In re Simone Garczynski Irrevocable Trust

THE STATE OF NEW HAMPSHIRE

SUPREME COURT

In Case No. 2019-0645, In re Simone Garczynski
Irrevocable Trust, the court on July 29, 2020, issued the
following order:

Having considered the briefs and record submitted on appeal, we
conclude that oral argument is unnecessary in this case. See Sup. Ct. R. 18(1).
We affirm.

The appellant, James Garczynski (James), who is both trustee and a
beneficiary of the Simone Garczynski Irrevocable Trust (trust), appeals an order
of the Circuit Court (Quigley, J.), following a hearing, allowing Michael
Garczynski (Michael), who is James’s brother and also a beneficiary of the
trust, to purchase certain real property that James had acquired from the trust
in 2017. On appeal, James argues that in allowing Michael to purchase the
property, the trial court erred by setting aside an earlier final order in the
absence of a claim of fraud, accident, mistake, or misfortune. See In the
Matter of Harman & McCarron, 168 N.H. 372, 375 (2015). He further argues
that the trial court’s alleged “refusal to enforce the terms of the” prior order is
entitled to no deference, and that the trial court erred by not enforcing certain
terms of the prior order and by not finding that Michael had “unclean hands.”

The trial court proceedings at issue in this case follow our order in In re
Simone Garczynski Irrevocable Trust, No. 2017-0487, 2018 WL 3581069 (N.H.
July 26, 2018) (Garczynski I). In Garczynski I, we vacated a trial court decision
that had denied Michael’s motion to invalidate the trust’s 2017 conveyance of
the property to James and to compel its conveyance to Michael. In vacating
the trial court’s decision, we ruled that the trial court had plainly erred by
ruling that Michael had forfeited his right to purchase the property under an
earlier court order and mediation agreement because the evidence established
that James, as trustee of the trust, had unequivocally refused to convey the
property in accordance with the terms of the earlier order on the mistaken
belief that Michael’s deadline for purchasing the property had passed.

On remand, the trial court held an evidentiary hearing. At the hearing,
Michael testified that if the trial court allowed him to purchase the property, he
should be required to pay the trust, and not James, because the trust had
earlier owned the property, and because he did not trust James to disburse the
purchase money to the trust’s beneficiaries. However, the record establishes
that James had already paid the trust for the property in 2017.
 By notice of decision dated February 8, 2019, the trial court ruled that
Michael was entitled to purchase the property from James. Under the terms of
the order, Michael was granted “30 days from the date of the notice of decision”
to purchase the property, “unless extended by agreement of counsel in writing.”
The February 8 order further provided that, if either party found “it appropriate
to extend Michael’s time to purchase the property,” that party was to send a
written request to extend the deadline both electronically and by mail “no later
than 25 days from the date of this notice.” The parties were then required to
attempt to “schedule the [closing]1 within the remaining 5 days of the ‘purchase
period,’” and if they were “unable to do so, they shall agree to a closing date no
later than 45 days from the date of the notice of decision.” The order required
Michael to provide, at closing, separate bank checks payable to James in the
amounts of $193,000 for the purchase price and $12,330 for one-half of the
carrying costs of the property from the time that James purchased it in
January 2017 through January 2019. If the closing did not occur “within 45
days from the date of the notice of decision,” the order provided that Michael’s
right to purchase the property would be extinguished. Michael timely moved to
reconsider certain aspects of the February 8 order on February 19, 2019.2 The
trial court denied the motion by notice of decision dated March 11, 2019, and
neither party appealed. Accordingly, the February 8 order became a final
judgment on April 11, 2019. See Prob. Div. R. 74(b).

