1984 and/or February

1985 (almost five years before trial). Lon Jr sent

Tito Smith copies of the property transfer docu-

ments on August 3, 1988. There was no legitimate

dispute in this matter, but Mr. Smith still ambushed

Lon Jr with this false surprise complaint at trial.

Mr. Beacham’s trial transcript affidavit

report showed that his extensive review of the trust

records over a period of years found no indication

that anyone vad eves presented the 50% : 50% split

of assets allegation toLonJrin any of the trust's

detailed records. That false surprise complaint was

another malicious attempt by Tito Smith, Leona,

Larry, and CPA Stanley to ambush Lon Jr at trial.

3) Tito Smith also alleged that the Second

Amendment, dated 12/12/84, had provided no

estate tax benefits to the Willoughby family and was

simply a deceptive action on Lon Jr’s part to take

advantage of his parents for his own financial

benefit. Mr. Smith also had CPA Stanley testify

about the federal estate tax issue Be ahs the two

trust arrangement (A-B Trusts). The CPA’s "non-

expert” testimony was grossly in error, as any estate

planner could easily and quickly determine.

Mr. Marion Beacham’s post trial analysis of

that issue found the CPA’s testimony was wrong.

Mr. Beacham proved in his report that the Second

Amendment actions had indeed saved the Wil-

loughby family an enormous amount of federal

estate taxes, and had legitimately reduced those

taxes to zero. He proved that Lon Jr had done an

outstanding job of estate planning for his parents.

4) Late in the trial, Tito Smith raised anoth-

er false "ambush" complaint. He claimed that Lon

Jr had unilaterally decided how much value to place

in the Marital Trust and had placed 27% of the net

trust estate value in that trust when it should have

been 34%. (1T. 167: Appendix E, pages 25)

That was a maliciously false complaint; the

Marital Trust asset value was determined by CPA

Stanley when he completed the Form 706 Estate

Tax Return for Lon Sr’s estate (8/1987). The CPA

lied when he testified that Lon Jr told him how to

make that distribution. The Trust Instrument’s

Second Amendment clearly specified how that

distribution was to be made, and the CPA used the

Second Amendment’s instructions to make those

calculations. The CPA certainly had nothing to

gain by not following the amendment’s instructions,

and it would have been professional malpractice for

him to not comply with those instructions.

Mr. Marion Beacham’s October affidavit

report also analyzed that issue in detail; he found

that the Second Amendment’s instructions had

been complied with properly. The CPA’s surprise

"admission" during trial testimony (that he now

believed he had originally made the wrong asset

allocations) was proven to be a false admission.

Mr. Beacham proved that the CPA’s methodology

in making the asset value calculations for the

Marital Trust was the correct method, and the value

assigned to that trust did comply properly with the

Second Amendment’s distribution directives.

The CPA’s false testimony at trial about that

surprise issue fit in neatly with the other false

testimony given by CPA Stanley on ever issue testi-

fied about. The CPA obviously attempted to help

his client (Leona) and Tito Smith succeed with

their collusive "ambush" of Lon Jr at trial.

5) During his closing argument, Tito Smith

also claimed that Lon Jr’s co-trustee actions re-

garding the other issues (ambush complaints)

showed that Lon Jr had a serious "conflict of inter-

est" as trustee, and he should therefore be removed.

Tito Smith alleged that Lon Jr had done everything

for his own advantage and had denied his mother

adequate financial income in her retirement years.

Tito Smith ignored the fact that Leona’s

retirement income would have exceeded $36,000.00

per year, if she had not spent $125,000.00 cash in

1987 for a condominium in Wilmington, N.C. (near

Larry). Her retirement income is in the top five

percent of all retired people in America.

During trial, CPA Stanley falsely testified

that Leona did not have an adequate income in

1987 to meet her expenses and her income in 1988

was only about $20,000.00. Lon Jr knew that the

CPA was lying, and he obtained copies of Leona’s

Form 1040 Federal Tax Reports for 1987 and 1988

after the trial. Those tax reports, completed by

CPA Stanley, reported that Leona’s gross income in

1987 was $40,230.00 and her income in 1988 was

$29,837.00 (no interest income on $125,000.00

spent on unnecessary Condo purchased in 1987).

Lon Jr reported this information to the trial

judge with a post trial motion, along with other

important documentary information pete. that

Leona, Larry, and CPA Stanley had all given false

testimony at trial. The trial judge ignored the false

and perjured testimony and denied Lon Jr’s Motion

to Stay The Execution. (Appendix B4)

This brief overview of the "ambush com-

plaints" illustrates the brutal and ruthless fraud

conducted throughout the shameful trial with the

full cooperation of Judge Robert R. Perry.

LON JR had traveled to Palatka (450 miles

X 2 = 900 miles) in June 1989 to participate in joint

deposition testimony with Leona during the discov-

ery process. None of the surprise complaints were

raise during Leona’s deposition testimony. She

admitted that there had been no mismanagement of

the trust by Lon Jr; her only complaint was that she

wanted more income from the trust estate. Her

monthly income distribution checks had been

reduced due to her pro-rata share of the "reserve

funds" set up to cover litigation expenses and Lon

Jr’s disputed trustee fees. (Appendix J)

If the surprise complaints were true, why

were they not included in Leona’s pleadings in

February 1989, or brought forth in her Deposition

testimony in June 1989? All of the surprise issues

introduced at trial were about actions that occurred

between December 1984 and August 1987, but none

of them were brought forth during discovery.

Then, three months after this joint deposi-

tion, when the trial started, these false surprise

complaints were strategically introduced to

"ambush" Lon Jr in a reprehensible and unethical

way and viciously assassinate his character and

integrity. These were complex trust administration

issues that would have required detailed research

of trst records, federal estate tax laws, Florida’s

probate law, and estate planning reference materi-

als to properly prepare for a legal defense at trial.

Lon Jr was ambushed with a premeditated conspir-

acy to deny him a fair trial and due process of law.

Those unethical and unprofessional actions consti-

tuted a heinous federal crime. (18 U.S.C. 241)

The trial judge’s actions forced Lon Jr to

testify about surprise issues 1, 2, and 3 (over objec-

tions), but Lon Jr was given no opportunity to testi-

fy or present any evidence about issues 4 and 5S.

Com aint issue 5 was not introduced until Mr.

Smith’s closing argument. (1T. 252) No witness

testified that they believed that Lon Jr had a "con-

flict of interest" as co-trustee, and no valid evidence

was presented to prove a "conflict of interest" com-

plaint. That complaint came out of thin air with no

testimony and no proof, just Tito Smith’s self-serv-

ing statements about the other ambush issues

during his closing argument. (1T. 247-254, see

Appendix E, pages 25.59)

The trial judge was extremely unfair toward

Lon Jr, and he allowed Tito Smith to brutally and

ruthlessly ambush Lon Jr at trial even though Alan

Fields repeatedly objected to testimony about

issues Outside the pleadings and he objected to

"non-expert" testimony by the CPA _ witness.

(Appendix E: 1T. 41, 111, 162, 163, 166, 167)

The Final Judgment shows that ambush

issues 1, 2, 3, 4 and 5 were used to unethically and

illegally justify Lon Jr’s removal as co-trustee, and

also used to justify major changes to the Trust

Instruments’ "distribution of assets" instructions.

Those changes were extreme violations of the Parol

Evidence Rule (Appendix F) although objections

were made at trial. (1T. 167, Appendix E, page 25)

Lon Jr’s _ brief proved that extrinsic

evidence cannot legally be used to modify a clearly

worded Trust Instrument. The Trust Instrument is

the best evidence of the Grantor’s intent and his

purposes. The judge used verbal self-serving

Statements at trial, five years after the Trust’s

Second Amendment, about surprise "ambush"

complaints not noticed to Lon Jr before trial to

justify making major modifications to Lon Sr’s

Trust Instruments. Those extremely abusive ac-

tions severely violated Lon Sr’s trust estate and

violated Lon Jr’s position as co-trustee in a tyranni-

cal manner. This was Reversible Error!

A Florida Equity Court trial judge has a

specific duty to act in a fair and impartial manner

toward all litigants and insure that the trial is

conducted in a fair manner, respecting each liti-

gant’s constitutionally protected civil rights, as

guaranteed by Florida’s Constitution, Article 1,

Section 9, and as guaranteed by the U.S. Constitu-

tion, Amendment 14. Judge Perry totally ignored

due process standards and acted in an abusive

manner toward Lon Jr, repeatedly denying him due

process of law. (Appendix G - legal citations).

LON JR was a co-trustee of both the Marital

Trust and the Family Trust, in addition to being a

remainderman beneficiary of the Marital Trust and

a primary beneficiary of the Family Trust. There-

fore, to remove Lon Jr as co-trustee under the

conditions described herein was a clear denial of

liberty and property interest without due process of

law. That was Fundamental Error’

Such an "ambush" of a co-trustee at a non-

jury trial makes a terrible mockery of the concepts

of fairness, impartiality, due process of law, truth,

and justice. It demonstrates that trustees can easily

be subjected to despotic, abusive judicial tyranny.

Even the extremely biased and unfair trial

judge recognized some of Lon Jr’s competent co-

trustee actions and work, and the Final Judgment

awarded Lon Jr $8,000.00 for his co-trustee fees.

That amount was grossly inadequate compensation

for Lon Jr’s extensive co-trustee management of

this $640,000.00 complex trust estate for 1987,

1988, and 1989 due to the very serious co-trustee

and beneficiary problems that Lon Jr had to cope

with. However, the $8,000.00 award did indicate

that even this extremely unfair judge could not

bring himself to deny Lon Jr any compensation for

his capable and responsible co-trustee work.

To prove the fraudulent intent in Tito

Smith’s surprise complaints "ambush" scheme, it is

important to understand that relevant trust records

documents had been provided to Mr. Smith one

year in advance of trial. Lon Jr had voluntarily

mailed copies of 33 relevant trust records docu-

ments to Mr. Smith on September 3, 1988, six

months before Leona’s complaint was filed. Those

trust records, and additional information made

available to Mr. Smith before trial, proved convinc-

ingly that Lon Jr had been an exceptionally compe-

tent and responsible co-trustee who had served the

trust estate faithfully for 78 months. Leona clearly

had no legitimate complaint against Lon Jr, but

Tito Smith still carried out his "ambush" scheme.

3. Itisadenial of due proc essforatrial

judge to evaluate aco-trustee's performance

by the trial judge’ s "personal opinions" when

his "opinions" conflict greatly with published

trust administrations standards.

Judge Perry repeatedly failed to be a fair and

impartial finder of fact and his erroneous decisions

proved that he was not sufficiently competent in

complex trust administration law to adjudicate this

case in a responsible manner. He did not even

follow basic due process of law standards.

Throughout the trial, the trial attorneys

avoided references to Florida’s trust administration

Statutes that related to the two complaints filed in

Leona’s pleadings. Why? Because Lon Jr’s disput-

ed co-trustee actions were firmly su ata by the

statutes. See 737.302; 737.402 (s)(vt z); 737.404;

738.02; and 738.13 (1)(2) in Appendix D.

Judge Perry used his own "opinions", rather

than using the Trust Instruments instructions and

Florida’s statutory law and/or other nationally

recognized trust administration law as a proper

legal basis for evaluating Lon Jr’s trustee actions.

No trustee should ever be subjected to such abusive

and unreasonabie judicial tyranny.

D’Alemberte v, Anderson, 349 So.2d 164

(Fla. 1977) is a Florida Supreme Court decision on

point with this argument.

Due process will not tolerate a situation

which forbids or requires the doing of an act in

terms so vague that men of common intelli-

gence must necessarily guess at its meaning.

Lon Jr’s appeal briefs proved that Judge

Perry’s opinions were opposite to well established

trust administration legal standards. One would

have to turn trust administration law standards

upside down and inside out to find any agreement

with Judge Perry’s biased personal "opinions".

Appendix H1 cites relevant legal standards that

prove that Lon Jr’s co-trustee actions were prudent.

Lon Jr’s appeal briefs proved that Judge

Perry ignored the Trust Instruments" directives,

ignored relevant statutory law, ignored relevant

trust administration standards, and ignored the

most authoritative evidential documents and testi-

mony presented at trial and in post trial motions.

Judge Perry made the case come out the way he

wanted it to come out, irrespective of the control-

ling legal standards involved or the validity of Lon

Jr’s testimony and evidential documents.

The appeal records also prove that Judge

Perry gave no fair and impartial consideration to

Lon Jr’s testimony and evidential documents, and

he gave no responsible consideration to Marion

Beacham’s professional trust expert deposition

testimony and his two sworn, witnessed, notarized

affidavit reports. Mr. Beacham provided the only

authoritative "trust expert" evidence in the trial

other than Lon Jr’s own expert testimony.

Judge Perry’s Final Judgment contained

blatantly false statements regarding the trust estate

and Lon Jr’s knowledge level about estate planning

and trust administration. (Appendix. Bl) That

fraudulent situation was reported in detail in Lon

Jr’s Amended Initial Brief, pages 38-42 (second

appeal). The Appellate Court’s "motion panel” did

not like Lon Jr’s detailed exposure of the obviously

false statements in the Final Judgment nor his

exposure of the "ambush" complaints fraud scheme.

(F.S. 839.13) The Court struck Lon Jr’s Amended

Initial Brief entirely because it exposed unethical

collusive acts by the trial judge and the two trial

attorneys that denied Lon Jr due process of law.

