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Wellin v. Wellin

United States District Court, D. South Carolina, Charleston Division

January 8, 2020

WENDY C.H. WELLIN, as Special Administrator of the Estate of Keith S. Wellin and as Trustee of the Keith S. Wellin Florida Revocable Living Trust u/a/d December 11, 2001, Plaintiff,
v.
PETER J. WELLIN, CYNTHIA W. PLUM AND MARJORIE W. KING, individually and as co-Trustees and beneficiaries of the Wellin Family 2009 Irrevocable Trust, u/a/d November 2, 2009, and FRIENDSHIP MANAGEMENT, LLC, Defendants. LARRY S. MCDEVITT, as Trust Protector of the Wellin Family 2009 Irrevocable Trust, Plaintiff,
v.
PETER J. WELLIN, CYNTHIA W. PLUM AND MARJORIE W. KING, individually and as co-Trustees and beneficiaries of the Wellin Family 2009 Irrevocable Trust, u/a/d November 2, 2009, FRIENDSHIP MANAGEMENT, LLC, and CYNTHIA W. PLUM as manager of Friendship Management, LLC, Defendants. PETER J. WELLIN, CYNTHIA W. PLUM AND MARJORIE W. KING, individually and as co-Trustees and beneficiaries of the Wellin Family 2009 Irrevocable Trust Counterclaim Plaintiffs,
v.
LARRY S. MCDEVITT, as Trust Protector of the Wellin Family 2009 Irrevocable Trust, LESTER SCHWARTZ as Trust Protector of the Wellin Family 2009 Irrevocable Trust, u/a/d November 2, 2009, and WENDY C.H. WELLIN, as Special Administrator of the Estate of Keith S. Wellin, Counterclaim Defendants. PETER J. WELLIN, CYNTHIA W. PLUM AND MARJORIE W. KING, individually and as co-Trustees and beneficiaries of the Wellin Family 2009 Irrevocable Trust, u/a/d November 2, 2009, FRIENDSHIP MANAGEMENT, LLC, Plaintiffs,
v.
WENDY WELLIN, individually and as Trustee of the Keith S. Wellin Florida Revocable Living Trust u/a/d December 11, 2001 Defendant.

          ORDER

          DAVID C. NORTON, UNITED STATES DISTRICT JUDGE

         This matter is before the court on Peter J. Wellin, Cynthia Wellin Plum, Marjorie Wellin King - in their individual capacities, their capacities as co-Trustees and beneficiaries Wellin Family 2009 Irrevocable Trust (“2009 Irrevocable Trust”), and Marjorie Wellin King in her role as Manager of Friendship Management, LLC - and Friendship Management, LLC (collectively, the “Wellin children”) motion for partial summary judgment based on the statute of limitations for all claims related to the establishment and the initial transactions involving the 2009 Irrevocable Trust (“2009 Transaction”)[1]. For the reasons outlined below, the court grants the Wellin children's motion for partial summary judgment.

         I. BACKGROUND

         Because the parties are well-acquainted with these cases, the court will dispense with a recitation of facts and include only a procedural history of the matters at hand.

         The instant motion for partial summary judgment involves three cases centered around a collection of disputes by and among the Wellin children, their stepmother Wendy C.H. Wellin, in her individual capacity (“Wendy”), and in her official capacity as trustee of the Keith S. Wellin (“Keith”) Florida Revocable Living Trust u/a/d December 11, 2001 (“trustee Wendy”), on behalf of the Estate of Keith as its duly Appointed Special Administrator (“Estate”), and Larry S. McDevitt and Lester S Schwartz, each as Trust Protector of the Wellin Family 2009 Irrevocable Trust (“McDevitt).

         Case No. 2:13-cv-1831 is by and between defendants the Wellin children and plaintiffs trustee Wendy and the Estate (“Wellin I”). Case No. 2:13-cv-3539 is by and between defendants-counterclaim plaintiffs the Wellin children and plaintiffs-counterclaim defendants McDevitt (“McDevitt”). Case No. 2:14-cv-4067 is by and between plaintiffs the Wellin children and defendants Wendy and trustee Wendy (“Wellin II”).[2]

         On June 30, 2017, the Wellin children filed the partial motion for summary judgment based on the issue of statute of limitations in Wellin I, ECF No. 599, McDevitt, ECF No. 638, and Wellin II, ECF No. 387. On September 22, 2017, the Estate, on behalf of the parties adverse to the Wellin children, filed a response in Wellin I, ECF No. 640, McDevitt, ECF No. 757, and Wellin II, ECF No. 503. On October 13, 2017, the Wellin Children filed a reply in Wellin I, ECF No. 663, McDevitt, ECF No. 699, and Wellin II, 445. On December 16, 2019, both parties filed supplemental briefings at the court's request. ECF No. 960; ECF No. 961. The motion has been fully briefed and is now ripe for the court's review.

