Regina Geels v. Lindsay Flottemesch - Fiduciary Duty

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April 8, 2026 Get Citation Alerts Download PDF Add Note

Regina Geels v. Lindsay Flottemesch

Indiana Supreme Court

• Citations: None known
• Docket Number: 25S-PL-00225
• Panel: Mark S. Massa, Loretta H. Rush
• Judges: Rush, Massa, Slaughter, Goff, Molter

• Disposition: Affirmed

• Opinion

• Authorities (14)

• Cited By (0)

• Summaries (0)

• Similar Cases (32.2K)

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Disposition

Affirmed

Combined Opinion

                        by Justice Goff

FILED
Apr 08 2026, 10:06 am

CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court

IN THE

Indiana Supreme Court
Supreme Court Case No. 25S-PL-225

Regina Geels,
Appellant (Defendant/Counterclaimant below),

–v–

Lindsay Flottemesch, Mackenzi Hatfield, and
Stephanie Malinowski as Guardian for Marley
Malinowski,
Appellees (Plaintiffs/Counterclaim Defendants below).

Argued: November 18, 2025 | Decided: April 8, 2026

Appeal from the Allen Superior Court
No. 02D09-2107-PL-284
The Honorable David J. Avery, Judge

On Petition to Transfer from the Indiana Court of Appeals
No. 24A-PL-2911

Opinion by Justice Goff
Chief Justice Rush and Justices Massa and Molter concur.
Justice Slaughter dissents, believing transfer should be denied.
Goff, Justice.

The distribution of proceeds from a life-insurance policy may bring
problems when the policyholder’s intended beneficiary does not match
the beneficiary named in the policy itself. To address this problem, federal
law typically requires that the proceeds go to the beneficiary named in the
plan documents while state law may provide more equitable remedies.
Here, a man named his sister as the beneficiary of his life-insurance
policies with instructions to distribute the proceeds to his daughters.
Despite these instructions, the sister claims the proceeds for herself. The
issues are (1) whether the sister waived her federal-preemption defense by
failing to raise it at the trial-court level, and (2) whether the trial court
erred in imposing a constructive trust in favor of the daughters after
finding that the sister had breached her fiduciary duty to her deceased
brother. Concluding that the sister waived her federal-preemption defense
and that the trial court did not err in finding that she breached her
fiduciary duty, we affirm.

Facts and Procedural History
At the time of his death in 2021, David Malinowski (the Father) had
three children (whom we refer to collectively as the Daughters): thirty-six-
year-old Lindsay Flottemesch and thirty-three-year-old Mackenzi Hatfield
(from Father’s first marriage) and nine-year-old Marley Malinowski (from
Father’s second marriage). 1 Having divorced Marley’s mother, Stephanie,
Father was not married at the time he died. Father had two life-insurance
policies through his employer, both of which were issued by Metropolitan
Life Insurance Company (MetLife) and had a total benefit value of
$150,000.

Three years prior to his death, Father asked his sister, Regina Geels
(Aunt), to help him hire attorneys for his estate planning and to represent

1Marley’s mother, Stephanie, participates as guardian for Marley who died in January 2024.
Geels v. Flottemesch, 259 N.E.3d 1003, 1005 n.2 (Ind. Ct. App. 2025).

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 2 of 15
him in a child-custody dispute with Marley’s mother. In June 2018, Father
executed a will and durable power of attorney, appointing Aunt as his
attorney-in-fact. That same month, Mackenzi texted her Aunt to say that,
according to Father, he had instructed the Aunt to split his life-insurance
benefits among the Daughters with Marley’s share held in trust. Aunt
responded, “Yes I am convincing him of [a] trust to protect his assets and
avoid court with [Stephanie],” adding that “it will pay out when [Marley]
is 18” and “will allow you and Lindsay to get yours without taxes.”
Appellant’s App. Vol. 2, p. 27. The following month, Aunt started paying
Father’s medical bills, rent, child support, and utility bills. In short, Aunt
appeared to be “acting as a de facto guardian” over Father’s financial
affairs. Id.