4. It is a denial of due process of law

for Appellate Court’s "motion panel" to issue

orderstoapro se Appellant that are extremely

vague and impossible to understand with any

reasonable degree of clarity and specificity.

Appendix A3 and A4 each show the content

of an order issued by the Appellate Court to Lon Jr

that was extremely vague. The writer of those

orders made no reasonable effort to make the

orders clear and understandable to "men of

common intelligence”. Thus, the orders were

unconstitutionally vague according to the standards

established by controlling Florida case law.

D’Alemberte v. Anderson, 349 So.2d 164

(Fla. 1977) is a Florida Supreme Court decision on

point with this argument. (quoted in argument 3).

The Court’s Order (dated 9/28/90) struck

Lon Jr's Amended Initial Brief entirely, but it did

not specify any part of the 49 page brief that failed

to comply with appellate rules, and it did not speci-

fy which rules were violated. How could any rea-

sonable person expect anyone to understand and

comply with such an extremely vague order?

The Order dated 12/5/90 did not clearly

ee whether it was referring to the Appellee’s

Motion To Strike Points III and IV or Lon Jr’s

appeal brief argument issues II] and IV. This was

an extremely confusing order to send to a non-

attorney pro se litigant. It would have been very

easy to write the order to state its purpose in

unambiguous terms.

The Court’s order denied Lon Jr the right to

report with candor on appeal how the lower court

trial ~~ had severely sagere ye the case against

Lon Jr by allowing unfair and unethical actions

during the initial trial.

Lon Jr filed a Motion For Clarification that

requested additional information about the Court’s

order and specified in detail why the order ap-

yeared to violate several of Lon Jr's constitutional-

a protected civil rights. The Appellate Court

responded by denying the motion; the court re-

fused to provide any clarification of its extremely

vague oder (Appendix A5)

Very serious due process error occurred

when the Appellate Court ignored well established

minimum standards for clarity of orders and then

failed to administer Florida’s laws fairly and impar-

tially toward Lon Jr as a pro se Appellant.

5. It its a denial of due process of law

when Appellate Court’s "motion panel”

orders Appellant to stop reporting actions of

the trial attorneys and trial judge that severe-

ly prejudiced the case against Defendant.

Appendix A4 contains the Appellate Court’s

Order (dated 12/5/90) which demanded that Lon

Jr cease all personal attacks against the trial judge

and the two trial attorneys. Lon Jr’s Amended

[Initial Brief made it very clear that those three

Officers Of The Court had severely prejudiced the

case against Lon Jr collusively with their unfair and

unethical actions.

The Sanction Order showed that the Court

was not really interested in the truth about the case

below. The Court was determined to prevent Lon

Jr from exposing unfair, unethical and criminal

actions in his appeal brief. The Court’s Order

denied Lon Jr his constitutionally protected civil

rights of free speech, right to present grievances to

a government agency, right of equal access to the

court, and right to due process during appeal. The

Court’s sanction order was clearly unconstitutional

because it denied Lon Jr civil rights protected by

the U.S. Constitution, Amend. 1, 14. (Appendix C)

The Appellate Court had a duty to provide

fair and impartial consideration of Lon Jr’s appeal

brief argument and also administer fairly State and

federal statutory law and case law relative to this

appeal. However, the "motion panel" tried to

cover-up the unethical and illegal acts committed

below by denying Lon Jr a fair opportunity to report

with candor to the court how those acts had severely

prejudiced the case against him. The Court acted

in a despotic bureaucratic manner toward Lon Jr.

6. It is a denial of constitutionally

protected civil rights when Appellate Court's

"motion panel” strikes entirely a pro se Appel-

lant’s appeal brief and then strikes two essen-

tial arguments from the amended brief

because the arguments contained complaints

about unfair and unethical actions of the

trial attorneys and trial judge.

Appendix A3 shows the contents of the

Appellate Court’s Order (dated 9/28/90) which

struck entirely Lon Jr’s Amended Initial Brief for

the second appeal because it reported unfair and

unethical collusive actions in the lower court, by

the trial judge and the two trial attorneys, that

severely prejudiced the case against Lon Jr.

Appendix A4 shows the Court’s Order (dated

12/5/90) which struck Argument Issues III and IV

from Lon Jr’s Initial Brief (Second Amendment).

The two arguments stricken specifically reported

the trial judge’s personal involvement in an unfair,

unethical, and criminal conspiracy to deny Lon Jr

his constitutionally protected civil ore The

Court’s unfair Order struck from the Initial Brief

(second trial) Lon Jr’s detailed report of the unfair,

unethical, and criminal actions taken by the trial

judge that severely prejudiced the case against Lon

Jr. (Appendix K: 18 U.S.C. 241, Fla. Stat. 839.13)

7. It is a denial of due process of law

for Appellate Court’s "decision panel” to

ignore controlling law regarding appropriate

due process standards.

All of Lon Jr’s appeal briefs reported due

process errors in the trial court and_ provided

hundreds of references to the appeal records to

prove that such errors had indeed occurred;

however, the Appellate Court’s "decision panel’

ignored the controlling case law cited in Lon Jr’s

appeal briefs and issued a Per Curiam Affirmed

decision (without opinion). Lon Jr cited several

U.S. Supreme Court cases regarding due process

standards. (Appendix Gl) (Armstrong v. Maas.

380 U.S. 545, 85 S.Ct. 1187 (1965) showed that a

litigant must be granted a new trial when due

process errors prejudice the case against him.

Lon Jr's appeal briefs also cited several

Florida decisions that prohibit unfair "ambush"

tactics during trial, but the Court ignored those

citations also, grossly abusing the Court’s judicial

authority and discretion. (Appendix G2)

8. It is a denial of due process of law

for the Appellate Court’s "decision panel” to

ignore applicable published legal standards

regarding trust administration procedures.

Leona’s pleadings alleged that Lon Jr had

stopped her monthly trust income payments and

that action constituted mismanagement sufficient

to justify his removal as co-trustee. However, trust

administration legal reference standards show that

Leona and her attorney did not adequately under-

Stand trust administration law regarding that issue.

Appendix H1 citations prove that a trustee is

authorized to withhold all "net" income distribu-

tions from the income beneficiaries until his trustee

OR, ipieepncet ae fees are paid. This long established

legal standard proves that Lon Jr’s disputed co-

trustee action was prudent and proper, rather than

being an irresponsible breach of trust as Judge

Perry erroneously reported in the Final Judgment.

Florida Statute 737.402 (s) shows that the trustee

has a lien on trust assets against the beneficiary

when the trust owes money to trustee; 738.13 (2)

allows withholding some income from distribution

to regularize the Daiibaiiens. as Lon Jr’s disputed

actions proposed be done. (Appendix D)

In addition, Lon Jr’s Answer (1R. 36-67) and

trial testimony and appeal briefs all showed that

Leona’s complaint was in error. Lon Jr had not

refused to make net income payments to Leona; he

prudently insisted that Larry take the trustee fees

into consideration when the monthly "nei" income

distribution checks for beneficiaries were calculat-

ed so the beneficiaries would not be overpaid.

However, Larry adamantly refused to comply with

Lon Jr's responsible and prudent request; Larry’s

obstinate and irresponsible actions are what kept

Leona, Lon Jr, and Larry from receiving any trust

income distributions for a ten month period.

There was no legitimate reason to remove

Lon Jr as co-trustee of his father’s trust estate.

The records proved that he had been an exemplary

co-trustee for more than six years, and his appeal

briefs proved that his trustee actions were prudent

and reasonable and were made in good faith. Lon

Jr’s appeal briefs proved that Leona’s filed com-

plaint was not a valid reason for removing him as

co-trustee. The Trial Court made grievous errors,

but the Appellate Court ignored all of them.

CONCLUSION

Lon Jr has shown herein that the Circuit

Court’s trial judge placed himself in an adversary

position to the Defendant throughout the lower

court’s litigation process and failed to act in a fair

and impartial manner as "finder of fact" and grossly

abused his judicial authority and discretion.

The Appellate Court’s tribunal also placed

itself in an adversary position to Lon Jr and ignored

the extremely prejudicial actions below and ignored

controlling legal standards relative to this case.

The appeal process became a farce and a bureau-

cratic sham. It proved that the Appellate Court

was incapable of being fair and impartial when

members of the "brotherhood" were involved in

unfair, unethical, and criminal acts.

Appellate Court judges must be required to

act fairly and impartially toward all litigants, re-

specting and giro | their constitutionally

guaranteed civil rights; if that requires them to

recognize and admit unfair, unethical, and criminal

acts of Officers of the Court below, so be it. Truth

and justice must be the overriding issue on appeal,

not the protection of unethical members of the

brotherhood. Justice demands reversal of this case!

Petitioner respectively moves this Court to

grant its Writ of Certiorari for the review and

reversal of the decisions below, and order the Court

to restore Lon Sr’s trust estate and Lon Jr and Larry

to the positions held before the fraudulent trial.

Respectfully submitted,

Lonnie E. Willoughby, Jr.

Acting pro se

P.O. Box 127

Mauldin, S.C. 29662

803-288-8924

“ag

INDEX TO APPENDICES

A ppendix Subject Page |

A Appellate Court’s Orders ]

Al Per Curiam Affirmed decision

A2 Order denying Rehearing

A3 Order striking Initial Brief

A4 Order striking Points III, IV

AS Order deny Clarification

B Trial Court’s Orders 6

Bl Final Judgment

B2 Order deny attorney fees/costs

B3 Order denying Rehearing

B4 Order denying Stay of Execution

:: U.S. Constitution 17

Article 4, Section 1, 2

Amendment 1

Amendment 14, Section ]

D Florida Statutes (Trust Admin. ) 18

Chapter 737 (selected sections)

Chapter 738 (selected sections)

2 Trial transcript statements 21

F Paro! Evidence References 40

G Due Process Citations 42

G1 U.S. Supreme Court Cases

G2 Florida Cases

PAGE ONE OF TWO PAGES

Appendix

IN ; 2NDICE

Subject

Trust Administration Citations

Marion Beacham’s Reports

(selected paragraphs)

"I" 1 August 22, 1989 Affidavit

"I" 1 October 20, 1989 Affidavit

Leona’s Deposition (partial)

Criminal Statutes

Kl 18 U.S.C. 241

K2 Fla. Stat. 839.13

Appendix Al

IN THE DISTRICT COURT OF APPEAL OF THE

STATE OF FLORIDA, FIFTH DISTRICT

JULY TERM 1991

LONNIE E. WILLOUGHBY, JR..,

Appellant,

v. CASE NOS.

89-2541;

90-1056

LEONA WILLOUGHBY

Appellee.

Decision filed October 8, 1991

Appeal from the Circuit Court

for Putnam County,

Robert R. Perry, Judge.

Lonnie e. Willoughby, Jr., Mauldin,

S.C., pro se.

Tito S. Smith, Palatka, for

Appellee.

PER CURIAM.

AFFIRMED.

GOSHORN, C.J.,

DAUKSCH AND SHARP, W., J.J., concur.

Appendix A2

IN THE DISTRICT COURT OF APPEAL OF THE

STATE OF FLORIDA, FIFTH DISTRICT

LONNIE E. WILLOUGHBY, JR..,

Appellant,

V. CASE NOS.

89-2541;

90-1056

LEONA WILLOUGHBY

Appellee.

Date: November 6, 1991

BY ORDER OF THE COURT:

ORDERED that Appellant’s MOTION FOR

EXTENSION OF TIME, filed October 30, 1991, is

denied. Accordingly, it is

ORDERED tht Appellant’s untimely

MOTION FOR REHEARING, filed October 25,

1991, and Appellant’s untimely and unauthorized

AMENDED MOTION FOR REHEARING, filed

October 28, 1991, are striken.

FRANK J. HABERSHAW, CLERK

cc: Lonnie E. Willoughby, Jr.

Leona Willoughby

Appendix A3

IN THE DISTRICT COURT OF APPEAL OF THE

STATE OF FLORIDA, FIFTH DISTRICT

LONNIE E. WILLOUGHBY, JR..,

Appellant,

v. CASE NOS.

89-2541;

90-1056

LEONA WILLOUGHBY

Appellee.

DATE: September 28, 1990

BY ORDER OF THE COURT:

ORDERED that Appeiliee’s MOTION TO

STRIKE INITIAL BRIEFS OF APPELLANT, filed

September 10, 1990, is granted. Appellant is grant-

ed twenty days from the date hereof to file and

serve a second amended initial brief that complies

with the appellate rules.

FRANK J. HABERSHAW, CLERK

cc: Tito S. Smith, Esq.

Lonnie E. Willoughby, Jr.

Alan B. Fields, Jr., Esq.

Appendix A4

IN THE DISTRICT COURT OF APPEAL OF THE

STATE OF FLORIDA, FIFTH DISTRICT

LONNIE E. WILLOUGHBY, JR..,

Appellant,

v. CASE NOS.

89-2541;

90-1056

LEONA WILLOUGHBY

Appellee.

DATE: December 5, 1990

BY ORDER OF THE COURT:

ORDERED that appellee’s motion to strike

with prejudice appellant's second amended initial

brief in Case No. 90-1056 is granted as to Points II]

and IV because of improper appellate argument.

Appellee’s motion to dismiss appeal and for an

award of attorney’s fees is denied pursuant to this

courts’ order of July 25, 1990 consolidating Case

Nos. 89-2541 and 90-1056. Appellant is hereby

ordered to cease all personal attacks against the

trial judge, opposing counsel and his own trial

attorney in this cause.

