August 2, 2013, Utah Supreme Court Case Summaries

In re Estate of William J. Hannifin, 2013 UT 46, No. 20111125 (August 2, 2013)

ISSUE: Doctrine of equitable adoption preempted by statute

Justice Lee,

Max Hill, in his capacity as Special Representative of the Estate of William J. Hannifin, appeals from a district court order awarding Willis Nakai a portion of that estate. Though Nakai is neither biologically nor legally related to Hannifin, the district court determined that he was nonetheless entitled to inherit under the doctrine of equitable adoption

At ¶ 1.

We reverse. We hold that the doctrine of equitable adoption, first recognized in In re Williams’ Estates, 348 P.2d 683 (Utah 1960), has been preempted by the detailed provisions of Utah‘s Probate Code. See UTAH CODE §§ 75-1-101 to -8-101. And, because Nakai does not qualify under the Probate Code‘s intestate succession provisions, we reverse the decision entitling him to inherit from Hannifin.

At ¶ 2.

The Court outlines the background of this case.

At ¶¶ 3-9.

We have long recognized the axiom “that our precedent must yield when it conflicts with a validly enacted statute.” Patterson v. Patterson, 2011 UT 68, ¶ 37, 266 P.3d 828. Statutes “may preempt the common law either by governing an area in so pervasive a manner that it displaces the common law” (field preemption) “or by directly conflicting with the common law” (conflict preemption). OLP, L.L.C. v. Burningham, 2009 UT 75, ¶ 16, 225 P.3d 177. Preemption may be indicated expressly, by a stated intent to preempt the common law. “More often,” however, “explicit pre-emption language does not appear, or does not directly answer the question. In that event, courts must consider whether the . . . statute‘s structure and purpose or nonspecific statutory language nonetheless reveal a clear, but implicit, pre-emptive intent.” Bishop v. GenTec Inc., 2002 UT 36, ¶ 9, 48 P.3d 218 (alteration in original) (internal quotation marks omitted).

At ¶ 10.

We have relied on “the federal model for determining whether federal law preempts state law” to determine “whether a state statute preempts the common law.” Id.; see UTAH CODE § 68-3-2(1) (“The rule of the common law that a statute in derogation of the common law is to be strictly construed does not apply to the Utah Code.”). Under that model, “[f]ield preemption occurs when the scope of a statute indicates that [the legislature] intended [a statute] to occupy a field” in such a way “as to make reasonable the inference that [the legislature] left no room for the [common law] to supplement it.” In re Adoption of A.B., 2010 UT 55, ¶ 31 (internal quotation marks omitted). Conflict preemption, on the other hand, “occurs where it is impossible . . . to comply with both [the common law] and [a statute], or where [the common law] stands as an obstacle to the accomplishment and execution of the full purposes and objectives of [the legislature].” Id. ¶ 33 (alteration in original) (internal quotation marks omitted).

At ¶ 11.

This notion of conflict preemption is reiterated in the Probate Code. Though the Code provides that “principles of . . . equity supplement its provisions,” UTAH CODE § 75-1-103, it also contains an express caveat that principles of equity may not be invoked where they are “displaced by the particular provisions of th[e] code.” Id. A judge-made doctrine that conflicts with a statute is certainly “displaced” by it.

At ¶ 12.

We find the Code to displace the doctrine of equitable adoption recognized in Williams’ Estates. [The Court discusses the facts of Williams’ Estates.]

At ¶ 13.

The Probate Code, enacted fifteen years after we embraced equitable adoption in Williams’ Estates, is in direct conflict with the doctrine in three principal respects: (A) Equitable adoption allows children who cannot satisfy the Probate Code‘s definition of “Child” to nonetheless participate in intestate succession as if they had. (B) Equitably adopted children can take by succession from both natural and adoptive parents—despite the Code‘s clear mandate to the contrary. (C) The doctrine adds confusion and complexity to our law‘s intestate succession scheme, in contravention of the Code‘s stated purpose of streamlining and clarifying the distribution of a decedent‘s estate.

