Berlinger et al v. Wells Fargo, N.A. as Successor to Wachovia Bank, N.A.
Filing
511
OPINION AND ORDER denying 494 Plaintiffs' Motion for Reconsideration; denying 495 Wells Fargo's Motion for Reconsideration; and denying 500 Wells Fargo's Motion for Leave to File Reply. See Opinion and Order for details. Signed by Judge John E. Steele on 12/8/2015. (MAW)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
STACEY SUE BERLINGER, aka
Stacey Berlinger O’Connor,
BRIAN BRUCE BERLINGER, and
HEATHER ANNE BERLINGER, as
Beneficiaries to the Rosa B.
Schweiker Trust and all of
its related trusts
Plaintiffs,
v.
Case No: 2:11-cv-459-FtM-29CM
WELLS
FARGO,
N.A.
AS
SUCCESSOR TO WACHOVIA BANK,
N.A., as Corporate Trustee
to the Rosa B. Schweiker
Trust,
and
all
of
its
related trusts,
Defendant/Third
Party Plaintiff
v.
BRUCE D. BERLINGER and SUE
CASSELBERRY,
Third Party Defendants.
OPINION AND ORDER
This matter comes before the Court on plaintiffs' Motion for
Reconsideration (Doc. #494) filed on October 20, 2015.
Defendant
Wells Fargo Bank N.A. filed a response in opposition (Doc. #497)
on November 6, 2015.
Defendant Wells Fargo Bank N.A. also filed
a Motion for Reconsideration (Doc. #495) on October 30, 2015.
Plaintiff filed a response in opposition (Doc. #498) on November
9, 2015.
Also before the Court is Wells Fargo’s Motion for Leave
to File a Reply (Doc. #500) filed on November 13, 2015.
Plaintiffs
filed a response in opposition (Doc. #501) on November 16, 2015.
The Court will address each motion in turn.
I.
Reconsideration
of
a
court’s
previous
order
is
an
extraordinary remedy and, thus, is a power which should be used
sparingly.
American Ass’n of People with Disabilities v. Hood,
278 F. Supp. 2d 1337, 1339 (M.D. Fla. 2003) (citing Taylor Woodrow
Constr. Corp. v. Sarasota/Manatee Airport Auth., 814 F. Supp. 1072,
1072-73 (M.D. Fla. 1993)).
raise
new
previously.”
issues,
not
“A motion for reconsideration should
merely
readdress
issues
litigated
PaineWebber Income Props. Three Ltd. P'ship v. Mobil
Oil Corp., 902 F. Supp. 1514, 1521 (M.D. Fla. 1995).
Courts have
“delineated three major grounds justifying reconsideration: (1) an
intervening change in controlling law; (2) the availability of new
evidence; [and] (3) the need to correct clear error or prevent
manifest injustice.”
Sussman v. Salem, Saxon & Nielsen, P.A., 153
F.R.D. 689, 694 (M.D. Fla. 1994).
The motion to reconsider must set forth facts or law of a
strongly convincing nature to demonstrate to the court the reason
to reverse its prior decision.
Taylor Woodrow, 814 F. Supp. at
1073; PaineWebber, 902 F. Supp. at 1521.
“When issues have been
carefully considered and decisions rendered, the only reason which
should commend reconsideration of that decision is a change in the
factual or legal underpinning upon which the decision was based.”
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Taylor
Woodrow,
814
F.
Supp.
at
1072–73.
A
motion
for
reconsideration does not provide an opportunity to simply reargueor argue for the first time-an issue the Court has once determined.
Court opinions “are not intended as mere first drafts, subject to
revision and reconsideration at a litigant’s pleasure.”
Quaker
Alloy Casting Co. v. Gulfco Indus., Inc., 123 F.R.D. 282, 288 (N.D.
Ill. 1988).
“The burden is upon the movant to establish the
extraordinary
circumstances
supporting
reconsideration.”
Mannings v. Sch. Bd. of Hillsborough Cnty., 149 F.R.D. 235, 235
(M.D. Fla. 1993).
II.