FRANK J. HABERSHAW CLERK

cc: Tito S. Smith, Esq.

Lonnie E. Willoughby, Jr.

Alan B. Fields, Jr., Esq.

Appendix AS

IN THE DISTRICT COURT OF APPEAL OF THE

STATE OF FLORIDA, FIFTH DISTRICT

LONNIE E. WILLOUGHBY, JR..,

Appellant,

v. CASE NOS.

89-2541;

90-1056

LEONA WILLOUGHBY

Appellee.

DATE: JANUARY 3, 1991

BY ORDER OF THE COURT:

ORDERED that Appellant's MOTION FOR

CLARIFICATION OF COURT’S ORDER, filed

December 19, 1990, is denied.

FRANK J. HABERSHAW, CLERK

cc: Tito S. Smith, Esq.

Lonnie E. Willougby, Jr.

Appendix B1

IN THE CIRCUIT COURT, SEVENTH

JUDICIAL CIRCUIT, iN AND FOR

PUTNAM COUNTY, FLORIDA.

Case No. 89-5224-CA-M

LEONA WILLOUGHBY,

Plaintiff,

VS.

LONNIE E. WILLOUGHBY, JR..,

as Trustee of the LONNIE

E. WILLOUGHBY, SR. TRUST

AGREEMENT DATED JANUARY 1,

1983,

Defendant

FINAL JUDGMENT

THIS MATTER having come on to be tried

before the Court and the Court having considered

the testimony of the witnesses together with their

demeanor and attitudes toward one another and the

Court having further reviewed all of the deposi-

tions, pleadings, exhibits and evidence, makes the

following findings:

a. That the Court has jurisdiction of both

the subject matter and the parties to this cause.

b. That although both Plaintiff and |

Defendant had filed several motions addressing the |

pleadings of the other, none of these motions were

called for hearing until the day of trial and this

cause had been continued previously to allow the

pleadings to be clarified; certain of these motions

were moot. and all of the party litigants want the

case tried and concluded.

c. That the Plaintiff, LEONA WIL-

LOUGHBY, and her deceased Husband, LONNIE

E. WILLOUGHBY, SR., had through their joint

efforts, accumulated a joint estate that gave rise to

a concern by them for estate tax consequences. It

was their intent to divide their jointly held estate so

that eaci held fifty percent and it was the Settlor’s

(LONNIE E. WILLOUGHBY. SR.) intent in creat-

ing the Trust dated January 1, 1983, and amended

December 12, 1984, to create a marital trust and a

family trust so that the Settlor’s widow, the Plaintiff

herein, and his two sons each received one-third of

his separate estate. The amendment specifically

provides for the Marital Trust to receive thirty-four

percent and the Family Trust the balance of Sixty-

six percent of the total trust assets. The intent of

the Decedent and his Widow, the Plaintiff herein,

was never accomplished, however, in that the es-

tates were never equalized, the bulk of the jointly

held estate being placed in the Decedent’s Trust.

and as result of the Defendant’s improper interpre-

tation of the Amendment to the Trust, the Plaintiff

has only received twenty-seven (27%) percent of

the Trust Income since her Husband’s death.

d. That although the Defendant.

LONNIE E. WILLOUGHBY, JR.., believes that he

is extraordinarily knowledgeable in the areas of

trust administration, estate taxes and probate, he

represents the classic example of a little knowledge

on a subject being a dangerous thing. His attitude,

demeanor and presentation clearly demonstrate an

uncompromising individual who has interpreted the

Trust and exercised his discretionary determina-

tions in a fashion that is most beneficial to himself.

e. Both the Defendant and his Co-Trus-

tee, LARRY M. WILLOUGHBY, as vested re-

maindermen of the Marital Trust with si nificant

discretion as to distributions of rincipal from the

Marital Trust to the Plaintiff, eis a conflict of

interest in making such determinations.

f. The Amendment to the Trust dated

December 12, 1984, which was proposed, drafted

and SS by the Defendant, specifically directs

the Trustees to make non-discretionary distribu-

tions of all income in the Marital Trust to the Plain-

tiff, and the Co-Trustee failed for approximately

one year or until the Plaintiff initiated this litiga-

tion to make such distributions. Such actions by the

Trustees constituted abusive and arbitrary misman-

agement of the Trust as well as a breach of their

fiduciary responsibilities to the Trust and the Plain-

tiff as an income beneficiary.

That the Defendant is entitled to

reasonable compensation for services as Trustee,

but the amounts set forth in the invoices submitted

by the Defendant to the Trust are unwarranted and

outrageous in that the vast majority of the Defend-

ant’s time, as billed, did not involve matters rele-

vant to the Trust, but rather, addressed his person-

al relationship with his Brother and Mother. This

Court further finds that for the services necessary

from the Trustee, a fee of $250.00 per month from

January 1987 through August 1989, or a total of

$8,000.00 is more than generous. The Cross-

Defendant, Co-Trustee, LARRY M. WILLOUGH-

BY, has requested no fees.

h. That the Defendant’s testimony and

evidence as to damages against the Trust and his

Co-Trustee are so _ remote, conjectural and

speculative that the Court can give them no cre-

dence.

IT IS THEREFORE ORDERED AND

ADJUDGED AS FOLLOWS:

a That all of the Motions, both Plain-

tiff’s and Defendant’s, called for hearing on the day

of trial be and they are hereby denied.

y a That the Co-Trustees, LONNIE E.

WILLOUGHBY, JR. and LARRY M. WIL-

LOUGHBY, be and they are hereby removed as

Trustees of the LONNIE E. WILLOUGHBY SR.

TRUST.

me That the Trust shall pay from its prin-

cipal the sum of $8,000.00 to LONNIE E. IL-

LOUGHBY, JR. for his services as Co-Trustee.

4. That LONNIE J. STANLEY, CPA of

3000 Crill Avenue, Palatka, Florida, 32177, is

hereby appointed Successor Trustee and upon his

submitting a surety bond conditioned upon his

poe performance as Trustee in the sum of

100,000.00, and said bond being ~ ip ar by this

Court he shall assume the duties of Trustee. The

premium for said bond shall be a trust expense.

a: That all financial institutions holding

accounts for this Trust are hereby notified of this

change in Trustees and are directed to alter their

accounts accordingly.

6. That the Trustee shall alter all ac-

countings to reflect a division of trust ownership so

that the Marital Trust contains thirty-four percent

of the total assets and the Family Trust contains the

balance with distributions made accordingly.

Additionally, the Trustee shall calculate and pay to

the Plaintiff from the Trust Principal seven (7%) of

Trust Income since the Settlor’s death.

4a That on the Defendant’s Counter-

Claim for damages against the Trust and Cross-

Claim against his Brother, LARRY M. WIL-

LOUGHBY, the Defendant, LONNIE E. WIL-

LOUGHBY, JR., shall take nothing and the Coun-

ter-Defendant and Cross-Defendant, shall go hence

without day.

8. This Court retains jurisdiction of this

cause to determine what, if any, attorney’s fees

should be paid by the Trust.

DONE AND ORDERED in_ Chambers,

Putnam County Courthouse, Palatka, Florida, this

12th day of October, 1989.

Robert R., Perry

Circuit Judge

Copies to: Tito S. Smith, Esquire

Alan B. Fields, Jr., Esquire

Jill F, Gale

Judicial Assistant

Appendix B2

IN THE CIRCUIT COURT, SEVENTH

JUDICIAL CIRCUIT, IN AND FOR

PUTNAM COUNTY, FLORIDA.

Case No. 89-5224-CA-M

LEONA WILLOUGHBY,

Plaintiff,

VS.

LONNIE E. WILLOUGHBY, JR..,

as Trustee of the LONNIE

E. WILLOUGHBY, SR. TRUST

AGREEMENT DATED JANUARY 1,

1983,

Defendant.

ORDER

THIS MATTER having come on to be heard

by the Court on the Motion for Attorney’s Fees

filed by Dowda & Fields, Chartered, seeking to

enforce a charging lien against the assets of the

Lonnie E. Willoughby, Sr. Trust, and the Court

having heard the testimony and having reviewed the

evidence presented by the parties, and it not ap-

pearing to the Court that the legal defense of the

Defendant, Lonnie E. Willoughby, Jr., in this litiga-

tion was of any benefit to the Trust and the Court

being further and fully advised in the primises, It Is

ORDERED AND ADJUDGED that the

Motion for Attorney's Fees to be aw arded from th

Trust be and the same is hereby denied

prejudice to the filing of a separate action, If nece

sary, to collect fees from the Defendant, individua

ly.

DONE AND ORDERED in Chambers,

Putnam County Courthouse, Palatka, Florida, this

23 day of April, 1990.

ROBERT R. PERRY _

Circuit Judge

Copiesto: Titos. Smith, Esquire

Alan B. Fields, Jr., Esquire

Lonnie E. Willoughby, Jr

JILL F.GALE _

Judicial Assistant

Witnol

Appendix B3

IN THE CIRCUIT COURT, SEVENTH

JUDICIAL CIRCUIT, INAND FOR

PUTNAM COUNTY, FLORIDA.

Case No. 89-5224-CA-M

LEONA WILLOUGHBY.

Plaintiff.

VS.

LONNIE E. WILLOUGHBY. JR..

as Trustee of the LONNIE

E. WILLOUGHBY, SR. TRUST

AGREEMENT DATED JANUARY 1.

1983.

Defendant.

ORDER DENYING DEFENDANT’S

MOTION FOR REHEARING

THIS CAUSE coming before this Court upon

the Defendant’s Motion for Rehearing and the

Court having considered the Motion and the at-

tachments thereto consisting of 86 pages and upon

the Defendant’s Motion For Leave To Change

Counsel of Record and Defense Counsel’s Motion

For Leave To Withdraw and the Court having

considered the Motions, and Court being otherwise

fully advised in the premises, finds as follows:

The Defendant’s Motion for Rehearing

brings no new matters cognizable by the Court

which merit a rehearing in this case. The Defend-

ant’s Motion for Rehearing and its attachments

demonstrates as do Defendant's prior pleadings,

that the Defendant has no grasp of the relevant

scope of the inquiry here. It again in a rehash of the

Defendant’s position in this case of his view of

himself as a dutiful, obedient and prudent son,

confronted by an obstructionist brother and a

mother who wishes to ay her own money. The

evidence in this case belies this and the record will

speak for itself. It is therefore,

ORDERED AND ADJUDGED:

That the Defendant’s Motion for Rehearing

be and the same is hereby denied. All aspects of

the Final Judgment are hereby confirmed. No

evidentiary hearing is necessary or appropriate in

this case.

That the Defendant’s Motion for Leave to

Change Counsel or Record and the Defense Coun-

sel’s Motion for Leave to Withdraw be and the

same is hereby granted. All future pleadings in

this case shall be directed to this Defendant at his

mailing address; Post Office Box 127, Mauldin,

South Carolina 29662.

DONE AND ORDERED in Chambers at

Palatka, Putnam County, Florida, this 7th day of

November, 1989.

CIRCUIT JUDGE

COPIES TO:

Lonnie E. Willoughby

Tito S. Smith, Esq.

Alan B. Fields, Esq.

ete

JUDICIAL ASSISTANT

Appendix B4

IN THE CIRCUIT COURT, SEVENTH

JUDICIAL CIRCUIT, INAND FOR

PUTNAM COUNTY, FLORIDA.

Case No. 89-5224-CA-M

LEONA WILLOUGHBY,

Plaintiff,

VS.

LONNIE E. WILLOUGHBY, JR..,

as Trustee of the LONNIE

E. WILLOUGHBY, SR. TRUST

AGREEMENT DATED JANUARY 1,

1983,

Defendant.

ORDER DENYING DEFENDANT’S

MOTION TO STAY THE EXECUTION

THIS CAUSE having come before this Court

on the Defendant, Lonnie E. Willoughby, Jr’s

Motion To Stay the Execution and the Court having

reviewed the Motion and being completely familiar

in the premises, it is

ORDERED AND ADJUDGED:

That the Defendant, Lonnie E. Willoughby,

Jr’s Motion to Stay the Execution be and the same

is hereby denied. The Defendant’s Motion again

demonstrates his proclivity for extensive justifica-

tion of his own actions, but present no appropriate

legal grounds for a Stay of this Court’s judgment.

DONE AND ORDERED in Chambers at

Palatka, Putnam County, Florida, this 3rd day of

January 1990.

RIT -RRY

CIRCUIT JUDGE

COPIES TO:

Lonnie E. Willoughby, Jr.

Tito S. Smith, Esq.

Appendix C

U.S. CONSTITUTION

Article IV

RELATIONS OF STATES

Section 1. Full Faith and Credit

Full faith and credit shall be given in each

State to the public acts, records, and judicial pro-

ceedings of every other State. And the Congress

may, by general laws, prescribe the manner in which

such acts, records, and proceedings shall be proved,

and the effect thereof.

Section 2. Privileges and Immunities of Citizens

1. The citizens of each State shall be enti-

tled to all privileges and immunities of citizens in

the several States.

AMENDMENTS

IST Amendment: Freedom of Religion, Speech,

Press, Assembly, and Petition

Congress shall make no law respecting an

establishment of religion, or prohibiting the free

exercise thereof, or abridging the freedom of

speech, or of the press, or the right of the people

peaceably to assemble, and to petition the govern-

ment for a redress of grievances.