At ¶ 15.

In light of these conflicts, the equitable adoption doctrine cannot be squared with the Probate Code; it is impossible to satisfy both the requirements of the Probate Code and the elements of equitable adoption. This is a doctrine in conflict with the Code, which we therefore repudiate as preempted by statute.

At ¶ 16.

At the time of our decision in Williams’ Estates, our intestate succession statutes did not define the terms “child” or “parent.” See UTAH CODE § 74-4-1 to -24 (1953). They did not distinguish classes of children that could take by succession (such as natural and adopted children) from those that could not (like foster children, stepchildren, and grandchildren). The Probate Code changed the landscape by providing precise definitions of parties legally entitled to take by intestate succession. These provisions displaced the open-ended system within which Williams’ Estates was situated.

At ¶ 17.

[A]ccording to the Code, a “Child” is “any individual entitled to take as a child under this code by intestate succession from the parent whose relationship is involved and excludes any person who is only a stepchild, a foster child, a grandchild, or any more remote descendant.” Id. § 75-1-201(5). “Parent” similarly “includes any person entitled to take, or who would be entitled to take if the child died without a will, as a parent under this code by intestate succession from the child whose relationship is in question and excludes any person who is only a stepparent, foster parent, or grandparent.” Id. § 75-1-201(33). And “for purposes of intestate succession by, through, or from a person, an individual is the child of the individual‘s natural parents” and “[a]n adopted individual is the child of the adopting parent or parents and not of the natural parents.” Id. § 75-2-114(1), (2).

At ¶ 19.

By enacting a Probate Code with a specific definition of “child” that excludes those “equitably” adopted, the legislature preempted common law doctrines that are in conflict with the results those definitions require. . . . Under this scheme and according to these definitions, the only methods of determining who is a child for intestate succession purposes are legal adoption and natural parentage. And Nakai is neither Hannifin‘s legally adopted nor his natural child. The closest Nakai comes to any of the relations delineated in the Probate Code is to a foster child, which is a category specifically excluded from taking intestate. Yet he falls short even there. A foster child/parent relationship is one marked by legal rights and responsibilities, neither of which existed in this case. Nakai thus can have no claim under the Probate Code to a distribution through intestate succession.

At ¶ 20.

Another intractable conflict between the Probate Code and equitable adoption stems from section 75-2-114(1)-(2), which states that “for purposes of intestate succession . . . [a]n adopted individual is the child of the adopting parent . . . and not of the natural parents.” This section operates to prohibit adopted children from taking by intestacy from both their natural parents and their adoptive parents. This is in direct contravention of the doc-trine of equitable adoption, which is purely beneficial to the child and in no way alters the legal relationship between the claimant and the decedent or between the claimant and the biological parents. See infra ¶ 43.

At ¶ 22.

[A]t the time of Williams’ Estates, the Utah Code posed no barrier to a “beneficial” law of equitable adoption that could establish a right of succession from an equitably adopting parent without foreclosing any succession rights on the part of or flowing from natural parents. But when our legislature enacted the Probate Code fifteen years later, it expressly foreclosed that possibility. It did so by enacting section 114, which prevents a child from inheriting from two sets of parents. See UTAH CODE § 75-2-114(1)-(2) (“[F]or purposes of intestate succession . . . [a]n adopted individual is the child of the adopting parent . . . and not of the natural parents.”). That is a significant legislative development in our law in the Probate Code and one that is in direct conflict with equitable adoption.

At ¶ 24.

We do not and cannot require the legislature to use magic words or express references to our precedent to preempt it. So it is no matter that “[n]o provision in the Probate Code mentions . . . equitable adoption” or that “the legislature has not specifically abolished equitable adoption,” as Nakai claims. We look at the words the statute does use, the results those words require, and the scheme that they create to decide whether our precedent has a continuing place in the law. See Bishop, 2002 UT 36, ¶ 9; Burning-ham, 2009 UT 75, ¶ 16. And here the answer is clear. Dual succession is an inherent element of equitable adoption. Yet dual succession is expressly foreclosed by statute. The conflict is palpable and explicit. Again, it is impossible to comply with both the Probate Code and with the judge-made doctrine of equitable adoption, as the former prohibits what the latter requires. And in light of this conflict, our only option is to abandon the doctrine of equitable adoption.