On March 4, 2019, while the motion for reconsideration was pending,
Michael deposited two checks into the trust in the amounts of $193,000 and
$12,330, for the purchase. According to the trust, the checks were “both made
payable to the Simone Garczynski Irrevocable Trust,” rather than to James.
Michael’s attorney advised James’s attorney of the deposit “at that time,” and
requested that the funds be taken from the trust’s account for a closing to

1 The text of the February 8 order stated that the parties were required to attempt to “schedule

the hearing within the remaining 5 days of the ‘purchase period’” if a party requested an
extension of the closing period. (Emphasis added.) However, in its August 14, 2019 order,
which is the subject of this appeal and, as discussed below, contained substantially identical
terms to the February 8 order, the trial court changed the word “hearing,” to “closing.”
Because there is no other reference to a “hearing” in the February 8 order to which the definite
article “the” could be referring, and in light of the context of the order and the trial court’s
alteration of the word “hearing” to “closing” in the August 14 order, we conclude that the word
“hearing” was intended by the trial court to be “closing.”

2 In his reply brief, James asserts that this motion was untimely because February 19 was the

eleventh day from the February 8 notice of decision. We note, however, that Monday, February
18, 2019, was the third Monday of February 2019, and was, therefore, a holiday during which
the court was closed. See RSA 288:1 (2016) (establishing the third Monday of February,
Washington’s Birthday, as a legal holiday); see also Supreme Court Admin. Order 2018-02
(establishing judicial branch holiday schedule for 2019, including Washington’s Birthday on
Monday, February 18, 2019). Accordingly, the deadline for filing the motion for reconsideration
was February 19, and not February 18. See Prob. Div. R. 12.

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occur on March 8. On March 7, counsel for James responded that “they would
get the money back to Michael Garczynski as quickly as they reasonably”
could, but that James “objected to the payment occurring in the way it was
proposed and indicated that Michael Garczynski needs to present the
appropriate bank checks payable to James Garczynski personally or this sale
will not be happening.” Counsel for James further stated on March 7 that the
closing would not occur on March 8, but would occur on March 11.

On March 11, 2019, counsel for Michael appeared at the office of James’s
attorney for the closing. Counsel for James then advised that the closing
would not occur unless Michael’s attorney had a check made payable to
James. At that point, however, the trust had not yet returned the funds that
Michael had paid for the purchase. The parties interpreted the deadlines
under the February 8 order as running from the notice of decision on the
February 8 order rather than the notice of decision on Michael’s timely motion
for reconsideration, and on March 12, 2019, less than forty-five days from
February 8, Michael’s counsel requested an extension of the deadline “because
the money in the trust was accessible to James,” and “if he insisted for
payment in another way, . . . the money would have to be returned and . . .
another check written.” On March 15, 2019, counsel for James responded by
letter stating that James “does not agree to any extensions of the deadline”;
enclosed with the letter were checks, dated March 12, executed by James on
behalf of the trust to Michael in the amounts Michael had paid on March 4.
Michael’s attorney received the March 15 letter on March 18.

Michael did not cash the checks from the trust. Rather, his counsel
maintained possession of them, and on April 9, 2019, two days before the
February 8 order went to final judgment, Michael filed a motion seeking to
compel the transfer of the property using the funds that he had paid the trust
on March 4. James objected, arguing that, because Michael had not provided
a bank check payable to James for the purchase, he had failed to comply with
a condition precedent for the purchase and, thus, was not entitled to purchase
the property. At a hearing on the motion, Michael’s attorney conceded that by
making the March 4 checks payable to the trust, Michael had not literally
complied with the requirement that he provide checks payable to James.
However, he argued that because the funds were available to James, and
because Michael did not, after depositing the funds into the trust, have other
funds with which to write a check to James, the transfer should be allowed to
occur with the funds that Michael had already paid the trust for the purchase.
Michael’s attorney represented that the reason Michael had placed the funds
into the trust “was that he doesn’t trust James with the money.”

