1. Is a personal representative in a wrongful death civil action entitled to compensation for their services pursuant to the West Virginia Estate Statute, W. Va. Code § 44-4-12(a)?
2. Does an ex-spouse with whom the decedent shares a child and co-parenting relationship constitute an “otherwise . . . equitably entitled [person]” under the West Virginia Wrongful Death Statute, W. Va. Code § 55-7-6, for purposes of sharing in settlement distribution?
3. Does the West Virginia Wrongful Death Statute, W. Va. Code § 55-7-6, create a statutory trust over which the appointed personal representative in a wrongful death civil action serves as a trustee, thereby entitling her to compensation pursuant to the West Virginia Uniform Trust Code?
This appeal arises from a wrongful death action pending before the Circuit Court of Harrison County, West Virginia (“Trial Court”) for which Petitioner, Holly McIntire, served as personal representative of the deceased, Markel Koon. Ms. McIntire and Mr. Koon are not married; however, they share a minor child, Morgan Koon. For fourteen (14) years Ms. McIntire and Mr. Koon successfully co-parented their daughter, maintaining a positive, productive, co-dependent relationship. In 2012, Mr. Koon was tragically killed in a mining accident, leaving behind several beneficiaries under West Virginia’s Wrongful Death Statute, W. Va. Code § 55-7-6. For various reasons, trial counsel for the Petitioner, Plaintiff below, concluded that none of the statutory beneficiaries could effectively function as personal representative in the wrongful death lawsuit. As a result, trial counsel asked, and Ms. McIntire agreed, to serve as personal representative in Mr. Koon’s wrongful death lawsuit.
Ms. McIntire diligently served as personal representative for approximately three (3) years, assisting trial counsel with damages quantification, discovery responses, location of witnesses, providing feedback on pleadings, providing photographs, attending witness statements, mediation, and generally communicating with the statutory beneficiaries. These activities occupied a substantial amount of Ms. McIntire’s personal and professional time. Trial counsel asserts that Ms. McIntire’s efforts as personal representative materially contributed to the substantial settlement received in this matter.
In 2015, the parties finally settled the wrongful death lawsuit and agreed on how the proceeds would be distributed amongst the beneficiaries. After tendering this proposal to the Trial Court, Ms. McIntire issued a request to be compensated $118,000.00 for her services as personal representative, such payment to be taken from the settlement proceeds. Counsel for the statutory beneficiaries subsequently filed their joint objections. By Order dated January 25, 2017, the Trial Court denied Ms. McIntire’s request for compensation. Ms. McIntire filed a motion to alter or amend this Order; however, the Trial Court reaffirmed its rulings, denying this motion by Order dated April 7, 2017. It is from these orders that Petitioner appeals.
Petitioner raises three arguments on appeal: (1) that she was a person “otherwise . . . equitably entitled to share” in the recovery under West Virginia’s Wrongful Death Statute, W. Va. Code § 55-7-6; (2) that she should be compensated for her services as personable representative under the West Virginia Estate Statute, W. Va. Code § 44-4-12(a); and (3) that the Wrongful Death Statute creates a statutory trust where the personal representative functions as trustee, thereby entitling her to compensation under the West Virginia Uniform Trust Code, W. Va. Code § 44D-7-708(a).
In its Order dated January 25, 2017, the Trial Court does not address arguments (1) or (3), instead electing to deny Petitioner’s request for compensation by focusing on argument (2). In a narrow opinion, the Trial Court concluded as a matter of law that personal representatives are not entitled to compensation under W. Va. Code § 55-7-6 and/or W. Va. Code § 44-4-12(a) because they are nominal parties to the litigation process and they do not actually administer an estate, since the settlement proceeds disburse directly to the statutory beneficiaries. This conclusion, Petitioner contends, misapprehends their initial request for compensation. Petitioner attempts to clarify that she seeks either: (1) to share in the settlement proceeds as a statutory beneficiary under the “otherwise . . . equitably entitled to share” language of W. Va. Code § 55-7-6; or (2) be compensated for her services as personal representative under W. Va. Code § 44-4-12(a) and/or W. Va. Code § 44D-7-708(a) – but not both, conceding that such a result would be a windfall.
In Petitioner’s eyes, the distinction between these two assertions is critical. The first is an argument in equity, asserting that the facts underlying her relationship with the decedent, when coupled with her extensive services as personal representative, rise to the level of entitling her to a share in the settlement proceeds as a statutory beneficiary. At the very least, Petitioner argues that she was entitled to an evidentiary hearing on this issue, so that she could build a record before the Trial Court made its legal conclusion.
In the alternative, Petitioner argues that the Trial Court was incorrect in concluding that she is not entitled to compensation under W. Va. Code § 44-4-12(a) and/or W. Va. Code § 44D-7-708(a). This argument essentially boils down to two points: (1) it would be unfair and bad public policy to refuse to pay personal representatives in wrongful death cases; and (2) the Wrongful Death Statute impliedly creates a statutory trust which is governed by W. Va. Code § 44D-7-708(a) and, therefore, Petitioner is entitled to compensation under that authority.
Respondents, all other statutory beneficiaries, argue that the Trial Court was correct in focusing its decision on a personal representative’s nominal role and the absence of an administrable estate. In their opinion, the case law clearly establishes that “because the personal representative is merely a nominal party and any recovery passes to the beneficiaries designated in the wrongful death statute and not to the decedent’s estate” no compensable estate administration work is necessary. Syl. Pt. 4, McClure v. McClure, 184 W. Va. 649, 403 S.E.2d 1297 (1991). Indeed, Respondents agree that W. Va. Code § 44-4-12(a) permits Petitioner to recover reasonable expenses incurred and commission upon the amount of the estate that is subject to administration; however, this statute has no application to proceeds recovered from a Wrongful Death Settlement, as those proceeds are not assets of the estate subject to administration. Hence, the Petitioner cannot recover her expenses and commission from settlement proceeds that rightly belong to the statutory beneficiaries.
With regard to Petitioner’s statutory trust argument, Respondents simply state that this is a “Hail Mary” argument with little merit. By making this argument, Petitioner is asking the Court to imply a statutory trust where the legislature has not enumerated one. The negative effects of this could be substantial, and this type of decision is more properly left to the legislature. Indeed, the Court interprets the law, it is not supposed to create it out of thin air.
Substantial. The Court clearly invoked Rule 20 because it is going to establish new law. One way or another, we are going to get a definitive answer on whether or not a non-statutory beneficiary who serves as personal representative in a wrongful death action is entitled to compensation for their services. Beyond that, the Court can address issues surrounding the equitable beneficiary language in W. Va. Code § 55-7-6. Presumably, the Court will provide guidance on what factors should be considered in evaluating whether someone is an equitable beneficiary. Previous cases have interpreted this language as a “catch-all” for those who may not be explicitly listed as a statutory beneficiary but are nevertheless entitled to benefits in equity. However, previous cases have also found this language does not apply to creditors who may seek to satisfy debts with wrongful death verdict/settlement proceeds. Thus, while it is clear this language is intended to expand the class of statutory beneficiaries, it definitely has limits. Hopefully, the Court will take this opportunity to define these limits. Because most times the personal representative is also a statutory beneficiary, this case presents the relatively rare and unique factual scenario where the personal representative is not a beneficiary but is nevertheless in the best position to represent the beneficiaries in civil action.