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PNC Bank, National Association v. Edwards

Supreme Court of Kentucky

December 19, 2019

PNC BANK, NATIONAL ASSOCIATION APPELLANT
v.
HONORABLE BRIAN C. EDWARDS, JUDGE, JEFFERSON CIRCUIT COURT APPELLEE AND HOPE BOYD, ADMINISTRATRIX WWA OF THE ESTATE OF FRANKIE S. HAGER; KENTUCKY WESLEYAN COLLEGE AND INTERNATIONAL BLUEGRASS MUSIC MUSEUM, INC. REAL PARITES IN INTEREST

          ON REVIEW FROM COURT OF APPEALS CASE NO. 2019-CA-000032 JEFFERSON CIRCUIT COURT NO. 17-CI-004509

          COUNSEL FOR APPELLANT: John R. Cummins Janet Jakubowicz Brent Robert Baughman Rachel Alyce Washburn BINGHAM GREENEBAUM DOLL LLP Michael D. Risley STITES 86 HARBISON, PLLC

          COUNSEL FOR APPELLEE: Not Represented by Counsel

          COUNSEL FOR REAL PARTY IN INTEREST, HOPE BOYD, ADMINISTRATRIX WWA OF THE ESTATE OF FRANKIE S. HAGER: Edward H. Bartenstein Daniel M. Oyler PARRENT 86 OYLER

          COUNSEL FOR REAL PARTY IN INTEREST, KENTUCKY WESLEYAN COLLEGE: Carol Dan Browing Neil Edward Barton STITES 85 HARBISON, PLLC

          COUNSEL FOR REAL PARTY IN INTEREST, INTERNATIONAL BLUEGRASS MUSIC MUSEUM, INC.: John David Meyer

          OPINION

          VANMETER JUSTICE.

         Appellant PNC Bank ("PNC"), appeals the decision of the Court of Appeals granting in part and denying in part PNC's petition for a writ of prohibition. PNC argues that the Court of Appeals erred by holding that the Jefferson Circuit Court had concurrent jurisdiction over Appellee Hope Boyd's claims of breach of fiduciary duty, breach of trust, breach of a confidential relationship, while also alleging that the original settlor, Frankie Hager, lacked capacity and was unduly influenced by PNC when she made changes to her trust in 2014.[1] While we acknowledge both parties' frustration and confusion over the underlying statutory framework, we find that the Jefferson District Court has exclusive jurisdiction of all breach of trust claims arising out of a KRS[2] 386B.8-180 proceeding. Thus, we reverse the Court of Appeals' decision and grant PNC's writ petition.

         I. Factual and Procedural Background.

         This writ appeal stems from allegations made regarding the actions of PNC as trustee of the Frankie Scott Hager Revocable Trust. In early 2017, Boyd-at that time attorney-in-fact for Ms. Hager-removed PNC as trustee and appointed Commonwealth Bank and Trust Company ("Commonwealth Bank") as successor trustee. In May 2017, PNC sent notice to Boyd pursuant to KRS 386B.8-180 ("statutory notice") informing her that Commonwealth Bank had accepted appointment as the new trustee. The statutory notice also contained information regarding the Trust and alerted Boyd of her right to object "to any action or omission disclosed in the Trust Information." In June, Boyd sent PNC a list of objections to PNC's statutory notice including allegations of breach of fiduciary duty, breach of confidential relationship, lack of capacity, and undue influence regarding administration of the trust and the transfer of $1, 032, 930.60 to two separate trusts for the benefit of Kentucky Wesleyan College and the International Bluegrass Music Museum, Inc.

         On August 18, pursuant to KRS 386B.8-180, PNC filed a petition in Jefferson District Court to approve its statutory notice. Three days later, Boyd and Ms Hager filed an action against PNC in Jefferson Circuit Court alleging breach of fiduciary duty, breach of trust, breach of confidential relationship, a contest of the charitable trust agreements (hereinafter "breach of trust claims"), and demanded injunctive relief, damages, and an accounting Boyd and Ms Hager also filed for removal of the district court action to circuit court The circuit court denied PNC's motion for dismissal of the circuit court action and PNC's subsequent motion to vacate.[3] Following these denials, PNC petitioned for a writ of prohibition in the Court of Appeals alleging the circuit court lacked subject matter jurisdiction The Court of Appeals granted in part and denied in part, holding that while the district court had exclusive jurisdiction over some claims raised via KRS 386B8-180, concurrent jurisdiction existed for the breach of trust claims brought under the separate circuit court action. PNC now appeals the Court of Appeals' decision.

         II. Analysis.

         PNC asserts that the Court of Appeals erred by determining that the circuit court and district court have concurrent jurisdiction over Boyd's breach of trust claims. PNC asks this Court for a writ prohibiting the circuit court from hearing such claims. First, we note that the "issuance of a writ is an extraordinary remedy that is disfavored by our jurisprudence." Caldwell v. Chauvin, 464 S.W.3d 139, 144 (Ky. 2015) (citation omitted). Further, "the issuance of a writ is inherently discretionary" and even upon a showing that the "requirements are met and error found, the grant of a writ remains within the sole discretion of the Court." Id. at 145-46 (citation omitted).

A writ of prohibition may be granted upon a showing that (1) the lower court is proceeding or is about to proceed outside of its jurisdiction and there is no remedy through an application to an intermediate court; or (2) that the lower court is acting or is about to act erroneously, although within its jurisdiction, and there exists no adequate remedy by appeal or ...

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