On August 14, 2019, the trial court ruled on the motion. The court
observed that the February 8 order was “very specific” and “detailed,” that
Michael was required under the order “to provide a bank check payable to
James . . . for the full amount owed,” that Michael “was well aware” that

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James, and not the trust, owned the property, and that Michael’s “deliberate
actions in disregarding the court orders [by paying the closing funds to the
trust] has delayed resolution of the ownership of the property and caused
additional litigation.” Nevertheless, the trial court noted that it was “a court of
equity,” and that Michael “did provide funds for the purchase and for the
amount then ow[ed] to James . . . for house expenses.” Thus, after
“consider[ing] . . . the information provided at the hearing and in the
pleadings,” the trial court ruled that Michael would be allowed “another
opportunity to purchase” the property. The trial court set forth terms for the
purchase that were substantially identical to those terms set forth in the
February 8 order. In addition, the trial court: (1) authorized James, as trustee,
to withdraw the funds deposited by Michael into the trust on March 4 and to
pay such funds to himself for the purchase if Michael had not cashed the
March 12 checks returning the funds to him;3 (2) ordered Michael to reimburse
James for all of the attorney’s fees that James had incurred since February
2019, and for half the carrying costs for the property during the same time
frame; and (3) authorized James, as trustee, to reimburse himself for the
attorney’s fees and carrying costs from Michael’s distributive share of the trust.

James moved for reconsideration, arguing that the February 8 order was
a final order, that the trial court has authority to “revisit a prior final order” if it
“becomes aware that [the] prior ruling may be legally incorrect,” and that,
although the court “has broad discretion to enter rulings and orders in an
equity matter,” it lacks discretion “to ignore previous orders.” Because the
February 8 order provided that Michael’s right to purchase the property would
be extinguished if the closing did not occur within forty-five days, and because
the trial court found that Michael had not provided a bank check payable to
James for the closing amount within the closing period, James argued that the
trial court had plainly erred by allowing Michael an opportunity to purchase
the property. The trial court denied the motion, and this appeal followed.

At the outset, we conclude that James has not preserved his argument
that the trial court erred by setting aside the February 8 order because there
was no claim of fraud, accident, mistake, or misfortune. It is a longstanding
rule that parties may not have review of arguments that they did not raise in
the trial court. Bean v. Red Oak Prop. Mgmt., 151 N.H. 248, 250 (2004). “The
trial court must have had the opportunity to consider any issues asserted by
the appellant on appeal; thus, to satisfy this preservation requirement, any
issues which could not have been presented to the trial court prior to its
decision must be presented to it in a motion for reconsideration.” McDonough
v. McDonough, 169 N.H. 537, 545 (2016); see also Prob. Div. R. 59-A(1).

3 At a subsequent hearing on James’s motion to reconsider the August 14 order, counsel for

Michael confirmed that he, and not Michael, had possession of the March 12 checks, and that
the checks had not been cashed.

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 Nowhere in his objection to the motion to compel transfer of the property
did James argue that, because the February 8 order was final, Michael was
required to establish fraud, accident, mistake, or misfortune. Nor did James
argue in his motion for reconsideration that the trial court had erroneously set
aside or vacated the February 8 order because there was no fraud, accident,
mistake, or misfortune. To the contrary, although James asserted that the
February 8 order was final, he suggested that the trial court had authority to
revisit the order if it determined that the order was “legally incorrect.”4

Even if the argument were preserved, however, we do not construe the
August 14 order as having vacated or set aside the February 8 order. The
interpretation of a court order is a question of law, which we review de novo. In
the Matter of Salesky & Salesky, 157 N.H. 698, 702 (2008). As a general rule,
a court decree or judgment is to be construed with reference to the issues it
was meant to decide. Id. at 703.

In this case, each party was seeking to enforce the terms of the February
8 order. Michael was arguing, in effect, that although he had not produced a
bank check made out to James individually, he had substantially complied
with the order by timely depositing the closing funds into a trust controlled by
James and requesting that James use those funds for the closing. Michael
pointed out that when James insisted on bank checks made out to him, James
failed either to timely return the funds that Michael had paid the trust so that
a timely closing could occur, or to agree to an extension of the closing deadline.
Thus, he was requesting that the trial court enforce the February 8 order by
compelling the conveyance of the property with the funds he had already paid.
James, on the other hand, was arguing that strict compliance with the
provision requiring bank checks made out to James was required. Because
Michael had not complied with that requirement, James argued that Michael’s
right to purchase the property had been extinguished under the terms of the
February 8 order. Thus, James was essentially seeking a judicial
determination that Michael had forfeited his right to purchase the property.

