Elkin King v. Forrest King, Jr.
U.S. Court of Appeals for the Eleventh Circuit
Elkin King v. Forrest King, Jr., 69 F.4th 738 (11th Cir. 2023)
Elkin King v. Forrest King, Jr.
Opinion
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[PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 20-14565
____________________
ELKIN KING,
Plaintiff-Appellant,
versus
FORREST KING, JR.,
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Middle District of Florida
D.C. Docket No. 3:18-cv-01427-BJD-MCR
____________________
Before WILSON, BRANCH, and TJOFLAT, Circuit Judges.
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2 Opinion of the Court 20-14565
PER CURIAM:
Elkin King (“Elkin”) brought a diversity suit 1 against his for-
mer stepfather, Forrest King, Jr. (“Forrest”), alleging that Forrest
owed him a fiduciary duty to disclose the existence of certain Set-
tlement Funds arising from the wrongful death of Elkin’s biological
father. We previously certified three questions to the Supreme
Court of Georgia regarding Elkin’s breach of fiduciary duty for fail-
ure to disclose claim. With the benefit of their response, we now
vacate the District Court’s grant of summary judgment to Forrest
on the failure to disclose claim and remand the matter for further
proceedings.
I.
The facts of this case, as reproduced from our previous opin-
ion certifying questions to the Supreme Court of Georgia, are as
follows:
On September 6, 1985, Elkin’s biological fa-
ther, Elkin Simpson, Sr., was killed in a plane crash.
Elkin, then named Elkin Simpson, Jr., was approxi-
mately seven years old. At the time of his death, Elkin
Simpson, Sr., was in the process of divorcing Elkin’s
mother, Peggy, but a final divorce decree had not yet
been entered. See Simpson v. King, 383 S.E.2d 120, 121
(Ga. 1989) (further describing Elkin Simpson, Sr.’s
marital and relationship status at the time of his
1 See 28 U.S.C. § 1332.
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20-14565 Opinion of the Court 3
death). Accordingly, Peggy filed a wrongful death
suit against the airline company as a surviving spouse
on behalf of herself and Elkin. See O.C.G.A. § 51-4-2
(1991). In 1989, when Elkin was approximately
eleven, Peggy and the airline company reached a set-
tlement agreement from which at least $200,000 was
set aside for Elkin’s benefit (“the Settlement Funds”).
Peggy’s attorney, Glover McGhee, suggested that the
Settlement Funds should be placed in an account in
her then-husband Forrest’s name. Peggy agreed, and
so the Settlement Funds check was made out to both
Peggy and Forrest on behalf of Elkin. Forrest then
placed the Settlement Funds in a separate account en-
titled “Elkin’s Account with Custodian of Forrest
King” at Charles Schwab in Atlanta, Georgia. The
parties dispute whether Peggy was also a party to the
account. There is no evidence that a formal, written
trust governing the use of these Settlement Funds
ever existed.
Forrest and Peggy divorced in approximately
February 1999, when Elkin was 20 years old. The par-
ties dispute whether Forrest turned over control of
the account to Peggy following the divorce, but it is
undisputed that Forrest’s name was on the account
until at least the divorce. Apparently, the last of the
Settlement Funds (approximately $50,000) was used
by Peggy in around 2005 as a down payment for a
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4 Opinion of the Court 20-14565
condominium she purchased in Louisiana. Elkin tes-
tified in a deposition that he first learned about the
Settlement Funds in 2017 from his maternal grandfa-
ther. Elkin also testified that he would have taken
control of the Settlement Funds had he known about
them when he was 18. Forrest, meanwhile, testified
in a deposition that he informed Elkin about the ex-
istence of the Settlement Funds when Elkin was
around 17 or 18 years old.
On November 30, 2018, Elkin sued Forrest in
the Middle District of Florida. In his amended com-
plaint, Elkin alleged that Forrest converted Elkin’s
Settlement Funds and that Forrest breached fiduciary
duties to Elkin under Georgia law because he (1)
“failed to disclose and concealed the fact of the settle-
ment” and (2) “failed and refused to account for [the
Settlement Fund] proceeds or to pay the proceeds to
[Elkin].” In his answer, Forrest responded by raising
the statute of limitations as an affirmative defense.
Following discovery, Forrest moved for summary
judgment on October 14, 2019, on both his statute of
limitations defense and on the merits. In turn, Elkin
moved for partial summary judgment on his claims
on March 30, 2020. On August 24, 2020, the District
Court granted summary judgment for Forrest on the
merits, holding (1) that a jury could find that Forrest
and Elkin were in a confidential relationship under
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Georgia law and so the statute of limitations could be
tolled; (2) that Forrest did not convert the Settlement
Funds because he used them only for Elkin’s benefit;
and (3) that if Forrest did owe Elkin a fiduciary duty
under Georgia law, it was only to “ensure the Settle-
ment Funds were used to [Elkin]’s benefit,” which
Forrest did.
