ESTATE OF STEPHEN E. LIBBY
Argued: November 15, 2017
L. Douglas, Esq. (orally), and Sarah A. McDaniel, Esq.,
Douglas McDaniel & Campo LLC, PA, Westbrook, for
appellants Sherryl L. Albert and the Estate of Stephen E.
Charles E. Gilbert, III, Esq. (orally), Gilbert & Greif,
P.A., Bangor, for appellee Stephen E. Libby II.
SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and
Sherryl L. Albert, individually and as personal
representative of the Estate of Stephen E. Libby (Stephen
Sr.), appeals from a purported judgment of the Penobscot
County Probate Court [R. Bradford, J.) adopting the
report of a referee and imposing a constructive trust on her
interests in real property. Sherryl argues that the court
erred because there was insufficient evidence to support the
referee's conclusion that she committed constructive
fraud. We hold that the court did not err in adopting the
referee's report imposing a constructive trust, but we
remand to the Probate Court with direction to enter an
Stephen Sr. died in November of 2013 and his will, which
named Sherryl as personal representative of his estate, was
filed with the Penobscot County Probate Court in January of
2014. Stephen Sr. identified his five children, including
Sherryl, in his will. At issue in this appeal are transfers
of real property that took place in 2001, 2011, and 2013 from
Stephen Sr. to Sherryl. As a result of these transfers, upon
Stephen Sr.'s death, Sherryl was the sole legal owner of
two properties, and she owned a one-half interest in six
additional properties as a tenant in common with Nancy Libby,
Sherryl's mother and Stephen Sr.'s estranged wife.
While the probate of Stephen Sr.'s estate was underway,
Sherryl filed a complaint against Stephen E. Libby II
(Stephen Jr.), her brother and Stephen Sr.'s son, and he
responded by filing a nine-count counterclaim against
Sherryl. By agreement of the parties and an order dated
February 9, 2016, the Probate Court assigned a referee to
hear Sherryl's claim and Stephen Jr.'s
counterclaim. 14 M.R.S. § 1151 (2017); M.R. Prob.
P. 53; M.R. Civ. P. 53(b)(1).
Stephen Jr.'s counterclaim alleged, in part, that Stephen
Sr. conveyed his property interests to Sherryl conditioned on
her agreement that she would hold the property for the
benefit of all his children and would convey her interests
back to the estate or into an appropriate trust after Stephen
Sr.'s death. Sherryl refused to convey her interests
after Stephen Sr.'s death and Stephen Jr. argued that her
refusal constituted constructive fraud. Stephen Jr. requested
a judgment imposing a constructive trust on the property at
The referee held a two-day testimonial hearing regarding
Stephen Jr.'s counterclaim on December 14 and 16, 2016.
The referee's report, dated January 17, 2017, found in
pertinent part that Stephen Sr. "held his daughter,
Sherryl Albert, in a position of trust, " and found
"by clear and convincing evidence that all of the Maine
real estate conveyed to Sherryl for no consideration or
payment was conveyed to her to hold in trust for [Stephen
Sr.'s] children." The referee concluded that Sherryl
committed constructive fraud and recommended the imposition
of a constructive trust on all of the Maine real estate
Stephen Sr. conveyed to Sherryl in 2001 and thereafter.
Sherryl filed a timely objection to the referee's report.
See M.R. Civ. P. 53(e)(2). The Probate Court held a
hearing on Sherryl's objections and, finding no errors,
adopted the referee's report and ordered judgment
"entered in the record." See 14 M.R.S.
§ 1155 (2017); M.R. Civ. P. 53(e)(2). Sherryl appeals.
18-A M.R.S. § 1-308 (2017); M.R. App. P. 2 (Tower 2016).
"When a trial court accepts a report of a referee, the
findings of the referee become the trial court's
findings, and we review those findings directly."
Wechsler v. Simpson,2016 ME 21, ¶ 12, 131 A.3d
909 (quotation marks omitted). The referee's
"findings are entitled to very substantial deference
because of the referee's opportunity to observe and
assess the witnesses' testimony." Karamanoglu v.
Gourlaouen,2016 ME 86, ¶ 11, 140 A.3d 1249
(quotation marks omitted). ...