United States District Court, D. South Carolina, Rock Hill Division
Desa Ballard, as Successor Trustee of the Trust of Chris Combis, u/a/d 10-15-2013, Plaintiff,
Diane Combis, Defendant. Desa Ballard, as Successor Trustee of the Trust of Chris Combis, Cross-claim Plaintiff,
George Combis; and Diane Combis, as former Trustee of the Trust of Chris Combis, Cross-claim Defendants. In the Matter of the Estate of Chris Combis Desa Ballard, as Personal Representative of the Estate of Chris Combis, Petitioner,
George Combis; Chris A. Combis; Diane Combis; and Superior Tile, Marble, and Terrazzo Corporation, Respondents. Linda Combis and Mary Combis, Plaintiffs,
George Combis and Diane Combis (Individually and as former Trustee of the Revocable Trust Agreement for Chris Combis), Defendants.
FINDINGS OF FACT AND CONCLUSIONS OF LAW AND
F. Anderson, Jr. United States District Judge
INTRODUCTION AND PROCEDURAL BACKGROUND
four consolidated cases all pertain to a dispute between
siblings regarding financial transactions involving their
father. At the Court's suggestion, the parties consented
to a bench trial due to the complexity of the factual and
legal issues presented.
Court received testimony in a five-day trial, heard extensive
closing argument, and took the matter under advisement. The
Court then determined that it needed additional evidence on
one issue and reopened the hearing for additional testimony.
The Court also directed the attorneys to exchange and submit
proposed findings and conclusions, some of which have been
adopted in this Order.
delving into the myriad of factual and legal issues presented
in this case, the Court is compelled to make a few general
observations. The four lawsuits resolved in this Order are
but a portion of twelve lawsuits filed by the three adult
children of Chris Combis and his wife, Jessie Combis. As will
be seen, the Combis family enjoyed considerable financial
success in the decorative tile and stone business in
Charlotte, North Carolina. Unfortunately, as is often the
case with closely-held family corporations, the partners were
better at their craft than they were with their corporate
record-keeping. This lack of documentation, coupled with
testimony regarding faded memories of financial transactions
that occurred nearly a decade ago, is what prompted this
Court to suggest the bench trial that commenced on July 12,
thus invited the family to drop this difficult and
emotion-laden controversy into its lap,  the Court now
proceeds to do its best to untangle and resolve the issues
presented, with the observation that the failure to follow
even rudimentary corporate formalities and reliance upon
“home drawn” financial documents often sow the
seeds of controversies that tax the ability of the legal
system to achieve justice years later.
Combis, referred to during the trial as “Pop” (to
distinguish him from his grandson of the same name and who
was a party at one time to one of these actions) was the
patriarch of the family who formed and operated Superior
Tile, Marble, and Terrazzo, Inc. (“Superior
Tile”) headquartered in Mecklenburg County, North
Carolina. Eventually, Pop's son, George,  assumed a
position with Superior Tile and, before Pop's death, took
over ownership of the company.
the projects for which Superior Tile provided stone and tile
work were the Charlotte Panthers Stadium and the headquarters
for Bank of America, both in Charlotte. At one point, George
even bragged that it would be easier to produce a list of
buildings in Charlotte that Superior Tile had not
worked on than to provide a list of those for which the
company had performed work. Suffice it to say that
Superior Tile was a successful business enterprise.
is married to Diane, with whom Pop had a close relationship.
Pop also had two daughters, Linda and Mary, both of whom
counted on Pop for much of their financial support.