King v. King, Jr., 46 F.4th 1259, 1262–63 (11th Cir. 2022) (per
curiam) (footnotes omitted).
Elkin filed a motion for reconsideration under Federal Rules
of Civil Procedure 59(e) 2 and 60(b). 3 Elkin argued, primarily, that
(1) the District Court had failed to consider the growth of the Set-
tlement Funds while invested in the Charles Schwab account, and
(2) that the Court failed to consider his failure to disclose argument.
The District Court rejected both arguments and denied Elkin’s mo-
tion. With respect to the second argument, the Court found that
2 Rule 59(e) allows a district court to alter or amend a judgment if a motion is
filed no later than 28 days after entry of the judgment. Fed. R. Civ. P. 59(e).
The only grounds for granting a motion to alter or amend a judgment are
newly discovered evidence or manifest errors of law or fact. Arthur v. King,
500 F.3d 1335, 1343 (11th Cir. 2007).
3 Rule 60(b) allows relief from a final judgment, order, or proceeding on the
basis of mistake, inadvertence, surprise, excusable neglect, newly discovered
evidence that, with reasonable diligence, could not have been discovered in
time to move for a new trial, fraud, because the judgment is void, because the
judgment has been satisfied, released or discharged, or for any other reason
that justifies relief. Fed. R. Civ. P. 60(b).
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6 Opinion of the Court 20-14565
Elkin had not sufficiently pleaded a breach of fiduciary duty prem-
ised on a failure to disclose, and that even if he had, “a failure by
Defendant to disclose the existence of the settlement funds does
not alter whether Defendant used the settlement funds for Plain-
tiff’s benefit.”
Elkin timely appealed to this Court. In our earlier opinion,
we held that the District Court correctly granted Forrest summary
judgment on the claim that he breached his fiduciary duty to Elkin
by misusing the Settlement Funds. King, 46 F.4th at 1263–64 n.4.
We further held that Elkin had forfeited his conversion claim by
not raising it on appeal. Id. Finally, though the District Court held
that Elkin had not alleged breach of fiduciary duty claim based on
a failure to disclose, we found that “Elkin’s short and plain state-
ment describing his failure to disclose claim was expressly incorpo-
rated into the breach of fiduciary duty section of his amended com-
plaint. Forrest thus had fair notice of Elkin’s failure to disclose
claim.” Id. at 1263 n.3 (internal quotation marks and citations omit-
ted).
With respect to Elkin’s failure to disclose claim, we certified
the following three questions to the Supreme Court of Georgia:
(1) If a confidential relationship creates a duty to disclose
which, if breached, would constitute fraud sufficient to
toll the statute of limitations, would that duty to disclose
also support a breach of fiduciary duty tort claim under
Georgia law?
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(2) If so, may an adult fiduciary in a confidential relationship
with a minor beneficiary without a written agreement
discharge his duty to disclose by disclosing solely to the
minor’s parents or guardians?
(3) If the adult fiduciary does have an obligation to disclose
to the minor beneficiary directly without a written agree-
ment, when must the adult fiduciary disclose or redis-
close to the minor beneficiary?
Id. at 1267.
II.
The only claim left for us to resolve is whether the District
Court erred when it granted Forrest summary judgment on Elkin’s
breach of duty for failure to disclose claim. With the benefit of the
Supreme Court of Georgia’s answer to our first question, we now
do so.
We review grants of summary judgment de novo. Brown v.
Nexus Bus. Sols., LLC, 29 F.4th 1315, 1317 (11th Cir. 2022). Sum-
mary judgment is proper “if the movant shows that there is no gen-
uine dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Id. (quoting Fed. R. Civ. P. 56(a)).
On summary judgment review, we view all evidence in “the light
most favorable to the nonmoving party” and draw “all justifiable
inferences in that party’s favor.” Id. at 1317–18 (internal quotation
marks omitted).
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As we previously stated, it appears as though Elkin had a
right to control the Settlement Funds when he turned 18. King, 46
F.4th at 1264–65 (citing O.C.G.A. § 19-7-1(a)). We continue to
agree with the District Court that “a reasonable jury could find De-
fendant assumed a fiduciary or confidential relationship with re-
spect to Plaintiff and the Settlement Funds.” [Doc. 71 at 7] It re-
mains true that “when a confidential relationship exists, the failure
to disclose a material fact constitutes fraud for purposes of tolling
the statute of limitations.” King, 46 F.4th at 1265 (citing O.C.G.A.
