Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Murchison v. Inter-City Mortgage Corp. Profit Sharing & Pension Plans

June 12, 2007

BETTY B. MURCHISON, PLAINTIFF,
v.
INTER-CITY MORTGAGE CORPORATION PROFIT SHARING & PENSION PLANS, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Richard W. Roberts United States District Judge

MEMORANDUM OPINION

The court of appeals has issued a judgment ("Judgment") affirming in part, vacating in part, and reversing in part the order accompanying the August 10, 2001 memorandum opinion ("August opinion") in this case. The court vacated that part of the order denying relief to plaintiff Betty B. Murchison ("Betty") on Count V of her complaint concerning assets of a joint venture, and reversed that part of the order that did not require defendant George Murchison ("George") to pay back to the Inter-City Mortgage Corporation Profit Sharing Plan (the "Plan") what the Plan lost due to Plan transactions George conducted that were prohibited under ERISA.

In addition, Betty has moved to hold George in contempt of an order that he file a declaration that he has provided to Betty an accounting of Murchison Brothers Partnership assets and any distribution due her from them, and a statement of receipts and disbursements reflecting the final accounting. She has also moved for an additional award of attorney's fees and for payment of the funds collected by the receiver.

I. Joint Venture

Count V of Betty's complaint asks that George be required to account to her for the proceeds of the sale of the Central Avenue Property. That property was not controlled by the Murchison Brothers partnership identified in Count IV and referred to throughout the August 10, 2001 memorandum opinion ("August opinion") as the "Partnership." It was controlled by what plaintiff called the Murchison, Murchison and Ricks partnership, which was not named in her complaint but will be referred to here as "MMR." (Tr. Trans. Vol. I, at 30-31.) The August opinion, see August opinion at 11-12, attributed Betty's testimony regarding receipt of only two distributions in 1995 to the Murchison Brothers partnership when she actually was testifying about the MMR partnership. Because the record showed that Betty was entitled to an accounting of Murchison Brothers partnership assets, she was granted relief on that request in Count IV.

The court of appeals noted that the August opinion offered no cause for refusing an accounting on the Count V property controlled by the MMR partnership, referred to in the remand judgment as the "joint venture," Judgment at 2, to which D.C. law entitled her. I read the judgment as requiring an accounting for the joint venture and I will order one. The court of appeals also noted that the August opinion did not explain whether I credited Betty's claim that she did not receive more than $15,000 of the joint venture's proceeds. I will expand on my finding cited in the remand that Betty "has failed to provide sufficient evidence to prove that the portion of assets that George paid her was less than the amount to which she was entitled."

I am not persuaded that Betty received less than what she was entitled to from the Central Avenue property beyond the $15,000 payout. She testified that she remembered "asking for maybe two distributions and that's all. Possibly -- no, I think two." (Tr. Trans. Vol. II, at 131.) Had such a claim been about the Murchison Brothers partnership, which handled more properties, it would have been less troublesome in supporting a claim for accounting of that partnership's assets. However, George's testimony more persuasively undermined Betty's on this issue concerning the Central Avenue property. First, his testimony on this was emphatic, credible, and plausible. When Betty's lawyer asked George if he sent checks to Betty for her share of rents and mortgage payments on the Central Avenue property, he pointedly replied: "No. Betty Murchison came in and made different withdrawal requests, which she usually would ask Mr. Ricks and he'd come in and Mr. Ricks and I would sign the checks and give the disbursed checks to her." (Tr. Trans. Vol. II, at 20)(emphasis added.) He added without contradiction that he had provided all those records during the document inspection conducted by Betty's lawyer. (Id. at 20-21.) The 1997 and 1998 K-1 tax forms were evidence of these additional payments.

Evidence of certain behavior by George added to George's credibility. He had actively objected over time to the unprincipled distributions of Plan assets by Betty's husband. Unlike John's behavior, George actively took steps after John's death to make good to the Plan the hundreds of thousands of dollars in losses caused by John's conduct. While George's methods used were prohibited, his intentions in those efforts contrasted starkly with what appeared to be plaintiff's attempt to ascribe the Plan's pecuniary condition largely to George.

II. Plan Repayment

George was a Plan fiduciary and conducted transactions that were prohibited by ERISA. The court of appeals held it error to decline to order George to repay to the Plan any losses that could be chalked up to his prohibited transactions. George will be ordered to make such repayments.

Not all of George's prohibited transactions, though, resulted in losses to the Plan. Some - - his transfers of promissory notes and real estate interests to the Plan to make up for John's loan activity that depleted Plan assets - - involved gains to the Plan. The prohibited transactions that resulted in losses to the Plan totaled $137,114.74. August opinion at 16-17.*fn1

Because John's prohibited actions as a Plan fiduciary also resulted in losses to the Plan, it would be inequitable to require only George and not John's estate to make good to the Plan the losses caused by prohibited transactions. I do not read the court of appeals' judgment as prohibiting a "make good" order against John's estate. As John's prohibited actions caused a loss to the Plan of $786,365.16, August opinion at 16, Betty as personal representative of John's estate, will be ordered make good to the Plan the losses John caused.

III. Motion for Contempt

The August opinion ordered George to provide for an accounting of the Partnership assets to Betty and to distribute to her any interest in the Partnership that remains due to her. A later order required George to file a declaration by December 27, 2002 that he has complied and a statement of receipts and disbursements reflecting the final ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.