14TH Amendment: Rights of Citizens

Section 1. *** No State shall make or

enforce any law which shall abridge the privileges

or immunities of citizens of the United States: nor

shall any State deprive any person of life, liberty, or

property, without due process of law, nor deny to

any person within its jurisdiction the equal protec-

tion of the laws.

Appendix D

FLORIDA STATUTORY LAW

737.302 Trustee’s standard of care and perform-

ance. - Except as otherwise provided by the trust

instrument, the trustee shall observe the standards

in dealing with the trust assets that would be ob-

served by a prudent trustee dealing with the ig ag

ty of another. If the trustee has special skills, or is

named trustee on the basis of representations of

special skills or expertise, he is under a duty to use

those skills.

737.402 Powers of trustee conferred by this part. -

(1) From the time of creation of the trust

until final distribution of the assets of the trust, a

trustee has the power to perform every act that a

prudent trustee would perform for the purposes of

the trust, without court authorization, including,

but not limited to, the powers specified in subsec-

tion (2).

(2) Unless otherwise provided in the trust

instrument, a trustee has the power:

(a) Tocollect, hold, and retain trust assets

received from settlor until disposition of the assets

should be made. The assets may be retained even

though they include an asset in which the trustee is

personally interested.

(s) To Borrow money, to be repaid from

trust assets or otherwise, and to advance money for

the protection of the trust and for all expenses,

losses. and liabilities sustained in the administra-

tion of the trust or because of the holding or

ownership of any trust assets, for which advances,

with any interest, the trustee has a lien on the trust

assets as against the beneficiary.

(u) To pay taxes, assessments, compensation

of the trustee, and other expenses incurred in the

collection, care, administration, and protection of

the trust.

(y) To employ persons, including attorneys,

auditor, investment advisor, or agents, even if they

are the trustee or associated with the trustee, to

advise or assist the trustee in the performance of

his administrative duties: to act without independ-

ent investigation upon their recommendations: and,

instead of acting personally, to employ one or more

agents to perform any act of administration, wheth-

er or not discretionary.

(z) To prosecute or defend actions, claims,

or proceedings for the protection of trust assets and

of the trustee in the performance of his duties.

(aa) To execute and deliver all instruments

that will accomplish or facilitate the exercise of the

powers vested in the trustee.

737.404 Powers exercisable by joint trustees:

(1) Any power vested in three or more

trustees may be exercised by a majority, but a trus-

tee who has not joined in exercising a power is not

liable to the beneficiaries or to others for the

consequences of the exercise, and a dissenting

trustee is not liable for the consequences of an act

in which he joins at the direction of the majority of

the trustees if he expressed his dissent in writing to

any of his cotrustees at or before the time of join-

der.

(2) If two or more trustees are appointed to

perform a trust and any of them is unable or refuses

to accept the appointment or, having accepted,

ceases to be a trustee, the surviving or remaining

trustees shall perform the trust and succeed to all

the powers, duties, and discretionary authority

given to the trustees jointly.

(3) This section does not excuse a cotrustee

from liability for failure either to participate in the

administration of the trust or to attempt to prevent

a breach of trust.

738.02 Duty of trustee for receipts and expendi-

tures. -

(1) A trust shall be administered with due

regard to the respective interests of income benefi-

ciaries and remaindermen.

738.13 Charges against income and principal. -

(1) The following charges shall be made

against income:

(d) Court costs, attorney’s fees, and other

fees on other accountings or judicial proceedings if

the matter primarily concerns the income interest,

unless the court directs otherwise.

(2) If charges against income are of unusual

amount, the trustee may charge them over a

reasonable period of time, by means of reserves or

other reasonable means, and withhold from distri-

bution sufficient sums to regularize distributions.

Appendix E

TRIAL TRANSCRIPT (FIRST TRIAL 9/6/89)

SELECTED SECTIONS

1T. 41: Questions by Tito Smith, answers by Lon Jr

A: Would you gp the question. please?

Q: Certainly, The assets belonging to your

dad that were in this trust, placed into two separate

trusts, a family trust and a marital trust. The

income from the marital trust being paid to your

mother together with the right to invade the corpus

of that trust.

A: Yes.

Q: The income off of the family trust paid

to Mama as well, but with no right to invade that

corpus whatsoever, only a lifetime right to income.

A: And to answer the question, would that

have avoided the estate taxes?

Q: Um-hum.

A: And the answer to that is yes, it would

have avoided the estate taxes.

Q: Could you tell me why we decided to

draw it in this fashion so that Mama doesn’t get the

income, you and your brother get the income.

A: Well, there were several reasons.

MR. FIELDS: Your Honor, I don’t know

where this line of questioning is going. Are we

trying to uphold the trust or are we challenging the

trust instrument itself? I understand the

allegations are that Mr. Willoughby is mismanaging

the trust. It sounds to me like this line of question-

ing is going behind, challenging the enactment of

the trust.

THE COURT: Go ahead.

MR. SMITH: We’re not trying to break the

trust, but we’re coming to a point ina moment that I

think will lead to a mismanagement area.

THE COURT: Well, Mr. Fields, let’s see

where this leads us.

MR. FIELDS: All right, sir.

(Note: the next ten pages (1T. 42-51) are about the

estate planning techniques used in the “Second

Amendment" to the Trust Instrument.

1T. 111: Questions - Tito Smith, Answers - Leona

MR. FIELDS: Your Honor, may I again

object. I don’t know what we’re going into, if we're

challenging the trust or if Mrs. Willoughby wants to

set aside the trust, or if she’s trying to say Mr.

Willoughby is not functioning properly under the

trust.

THE WITNESS: I’m not doing either of

those, sir.

MR. FIELDS: Seems to me they’re challeng-

ing the trust.

MR. SMITH: Your Honor, we’re not chal-

lenging the trust. The point I’m trying -- what I’m

trying to do is portray a portrait for the Court of the

actions of the defendant in this case, how he has

orchestrated things and what he has done and what

it’s led to.

THE COURT: I’m awaretothe point. The

objection is overruled. If there was one with a legal

basis. I didn’t hear one.

MR. FIELDS: Immaterial, irrelevant to the

pleadings and to the accusations here today.

1T. 162-163: Questions by Tito Smith, Answers are

by CPA Lonnie Stanley (CPA who did the Form 706

Estate Tax Report for Lon Sr’s estate and also does

Leona’s federal tax returns, since 1985).

QO: Based upon, again, your representation

of the Willoughbys and your understanding of the

trust, why was it, did you believe, that this trust was

executed? What was the objective of the trust?

MR. FIELDS: Your Honor, I object. I don't

think this witness has any ~~ to explain the

trust. I think the trust speaks for itself.

MR. SMITH: _ The trust speaks for itself.

He certainly can say what he understood based

upon representations by his clients, their objective

was with the trust.

MR. FIELDS: One, I think would be the

dead man’s statute and as to Mrs. Willoughby, |

don’t know. But I think we’d have to see what those

representations were.

THE COURT: [ll overrule the objection.

But don’t give him the dead man’s testimony.

Don’t tell me what -- the dead man’s statute doesn’t

apply to him. He’s not interested in this.

MR.SMITH: That’s correct, Your Honor.

THE COURT: Overrule the objection. Go

ahead.

MR. FIELDS: May I inquire for voir dire?

If we’re going 4 4 an expert opinion, I suppose.

THE COURT: I don’t know that he’s giving

an expert opinion.

MR. SMITH: I haven’t asked that he be

qualified as an expert.

MR. FIELDS: May I just ask a couple of

questions?

THE COURT: | If he’s not giving an expert

opinion, I don’t think -- and he hasn’t been submit-

ted to me as an expert yet.

MR. FIELDS: But I object to any testimony

of this witness relating to this trust based upon what

people told him. Number one, it would be self-

serving from Mrs. Willoughby’s standpoint.

Number two, it he’s going to explain what the trust

was meant to be, he is not qualified, he’s incompe-

tent to do that. Number three, there has been no

predicate to show that he had any knowledge of the

trust before it was executed as to what was their

intent.

THE COURT: Objections is overruled. Go

ahead.

BY MR. SMITH:

Q: What was your understanding of why your

clients executed the trust?

A: My understanding was that they wanted

to avoid probate and estate taxes.

Q: All right, sir. Did the trust accomplish

this?

A: The trust accomplished that, yes, sir.

Q: It accomplished the avoidance of pro-

bate?

A: Yes, sir.

Q: Did it accomplish the avoidance of

estate taxes?

A: Yes, sir, there were no estate taxes paid.

oe)

1T. 166-168, Questions by Tito Smith, Answers are

by CPA Lonnie Stanley

Q: When you prepared the 706, who re-

tained you to file that document?

A: Lonnie Willoughby, Jr., and Mrs. Wil-

loughby. (Note error: it was Larry and Leona)

Q: And in doing so, I understand that you

had an opportunity again to review all of the trust

documents and you were familiar with this docu-

ment, the amendment to the trust?

A: Yes, sir.

Q: In preparing the 706, how much of

what percentage was allocated to Mrs. Willoughby

of the trusts assets?

A: On the 706, the marital trust was allo-

cated at approximately 27% of the entire asset

value.

Q: All right, sir. Let me direct your atten-

tion to the paragraph on the face page of that

amendment to the trust where it recites that a

trustee shall insure that at least 34% shall go to

their trust, or words to that effect.

A: I believe it says in apportioning to the

marital and family trust specific assets previously

valued for estate tax purposes, the trustee shall

assure that my husband receives at least 34%. This

is Leona Willoughby’s trust.

Q: I’m sorry. I’m showing you Mrs. Wil-

loughby’s.

MR. FIELDS: Your Honor, may I object

again. We’re getting outside of the pleadings in

this case. We’re attempting to, one, to enforce the

terms of the trust, and that we now again seem to be

attacking the trust instrument itself.

MR.SMITH: Your Honor, we’re not attack-

ing -- excuse me. Go ahead.

MR. FIELDS: I don’t know where we're

going. We're trying to get something that’s certain-

y outside of the pleadings and I don’t know where

-- I think I know where it’s intended to go, but that’s

certainly not in the pleadings of what I understood

we would be here for. Now we're Starting to attack

the instrument and how it was planned or what it

does. I think it’s been pretty well universally testi-

fied to so far, that’s what was done and that was the

intent of the settlor.

MR. SMITH: I don’t agree with this --

THE COURT: The objection boils down to

materiality to these issues, is that it?

MR. FIELDS: Yes, sir, materiality and

relevancy, and also as to the parole evidence rule.

We're attempting to avoid this instrument by ex-

plaining it with people who are not a party to it.

MR. SMITH: Your Honor, what we’re trying

to do is show mismanagement on the part of this

gentleman as a co-trustee. And part of that

mismanagement is that he decided unilaterally it’s

oing to be 27% and not 34%, regardless of what

addy said and regardless of what the instrument

that he drafted said. And I’d like for this CPA to

testify to that.

THE COURT: Objection is over ruled. |

can see the materiality and the relevance.

BY MR. SMITH:

Q: Why, Mr. Stanley, did you in the 706

reflect 27% or allocate 27% of the trust assets to

Mrs. Willoughby as opposed to 34% that this

document recites?

A: When we prepared the 706 or in the

‘be ber of it and my conversations with Lonnie

illoughby, Jr., we allocated that based on what he

had explained to me was the interpretation of this

tors gate in the trust. Which, what it ended up

eing is that we had taken 34% of the net value, the

ross estate minus the estate expenses, and then

rom that we subtracted one-half of the jointly held

roperty that Mr. Lonnie Willoughby, Sr., and

eona Willoughby owned. And that ended up

arriving at that 27%.

6 All right, sir. Have you had an opportu-

nity eo to that time to review this?

A: es, sir, | have. I believe that we erred

in that calculation. The trust calls for 34%, and

down here at the bottom, the part I think that had

created the confusion, was a reference to Florida

Statutes 732.207, 732.208. I have discussed this

with another attorney looking for an interpretation

of what do those chapters really mean. And my

understanding after that conversation was that the

30% referred to in those chapters is subject to

assets that are solely in the name of the individual,

consequently we should not have reduced the 34%

by one-half of those assets.

Q: All right, sir. And based upon your

understanding of the law and the language in that

trust now, what percentage of the income from the

trust should she be receiving?

A: She should be receiving 34%.

Q: And she should have been receiving it

since its inception?

A: Yes, sir, I believe she should have been

receiving it since its inception.

Q: And to your knowledge what has she

received?

A: To my knowledge, she has received

income based upon 27%.

1T. 171: Questions by Tito Smith, answers by CPA

Q. Do you still continue to represent Mrs.

Willoughby as a CPA?

A Yes, sir, I do.

Q: And you’ve had discussions with her

relative to this trust?

A: Yes, sir, I have.

Q: And you’re doing her income tax returns

now?

A: Yes, sir, ] am.

Q: Can you testify from your experience

having prepared those returns how her income has

been affected since her husband’s death?

A: Well, the first return that I prepared for

Mrs. Willoughby was a joint return for 1985, and on

the joint return her income was a! changer

$75,000. That was prior to Mr. Willoughby’s death.

Since that return, the income has diminished each

year. Her 1988 return was approximately $20,000 in

income.

Q: And that included the income from the

trust?

A: Yes, sir, it did.

Q: Have you had the opportunity to -- of

course, you've done her income tax return. Have

you had an opportunity to prepare financial state-

ments for her? Have you ever done that?

A: No, sir, ’'ve never done that. You know,

I’m somewhat familiar with her assets, but we’ve

never prepared balance sheets and compared those.

: Have you prepared anything like a

ae, Anything showing what her income in and

what her outgo is?