§ 23-2-53; Doe v. Saint Joseph’s Catholic Church, 870 S.E.2d 365, 371
(Ga. 2022)).
The Supreme Court of Georgia provided guidance as to
whether the same breach of a duty to disclose a material fact in the
context of a confidential relationship—which constitutes fraud suf-
ficient to toll the statute of limitations—would also support a
breach of fiduciary duty tort claim under Georgia law. To begin,
the Supreme Court of Georgia stated that “while all fiduciary rela-
tionships are confidential in nature, only some confidential rela-
tionships are fiduciary relationships.” King v. King, Jr., -- S.E.2d –
(Ga. 2023), 2023 WL 3468616 at *3.
In determining whether a confidential relationship is also a
fiduciary relationship, “the guiding principle is that the fiduciary
has a duty to act with the utmost good faith” and “a failure to act
with the utmost good faith constitutes a breach of fiduciary duty.”
Id. The Court went on to say that when a party to a confidential
relationship has a duty to disclose and breaches that duty in a
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manner sufficient to toll the statute of limitations, “such a breach
could violate a fiduciary’s duty of utmost good faith.” Id. The
Court recently reiterated that standard in Doe. See Doe, 870 S.E.2d
at 371 (“To benefit from tolling under OCGA § 9-3-96, [a plaintiff]
must first establish . . . actual fraud. Doing so requires a showing
of . . . a fraudulent breach of a duty to disclose that exists because
of a relationship of trust and confidence.”) (internal quotation
marks and citations omitted).
Put simply, we asked: “If a confidential relationship creates
a duty to disclose which, if breached, would constitute fraud suffi-
cient to toll the statute of limitations, would that duty to disclose
also support a breach of fiduciary duty tort claim under Georgia
law?” And the Supreme Court of Georgia answered: “[I]f the par-
ties in a confidential relationship are also in a fiduciary relationship,
a fraudulent breach of the duty to disclose would support a breach-
of-fiduciary duty tort claim under Georgia law.” King, 2023 WL at
*3. The question, then, is whether Elkin and Forrest were in a fi-
duciary relationship. The District Court already held that a reason-
able jury could find that they were.
A breach of fiduciary duty claim under Georgia law has
three elements: “(1) the existence of a fiduciary duty; (2) breach of
that duty; and (3) damage proximately caused by the breach.” Ray
v. Hadaway, 811 S.E.2d 80, 84 (Ga. Ct. App. 2018) (internal quota-
tion marks omitted). Ultimately, the District Court was correct in
finding that a reasonable jury could find a fiduciary relationship ex-
isted between Elkin and Forrest. The Court erred, however, in
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10 Opinion of the Court 20-14565
holding that “if a fiduciary duty did exist, it was merely to ensure
that Settlement Funds were used for [Elkin’s] benefit,” [Doc. 71 at
11] because the Supreme Court of Georgia found that violating a
duty to disclose within a fiduciary relationship can also constitute
a breach of fiduciary duty. And “the issue of the existence of a fi-
duciary relationship is a question for the jury unless there is a com-
plete absence of evidence of such a relationship.” Levine v. SunTrust
Robinson Humphrey, 740 S.E.2d 672, 683 (Ga. Ct. App. 2013).
Under Georgia law, the same breach of a duty to disclose
that would toll the statute of limitations can also support a breach
of fiduciary duty tort claim. The District Court should only have
granted Forrest summary judgment if there was no genuine dis-
pute as to any material fact regarding the tort claim and Forrest
was entitled to judgment as a matter of law, viewing all evidence
and making all inferences in the light most favorable to Elkin.
Viewing the record in that light, a reasonable jury could find the
following facts at trial: 4 (1) Elkins and Forrest were in a confidential
or fiduciary relationship such that, under Georgia law, the statute
of limitations could be tolled and a claim for breach of fiduciary
duty could be supported; (2) at the time Elkin turned 18, at least
$50,000 of the Settlement Funds remained in the Charles Schwab
account; (3) Elkin had a right to take control of the Settlement
Funds when he turned 18; (4) Forrest had a duty to disclose the
existence of the Settlement Funds and turn over control of those
4 To be clear, that is not to say that a jury necessarily will find these facts at
trial. Just that a reasonable jury could.
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20-14565 Opinion of the Court 11
funds to Elkin when he turned 18; (5) Forrest failed to do so; and
(6) Elkin would have taken control of the funds when he turned 18.
As such, summary judgment was inappropriate, and we va-
cate the District Court’s order with respect to that claim.
VACATED AND REMANDED.
Reference
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