United States District Court, D. Maryland
J. HAZEL United States District Judge
an action by Plaintiffs Quinn Breece Lobato
("Lobato"). as current sole Trustee of the
Breece/Hcmdon Family Trust ("the Trust"), and
Vanessa Christine Breece. Otin Blair Breece. and Adam Samuel
Breece. as beneficiaries of the Trust, (collectively.
"Plaintiffs"), against Defendants Susan K.
I lerndon. Amelia Marie Breece. and Benjamin Scott
Breece (collectively. "Defendants"), to
recover financial assets held by Herndon and seek damages for
alleged fraud, conversion, and tortious interference with
contract. See LCF No. 1. Presently pending before
the Court is Defendants" Motion to Dismiss Pursuant to
Fed.R.Civ.P. 12(b)(2). (3). (4). (5). and (6). ECF No. 14. No
hearing is necessary. See Loc. R. 105.6. For the
reasons stated below. Defendants' Motion to Dismiss is
Breece and Susan Hcrndon were married on July 29, 1991. See
ECF No. 21 at 1.Ms. Herndon had not previously been
married, nor had any children. Id. at 24. Mr. Breece
had four children from two previous marriages: Vanessa. Olin,
Adam, and Quinn Breece. See id Mr. Breece and Ms.
Herndon later had two children together. Amelia and Benjamin
Breece. Mr. Breece and Ms. Herndon created a
"revocable inter vivos trust" the
"Brcece/Herndon Family Trust" on September 2. 1992.
ECF No. 1 ¶ 11; ECF No. 1-5. At that time. Mr. Breece and
Ms. Herndon lived together at 4811 Mercury Drive. Rockville.
Maryland 20853 (the "Maryland Residence"). Mr.
Breece's four other children also lived in Maryland.
design and operation of the Trust is complex, but the
relevant provisions, included in the Amended Trust, are as
follows: during the lives of both Mr. Breece and Ms. Herndon
(the "Grantors" or the "Undersigned"),
the Trust was to be divided into two separate sub-trusts, the
'R.O.B. Trust" and the "S.K.I I. Trust."
which belonged to Robert Breece and Susan Herndon.
respectively. ECF No. 1 ¶ 14: see No. 1-5 at 1.
Properly held in these two Trusts was intended to be
"exclusive property" of each Grantor, and
"separate property at the time of such conveyance or
transfer, shall remain the separate property of the
Undersigned transferring such property to the Trustees."
id. at 1.3.
governed by Article XXII of the Trust, alter the first
Grantor died, the "Trust Estate" would be divided
into "two separate Trusts." the "Marital
Trust" and the "Family Trust." ECF No. 1-5 at
9. The Marital Trust would "consist of the survivorfs].
. . separate property in the Trust Estate and a fractional
proportion in all property of the [deceased Grantor]."
subject to a marital tax exemption. ECF No. 1-5 at 9; ECF No.
19-3 at 6. The Family Trust would consist of "the
balance of the Trust Estate remaining after setting aside all
property of the Trust Estate that is included in the Marital
Trust." ECF No. 1-5 at 11. After the second Grantor
died, as governed by Article XXIII of the Trust, "all
Trust principal" was to be "held in Trust for the
benefit of [the Grantors" | beneficiaries." ECF No.
1-5 at 12. The beneficiaries of the Trust would be the
"children of the Undersigned then living and children of
the Undersigned then deceased but leaving surviving
issue." A/, at 13. Further, part of the Trust was to be
"set-aside" for the support and education of
beneficiaries under the age of 21. Id.
document known as "Schedule A." dated September 2.
1992. Herndon transferred all of her interests in several
"Private Limited Partnership Interests." of which
she was the stated owner, to the S.K.H. Trust. ECF No. 1-5 at
18-19. These Partnership Interests included the Herndon
Family Limited Partnership (the "HFL Partnership"),
as well as the Breece Family Limited Partnership, the S.K.H.