In January 2020, Father was hospitalized and appointed Aunt as his
health-care representative. Father and Aunt also became joint owners of a
bank account so Aunt could make transactions on his behalf. At some
point in the summer of 2020, Father asked his friend to sell Father’s car,
and Aunt requested the friend mail her the money from the sale which the
friend declined to do. In July 2020, while Father was hospitalized again,
Aunt terminated Father’s lease and moved his belongings and his dog out
of his residence without his knowledge or permission. Although Father
was unhappy with Aunt’s decision to end his lease, he took no action to
counter the decision. Upon release from the hospital, Father lived with
Aunt and her husband from August to early September 2020. He then
lived with Lindsay for about a month before staying with friends until he
moved into his own apartment sometime around December 2020 or
January 2021. On January 1, 2021, Father designated Aunt as the sole
beneficiary of his two MetLife insurance policies. He died in his apartment
on June 14, 2021, having succumbed to congestive heart failure.

On June 29, Aunt submitted a claim to MetLife for the life-insurance
proceeds. Three days later, Lindsay contacted MetLife and informed it
that “there was litigation as to the life insurance policies.” Id. at 30. On
July 9, Daughters filed a petition to construe the will and impose a
constructive trust over the proceeds of Father’s life-insurance policies,
naming Aunt and MetLife as defendants. Daughters alleged that Father
intended for Aunt to hold the benefits as trustee for the Daughters. And to

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 3 of 15
the extent the beneficiary designation on the life-insurance policies was
Aunt’s alone, the Daughters contended, the designation was the result of
undue influence or fraud. MetLife filed an answer in which it stated as an
affirmative defense that the Daughters’ claims against MetLife arose
under the federal Employee Retirement Income Security Act (ERISA), and
that ERISA preempts any claims or remedies not expressly covered by the
act. Aunt also filed an answer. But rather than raising an affirmative
defense under ERISA, she denied Daughters’ claim that her beneficiary
designation was the result of undue influence or fraud and raised a
counterclaim against Daughters for defamation.

All parties subsequently filed an agreed motion for interpleader which
stated that the life-insurance policies were governed by ERISA. The trial
court granted the motion and dismissed MetLife as a defendant after it
deposited the proceeds with the clerk of the court. After a failed
mediation, the case proceeded to a bench trial.

On August 29, 2023, the trial court entered detailed findings of fact and
conclusions of law. Applying a preponderance-of-the-evidence standard,
the court found that, although Aunt’s beneficiary designation was not the
result of undue influence or fraud, the “life insurance proceeds in the
amount of $150,000.00 are subject to a constructive trust on behalf” of
Daughters. Id. at 50. Father and Aunt had a fiduciary relationship, and
Father had “named [Aunt] the beneficiary of the life insurance policies,”
the court explained, “with the instruction that [Aunt] was to distribute the
proceeds to his [D]aughters.” Id. at 52. The trial court also concluded that
each Daughter was entitled to one-third of the proceeds.

Aunt appealed, and a divided Court of Appeals reversed on federal-
preemption grounds. Geels v. Flottemesch, 237 N.E.3d 674, 682 (Ind. Ct.
App. 2024) (Geels I), vacated. The majority acknowledged that Aunt had
not raised preemption as an affirmative defense in her answer. Id. at 680.
But because her former codefendant, MetLife, had raised preemption in its
answer, and because the parties had agreed that ERISA governed the
policies in their motion for interpleader, the majority concluded that the
issue was not waived. Id. The majority then determined that ERISA

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 4 of 15
preempts “all State laws” to the extent that those laws “relate to any
employee benefit plan” covered by ERISA. Id. at 681 (quoting 29 U.S.C. §
1144 (a)). In dissent, Judge Foley would have held that Aunt waived the
federal-preemption argument. Id. at 683. But because he considered a
preponderance-of-the-evidence standard improper, he would have
remanded to the trial court to apply the “clear and convincing evidence”
standard to impose a constructive trust. Id. We granted transfer and, in a
per curiam opinion, remanded for the trial court to apply the clear-and-
convincing-evidence standard. Geels v. Flottemesch, 243 N.E.3d 1069, 1070
(Ind. 2024) (Geels II). Our opinion did not address whether Aunt waived
her federal-preemption defense.

