United States District Court, D. Massachusetts
WILMINGTON SAVINGS FUND SOCIETY, FSB, d/b/a CHRISTIANA TRUST, NOT IN ITS INDIVIDUAL CAPACITY, BUT SOLELY AS TRUSTEE FOR BCAT 2015-14BTT
NINA B. COLLART et al.
MEMORANDUM AND ORDER ON CROSS MOTIONS FOR SUMMARY
Richard G. Stearns, United States District Judge.
Savings Fund Society, FSB (Wilmington), brought this lawsuit
against Nina Collart (Nina) and Thomas Mann, Jr.
(collectively defendants). At issue is the validity of a mortgage
executed by Lucien Collart, Jr. (Lucien) on the Collart
family property in Harwichport, Massachusetts. The Amended
Complaint alleges fraudulent transfer (Count IV) and seeks a
declaratory judgment (Count I), an equitable lien (Count II),
and a constructive trust (Count III). Both parties have moved
for summary judgment. For reasons that will be explained, the
court will allow defendants' motion on Counts III and IV,
enter a declaratory judgment invalidating the Mortgage, and
grant Wilmington an equitable lien.
following facts are not disputed by the parties. On March 26,
1999, Anne Collart (Anne) and Lucien, together with their
daughter Nina, acquired a real property interest in 679 Route
28, Harwichport, Massachusetts (the Property), as joint
tenants with right of survivorship. On May 18, 1999, the
Collarts executed three nearly identical Declarations of
Trust establishing the Anne Trust, the Nina Trust, and the
Lucien Trust, in which each family member was the sole
beneficiary of the Trust bearing his or her name. Anne was
the initial Trustee of the Lucien and Nina Trusts. Lucien was
the initial Trustee of the Anne Trust. That same day, the
Collarts granted each Trust an undivided, one-third interest
in the Property and an adjacent lot (681 Route 28,
Harwichport, Massachusetts) as tenants in
died on April 18, 2002. Anne's will bequeathed Lucien
certain personal property and distributed the remainder of
her estate into two trusts: the Tax Shelter Trust Fund and
the Marital Trust Fund (the Estate Trusts). The terms of the
Estate Trusts entitled Lucien to the net income of the
Trusts, but permitted him to access the principal only if he
was otherwise unable to maintain his standard of living. Upon
Lucien's death, Nina was to receive the remaining corpus
of the Estate Trusts. Despite the explicit instructions of
Anne's will, Lucien did not transfer any of Anne's
estate to the Estate Trusts, nor did he appoint a successor
Trustee for the Lucien Trust. Nina, however, appointed Mann
as the successor Trustee of the Nina Trust on March 8, 2006,
and recorded the appointment on September 17, 2007.
years after Anne's death, Lucien - at the behest of his
friend, Brenda Tri - undertook the purchase of an additional
property located at 299 Main Street in South Dennis,
Massachusetts (the Bass River Property) for $2.3
million. On April 17, 2007, Lucien closed on the
property and paid the sellers, Edward and Debbie Crowell, a
deposit of $230, 000. To satisfy the remaining balance, Lucien
liquidated assets from Anne's estate and her Individual
Retirement Account (IRA), as well as his own portfolio and
IRA. Still short of funds, Lucien executed a mortgage (the
Mortgage) against the Property with Bank of America, N.A.
(BOA) on June 13, 2007, to secure a $500, 000 home equity
line of credit (HELOC). The Mortgage was recorded with the
Registry of Deeds on August 7, 2007 and identifies the
Grantor as “LUCIEN R. COLLART JR., AN UNMARRIED
PERSON.” Defs.' Ex. I (Dkt # 40-9) at 2. Lucien
subsequently completed his purchase of the Bass River
Property using the full HELOC.
concern for her father's mental health (and Tri's
influence on his financial affairs), Nina petitioned the
Probate Court to appoint a conservator for Lucien on July 29,
2008. The Probate Court approved the petition
and appointed John Conathan II as Lucien's guardian,
responsible for managing all of Lucien's property,
finances, assets, and obligations. Between July 30, 2008, and
July 30, 2010, Conathan made regular payments on the HELOC
account, totaling $23, 358.10. On counsel's advice (that
the Mortgage was invalid), Conathan stopped making payments
on the HELOC.
this time, Conathan negotiated a settlement of the Bass River
Property litigation, which included a sale of the property
for $1.75 million. The settlement also required the Crowells
to pay Lucien $250, 000. To approve the sale, Conathan sought
the appointment of a Guardian ad Litem in May of 2009. The
Probate Court's appointee, Carol Kenny, determined that
selling the Bass River Property was in Lucien's best
interest. On November 17, 2009, the Probate Court approved
the sale after receiving Kenny's report. Conathan used the
proceeds of the sale to fund a securities account on behalf
of Lucien, Anne's estate, and Nina. Despite Kenny's
recommendation, Conathan did not use any of the proceeds to
satisfy the balance owed on the HELOC.