A: The only things that I prepared are her

tax returns in that regard.

Q: In doing that, preparing those tax re-

turns though you review, do you not, the expendi-

tures?

A: Yes, We have reviewed her expenditures.

Q: Based upon that review, does it appear to

you as though she is expending more monies than

she’s receiving?

A: Depends on which year we refer to. In

1987 she expended more money than what she

received . In 1988, I would have to -- I’d have to

refer back toit. There was period there where she

did not receive as much income, and during that

time she definitely was expending more money.

Now she probably is very close to a break even

proposition until we get into 1989 and now her

income is down again, and I think that she probably

is expending more money than her income. She

probably is eating into her assets, yes, sir.

Q: And did you do any calculations at her

request to determine what it would take in the form

of income from the trust to maintain her on an even

keel?

A: Yes, sir, I did.

Q: And what was that figure?

A: Approximately $2,000 a month.

1T. 181: CPA Lonnie Staniey still on witness stand.

THE COURT: Mr. Stanley, before you go, two

things. If I understand correctly, the tax conse-

quences, that is, the savings of the estate taxes

would have been effective upon the first 1983 trust.

That is the savings of taxes in both his and her

estate?

THE WITNESS: Right. The trust, in essence, by

simply passing on the first death over to benefici-

aries being the sons would have accomplished the

same thing by reducing Mrs. Willoughby’s estate

below the unified credit. In other words, not allow-

ing that to pass over.

THE COURT: So the second trust had no effective

tax consequences with regard to the estate tax?

THE WITNESS: I think that’s correct, yes, sir. In

regard to the estate taxes.

THE COURT: And it was not necessary to effect --

to have the second trust in order to save all the

taxes you're going to save?

THE WITNESS: I believe that’s correct, yes, sir.

1T. 185: Plaintiff concludes argument.

THE COURT: Plaintiff rests. Mr. Fields?

MR. FIELDS: May it please the Court. Your

Honor, at this time I would like to ask for a dismiss-

al of the complaint based upon the following basis.

Number one, this is, I think agreed upon.

This is a spendthrift trust. And based upon the law,

as I understand it, that in the spendthrift trust it is

set up on the basis that --

THE COURT: Do you agree it’s a spendthrift

trust?

MR. SMITH: No, Your Honor. He tends to, |

don't.

MR. FIELDS: Well sir, I don’t have any doubt in

my knowledge that this is a spendthrift trust. It

quacks, it barks, it does everything like a spend-

thrift duck barking trust. It. prohibits the individu-

als from anticipating income, it prohibits the trus-

tees -- I mean the beneficiaries from a creditor

attaching. It also prohibits the beneficiary from any

say so in its organization or management. It is a

trust. It is a spendthrift trust. And based upon the

law, as I understand it, in 54 Am. Juris., Trusts,

Section 128, removal of trustee, and University of

Miami law Review, 540, number 1985, and

ust by Lowell and Grimsley,

Section 4-3, that the beneficiaries may not bring an

action to get rid -- to remove the trustee of a spend-

thrift trust.

**eee** Now I think we’ve tried to go

beyond everything in this matter as to what hap-

pened in this amendment to the trust, but I don’t

think there is any doubt that that is what the intent

of the settlor was. Regardless of everything he’s

trying to do to attack this trust.

Now in accordance with the Fifth District

(Court of Appeals) in Parr versus Cushing, 507 So

2d 1227, it’s very specific as to an express trust.

And quoting on page 1228, "generally removing a

trustee should na sain upon a clear showing

of abuse or wrongdoing in the actual administration

of the trust.” What we have here has been a differ-

ence of opinion between the co-trustees. There is

nothing shown as to actual mismanagement of the

trust, and I think that Mrs. Willoughby admitted

that. Specifically, I know she’s done that on the

ada rig

nder the case of Bacon versus Martin, 518

So.2d 925, a Third DCA case, we relate to the stat-

ute that we’ve been speaking of in the trust admin-

istration statute. And that case says that this is a --

the statute is in derogation of the common law, and

where the statute does not provide, then you go to

what was the intent of the settlor. And the settlor

said in this case that remuneration can be paid to

the trustee. The settlor had said that the trustee,

trustees, whichever, can consider in net income

their expenses prior thereto. And what you had

here was a question amongst the two trustee, when

they seatted getting along, then one says well, I

don’t like what you’re doing. ********

Now all we’ve had here so far is attempts to

set aside, to vacillate from the trust instrument

itself. There is nothing showing that Mr. Willough-

by, Lon Willoughby as co-trustee, varied from the

provisions of that trust. It gives him discrimination,

it gives him discretion, it gives the other trustee.

The fact that they won’t work together is not the

issue. That does not make mismanagement.

Your Honor, the cases that I’ve cited, I don’t

think there has been enough evidence to show at

this point that Mr. Lon Willoughby has mismanaged

this trust.

1T. 191: After Tito Smith’s rebuttal of Alan

Fields’ motion to dismiss.

THE COURT: Motion is denied. Are your ready?

MR. FIELDS: Yes, sir.

MR. Fields called Lon Jr. as his first witness.

1T. 199: Lon Jr. still testifying.

Q: You’ve heard what Mr. Stanley had to say about

the taxable event of the original trust, the amend-

ment?

A TOs, olf.

Q: No. sir.

Q: Would you please explain?

A: Mr. Lonnie Stanley is totally wrong, and this is

one of the great problems in estate planning. It is

extremely difficult to find anyone who knows what

they’re doing. Everybody has got an opinion, but

almost nobody has researched it thoroughly enough

to be accurate.

Q: Please tell the Judge wherein Mr. Stanley is

wrong.

A: Okay, Well, If I understood his testimony, and

again, it’s difficult to get in his head and under-

stand what he meant to Say, but if I understood his

testimony, he said that the first trust that my

mother and father had would have effected the

same tax savings as we had with the amendment.

And that’s totally wrong.

The first trust my mother and father had

would have effected no estate tax savings, if we had

just left that trust in effect the way it was in effect

prior to us making the second amendment, other

than the fact that the amount of cash that had been

put into my father’s estate would have gotten in-

volved in those trust calculations. But the bottom

line of it is, on the original trust everything in my

father’s estate would have passed into my mother’s

estate.

Now Mr. Lonnie Stanley was correct that

there would be no estate tax upon my father’s death

and there would be no probate upon my father’s

death simply because those cash assets that we had

put in the original trust would have passed to my

mother under the original trust, through the trust,

outside of probate. The other assets that would

have been passed outside the trust upon my father’s

death would have avoided probate simply because

they were joint assets and would have passed to my

mother as the remainder of the two jointly owned --

joint owners. So we would have avoided the pro-

bate upon my father’s death in either case.

ut that’s not the thing that’s important.

What’s important is what do you finally do when

everything is accounted for? The final accounting

comes when the second of those two joint owners

dies. That’s when the IRS calls in and wants their

money for estate taxes. And that’s when the estate

would have had to be probated for all assets that

were outside the trust, as there are substantial

assets outside this trust currently.

So it’s not enough to look at it in the begin-

ning stages, you have to look at the final stage to

determine the proper estate planning. And in that

respect, Mr. Lonnie Stanley’s testimony was very

misleading, as far as it went.

1T. 212: Lon Jr. testifying.

BY MR. FIELDS:

Q: Mr. Willoughby, in accordance with my request

in preparation for today, have you prepared a

services report, a synopsis, of your activities relat-

ing to this trust and your problem with your co-

trustee and the other beneficiary?

A: Yes sir. I tried to prepare what essentially is a

brief summary.

Q: Is this the document?

A: Yes Sir, it is.

Q: If I can ask you to be , again, brief and summa-

rize this more briefly -- Your Honor, I'd like to have

this entered, his summary.

MR. SMITH: It it'll save time by introducing this,

that’s fine.

THE COURT: Any objection?

MR. SMITH: None, Your Honor.

THE COURT: Mark it.

MR. SMITH: I think it’ll save time.

THE COURT: Be number nire.

(THEREUPON, the document was marked as

Defendant’s Exhibit Number Nine by the Clerk)

BY MR. FIELDS:

Q: Now, Mr. Willoughby, I asked you if you could

please be even more brief than that and teil the

Court essentially of the problems which faced you

and why you considered that it was time that you

charged your co-beneficiaries and yourself with the

fee and what fees were charged.

THE COURT: Is this included in the summary? Is

this included in the summary?

MR. FIELDS: I’m just asking -- I think it is, Your

Honor.

THE COURT: Well, if I’m going to read the

summary, do I have to listen to this again? Which

one do you want me to do?

MR. FIELDS: Read the summary, Your Honor.

BY MR. FIELDS:

Q: Mr. Willoughby -- forget what all is in that --

did you include that in your research into fees

charged by trust departments?

A: fs that written in the summary?

©: Yes.

A: Ihonestly do not recall. I don’t believe it is.

QO: Well, I don’t believe it is. Can you please teil us

then what if any research you have done in order to

ascertain what the corporate trustee in the south-

east would charge for the services of managing this

trust?

A: Yes sir. In Jacksonville, Florida, I have met

with trust officers for Barnett Bank, First Union

Bank, First National Bank of Florida, Sun Bank,

and I have ~~ from NCNB Bank in South

Carolina, the fee structure for NCNB Bank of

Florida. And I discussed with those four bank trust

officers in detail, some of those discussions lasted

an hour with just one bank. We went into great

detail about what their charges would be under

numerous circumstances including management of

the Penn Oaks Apartments in DeLand, etc.

Q: Based upon that research, were you able to

ascertain what it would cost you and your co-

beneficiaries of these trusts for a corporate trustee

to manage this trust in lieu of yourself?

A: Yes sir. I can summarize that very briefly. Two

banks charge the lowest fees. One of those is

Barnett Bank and the other one is First National.

Or Florida National. I’d have to look at the records

to be sure whether it’s First National or Florida

National, but in any case, I can tell you what the

lowest rate is. The lowest rate is 1% of the gross

net asset value of all trust assets.

So if the trusts’ gross value is, well say, sixty-

five, $650,000, then they charge a 1% fee per year to

or those assets. In other words, that would be

$6,500. But because this is a living trust that cur-

ape has co-trustees, if they were to begin manag-

ing that they charge -- all of those institutions, all

five of them, insist on charging what’s called an

assumption fee and for most of those that is a 1%

fee also. So they would charge $6,500 just to start.

Then they charge another $6,500 per year

and most of them want this paid on a quarterly

basis. Now when I say paid, they automatically take

it out of the trust. They don’t have to wait and get a

check for their services the way I’m still waiting to

pet a check for mine, for all oo fees. I’ve never

een paid. They automatically take it out up front

before the beneficiaries receive anything. And then

whatever the net income is after their fees, then the

beneficiaries are paid on whatever terms are

established in the trust agreement. Whether it be

monthly or quarterly.

"33

Q: After you ascertained that you were having

sufficient problems, upon what basis did you discuss

with your Brother that you thought you should now

be paid for your services?

A: Well, I explained to him in my letter, which is

dated in April of 1988, that I had had tremendous

problems with him, that he had failed to do his duty

as a co-trustee even on the small, simple things.

Q: In what way do you think he’s failed?

A: Well, at that point in time, I had been working

on the trust tax returns for the tax year of 1987.

This was in the spring of 1988. And he receives

bank records from two banks holding trust ac-

counts. One from Security First Federal and one

from First Union.

So as a result of them sending those records

to him, and he and signed papers to the effect that

they would send those papers to him, and then I

received bank records on about seven accounts.

He gets record on two, and I’get them on seven. But

on the two that he received, he also gets the Substi-

tute Form 1099 which shows how much interest

income that bank trust accounts has -- had reported

to the Internal Revenue Service directly by the

bank. Well, whoever does your tax returns needs

that form in order to verify how much tax should be

reported on that tax return from that account.

He had not sent me both of the 1099’s Substi-

tute 1099 Forms, that I needed. He had sent me

one of them back in February of 1988. The other

one had never come, so I wrote him and asked him

to send it to me. I received that form 25 days after |

mailed the tax return to him.

In addition to that, he was withholding my

own personal checks, beneficiary checks. He had

withheld those in December. He withheld them

again in January of 1988. And we had had several

conversations in that regard.

Q: What explanations did he give you for withhold-

ing your beneficiary's checks?

A: He told me that under the terms of the trust he

didn’t have to pay me one dime unless I needed the

money, and that I would get my checks whenever he

felt like it.

And I explained to him very calmly that he

and I both, as co-trustees, had a responsibility

under this trust to distribute all the net income ona

monthly basis. And that he was supposed to sign

those checks if they were in the right amount, and

send them out to me just like he wanted me to sign

the checks to Mother. He had no —. with

sending the check to Mother, but he didn’t want to

send me my check because he was being very stub-

born and very hard-headed, and he felt like -- that

he had the right as a co-trustee to withhold my

checks. And I explained to him that’s not what the

trust says. Both of us have a joint responsibility to

distribute those net income checks if they’re in the

right amount or currently due. But I didn’t get my

check for a couple of weeks, and finally he decided

-- aS a matter of fact, I didn’t get them for quite

some time in December.

So he and I had another conversation in

January when he called me, and he insisted at that

point in time that I agree to pay off all of the funds

that are in the trust, distribute those funds out, and

do away with the trust as soon as the Penn Oaks

mortgage note was paid.

ow what he was referring to was in the fall

of 1987, the people who have the mortgage note on

the Penn Oaks wanted to renegotiate with us the

12% interest rate. And we did not agree to lower

that rate to 9% like they asked us to do. And so

they went outside and tried to find someone else

that would give them a second mortgage note at a

better interest rate than 12%. And then they were

going to pay off that balloon note.