On remand, the trial court determined that “the clear and convincing
evidence demonstrates that the Aunt was designated as the beneficiary of
[Father’s] life insurance policies for the purpose of distributing the
proceeds to his [D]aughters.” Appealed Order at 2 (bold emphasis
omitted). Beyond this determination, the court’s new order simply
“incorporate[d] and reinstate[d] its Order or Judgment dated August 29,
2023.” Id. Aunt appealed again, arguing that any state-law remedies like a
constructive trust were preempted by ERISA and that, even so, such
remedy lacked the requisite clear and convincing evidence.

In a unanimous published opinion, the Court of Appeals again
reversed on federal-preemption grounds. Geels v. Flottemesch, 259 N.E.3d
1003, 1005 (Ind. Ct. App. 2025) (Geels III). The panel cited the same reasons
as its original opinion in Geels I to conclude that Aunt did not waive the
issue. Id. at 1010. The panel then concluded that ERISA preempted the
state-law remedy of a constructive trust, adding that it “derived” its
analysis from Geels I. Id. at 1010 n.5. Although Geels I was vacated, we did
not address preemption in our per curiam opinion, so the panel saw “no
reason to deviate from [its] original decision.” Id.

Daughters petitioned for transfer, which we granted, thus vacating the
Court of Appeals’ opinion. Ind. Appellate Rule 58(A).

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 5 of 15
Standard of Review
The trial court here issued written findings of fact and conclusions of
law. An appellate court “will not set aside the findings or the judgment
unless they are clearly erroneous.” In re Adoption of T.W., 859 N.E.2d 1215,
1217 (Ind. Ct. App. 2006); see also Ind. Trial Rule 52(A). In deciding
whether the findings and conclusions are clearly erroneous, we use a two-
tiered analysis. Oil Supply Co., Inc. v. Hires Parts Serv., Inc., 726 N.E.2d 246,
248 (Ind. 2000). First, a “trial court’s findings of fact are clearly erroneous
if the record lacks any evidence or reasonable inferences to support them.”
In re Adoption of T.W., 859 N.E.2d at 1217. Second, a “judgment is clearly
erroneous when it is unsupported by the findings of fact and the
conclusions relying on those findings.” Id. This Court will not “reweigh
the evidence or assess the credibility of witnesses” and will “consider only
the evidence favorable to the trial court’s judgment.” Kalwitz v. Est. of
Kalwitz, 822 N.E.2d 274, 280 (Ind. Ct. App. 2005), trans. denied.

Discussion and Decision
In resolving this case, our opinion first addresses whether Aunt waived
her argument that federal ERISA law preempts state-law remedies like a
constructive trust. We conclude that Aunt waived her preemption defense
because she raised it for the first time on appeal. Second, we address
whether the trial court’s imposition of a constructive trust in favor of the
Daughters was clearly erroneous. Because there was evidence to support
the court’s findings that Aunt and Father had a fiduciary relationship and
that Aunt breached her fiduciary duty when she failed to distribute the
proceeds to Daughters, the trial court did not err in imposing a
constructive trust.

I. Aunt waived her argument that ERISA preempts
the state-law remedy of a constructive trust.
ERISA is a federal statute that “establishes minimum federal standards
governing employee-benefit plans.” FMS Nephrology Partners N. Cent. Ind.