passed away on August 28, 2013. On June 15, 2015, the Probate
Court entered an Order of Final Settlement granting Nina the
balance of Lucien's estate - approximately one million
dollars. Nina subsequently recorded her appointments as the
successor Trustee of the Anne Trust and the Lucien Trust. BOA
assigned the Mortgage to Wilmington on September 16,
2015. In a letter dated November 2, 2016, Nina,
acting through counsel, requested that Wilmington discharge
the Mortgage. On June 17, 2017, acting in her capacity as
Trustee of the Anne and Lucien Trusts, Nina conveyed the
Property to herself in her individual capacity.
November 9, 2017, Wilmington initiated this lawsuit. Both
parties moved for summary judgment on January 4,
2019. The court heard argument on February 27,
judgment is appropriate when the record, viewed in the light
most favorable to the nonmoving party, reveals “no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). “[T]he 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, 247-248 (1986) (emphases in
original). This standard does not change on cross-motions -
the court views each motion separately and draws all
reasonable inferences in favor of the non-moving party.
Pac. Indem. Co. v. Deming, 828 F.3d 19, 23 (1st Cir.
Validity of the Mortgage
Count I, Wilmington seeks a declaratory judgment
acknowledging the Mortgage as a valid encumbrance and first
priority lien on the Property. Because the validity of the
Mortgage turns on the facts as they existed in June of 2007
and is central to a resolution of the dispute between the
parties over the $500, 000 HELOC, the court is satisfied that
Count I presents an actual controversy ripe for judicial
resolution. See Verizon New Eng., Inc. v. Int'l Bhd.
of Elec. Workers, Local No. 2322, 651 F.3d 176, 188 (1st
Cir. 2011) (reciting the “fitness” and
“hardship” standards for declaratory judgment).
Mortgage was Executed in Lucien's Individual
maintain, and the court agrees, that Lucien had no authority
to execute the Mortgage in his individual
capacity. A trustee may only bind the trust estate
if he is acting in his capacity as trustee. Rogaris v.
Albert, 431 Mass. 833, 836 (2000), citing Restatement
(Second) of Trusts § 271 cmt. b (Am. Law Inst. 1957).
“[W]hatever authority the signer may have to bind
another, if he does not sign [in that capacity], he binds
himself, and no other person.” Id.
(alterations in original), quoting Stackpole v.
Arnold, 11 Mass. 27, 29 (1814). A trust cannot be bound
by a conveyance that makes no reference to the trust or to a
party's role as trustee. See Id. Where a grantor
“has nothing to convey . . . [t]he purported conveyance
is a nullity, notwithstanding the parties' intent.”
Bongaards v. Millen, 440 Mass. 10, 15 (2003).
the Mortgage was made between “LUCIEN R COLLART JR., AN
UMARRIED PERSON . . . and Bank of America, N.A.”
Defs.' Ex. I (Dkt # 40-9) at 2. Lucien signed the
Mortgage in his own name and did not indicate that he was
signing in his capacity as the Trustee for any
Trust.Moreover, the Mortgage makes no reference
to any of the nominee Trusts, nor does it otherwise indicate
that Lucien was acting on behalf of their interests. The
parties do not dispute that as of June 13, 2007, Lucien owned
no part of the Property individually. Accordingly, when
Lucien executed the Mortgage in his individual capacity, he
had nothing to convey to BOA and the purported encumbrance
was a nullity. See Bongaards, 440 Mass. at 15
(invalidating a conveyance because the trustee had no
authority to convey the property in her individual capacity).
Authority to Mortgage the Property
response, Wilmington first argues that the Mortgage is
nonetheless valid because Lucien “possessed complete
authority over the Lucien Trust and the Anne Trust.”
Pl.'s Opp'n (Dkt # 52) at 2. I disagree. “The
interpretation of a written trust is a matter of law to be
resolved by the court. The rules of construction of a
contract apply similarly to trusts; where the language of a
trust is clear, we look only to that plain language.”
Ferri v. Powell-Ferri, 476 Mass. 651, 654 (2017)
(citations omitted). In Massachusetts, nominee trusts are
trusts created to hold title to real property in which the
trustee has “only perfunctory duties.”
Roberts v. Roberts, 419 Mass. 685, 687 (1995). The
defining feature of a nominee trust ...