The current litigation involves three family trusts: the Rosa
B. Schweiker Family Trust, the Frederick W. Berlinger Family Trust,
and the Rose S. Berlinger Family Trust (collectively the Berlinger
Trusts).
Berlinger
Plaintiffs Stacey Sue Berlinger (Stacey), Brian Bruce
(Brian),
and
Heather
Anne
Berlinger
(Heather)
(collectively plaintiffs) are the children of Bruce D. Berlinger
(Bruce) and Sue Casselberry (Sue).
(Doc. #366, ¶ 61.)
The Second
Amended Complaint (Doc. #93) asserts a claim for Breach of Trust
(Count I) and an overlapping claim for Breach of Fiduciary Duty
(Count II) against Wells Fargo N.A. (Wells Fargo) as the former
corporate trustee of the Berlinger Trusts.
Plaintiffs moved for
summary judgment as to the portion of Counts I and II relating to
trust distributions for alimony.
(Doc. #360.)
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Wells Fargo moved
for summary judgment on Counts I and II in their entirety.
(Doc.
#364.)
On October 16, 2015, the Court entered a forty page Opinion
and Order (Doc. #492) granting Wells Fargo’s Motion for Summary
Judgment (Doc. #364) in part, and denying plaintiffs’ motion for
summary judgment (Doc. #360).
The Court granted summary judgment
in favor of Wells Fargo and against plaintiffs as to the portions
of Counts I and II which alleged: (1) Wells Fargo had a fiduciary
duty to refrain from making distributions to Bruce which would be
used to pay alimony; (2) the $2 million investment in the 550
Banyan Blvd. was a distribution to Bruce; (3) the $2 million
payment authorized by Wells Fargo from the Rosa Trust was made to
non-beneficiary
Sue;
(4)
the
investment
in
the
Banyan
Blvd.
Property violated Wells Fargo’s duty to diversify; and (5) Wells
Fargo breached its fiduciary duty by investing trust assets in inhouse propriety mutual funds.
(Doc. #492, pp. 38-39.)
The Court, however, denied a portion of Wells Fargo’s motion
for summary judgment, finding material facts remain disputed as to
whether the decision to invest in the Banyan Blvd. Property and/or
make improvements thereto was imprudent and/or made in bad faith.
Therefore, the only remaining issue in this case is plaintiffs’
claim that the Rosa Trust’s investment in the Banyan Blvd. Property
(and capital improvement made to the property) was imprudent and/or
made in bad faith.
(Doc. #492, p. 29.)
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Plaintiffs now ask the Court to reconsider its Opinion and
Order based on clear error, and to grant summary judgment in their
favor.
(Doc.
#494.)
Likewise,
Wells
Fargo
requests
reconsideration of the Opinion and Order, seeking summary judgment
in favor of Wells Fargo on the last remaining issue of the Banyan
Blvd. Property.
(Doc. #495.)
III.
A.
Plaintiffs’ Motion to Reconsider (Doc. #494)
Plaintiffs ask the Court to reconsider its Opinion and Order,
asserting “the Court’s decision is in clear error with Florida
law, and is in need of correction.”
(Doc. #494 at 2.)
Wells
Fargo opposes plaintiffs’ motion, arguing it is improper and
distinguishing the case cited by plaintiffs in support of their
motion.
The Court has carefully reviewed plaintiffs’ motion and
finds no change in controlling law, no new evidence, and no clear
error or manifest injustice in the Opinion and Order.
Plaintiffs assert that “under controlling Florida precedent,
spendthrift trusts impose a duty on a trustee that prohibits the
making of distributions from a trust with a spendthrift provision
when such distributions will be given to creditors.”
¶ 1.)
(Doc. #494,
In support of their position, plaintiffs cite to a portion
of a single sentence from Zlatkiss v. All Am. Team Concepts, LLC,
125 So. 3d 953, 954 (Fla. 5th DCA 2013), which states “Steinmetz’s
trust is a spendthrift trust, which prevents the trustee from
making distributions if the distributions would be available to
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creditors.”
Id.