Pop and George did not maintain complete business records and
constantly moved money around from the company to the various
family members. Further, Pop eventually transferred ownership
of Superior Tile to George. Additionally, George and Diane
began a new company in Diane's name to take advantage of
her status as a member of a minority. Thus, two corporate
entities are involved in these actions.
died on February 3, 2009, and, shortly thereafter, the
harmony that had existed was gone and the litigation began.
noted previously, the Court's fact-finding process has
been made more difficult due to the lack of adequate
documentation for the disputed financial
transactions as well as several witnesses' professed lack
of memory regarding key events. “I don't
recall” was a frequent response to many pertinent
the documentation of transactions in the Trust Account,
George and Diane produced a ledger sheet containing cryptic
entries that are of little help. As to backup documentation,
Diane, when pressed, frequently said, “I gave that to
my lawyer.” Such documentation was never produced at
trial. The “lawyer” being referred to was one or
more of the previous attorneys who have represented George
and Diane during the course of their litigation. At one point
during the trial, this Court interrupted the proceedings to
inform Diane that merely incanting the phrase “I gave
it to my [previous] lawyer” was not a substitute for
producing relevant documents during discovery. Indeed, one of
her previous attorneys, Charles Bridgmon
(“Bridgmon”), testified for George and Diane at
trial. For these reasons, the Court announced that, following
the close of the trial testimony, the Court would keep the
record open for an additional two days to allow the documents
allegedly given to previous counsel to be retrieved from the
attorneys and produced to this Court. No such documents were
George was occasionally less than forthcoming. For example,
one issue in the case was the extent to which George
contributed monies that went into a joint account with Pop.
When pressed for documentation at his deposition (which
deposition was published at trial), George responded,
“Well, not being smart, I don't have to show
anybody where it came from.”
at times, George's trial testimony was internally
inconsistent. When asked about what happened to the hotly
disputed $412, 000.00 that was allegedly loaned to him from
the Trust managed by his wife, George testified (on the
fourth day of trial) that approximately $150, 000.00 of it
was used for the benefit of his sister Linda, to wit: a $60,
000.00 horse barn; a $20, 000.00 fence; a $63, 000.00
Suburban; a $20, 000.00 tractor; a $12, 000.00
“Gator” all-terrain vehicle; and $15, 000.00
worth of stone and tile. By the next morning of trial,
however, George had retreated from this position and
acknowledged on cross-examination that none of these items
were purchased with the Trust monies, if they had been
purchased at all.
other threshold issue bears mention. Mindful of its
obligation to police its own jurisdiction, this Court
inquired of the parties whether any or all of the claims
asserted in this action (which was removed to this Court on
the basis of the diverse citizenship of the parties) should
be dismissed because of the so-called “probate”
exception to federal jurisdiction.
for Desa Ballard, the Personal Representative and Successor
Trustee, argued, as she had since removal to this Court, that
these cases belonged in state court. The two remaining groups
of litigants, George and Diane, as well as Linda and Mary,
suggested jurisdiction was proper in this federal Court.
reasons stated in open court, this Court determined that the
ownership question for certain items of personal property
(such as rare coins, antiques, firearms, and watches) were
probate court matters and, therefore, this Court declined to
hear testimony regarding such personal
remaining claims, which distilled to their essence are
contract-based claims between diverse parties, were held to
be properly before this Court. At the risk of
oversimplification, these claims are:
(1) The $230, 000.00 Note;
(2) The $412, 000.00 “Loan” and related Breach of
Fiduciary Duty Claim;
(3) The $49, 564.09 Missing Certificate of Deposit; and
(4) The Allocation of Desa Ballard's Fees as Trustee of
receiving the testimony, carefully considering all the
evidence, weighing the credibility of the witnesses,
reviewing the exhibits and briefs, and studying the
applicable law, this Court makes the following Findings of
Fact and Conclusions of Law pursuant to Fed.R.Civ.P. 52. The
Court notes that to the extent any of the following Findings
of Fact constitute Conclusions of Law, they are adopted as
such, and to the extent any Conclusions of Law constitute
Findings of Fact, they are so adopted.
FINDINGS OF FACT
March 11, 2003, Pop executed his last will and testament (the
“Will”) and established the Chris Combis
Revocable Trust (the “Trust”) under North
Pursuant to the Will, the property in his estate (the
“Estate”) at the time of his death would
“pour-over” into his Trust.
designated himself as the original Trustee of the Trust.