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 6 of 15
Dialysis Ctrs., LLC v. Meritain Health, Inc., 144 N.E.3d 692, 696 (Ind. 2020).
ERISA provides “a set of standard procedures to guide processing of
claims and disbursement of benefits.” Egelhoff v. Egelhoff ex rel. Breiner, 532
U.S. 141, 148 (2001) (quoting Ft. Halifax Packing Co. v. Coyne, 482 U.S. 1, 9
(1987)). Specifically, ERISA directs plan administrators to discharge their
duties “in accordance with the documents and instruments governing the
plan.” 29 U.S.C. § 1104 (a)(1)(D). To ensure “nationally uniform plan
administration,” Egelhoff, 532 U.S. at 148, ERISA preempts or
“supersede[s] any and all State laws” to the extent that those laws “relate
to any employee benefit plan” covered by the statute, 29 U.S.C. § 1144 (a).

Although ERISA generally preempts state-law remedies governing
employee-benefit plans, ERISA preemption is a choice-of-law defense. See
Associates Inv. Co. v. Claeys, 533 N.E.2d 1248, 1254 (Ind. Ct. App. 1989). As
such, a party raising ERISA preemption should raise it as an affirmative
defense in a responsive pleading or later in litigation with all parties’
consent. Id. (citing T.R. 8(C)). A party “cannot sit idly by, permit the court
to proceed under the wrong law,” and then “complain because the court”
did so. Id. And a party who raises ERISA preemption for the first time on
appeal without raising it at trial waives the defense. Id. (declining to
address ERISA preemption for the first time on appeal).

Here, Aunt waived her ERISA-preemption defense because she raised
it for the first time on appeal. In her answer to Daughters’ petition to
impose a constructive trust over the life-insurance policies, Aunt raised no
ERISA-preemption claim. See Appellant’s App. Vol. 2, pp. 99–101. Instead,
she asserted that Daughters “fail[ed] to state a cause of action upon which
relief can be granted” and that MetLife knew of the “designated
beneficiary” from the plan documents. Id. at 100–01. These responses did
not alert Daughters that Aunt was raising ERISA preemption as a defense
to their request for a constructive trust.

Aunt seeks to avoid waiver by arguing that MetLife’s answer to the
Daughters’ complaint sufficiently notified them of the ERISA-preemption
claim. We reject this argument. MetLife’s answer stated that Daughters’
claims “against MetLife, if any,” arose under ERISA, and that, “[t]o the

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 7 of 15
extent the Complaint makes claims or seeks remedies not provided for
under ERISA, those claims and remedies are pre-empted by ERISA and
must be stricken.” Id. at 96 (emphasis added). In other words, MetLife
asserted the affirmative defense for itself. Just because MetLife raised
ERISA preemption as an affirmative defense did not put Daughters on
notice that Aunt would raise the defense as well. As far as the Daughters
knew, Aunt may have had a strategic reason for choosing to apply state-
law remedies instead of ERISA. By failing to expressly join in that defense,
Aunt waived the issue for appellate review.

We find support for this conclusion in caselaw. In In re Estate of Blair,
the Court of Appeals held that a party could not preserve an issue for
appeal by “piggybacking” on another party’s objection. 177 N.E.3d 84, 94
(Ind. Ct. App. 2021). In that case, the trial court found that a
granddaughter exerted undue influence over her grandfather to facilitate
the transfer of his home to her. Id. at 89, 91. At trial, the court played the
deposition of grandfather’s attorney, and the estate’s personal
representative objected on grounds of attorney-client privilege. Id. at 90–
91. The granddaughter did not object. Id. at 90. On appeal, the Court of
Appeals held that even if she had standing, the granddaughter waived
any argument that playing the deposition violated attorney-client
privilege because she did not join the personal representative’s objection
or object herself. Id. at 94 (citing Fowler v. Newsom, 90 N.E. 9, 13 (Ind.
1909)). Likewise, in Scott v. State, the defendant could not preserve an
error for appellate review by relying on his codefendant’s motion. 409
N.E.2d 1184, 1187–88 (Ind. Ct. App. 1980). The defendant and his
codefendant were tried together for criminal-deviate conduct. Id. at 1185–
86. The codefendant (unsuccessfully) moved for a separate trial, but the
defendant never joined the motion. Id. at 1187–88. The Court of Appeals
held that the defendant waived the issue because he neither moved for
severance himself nor joined his codefendant’s motion. Id.