Notably, the quotation cited by plaintiffs is
interpreting the specific trust at issue in that case, and it does
not distinguish between distributions made directly to creditors
and distributions made to beneficiaries who then choose to pay
creditors.
See id.
In Zlatkiss, a creditor brought an action against a trustee
of
a
spendthrift
trust
after
the
trustee
refused
to
make
distributions upon learning that the trust beneficiary had signed
a personal guaranty for a loan that went unpaid.
Id.
The creditor
sought a declaration that sections 736.0501-.0507 Florida Statutes
(2012), which recognize the enforceability of spendthrift trusts,
violate article I, section 21 of the Florida Constitution by
preventing access to courts.
Id. at 955.
The Fifth District
Court of Appeal of Florida affirmed the trial courts grant of
summary judgment, finding the statutes do not limit access to
courts and are not unconstitutional.
Id.
Plaintiffs’ attempt to extrapolate the Zlatkiss opinion into
a holding that a trustee has an affirmative duty to forego making
any
distribution
to
beneficiaries
that
would
creditors (Doc. #494, pp. 2-3) is unfounded.
the holding of the case.
then
be
given
That is simply not
In addition, plaintiffs fail to address
the subsequent paragraph in the Zlatkiss opinion, cited by this
Court in its Opinion and Order (Doc.
states:
- 6 -
492, pp. 18-19), which
Florida law recognizes the validity of
spendthrift trusts.
See Waterbury v. Munn,
159 Fla. 754, 32 So. 2d 603, 605 (1947). A
spendthrift trust is a trust “created with a
view of providing a fund for the maintenance
of another, and at the same time securing it
against his own improvidence or incapacity for
self-protection.” Croom v. Ocala Plumbing &
Elec. Co., 62 Fla. 460, 57 So. 243, 244 (1911).
When a trust includes a valid spendthrift
provision, a beneficiary may not transfer his
interest in the trust and a creditor or
assignee of the beneficiary may not reach any
interest or distribution from the trust until
the beneficiary receives the interest or
distribution.
§ 736.0502(3), Fla. Stat.
(2009).
Zlatkiss, 125 So. 3d at 954 (citing Miller v. Kresser, 34 So. 3d
172, 175 (Fla. 4th DCA 2010) (emphasis added).
After again thoroughly reviewing Zlatkiss, the Court finds
nothing which creates an affirmative duty of the trustee to forego
making distributions to a beneficiary when the distribution will
then be given by the beneficiary to a creditor.
Accordingly,
plaintiffs’ motion to reconsider is denied.
B.
Wells Fargo’s Motion to Reconsider (Doc. #495)
Wells Fargo also asks the Court to reconsider its Opinion and
Order (Doc. #495), asserting that the Court should have granted
its summary judgment motion in full.
According to Wells Fargo,
the Court should use the same standard it applied to the alimony
payments, where it found no breach of trust as to the investment
and improvements made to the Banyan Blvd. Property.
Wells Fargo
asserts that the prudent investor rule is displaced by the language
of the trust.
Plaintiffs respond in opposition.
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(Doc. # 498.)
The Court has carefully reviewed Wells Fargo’s motion and
finds no change in controlling law, no new evidence, and no clear
error or manifest injustice in the Opinion and Order.
Wells Fargo
is essentially attempting to re-litigate issues already decided by
this Court; namely, whether material facts remain disputed in
relation to the Rosa Trust’s investment in the Banyan Blvd.
Property (and capital improvements made to the property).
The
Court finds no basis for reconsideration.
Accordingly, it is hereby
ORDERED AND ADJUDGED:
1.
Plaintiffs' Motion for Reconsideration (Doc. #494) is
DENIED.
2.
Wells Fargo Bank, N.A.’s Motion for Reconsideration
(Doc. #495) is DENIED.
3.
Wells Fargo Bank, N.A.’s Motion for Leave to File Reply
(Doc. #500) is DENIED.
DONE and ORDERED at Fort Myers, Florida, this
December, 2015.
Copies:
Counsel of Record
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8th
day of
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