Q: They wanted to discount it?

A: They wanted to discount it, and I had informed

them that if they did that, there was to be a $26,000

penalty for paying it off prematurely that I had

personally written into the sales contract so that

they could not pay it off within the first five years

without that penalty. But they could pay it off after

five years without penalty. This was within that first

five year term.

So I reminded them, you have a penalty here

if you want to pay it, but, of course, you’ve got a

right to pay it off and get someone else to refinance

the second mortgage. So all of that was going on,

and we were reasonably confident that they were

probably going to get financing, and so the Penn

oaks mortgage not would be paid off either in the

fall of 87 or sometime in ’88.

Q: And your co-trustee then wanted to terminate

the trust?

A: And in that phone conversation, which is a

recorded conversation, which I have a tape of, he

insisted that I agree right then and there on the

phone that I would agree to distribute all the funds

out of the trust as soon as that mortgage note was

paid off, and that we would do away with these

trusts, and that if I didn’t -- and I told him, I said,

look, it’s not my practice as a businessman to make

decisions before they need to be made.

I have a general rule. I make decisions in a

timely manner when I think they need to be made. I

don’t make them weeks, or months, or years before

they need to be made. And I said, "I’m not going to

agree to do that at this point in time." I said, "We'll

make that decision whenever it needs to be made.

It does not need to be made today."

He got very adamant with me in that phone

conversation, became extremely insulting, and this

phone conversation went on for quite some time.

I tried to remain calm and cool and keep

bring him back constructively to our responsibility

as co-trustees as I had done numerous times in my

letters to him, trying to help him maintain a respon-

sible co-trustee position even though he himself

wasn’t familiar with what was in the trust.

He was quoting things out of the trust off the

top of his ‘oh that were totally invalid. And he

got very heated in the discussion, and he told me

that -- he said, "I can’t work anything out with you."

He said, "You’re worse than my Father ever was to

talk to," and he went on and on and on.

Q: Was he attempting to do something that was

contrary to the terms of the trust?

QO: Yessir. There was nothing in the trust about

paying off that mortgage note, and we'll terminate

the trust, and we’l]l distribute all the income.

These were demands that he was placing on me,

totally outside of our responsibilities as co-trustees.

Q: Do you believe that you can maintain the trust

in the best interest to all beneficiaries if you would

remain the sole trustee?

A: Yessir. I could maintain this trust very cost-

effectively and efficiently if | did not have to con-

tend with my Brother and if we could resolve my

Mother’s fears and doubts with regard to her

income. And I think I can probably do that today in

testimony.

Q: You’re familiar with the law and you’re familiar

with the trust?

A: Yessir. I am very familiar with it.

Q: riave you followed the dictates of them as far as

you know’

A: To the best of my knowledge and understand-

ing, | have followed these trust requirements and

the Florida trust law, which I have -- as I testified

earlier -- I’ve got copies of the Florida trust laws.

And I have followed those as honestly and respon-

sibly as I know how to do as a human being.

It has been a nightmare. It has cost me a ton

of money out of my own personal life, but I do it

because I understand this. The very first and most

important responsibility as trustee is to allow

nothing to interfere with him accomplishing his

trustee duties.

MR. FIELDS: Thank you. I have nothing further.

1T. 249: Tito Smith’s closing argument.

The point, Your Honor, that we’re attempt-

ing to make is that the amendment drawn by Mr.

Willoughby did one thing and one thing only, and

that was - it added to his position. I don’t believe

that there was any tax savings, there was any

changes as far as the Internal Revenue Service was

concerned by the amendment. The only difference,

the only significant difference being that instead of

mama drawing the income off of that, those trust

funds, now she only draws a percentage of it. A

relatively small percentage of it.

Now I recognize the fact that one of the

things the plaintiff has to prove in this case is

mismanagement. And I think the law on that Is

relatively clear, and I would like to give the Court a

number of cases on the law, some of which Mr.

Fields referred to himself. I don’t know if the Court

wants copies of these or just citations, but I think

that what we have to demonstrate is that the trustee

has failed to perform or has performed arbitrarily

or has mismanaged this trust.

I think that the evidence clearly presents

that. It clearly shows that. Particularly in two sig-

nificant areas. One is that Lon decided when he

interpreted the trust provisions that he had drawn

upon Dad’s death that we weren’t going to put 34%

into Mom’s Marital Trust, we’re only going to put

27% in there. And he did it with a rationalization

obviously false now that this was saving taxes.

He, for whatever reason, never got the two

estates, hers, Mrs. Willoughby’s and Mr. Willough-

by’s equal, 50-50, as they had requested. And I

think that if he had done that he would have

achieved the settlor’s objectives, which was to leave

50% of their joint assets to Mama, and one-third of

50% of those assets to Mama, one-third to each one

of his two sons.

Even his expert will testify, and you'll see it

when you read his deposition, that in fact 34% is the

correct amount. The CPA has testified to that as

well.

The other really more major in my mind area

of mismanagement is when he decided unilaterally

in 1988 after no fees having been charged and after

making a statement to his Mom and his Dad to let

your sons serve as co-trustees, we’re grown men,

we'll take care of you, and we won’t charge you any

fees like a bank would, now in 1988 he’s decided

that because he hasn’t gotten along with his Brother

for a while and he hasn’t gotten along with his

Mama for a while, he’s going to start charging fees.

He decided this unilaterally, and then he decided

on top of that that until his fees are paid, or as he

calls them, administrative expenses, then there is

not going to be any income distribution.

Well, as a trustee you’ve got a fiduciary

responsibility to your income beneficiary. And I

think that he directly affected Mom’s income and

deprive her of her right to that income for a period

of ayear. And I think again the Court file reflects

that when he made -- finally made that distribution

in April of 1989, it was because he just got served

with process in this case. If we hadn’t instituted this

litigation, this stalemate might continue. And who

does the stalemate benefit?

It adds to the trust which are ultimately dis-

tributed upon Mom’s death to the two sons.

I think that’s clear, arbitrary mismanagement

of the trust. I think what the testimony and the

evidence has shown with respect to Lon Willoughby

is a man that since he left the FAA has in some

fashion or another lived off Mom and Dad.

He came down, he worked with the Penn

Oaks Apartments. That’s Mom and Dad’s apart-

ments. He made a living off of that. He made an

income off of that. In addition, he received 30% of

the proceeds when that was sold.

And that’s continued today. And now at this

— in time he’s attempting to fice off of the trust.

he trust has clearly become an obsession with him.

If your look at his files, you look at his documents,

you listen to his testimony, he does nothing but

attempt to be a trustee in this trust, trying to take

care of Mama and Brother and himself.

And I think that he’s allowed that position to

cause him to get into a conflict of interest situation.

In other words vege the less money he can put in

Mom’s pocket, the more money he can put in his

own. Now I’m not trying to say that Mr. Lon Wil-

loughby, Jr., is a bad man, I’m just trying to Say that

that’s the facts as we have them today. He’s in a

conflict of interest situation and I think he ought to

be removed as trustee.

Appendix F

PAROL EVIDENCE REFERENCES

Black’s Law Dictionary, Sixth Edition:

This evidence rule seeks to

preserve integrity of written agreements by refus-

ing to permit contracting parties to attempt to alter

import of their contract through use of contempo-

raneous oral declarations. Vv ir

Stores, Inc., 437 Pa. 117, 262 A.2d 851. Under this

rule when the parties to a contract embody their

agreement in writing and intend the writing to be

the final expression of their agreement, the terms

of the writing may not be varied or contradicted by

evidence of any prior written or oral agreement in

the absence o frend, duress, or mutual mistake.

tors, 76 Wis.2d 151, 250 NW. 20362,365 But rule

does not forbid a resort to parol evidence not

inconsistent with the matters stated in the writing.

t Co.; Tex.Civ.App.,

157 S.W. 2d 946, 947. *****

This rule is also applicable to wills and trusts.

xe e284

THE LAW OF TRUSTS (Scott), Fourth Edition

Section 38. The Parol Evidence Rule

Second paragraph: Under the parol evi-

dence rule, if ies manifestations of intention of the

settlor is integrated in a writing, that is, if a written

instrument is adopted by him as the complete

expression of his intention, extrinsic evidence, in

the absence of fraud, duress, mistake, or other

ground for reformation or rescission, is not admis-

sible to contradict or vary it. (Federal) Estate of

Craft vy. Commissioner, 68 T.C. 249 (1977)

Section 164.1. The terms of the trust.

Second paragraph: In determining the terms

of the trust, resort is had in the first place to the

instrument, if any, under which the trust is created.

As to any matter expressly covered by the

instrument, the provisions of the instrument, if

unambiguous, determine the terms of the trust. In

such a case extrinsic evidence in the absence of

fraud or mistake is not admissible to vary or add to

the terms of the instrument.

England: Inre Huxtable, [1902] 2 Ch. 793.

Federal: Commissioner of Internal Revenue v.

Melivaine, 78 F.2d 787 (7th Cir. 1935), affirmed sub

nom.; Aclvering v.Mclivaine. 296 U.S. 488, 56 S.Ct.

332, 80 L., Ed. 345 (1936); Petition of United States

Behalf of Smit) . I

485 F. Supp. 1222

(D.C. 1980) (quoting the text)

FLORIDA CASES:

When the terms of an instrument are clear

and unambiguous there is no need for the court to

construe the instrument. *** intent of settlor

should not be determined by isolated words and

phrases, but, rather, the instrument as a whole

should be considered and testator’s general plan

interpreted. Fj Nati Florida v

Moffett, 479 So.2d 312 (Fla. Sth DCA 1985)

It is the intention which the settlor expresses

in the trust instrument which controls, not that

which he might have had in mind when the trust was

executed. [lesv, Iles, 29 So.2d 21 (1947)

*** the fact remains that the court was not entitled

to rely on extrinsic evidence of the settlors’ intent

concerning an unambiguous trust instrument.

In construing wills and trusts, the intent of

the testator or settlor should prevail and effect

oh to his wishes. Knauer v, Barnett, 360 So.2d

399 (Fla. 1978)

Appendix G1

DUE PROCESS CITATIONS

U.S. Supreme Court Cases

Armstrong v, Manzo, 380 U.S. 545, 85 S.Ct. 1187

(1965); 14L.Ed.2d 62 (1965)

85 §.Ct. 1191 [6] A fundamental require-

ment of due process is "the opportunity to be

heard.” Grannis v, Ordean, 234 U.S. 385, 394, 34

S.Ct. 779, 783. It is an opportunity which must be

granted at a meaningful time and in a meaningful

manner. The trial court could have fully accorded

this right to the petitioner only by granting his

motion to set aside the decree and consider the

case anew. Only that would have wiped the slate

clean. Only that would have restored the petitioner

to the position he would have occupied had due

process of law been accorded to him in the first

place. His motion should have been granted.

For the reasons stated, the judgment Is

reversed, and the case is remanded for further

proceedings not inconsistent with this opinion.

Marshall v. Jerrico, Inc, 446 U.S. 238, 100 S.Ct.

1610, 64 L.Ed. 2d 182, (1980)

100 S.Ct. 1613: The Due Process Clause entitles a

“sieeegee to an impartial and disinterested tribunal in

oth civil and criminal cases. This requirement of

neutrality in adjudicative proceedings safeguards

the two central concerns of procedural due process,

the prevention of unjustified or mistaken depriva-

tions and the promotion of participation and

dialogue by affected individuals in the decision

— process. See Carey v. Piphus, 435 U.S.

247, 259-262, 266-267, 98 S.Ct. 1042, 1043, 1050-

1052. 1053, 1054, 55 L.Ed.2d 252 (1978) At the

same time, it preserves both the appearance and

reality of fairness, "generating the feeling, so

important to a popular government, that justice has

been done," Joint Anti-Fascist Committee v.

McGrath, 341 U.S. 123, 172, 71 S.Ct. 624, 649, 95

L.Ed. 817 (1951) Frankfurter, J., concurring), by

ensuring that no person will be deprived of his

interests in the absence of a proceeding in which he

may present his case with assurance that the arbiter

is ROt predisposed to find against him.

Indeed, "justice must satisfy the appearance

of justice.,” Offutt v, United States, 348 U.S. 11, 14,

75 $.Ct. 11, 13, 99 L.Ed. 11 (1954)

Mull; & anov ‘ 2., 339

U.S. 306, 70 S.Ct. 652 (1950)

70 S.Ct. 656 [4] **** Many controversies

have raged about the cryptic and abstract words of

the Due Process Clause but there can be no doubt

that at a minimum they require that deprivation of

life, liberty or property by adjudication be preceded

by notice and opportunity for hearing appropriate

to the nature of the case.

Page 657 [7] Against this interest of the

State we must balance the individual interest

sought to be protected by the Fourteenth Amend-

ment. This is defined by our holding that "The

fundamental requisite of due process of law is the

reo a to be heard." Grannis v, Ordean, 234

U.S. 385, 394, 34. S.Ct. 779, 783, 58 L.Ed. 1363. This

right to be heard has little reality or worth unless

one is informed that the matter is pending and can

choose for himself whether to appear or default,

acquiesce or contest.