At ¶ 27.

Such abandonment is the only way to maintain fidelity to the objectives expressly detailed in the Probate Code. See Bishop, 2002 UT 36, ¶ 9 (stating the court considers a statute‘s stated objective in determining preemptive intent). As the Code indicates, its detailed intestate succession scheme is designed:

(a) To simplify and clarify the law concerning the affairs of decedents, missing persons . . .;

(b) To discover and make effective the intent of a decedent in distribution of his property;

(c) To promote a speedy and efficient system for ad-ministering the estate of the decedent and making distribution to his successors;

(d) To facilitate use and enforcement of certain trusts; and

(e) To make uniform the law among the various jurisdictions.

Id. § 75-1-102(2).

At ¶ 28.

The doctrine of equitable adoption undermines these objectives by introducing uncertainty, complexity, and inefficiency—the very evils the Probate Code was designed to avoid.

At ¶ 29.

We accordingly jettison the doctrine of equitable adoption as a vestige of a common-law friendly intestacy regime that has been overtaken by statute. Thus, we hold that the administration of Hannifin‘s estate is subject to the express terms of the Probate Code, including terms governing matters of distribution and representation. We reverse and remand for further proceedings consistent with this opinion.

At ¶ 33.

Justice Durham (dissenting),

I disagree with the majority‘s conclusion that it is “impossible” to follow both the doctrine of equitable adoption and Utah‘s version of the Uniform Probate Code (Probate Code or Code). See supra ¶ 16.

At ¶ 34.

Given the dynamic nature of the state law-making process, we assume, absent a contrary indication, that the legislature in-tends its statutes to work in tandem with our case law, and we reconcile the common law with statutory law whenever possible. See Olseth v. Larson, 2007 UT 29, ¶ 39, 158 P.3d 532 (“We presume the Legislature is aware of our case law . . . .”); see also Bishop, 2002 UT 36, ¶ 10 (“[T]he common law must necessarily give way” to statutory law only when the two are “in conflict” or when the legislature intended to preempt the common law.). Conflict preemption occurs only “where it is impossible . . . to comply with both [the common law] and [statutory] requirements, or where [the common law] stands as an obstacle to the accomplishment and execution of the full purposes and objectives of [the legislature].” Navajo Nation v. State (In re Adoption of A.B.), 2010 UT 55, ¶ 33, 245 P.3d 711 (first alteration in original) (internal quotation marks omitted).

At ¶ 36.

When the legislature enacted the Probate Code thirty-eight years ago, 1975 Utah Laws 579–715, it included the following section, which has not been amended: “Unless displaced by the particular provisions of this code, the principles of law and equity supplement its provisions,” UTAH CODE § 75-1-103. The legislature instructed the judiciary not to infer preemption just because the legislature had spoken on a subject. Rather, courts are to find preemption only where the Probate Code directly “displace[s]” a common law doctrine. At the time the Code was enacted with this presumption against preemption, equitable adoption had been the law in Utah for fifteen years. In re Williams’ Estates, 348 P.2d 683 (Utah 1960). Yet nothing in the original Probate Code or its subsequent amendments either addresses or conflicts with equitable adoption.

At ¶ 37.

 

Justice Durham argues that (1) The Probate Code’s Definitions of “Child” and “Parent” do not undermine the doctrine of equitable adoption; (2) the Probate Code’s rule that adopted children cannot inherit from their biological parents is irrelevant to the doctrine of equitable adoption; and (3) the stated objectives of the Probate Code are not in conflict with the doctrine of equitable adoption.

At ¶¶ 38-50.