Heard: February 1, 2018.
action commenced in the Superior Court Department on November
case was heard by Robert C. Cosgrove, J., on motions for
summary judgment, and entry of separate and final judgment
was ordered by him.
Richard B. Reiling (Richard C. Woods, Jr., also present) for
Stephen M. LaRose (Charles Dell'Anno & Edward M.
Joyce, Jr., also present) for the defendants.
Present: Trainor, Blake, & Lemire, JJ.
issue in this case is whether the assets of an irrevocable
spendthrift trust, established in 2007 on behalf of a
disabled husband upon divorce from his wife, are available to
satisfy any damages awarded in a subsequent personal injury
action against the former husband. Resolution of the issue
requires us to consider whether the trust was self-settled.
We conclude that successful plaintiffs in this action may
recover damages from the trust.
The Probate and Family Court proceedings.
the motor vehicle accident at issue in this case, Brian K.
McInerney was involved in a motor vehicle accident in 2001,
in which he sustained a severe traumatic brain injury. In
September of 2004, a judge of the Probate and Family Court
appointed coguardians for him due to his inability to make
medical and other important decisions.'
married in 1987, McInerney and his former wife, Susan J.
Stone, separated in January of 2004. McInerney filed a
complaint for divorce on March 8, 2005, requesting an
equitable division of the marital assets under G. L. c. 208,
§ 34.Throughout the marriage, Stone held
significant assets in her own name, including accounts at
KeyBank National Association (KeyBank), at least some of
which derived from a trust created for Stone's benefit by
her grandfather. McInerney worked for only one year during
the marriage; Stone worked as an artist and then as a mental
health counselor, making a modest salary. During the
marriage, the family was supported primarily, if not
exclusively, by Stone's income from her employment and
by his guardian, and Stone executed a separation agreement,
which was incorporated into the judgment of divorce nisi. The
separation agreement was later amended by stipulation and
approved by a judge of the Probate and Family Court. The
amended separation agreement (ASA), dated January 26, 2007,
settled McInerney's and Stone's rights and
obligations to one another upon dissolution of their
marriage. In pertinent part, the ASA provided
that Stone would transfer approximately thirty-five percent
of the funds in her KeyBank accounts to a spendthrift trust
to be created for McInerney. In addition, the ASA
contained provisions regarding the marital home, a vacation
home in Maine, the purchase of a home in Plymouth for
McInerney, and other assets, including assets inherited by
Stone. The ASA provided that the division of assets would
survive entry of the judgment of divorce nisi and would have
independent legal significance. By approving the ASA and
incorporating it into the judgment of divorce nisi, the
Probate and Family Court judge found that the terms were fair
Creation of the Brian K. McInerney Irrevocable
Brian K. McInerney Irrevocable Trust (trust) was created on
March 23, 2007, and, though irrevocable, the trustees were
given complete discretion to distribute as much of the income
and principal of the assets in the trust as they felt were
necessary to meet the reasonable needs of McInerney. The
terms of the trust identified Stone as the settlor, McInerney
as the beneficiary, and their children, Elise and Dru, as the
remainder beneficiaries. The trustees at that time were
McInerney's sister and guardian (Jean E.
McInerney), and Bank of America as the corporate
trustee. The trust provides that the "interest of any
beneficiary created herein, either as to income or principal,
shall not be alienated, anticipated or in any other manner
assigned by such beneficiary and shall not be subject to
legal process, bankruptcy proceedings, or the interference or
control of creditors."
to the ASA, on May 7, 2007, Stone transferred $3, 538, 402.34
of stocks and bonds to the trust. She also transferred the
Plymouth home valued at $538, 400 into the trust. In
addition, McInerney transferred assets standing in his own
name, totaling more than $120, 000, into the trust.
The motor vehicle ...