Family Limited Partnership, and the Smith Mountain Family
Limited Partnership (the "Other Partnerships"). The
Limited Partnership Agreement of the HFL Partnership
describes Susan Herndon as owning a 98% interest in the HFL
Partnership. ECF No. 1-13 at 2.
Breece and Ms. Herndon divorced on January 14. 2003. ECF No.
21 at 1-2. A Property Settlement Agreement, dated October 29.
2002. was incorporated into the parties' Final Divorce
Decree. ECF No. 1 ¶ 19: ECF No. 21 at 4. Robert Breece
died six years later on August 10. 2009. ECF No. 1 ¶ 29.
Susan Herndon qualified to act as the Administrator ol"
Robert Breece's Estate (the "Estate"). ECF No.
1 ¶ 29. Herndon probated, or established the validity
of. a copy of Robert Breece"s Last Will and Testament
(the "Will") in the Circuit Court of Warren County,
Virginia (the "Warren County Court"). Id.
¶ 30. Upon Plaintiff Lobato's request. Herndon also
emailed Lobato a copy of the Will, along with a copy of the
Trust, in January 2010, Id. at 5. The copy of the
Trust sent by Herndon did not include Schedule A.
Id. ¶ 36.
Quinn Breece Lobato was elected to act as Co-Trustee of the
Trust by a majority of the Trust's beneficiaries (four of
the six Breece children) on November 14. 2010. ECF No. 1
¶ 52. Throughout 2010 and 2011. the family was
litigating several lawsuits that had been filed against
Robert Breece's Estate. Id. at 8. Herndon told
Lobato that she did not intend to transfer assets from the
Estate to the Trust until the lawsuits were resolved.
Id. ¶ 54. Herndon also told Lobato that the
Trust had been "created" but not
"funded." Id. ¶ 55: sec also
¶; 48. I lowever. I Icrndon allegedly transferred $50,
000 from the Estate to the Trust in November 201 0.
unbeknownst to Plaintiffs. Id. c¶
56-57. The lawsuits against Mr. Breece's Estate were not
resolved until November 2011. Id. ¶ 58. On
November 27. 2011. Lobato sent Herndon a letter, notifying 1
Icrndon that Lobato had been elected to act as Co-Trustee of
the Trust. Id. ¶ 60.
November 29. 2011. Herndon's Virginia attorney mailed a
letter to Lobato. refusing to recognize Lobato's status
as Trustee, and claiming HerndoiTs authority to act as Sole
Trustee of the Trust. ECF No. 1 ¶ 60. Lobato filed suit
in the Warren County Court in November 2012. seeking a
declaratory judgment regarding the validity of her status as
Trustee. Id. ¶ 63. During this litigation, two
family members. Daniel Breece and Frederick Rodriguez, were
appointed to serve as Co-Trustees. ECF No. 1 ¶ 64:
see ECF No. 19-3 at 10. Herndon resigned as Trustee
in May 2013. ECF No. 1 ¶ 65. The Warren County Court
entered an order on October 10. 2014. confirming that the
election of Lobato as Trustee was authorized by the terms of
the Trust, and that Lobato had the authority to act as
Trustee. Id. ¶ 67. In the order, the Warren
County Court also removed Daniel Breece as a Trustee, and Mr.
Rodriguez resigned as Trustee on October 20. 2014.
Id., ¶¶ 68-69. In October 2014. Ms. Lobato
received a number of Trust-related documents from Daniel
Breeee's wife. Id. ¶ 70. Upon review of
these documents. Lobato first discovered "Schedule
A." which included the previously-undisclosed
Partnerships of Ms. Herndon. Id. ¶ 71, Lobato
contends that the HFL Partnership consists of accounts valued
at $510, 632.86. ECF No. I at 10. Plaintiffs claim that this
money belongs to the Trust, and therefore bring suit against
fled the instant Complaint on September 30. 2015. Plaintiffs
allege claims of Detinue (Count I). Fraud (Count II).