Page 657 [8] An elementary and fundamen-

tal requirement of due process in any proceeding

which 1s to be accorded finality is notice reasonably

calculated, under all the circumstances, to apprise

interested parties of the pendency of the action and

afford them an opportunity to present their objec-

tions. Milliken vy, Meyer, 311 U.S. 457, 61 S.Ct.

339, 85 L.Ed. 278, 132 A.L.R. 1357; Grannis vy,

Ordean, 234 U.S. 385, 34 S.Ct. 779, 58 L.Ed. 1363.

ri wn_ of

232 U.S. 604, 34 S.Ct. 443, 58 L.Ed. 751; Vv

Holly, 176 U.S. 398, 20 S.Ct. 410, 44 L.Ed. §20.

The notice must be of such nature as reasonably to

convey the required information, Grannis v.

Ordean, supra, and it must afford a reasonable time

for those interested to make their appearance,

Roller v, Holly, supra, and cf. !

214 U.S. 71, 29 S.Ct. 580, 53 L.Ed. 914.

Peralta v, Heights Medical Center, Inc., 108 S.Ct.

896 (1988)

Page 900: "it is no answer to say that in his

particular case due process of law would have led

to the same result because he had no adequate

defense upon the merits" Coe v, Armour Fertilizer

Works, 237 U.S. 413, 424, 35 S.Ct. 625, 629, 59 L.E.

1027 (1915). As we observed in Armstrong _v.

Manzo, supra, 380 U:S., at 552, 85 §.Ct., at 1191,

only "wip[ing] the slate clean... would have restored

the petitioner to the position he would have occu-

pied had due process of law been accorded to him

in the first place." The Due Process Clause de-

mands no less in this case.

Appendix G2

DUE PROCESS CITATIONS

Florida Cases

, 390 So. 2d 704 (Fla. 1980) states

on page 706, 707 that:

This court, as most jurisdictions, adopted

discovery as part of our procedural rules to improve

Our system of justice. It is a tool intended (1) to

identify at early stages of a proceeding the real

issues to be resolved; (2) to provide each party with

all available sources of proof as early as possible to

facilitate trial preparation; and (3) to abolish the

tactical element of surprise in our adversary trial

process. In Surf Drugs, Inc. v. Vermette, 236 So.2d

108 (Fla. 1980) we stated that the primary purpose

of our rules is to prevent the use of Surprise, trick-

ery, bluff and legal gymnastics. Revelation through

discovery procedures of the strength and weakness-

es of each side before trial encourages settlement

of cases and avoids costly litigation. Each side can

make an intelligent evalantins of the entire case

and may better anticipate the ultimate results.

3riffin V. Griffin.

463 So.2d 569 (Fla. lst DCA 1985)

(TRUST LITIGATION)

[1] Issues in cause are made solely by pleadings.

[2] Once issues have been fixed by pleadings, they

may be changed only by stipulation of the parties,

motion and order, or amendment express or im-

plied to conform to evidence.

[3] In absence of motion to amend pleadings, trial

court erred in ruling on trustees’ obligatiors to

minor trust beneficiary where that issue had not

been raised in the pleadings and where timely

objections alleging prejudice to efforts to interject

evidence on issues of payments to that beneficiary

had been made.

r :

159 So. 2d 236 (Fla. 1963) states:

[3] Issues in cause are made solely by pleadings.

[5] Pleadings are intended to present, define and

narrow issues and to form foundation of, and to

limit, proof to be submitted on trial and objective

sought is to reach issues of law and fact in one

affirmative and one defensive pleading.

This purpose will not be served nor this objec-

tive achieved if operative issues, as distinguished

from evidential issues, are allowed to be created

outside the aprey in depositions, admissions,

affidavits, and the like, which may be filed in a

cause. If this were allowed neither the parties nor

the court would be able to say with certainty what

the triable issues in a cause are.

[6] only instance in which legal issues not raised in

pleadings may be decided is where issue, although

not pleaded, is tried by consent of parties.

‘ y .

202 So. 2d 810, 815-816 [6,7] (Fla. 3rd. DCA 1967)

(TRUST LITIGATION).

On page 816, this court refers to R.Civ.P.

1.15 (b) ***[1.190 (b) is current rule] *** and

explains that when objection was made to new issue,

and appellee Be gnege no amendments to the trial

judge upon which he could make a ruling, the new

issue could not be tried.

Appendix H

TRUST ADMINISTRATION CITATIONS

2d., Section 242 (page 605) provides a clear expla-

nation of the trustee’s compensation claim status.

See Paragraph 242 e. which states:

Lien for compensation. The trustee need

not pay over income without deducting the compen-

sation to which he is entitled with respect to the

income, and need not pay over principal without

deducting the compensation to which he is entitled

with respect to the principal. To this extent the

trustee has a security interest in the trust property

for his compensation.

Similar statements to that above are made in

, Scott, Section 242.3: Bogert,

Trusts and Trustees, Sections 972, 974; 90 C.J.S.

Trusts, Section 406: and 76 Am Jur 2d. Trusts,

Section 523 - §34.

Smith v, Jones, 162 So. 496 (Fla. 1935)

Quotes from page 498:

[3] Courts of chancery have the inherent

hae in dealing with trusts, to he ee payment out

of the trust fund to the trustee, of all his necessary

costs, expenses, and reasonable counsel fees for

defending the trust estate, and in order that its

decree shall be enforced, may declare a lien on the

trust estate for such payment, and may also make

provision for the sale of the trust property or so

much thereof as may be necessary to ay the same.

Bay Biscayne Co. v. Baile. 73 Fla. 1120, 75 So. 860.

[4] The general rule is that the expenses of

properly administering trust are a lien on behalf of

trustee for estate in his hands, and he will not be

compelled to part with his control of estate until

such expenses are paid. Bay Biscayne Co. v. Baile,

supra.

Regarding reimbursement of attorney fees

and cost for trust litigation, "Scott On Trusts"

(1939), shows longstanding trust administration

policy: currently reported as The Law of Trusts

(Scott), Fourth Ed.

Section 246, Liability upon contract: page

1422: "* * * Where the trustee acting within his

powers makes a contract with a third person in the

course of the administration of the trust. although

the trustee is ordinarily personally liable to the

third person on the contract, he is entitled to

indemnity out of the trust estate. If he has dis-

charged the liability out of his individual property,

he is entitled to reimbursement; if he has not dis-

charged it, he is entitled to apply the trust property

in discharging it, that is he ts entitled to exonera-

tion. Thus, where the trustee has properly em-

ployed an attorney in litigation oe the trust

estate, he may pay the attorney out of the trust

estate, or if he has paid him out of his individual

property, he is entitled to reimbursement out of the

trust estate. If the trustee has acted properly in

incurring the expense, he is entitled to indemnity

hit turns Out that the trust estate is not

benelited thereby. The mere fact that the litigation

is unsuccessful does not preclude the trustee from

obtaining indemnity out of the trust estate, provid-

ed that he was acting within his powers in incurring

the expense." [Emphasis added]

Additional guidance regarding trust litiga-

tion is provided by "Restatement of the law, Trusts

2d" Sections 178, 244, 245, 246, and 200 e., 194 a.

(2nd para.), and 167, 251, 253, 254, 254 e., and 258.

Also see 76 Am Jur. Trusts, Sections 653 through

659.

90 C.J.S. Trusts, Section 232 states:

232 a. In General: Broadly speaking, the

only ground for removal of a trustee is jeopardy to

the trust or trust property. Some beneficial end

must be achieved by removal of the trustee or it will

not be justified. ** Trustees are not to be removed

unless the facts disclose violation of the trust obli-

gation or unsuitableness **. Unless the protection

of the estate requires the court to displace a trus-

tee, vested with a discretion by the creator of the

trust, this should not be done. ** Some substantial

reason must 2ppear, and a trustee will not be

removed at the mere whim or caprice of the benefi-

Ciary, Seeeseses

232 c. (1) Antagonistic and Hostile Rela-

tions: A contingent remainderman will not be

removed from trusteeship on the ground of adverse

interest where he was designated trustee by the

creator of the trust, but will be removed for advers

interest where not so designated. In re Weller’s

Estate, 108 N.E. 306, 267 Ill. 230

Shirk et al.v. Walker, 10 NE(2d) 192 (Mass. 1937)

[8] A trustee was not required to be removed on

— that he had become unsuitable because he

ad aroused permanent and justifiable hostility of

income beneficiaries, where it was found, that one

of income beneficiaries entertained some hostility

towards trustee, trustee had no hostility towards

such beneficiary, and his relations with other

income beneficiaries had been friendly except as

affected by bringing of suit.

[11] The existence of hostile feeling on part of

beneficiaries towards a trustee does not relieve

court of its duty to exercise its best judgment under

all the circumstances.

12] A trustee is not required to be removed

ecause of hostile feeling of beneficiaries toward

him, where such feeling does not interfere with

proper administration of trust.

Sate (page 197) The facts established do not call

or the removal of the trustee. There is no fraud or

dishonesty. There is no incapacity or negligence

which might indicate future peril to the trust

property. There is a long record of faithful and

efficient administration. The trustee has acquired

a valuable experience of the renting capabilities of

the building. At most there may have been a few

errors of judgment or of law as to matters about

which honest and intelligent opinions might differ,

and these would be capable of easy correction and

after a final decision of the court would not be

likely to be repeated. In such cases courts do not

commonly remove the trustee, especially when he

was selected by the original settlor and not by the

court itself. Murdock v. Elliot, 77 Conn. 247,

256,58 A. 718; Crabb v. Young, 92 N.Y. 56, 66 et

“4 Wylie v. Bushnell, 277 Ill. 484, 505, 115

N.E. 618; Waller v. Hosford, 152 Iowa 176, 130

N.W. 1093; Preston v. Wilcox, 38 Mich. 578, 582;

Wilson v. Smoot, 186 Ky. 194, 199., 216 S.W. 129;

Massey v. Stout, 4 Del. Ch. 274; Smith v.

Heyward, 115 S.C. 145, 164, 105 S.E. 275; Nickels

v. Philips, 18 Fla. 732; Am. Law Inst. Restatement;

Trusts, Section 107 (a) comment f.

Page 197: There are many trusts in which no trus-

tee could fully perform his duty without incurring

the hostility of some of the beneficiaries. This case

bears little resemblance to Comstick v, Bowles

(Mass.) 3 N.E. (2d) 817.

Appendix "I"

MARION BEACHAM REPORTS

Selected sections from two affidavit reports;

the first report, eight pages, dated August 22,1989,

was presented at trial (9.76/89) and is fn the appeal

record; report dated October 20, 1989, eight pages,

was presented with Lon Jr’s

after the trial, and it is also in the appeal record.

Appendix "I" 1

Affidavit Report, August 22, 1989

(Report written to Attorney Alan Fields, Jr)

Starting at Page 4, second paragraph:

In all my years, I cannot remember any situa-

tion similar to the one at hand where an individual

trustee has worked as hard as Lonnie Willoughby,

Jr. has with this trust. He had devoted an enormous

amount of his time and talents to understanding

complex fiduciary tax rules, estate tax laws, estate

gee Florida probate law, general fiduciary

aw, investments and the law of mortgages. He even

has a working knowledge of the rules of civil proce-

dure. All of these activities go far Saond what

normal laymen would do if they were asked to serve

as a trustee.

I think you would agree that Lon’s allegiance

to the trust and to his duties and responsibilities is

extremely unusual. He takes his job very seriously.

Even though he is a family member, he has reached

a point where I think it can be said that he has

almost become detached from the emotions usually

found in such relationships and elevated himself to

an almost unbiased status, similar to what is usually

the case when corporate fiduciaries serve as trus-

tees. At the bank, we often have to make tough

decisions when our discretionary judgment has to

be exercised. How many of us could truly deal with

our mothers in a totally unbiased fashion as Lonnie

has often done?

All of Lonnie’s work and detailed knowledge

of the trusts and what needs to be done has gone

unappreciated by Larry and Leona. Indeed, they

appear to resent it and him. This trust has virtually

been Lonnie’s life for the past three or four years.

Every step of the way, he has attempted to make

well-reasoned decisions and recommendations to

Larry and Leona. There is no one in my opinion,

inal or outside of the family, who will ever have

the intimate knowledge that Lon has gained about

his duties and the purposes of the trust. This trust

would not receive the kind of attention and dili-

gence that Lon has given it from anyone else.

The complaint asks the Court to remove Lon

because he stopped making income distributions to

Leona. If the Court would allow it, I think that this

bone of contention could easily be overcome by

introducing evidence showing what assets Mrs.

Willoughby has and her other sources of income.

At this point and in her present circumstances, she

would appear to be able to operate her financial

affairs independently from the trust. I think Lon

acted grsteny | in his actions in this regard even

though neither Leona nor Larry agreed with him.

This was a very tough thing to do but understand-

able to me if you properly assess the totality of the

circumstances. He had to have an income reserve

to make sure that there would be enough available

to meet certain future expenses. This is normal

trustee behavior as the majority of time an income

beneficiary receives a "net" amount each month,

which can either be a set amount based on project-

ed income and expenses for a year’s time for the

trust or a variable amount which is distributed each

month after that month’s expenses have been

deducted.

What Lon did or proposed to do should cer-

tainly not be considered unusual, abusive, or

outside the scope of his responsibilities under the

trust. Indeed, it would be quite embarrassing to

have to approach a beneficiary about reimbursing a

trust because the trustee did not retain sufficient

funds to meet the trust’s obligations. None of this

was arbitrary or capricious on Lon’s part.