Trust beneficiaries were his three adult children George,
Mary, and Linda. All three children were officers of Superior
Tile and, at various times, received money as salary or
director's fees, although the record is not clear
regarding these payments.
the time Pop established the Trust, he owned one house (the
“Lochridge House”) located at 718 Lochridge Road
in Charlotte, North Carolina. The Lochridge House was
unencumbered by a mortgage.
2003, Pop purchased a house and real property (the
“Horseshoe House”) located at 9313 Horseshoe
Circle in Fort Mill, South Carolina. Although Pop and George
signed the mortgage for the Horseshoe House, George did not
sign the note that required $1, 289.56 per month
resided in the Lochridge House from prior to the creation of
the Trust until the house was sold in 2013. Title was never
placed in her name.
Linda has resided in the Horseshoe House from the time Pop
purchased it until the present day. Title was never placed in
the exception of one $1, 289.56 mortgage payment made by
Linda on the Horseshoe House, neither sister has paid any
consideration for their occupation of either house.
George has never resided in either the Horseshoe House or the
July 14, 2005, Pop and Superior Tile entered into a loan
agreement (the “$230, 000.00 Note”), under which
Pop agreed to provide Superior Tile with the use of $230,
000.00. In return, Pop received a note, obviously drafted by
a non-lawyer, which reads as follows:
July 14, 2005
RE: Loan Agreement
This agreement is between CHRIS COMBIS and SUPERIOR TILE AND
CHRIS COMBIS agrees to loan SUPERIOR TILE AND MARBLE $230,
000.00. The terms and conditions are as follows:
1) In exchange for the use of $230, 000.00, SUPERIOR TILE AND
MARBLE agrees to the following:
a) Pay interest quarterly at the rate of 7%.
b) For the life of the loan, SUPERIOR TILE AND MARBLE agrees
to continue to pay MARY COMBIS and LINDA COMBIS a salary of
$150.00 per week.
c) SUPERIOR TILE AND MARBLE agrees to pay the personal
insurance for MARY COMBIS and LINDA COMBIS.
d) SUPERIOR TILE AND MARBLE agrees to pay the automobile
insurance (one vehicle each) for MARY COMBIS and LINDA
This loan will be terminated 30 days after the death of CHRIS
COMBIS and the monies will be put back in his estate.
Accepted: s/ CHRIS COMBIS
SUPERIOR TILE & MARBLE CORPORATION Accepted: s/ GEORGE C.
April 21, 2006, Pop executed a First Amendment and
Restatement of his Trust, replacing himself with Diane as
Trustee. Both Linda and Mary consented to Diane's
or about the time of the naming of Diane as Trustee, Diane
and Linda met with Paul Hattenhauer
(“Hattenhauer”), the lawyer who drafted Pop's
Will and the Trust, regarding Diane's duties as the new
Trustee. Hattenhauer also provided Diane with a book
describing the duties and responsibilities of a trustee.
George and Pop were co-owners with right of survivorship of a
Wachovia Securities investment account (the “Joint
Account”). On April 30, 2006, the value of the
funds held in the Joint Account was $387, 590.14.
During the month of April 2006, Pop withdrew the entirety of
the funds held in the Joint Account without George's
consent and exercised sole control over the funds.
September 11, 2006, Pop conveyed the Lochridge House into the
October 13, 2006, Pop conveyed the Horseshoe House into the
April 18, 2007, Pop filed a lawsuit against George, Diane,
and Superior Tile claiming that Superior Tile was in breach
of the $230, 000.00 Note and prayed for the recovery of $230,
000.00, together with interest.
July 27, 2007, Pop caused a check in the sum of $417, 359.01
to be drafted from an account of which he was the sole owner.
August 1, 2007, Pop and Diane deposited the $417, 359.01
check in a Park Sterling Bank account owned by the Trust.
August 2, 2007, Pop filed a voluntary dismissal without
prejudice of the North Carolina lawsuit ...