         II. STANDARD

         Summary judgment shall be granted “if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). “By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Id. at 248. “[S]ummary judgment will not lie if the dispute about a material fact is ‘genuine,' that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. “[A]t the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Id. at 249. The court should view the evidence in the light most favorable to the non-moving party and draw all inferences in its favor. Id. at 255.

         III. DISCUSSION

         A. Statute of Limitations

         The Wellin children ask the court to grant a partial summary judgment on the claims based on the 2009 Transaction on the grounds that the statute of limitations expired by the time Keith filed his initial complaint against the Wellin children in July 2013. ECF No. 599 at 8. “A federal court sitting in diversity must follow state law in determining whether an action is commenced for the purposes of applying the statute of limitations.” Burgess v. Elliott, 2017 WL 1505421, at *3 (D.S.C. Apr. 27, 2017), aff'd, 696 Fed.Appx. 125 (4th Cir. 2017), cert. dismissed, 202 L.Ed.2d 3, 3 (2018); see also Thornton v. Cessna Aircraft Co., 886 F.2d 85, 88 (4th Cir. 1989); Alday v. Techphy Div. Firminy, 10 F.Supp.2d 562, 563 (D.S.C. June 8, 1998). In a tort claim, a federal court “considering a diversity action . . . applies . . . the procedural law of the [forum state].” Burgess v. Elliott, 2017 WL 1505421, at *3 (D.S.C. Apr. 27, 2017), aff'd, 696 Fed.Appx. 125 (4th Cir. 2017); see also Sokolowski v. Flanzer, 769 F.2d 975, 977 (4th Cir. 1985). Under South Carolina law, “statute of limitations is a procedural device that operates as a defense to limit the remedy available from an existing cause of action.'” In re Ashe, 2016 WL 1084282, at *2 (Bankr. D.S.C. Mar. 18, 2016) (quoting Capco of Summerville, Inc. v. J.H. Gayle Const. Co., 628 S.E.2d 38, 41 (S.C. 2006); see also Thornton v. Cessna Aircraft Co., 703 F.Supp. 1228, 1230 (D.S.C.1988), aff'd and remanded, 886 F.2d 85 (4th Cir. 1989) (“A statute of limitations, which requires an action to be brought within a fixed time following accrual of a cause of action, is generally procedural because it affects the remedy rather than the right.”). Because the statute of limitations is procedural under South Carolina law, the court will apply South Carolina law[3] in its analysis of the statute of limitations and any equitable tolling or estoppel of the same.

         Under South Carolina law, this action is governed by a three-year statute of limitation period. S.C. Code § 15-3-530(1) (Supp. 2012) (stating that the statute of limitations is three years for “an action upon a contract”); S.C. Code § 15-3-530(5) (stating that the statute of limitations is three years for “any injury to the person or rights of another, not arising on contract and not enumerated by law”); Graham v. Welch, Roberts & Amburn, LLP, 743 S.E.2d 860, 862 (S.C. Ct. App. 2013).

         These statutes of limitations are modified by a doctrine known as the “discovery rule.” “Under the discovery rule, the limitations period commences when the facts and circumstances of an injury would put a person of common knowledge and experience on notice that some claim against another party might exist.” Stokes-Craven, 787 S.E.2d at 489; see S.C. Code Ann. § 15-3-535 (2005) (“[A]ll actions initiated under Section 15-3- 530(5) must be commenced within three years after the person knew or by the exercise of reasonable diligence should have known that he had a cause of action.”). “This standard as to when the limitations period begins to run is objective rather than subjective.” Stokes-Craven, 787 S.E.2d at 489 (quoting Burgess v American Cancer Society, South Carolina Division, Inc, 386 S.E.2d 798, 800 (S.C. Ct. App. 1989) (emphasis in original)). “Therefore, the statutory period of limitations begins to run when a person could or should ...


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