The fiduciary tax returns are another area

that has caused the rift between the trustee broth-

ers to widen. Unless we happen to be working with

a co-trustee who is also a CPA, almost without

exception do we ever see any individual who has any

idea about how these returns are prepared or what

constitutes income or principal. Most of the time

just knowing that a fiduciary must file income tax

returns and when they are due is the extent of

knowledge for most individual trustees. In the

Willoughby situation, you have a trustee who has

gone far beyond these bounds and learned about an

area of tax law that can be confusing and often

times perplexing.

Lon, from the beginning, has acted fairly with

all parties. He has kept them well-informed about

trust matters. He has been diligent in upholding

the purposes of the trust and preserving and pro-

tecting the trust principal. He is a man who has

taken his job seriously. On the other hand, Larry

has been much less attentive to the trust and, at

times uncooperative. In what shape would this

trust be in if Larry was the sole trustee? In my

opinion, I think Larry would probably have done

what most individual trustees do and that is, he

would have relied on attorneys, CPAs and perhaps

other investment advisors to "run" the trust for him

and furnish the basic expertise to get the job done.

I think that he would be the first to tell you that he

would not have had the time nor would he have

taken the time to absorb as much knowledge as Lon

has over the past few years. I may be giving him the

benefit of the doubt on this, but I have to believe

that he would have been diligent enough to at least

"farm out" these responsibilities as opposed to

ignoring his responsibilities altogether.

One certain fact of life in all of this is that

this trust is irrevocable and it will continue to exist

for an indefinite period of time. It is an almost

universal principle of law that a trust will not be

allowed to fail for want of a trustee. In this case,

you have one person who is truly willing and, with-

out question, in my mind, able to do the job in an

efficient, cost-effective fashion. He has an inti-

mate familiarity with the assets and the terms of the

trust. He has an excellent background in invest-

ments and investment vehicles. He knows his

mother’s needs and what assets she has at her

disposal. He is intensely serious about this whole

matter. It would be an injustice to Lon to have him

removed for doing what amounts to an incredible

job, an incredible job the right way. I can say in all

honesty that he ian served faithfully and above

reproach.

On the matter of compensation, it would be

ludicrous to deny that Lon was entitled to compen-

sation, so the only argument should be about the

amount of compensation. This man has spent

hundreds of man-hours in research, preparing

documentation, and in dealing with the problems

that have arisen. Rightfully or wrongfully, he has

foregone opportunities to increase his own net

worth just to immerse himself in the affairs of the

trusts. Such devotion to duty is truly remarkable

and extraordinary.

eee+e+**+ Ft

Page eight (final page)

In concluding all of this, I hope that what I

have said will be of some value to the proceeding at

hand. Even though I have personally only met with

Lon, I have tried to be objective in this exercise.

Lon has given his job a superhuman effort far

beyond what most individuals would do under the

circumstances. As near as I can tell, he has carried

out his responsibilities extremely well under diffi-

cult circumstances. I have been absolutely amazed

by the infinite amount of detail he has recorded.

At this point, he has become well-versed in virtually

tg aspect of trust administration. He has saved

his family an enormous amount of money in tax

Savings in his orchestration of the set-up and

administration of the trust. He has been zealously

faithful to his father’s wishes, and he has done his

dead-level best to promote an understanding of all

that is involved with his mother and brother. I hope

the court will be supportive of his efforts and allow

him to continue to serve as a trustee at fair com-

pensation.

Please let me know if your have any questions.

/s/ Marion Beacham, Jr.

Vice President and

Trust Officer

(NCNB Bank, Greenville, S.C.)

Appendix "I" 2

MARION BEACHAM’S SECOND AFFIDAVIT REPORT

NCNB

Greenville Trust Offices

P.O. Box 608

Greenville, SC 29602

Télephone 803 / 271-5803

October 20, 1989

Lonnie E. Willoughby, Jr.

307 Poplar Lane

P.O. Box 127

Greenville, South Carolina 29662

Re: Review of Willoughby Trial Transcript

September 6, 1989

Dear Lon:

As you requested, I have completed my review of

the testimony transcribed on September 6, 1989, (a

copy of which you furnished me on October 13,

1989) in the suit filed by your mother to have you

removed as a co-trvstee of the trust agreement

between your father and you and your brother, as

the co-trustees. In the following paragraphs, I will

attempt to briefly give you my opinion of the testi-

monv presented, particularly with regard to the

estate planning aspects of what was done and the

conflicting information that evolved that day over

the proper amount to be funded into the marital

trust aS a consequence of your dad’s death on

November 22, 1986.

It is obvious to me that your mother’s case against

you for mismanagement was primarily based on the

fact that you allegedly sought to deliberately dimin-

ish her hare of your father’s estate by persuading

him to execute the second amendment to the trust

agreement thereby increasing the funds available to

your. Through her attorney, she also alleged

that your actions in withholding income distribu-

tions for a period of time in 1988 were contrary to

the dictates of the trust agreement and thus irre-

sponsible actions warranting your removal. In the

same vein, both your mother and Larry seemed to

be offended that you would have the gall to charge

for your services as a co-trustee in spite of the

considerable evidence you had that charges were

justified and authorized by the clear language in

the agreement itself.

As you know, I myself have spent a large amount of

time reviewing your actions and assessing your

performance as evidenced by the attached state-

ment of charges. Apparently, my letter to your

attorney dated August 22, 1989 was never admitted

into evidence on a technicality. If you need to offer

this current letter to support a motion for a rehear-

ing or for an appeal if such should become neces-

sary, I would like to attach a copy of that August

22nd letter as a part of my assessment of this case

and in further support of my view that you have

done an extraordinary job on this trust. In other

words, I would like for it to be a part of the overall

record and submitted as additional evidence, and

incorporated by reference as a part of the present

letter, to justify your reasoning for requesting a

rehearing or for an appeal.

I have seen nothing in my investigation of this

transcript that would change any of my personal

views about your performance as expressed in that

letter.

As I read the transcript, the first thing that I found

objectionable was Mr. Smith’s contention that your

interpretation of the trust and your actions as a

family member and as a co-trustee were designed to

accomplish one objective, i.e., to reduce your

mother’s income and thus increase your income.

He contends that you falsely justified these actions

to and your brother as saving money

for the Willoughby Family by reducing or eliminat-

ing administrative expenses and estate taxes.

Lonnie Stanley, the CPA who prepared the Form

706 (U.S. Estate Tax Return), clearly appeared to

me to be confused about the finer points of estate

Mr and incapable of properly verbalizing the

effect of the second amendment on both your father

and your mother’s estate plans. He also demon-

strated that he did not understand marital deduc-

tion concepts. Since Alan Fields did little to refute

any of Mr. Stanley’s erroneous testimony, he too

showed that he had little knowledge of what the

estate plan was all about and what amounts were to

be funded into the marital trust and the family

trust.

If it would please you and the Court, I would like to

clarify these concepts and what was done by the

amendment, and thus prove that your mother’s

interest in the one family estate was not

diminished and her income was not materially

reduced.

One objective of proper estate planning is to avoid

the tax at the death of the surviving spouse. Essen-

tially, that was the purpose of the second amend-

ment - to insure the use of the full estate tax exemp-

tion in both your father and your mother’s estates

and virtually eliminate costly estate taxes.

Initially, the original trust assets placed in your

dad’s trust and your mom’s identical trusts only

comprised a small portion of their total assets.

Their joint ownership of the Penn Oaks Apartments

and the San Marco Motel was a problem from an

estate planning standpoint because these assets

would pass outside their wills to the survivor and

create the problem that I alluded to above - a sub-

Stantial part of your dad’s unified credit would have

been wasted and your mother’s separate estate

would have greatly exceeded her credit and signifi-

cant estate taxes would have been incurred at her

subsequent death.

You recognized that their original trust agreements

were incomplete and inadequate from an estate

planning standpoint. Several times in your testi-

mony reference is made to saving taxes on "this

estate." I think it is important to emphasize that

this term meant our father’s own assets, your

mother’s own assets, and the assets owned by the

two of them pointly. The original trust agreement

only accomplished a part of the overall objective of

Saving estate taxes because your mom’s estate was

still going to be far larger than the exemption or

unified credit if the planning had stopped here.

In reviewing your testimony and all of the previous

correspondence that you provided me with, it is

clear that while tng. | estate taxes was a primary

motive in developing the second amendment, it was

not the only motive. Your father was concerned

about your mom’s propensity for spending money

on dubious causes and clearly wanted to restrict the

funds that would be available to her at his death. It

was his expressed desire for the estate to be divided

three equal ways, or as close to this as possible. It

is clear from the correspondence that I have seen

that Larry was aware of this and your mother was

aware of it and was agreeable to it.

For these reasons, namely, the inadequacy of the

original trust agreement to save taxes on their total

estates and their desires for you and Larry to share

in their estates without waiting until both parents

were deceased (as would have been the case under

the original trust agreement), the second amend-

ment was prepared and executed. Simultaneously

with it, the mortgage notes on the two properties

were funded into your dad’s trust. This alleviated

the problem of the reg dep property defeat-

ing the utilization of the unified credits in both of

their estates.

There were some references in the testimony to

splitting their estates so that each would have ap-

proximately 50% of their total estates in their

trusts. I did not note that anyone had ever consid-

ered this Se in my review of the corre-

spondence. Even if each owned one-half, or 50%,

of the total joint estate, there would have still been

an estate tax problem because a large part of your

dad’s 50% would have been included in your mom’s

estate and estate tax consequences would have

resulted at her subsequent death. The use of his

unified credit would have been minimal because

there would have been a large marital deduction at

his death.

At this point, it becomes important to review

Lonnie Stanley’s testimony. It was his belief that

this second amendment was unnecessary to avoid

estate taxes. That statement was true only to your

dad’s estate as everyone understood it at the time.

The second amendment was designed to insure that

none of your dad’s unified credit ($500,000 at the

time of his death) would have been wasted. The

family trust was to contain assets valued to the

maximum limit of the credit with the balance of the

assets to comprise the marital trust. In this fashion,

both your dad and mom’s estates could avail them-

selves of each of their full unified credits and there

would have been zero estate taxes at your mother’s

death. The second amendment, which created an

ewe paragraph 5 was absolutely essential to accom-

plish the estate tax avoidance motive as you, Larry

and your mom and dad understood. r. Stanley

failed to either realize or point out this essential

fact about the second amendment.

Your mom’s attorney ereated the impression that

the amendment only served your interest by reduc-

ing the income available to her and increasing the

amount going to you and further contending that

you even underfunded her marital trust contrary to

the terms of the trust agreement.

To properly understand this, we need to review the

Form 706 and apply the language in paragraph S of

the amendment to the creation of the marital and

family trusts keeping in mind the points that I have

made.

***** two pages of mathematical calculations and

explanations of the proper method of evaluating

the proper funding of the Marital and Family

Trusts. e+e¢+44244%

Hopefully, this extensive recounting of the explana-

tion of the amendment language will clarify all of

the erroneous testimony.

As you know, you informed ru of these calcula-

tion in August of 1987 and told him then exactly

how much income would be available to your mom.

[based upon CPA Stanley’s Form 706 calculations]

At that - Leona was looking at an estate in her

right of well over $500,000 consisting of the

$308,245 by reason of your dad’s death, her own

trust of $100,000 and the balance of the "joint"

assets ($127,659).

It was ludicrous for anyone to infer that your plan-

ning deprived her of income to your benefit when

she essentially had income available to her from

various sources in excess of $3,500 per month. It

was also ludicrous for Mr. Smith to state that you

underfunded the marital interest by 7% when I have

shown it was well over 34%.

I feel that it would be unnecessary to reiterate my

comments in the attached letter since I think that it

explains why I felt your were justified withholding

income payments because they were incorrectly

calculated due to the fact that your fees would not

be considered.

Also, my comments on your fees in that letter are

about all that I can relate about that matter.

In conclusion, I would like to once again say that I

think that you have done an extraordinary diligent

job as a co-trustee for your family. You obviously

ave the experience and background concerning

investments that a trustee needs to preserve and

protect trust principal. The management of the

mortgage notes is a job some people may take for

granted, but you have performed the fiduciary

duties in overseeing this asset that professional

trustees are compelled to perform. I find that your

certainly have not acted in a capricious, arbitrary

fashion. You have tried your best to be informa-

tive, cooperative, and, above all, to act in a respon-

sible manner.

I hope that you get a favorable ruling as that is how

I think the Court would see your case if all of the

erroneous information presented at the trial is

discounted.

Good luck.

Very truly yours,

/s/ Marion W. Beacham, Jr.

Vice President and

Trust Officer

MWB, Jr.:vm

Appendix J

LEONA’S DEPOSITION

Selected sections only:

DIRECT EXAMINATION

BY MR. FIELDS:

Q: Would you state your name and address, please

ma’am?

A: Leona S. Willoughby. S is for Stephens, with a

ph.

Q: And where do you reside at, Mrs. Willoughby?

A: On Riverside Drive and Roberts Boulevard in

San Mateo Estates. On the corner.

Q: And do you own that home?

A: Yes, Ido.

Q: Is there any indebtedness on it?

A: No Sir.

Q: You are the plaintiff in a complaint seeing to

have your son, Lonnie E. Willoughby, Jr., removed

as trustee?

A: Yes Sir.

Q: And you attached to your complaint a revocable

trust agreement and then an amendment to that

agreement?

A: Yes Sir.

Q: Are those the trust agreements that you’re

speaking of

This text is long and has been trimmed here. Open the source document for the complete record.

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