Conversion (Count III), and Tortious Interference with
Contract (Count IV). In support of Count I. Plaintiffs allege
that Herndon has made unauthorized "distributions to
herself from the HFL Partnership after Mr. Breeee's
death, and now "unjustly detains" the HFL
Partnership. ECF No. 1 at 11. In support of Count II.
Plaintiffs allege that I Ierndon committed fraud when she
made false representations or omissions that the copy of the
Trust was a "true and complete copy." and sent
accountings to Plaintiff Lobato that "did not include
the assets listed on Schedule A." Id. at 12-1
5. In support of Count III. Plaintiffs
allege that I Ierndon converted Schedule A by "retaining
it and not giving it to Trustee Lobato." Id. at
16. In support of Count IV. Plaintiffs allege that Herndon
interfered with Lobato's right to act as Trustee by
refusing to acknowledge Lobato's status as Co-Trustee and
hiring an attorney to prevent Lobato from acting as Trustee.
Id. at 16-17. Defendants, through counsel, have
tiled a Motion to Dismiss the Complaint Pursuant to
Fed.R.Civ.P. 12(b)(2). (3). (4). (5). and (6). HCT No. 14.
Plaintiffs filed their Opposition. BCF No. 19. and Defendants
filed their Reply. ECF No. 20.
Process and Sen ice of Process - Fed.R.Civ.P. 12(h)(4) and
Standard of Review
may. as here, challenge the sufficiency of process or service
of process under Fed.R.Civ.P. 12(b)(4) and (b)(5).
O'Meara v. Waters, 464 F.Supp.2d 474. 476 (D.
Md. 2006). Following such a motion. Plaintiffs bear the
burden of establishing the validity of service under Federal
Rule of Civil Procedure 4. Id. Rule 4. which governs
summons in a civil action, provides in relevant pan that
"any person who is at least 18 years old and not a party
may serve a summons and complaint." Fed.R.Civ.P.
4(c)(2). Rule 4 further provides that service may be made by
"delivering a copy of the summons and of the complaint
to the individual personally." Or by "leaving a
copy of each at the individual's dwelling or usual place
of abode with someone of suitable age and discretion who
resides there." Fed.R.Civ.P. 4(e)(2).
fourth Circuit has provided that in cases where service of
process has given a defendant actual notice of the claim
against it. courts may adopt a liberal interpretation of Rule
4 and "uphold the jurisdiction of the court."
Karlsson v. Babmowitz, 318 F.2d 666. 668 (4th Cir.
1963). While the "plain requirements for the means of
effecting service of process may not be ignored." where
the defendant has actual notice of the action, "every
technical violation of the rule or failure of strict
compliance may not invalidate the service of process."
Arnico. Inc. v. PenrodStauffer Bldg. Sys. Inc., 733
F.2d 1087. 1089 (4th Cir. 1984).
argue that process was insufficient as to all three
Defendants because the "Return of Service" forms
did not specify that the process server. Stacey Loving, was
over the age of 1 8 and not a party to the action. ECF No.
14-2 at 6. Defendants further argue that with respect to
Defendants Susan Hemdon and Benjamin Breecc. the forms also
do not specify "the dwelling place where process was
left" or "the name of the receiving person or
agent." Id. Additionally. Defendants argue that
service of process was insufficient as to Benjamin Breece
because his "dwelling or usual place of abode" is
where he attends college in Terre Haute. Indiana.
Id., at 7. Defendants arguments are unpersuasive.
support of the sufficiency of service. Plaintiffs attach the
affidavit of the process server, Stacey Loving. ECF No. 19-2.
While the "Return of Service" form is silent as to
her age. Loving testifies in the affidavit that she is
"over the age of 18" and "not a party to the
above-captioned action." ECF No. 19-2. Moreover, the
Return of Service forms do not even list a designated line to
write the date of birth of the process server - only lines
for a signature, name. address, and phone number.
See ECF No. 14-1 at 11-13. Additionally, the plain
language of Rule 4 does not require the return of service
form to include the date of birth of the process server, or
even the production of a return of service form at all.
Fed.R.Civ.P. 4(c). Rule 4 ...