Within this context, we construe the August 14 order as determining that
Michael had substantially complied with the February 8 order, and enforcing
the February 8 order by allowing the purchase to proceed under the
circumstances and requiring Michael to make James whole for the damages
Michael’s lack of strict compliance with the February 8 order had caused. The
trial court had inherent authority to enforce its earlier judgment. See generally
In the Matter of Kosek & Kosek, 151 N.H. 722, 726-27 (2005). Such authority
is within the trial court’s sound discretion, and we will not overturn the trial
court’s decision absent an unsustainable exercise of discretion. Cf. Simpson v.
Young, 153 N.H. 471, 480 (2006) (addressing the trial court’s refusal to hold a

4 We express no opinion as to the accuracy of this assertion.

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party in contempt). Substantial compliance with a court order will generally
allow a party to avoid a finding of contempt, even if that party’s conduct does
not strictly conform to the requirements of the prior order. Accusoft Corp. v.
Palo, 237 F.3d 31, 47 (1st Cir. 2001); cf. Rand v. Rand, 4 N.H. 267, 277 (1828)
(rejecting challenge to service on basis that service was in “substantial
compliance with the spirit of the order of the judge of probate”). Accordingly,
we reject James’s contention that the trial court’s alleged “refusal to enforce the
terms of the February 2019 order” is entitled to no deference.

In this case, we conclude that the trial court acted well within its
discretion. Even if the thirty-day deadline to close ran from the February 8
notice of decision, and not the March 11 notice of decision on Michael’s timely
motion for reconsideration,5 the record establishes that Michael paid the trust,
which was controlled by James and had previously owned the property, the
closing funds on March 4, well within the deadline. The record further
establishes that Michael’s attorney notified James’s attorney of the deposit “at
that time,” and requested that the funds be used at a March 8 closing.
Notwithstanding the requirement that a party seeking to extend the thirty-day
deadline notify the other party of the need for an extension within twenty-five
days of the notice of decision, James’s attorney responded on March 7, more
than twenty-five days after February 8, by rescheduling the closing to March
11, insisting that Michael provide a bank check to James personally at the
closing, and committing to returning the funds that Michael had paid the trust
“as quickly as they reasonably” could. James did not, however, return the
funds to Michael so as to allow Michael to obtain a bank check for the March
11 closing. Moreover, notwithstanding the parties’ obligation to agree to a
closing date within forty-five days of February 8 if an extension were deemed
necessary, James refused any extension other than the extension that he had
unilaterally scheduled, and did not return the funds to Michael until after the
March 11 closing date had passed.

On this record, we conclude that the trial court sustainably exercised its
discretion by allowing Michael to purchase the property, by not strictly
applying the provision of the February 8 order stating that the right to
purchase would be extinguished if the closing did not occur within forty-five
days, and by ordering Michael to reimburse James for the costs James had
incurred as a result of Michael’s failure to provide bank checks payable to him.
Likewise, we conclude that the trial court sustainably exercised its discretion
by not finding that Michael had “unclean hands” barring equitable relief. See
Polonsky v. Town of Bedford, 173 N.H. ___, ___ (decided April 24, 2020) (slip op.

5 Since the parties, both in the trial court and on appeal, have interpreted the February 8 order

as calculating the thirty-day and forty-five-day deadlines from the notice of decision on the
February 8 order, we will assume, without deciding, that this interpretation of the February 8
order is correct.

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at 12-13) (rejecting unclean hands argument on basis that trial court’s decision
to allow equitable relief was not an unsustainable exercise of discretion).

Affirmed.

Bassett, Hantz Marconi, and Donovan, JJ., concurred.

Timothy A. Gudas,
Clerk

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