Aunt also seeks to avoid waiver by arguing that the plan documents
and the parties’ motion for interpleader stipulated that ERISA governed
the life-insurance policies. See Appellant’s App. Vol. 2, p. 104. We reject
this argument as well. Aunt represented to the trial court throughout the

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 8 of 15
proceedings that Indiana law, not ERISA, required judgment in her favor.
In her answer to Daughters’ petition to impose a constructive trust, Aunt
did not raise ERISA. See id. at 99–101. Then at trial, Aunt argued that her
designation as the beneficiary was valid “under Indiana State Law”
because there was no undue influence and Father wanted to pay her back.
Tr. Vol. 2, p. 6. Most notably, Aunt never mentioned ERISA in her
proposed findings and conclusions and insisted she was entitled to relief
under Indiana law. She argued that it is “well-settled” law in Indiana that
“life insurance policies are non-probate assets and pass directly to the
beneficiary as a matter of law.” Appellees’ App. Vol. 2, p. 12. Because the
“[p]arties are bound by the theory upon which the case was tried,” and
because Aunt tried the case exclusively on Indiana law, she waived her
preemption defense. See Associates Inv. Co., 533 N.E.2d at 1254.

Having concluded that Aunt waived her ERISA-preemption defense,
we turn to whether the trial court erred in imposing a constructive trust
on behalf of Daughters. 2

II. The trial court’s imposition of a constructive trust
was not clearly erroneous.
The trial court’s imposition of a constructive trust in favor of the
Daughters was not clearly erroneous. First, the evidence supports the trial
court’s findings that Aunt and Father had a fiduciary relationship and
that, by breaching her fiduciary duty, Aunt’s actions amounted to

2Because we conclude that Aunt waived her ERISA-preemption argument, we need not
address whether ERISA preemption applies after the plan administrator has distributed the
proceeds. Here, the parties’ agreed interpleader procedure tasked MetLife, the plan
administrator, with depositing the proceeds with the court. Because the goal of ERISA is to
enable “nationally uniform plan administration,” Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S.
141, 148 (2001), it is not clear if preemption applies once the administrator has distributed the
proceeds, cf. State Farm Life v. Goecks, 184 F. Supp. 3d 701, 702–03, 709 (W.D. Wis. 2016)
(applying ERISA preemption even after the plan administrator deposited proceeds with the
court as part of the interpleader action). We also need not address Daughters’ argument that
the law-of-the-case doctrine requires us to apply state law because Aunt waived preemption.

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 9 of 15
constructive fraud. Second, a finding of constructive fraud supports the
imposition of a constructive trust.

A constructive trust is a state-law equitable remedy “available against
one who through fraud or other wrongful means acquires property of
another.” Kalwitz, 822 N.E.2d at 280. A constructive trust imposes an
equitable duty on a person holding title to property to convey it because
“he would be unjustly enriched if he were permitted to retain it.” Id.
(quoting Melloh v. Gladis, 309 N.E.2d 433, 438–39 (Ind. 1974)).

A constructive trust must be established by clear and convincing
evidence. Melloh, 309 N.E.2d at 440. 3 “Fraud constitutes an essential
ingredient in a constructive trust.” Geels II, 243 N.E.3d at 1070–71 (quoting
Hall v. Ind. Dep’t of State Revenue, 351 N.E.2d 35, 38 (Ind. Ct. App. 1976)). In
the context of a constructive trust, fraud “is not confined to fraud as one
might define it for purposes of criminal law.” Zoeller v. E. Chicago Second
Century, Inc., 904 N.E.2d 213, 221 (Ind. 2009). Instead, the constructive-
trust “remedy is available where there is standard fraud (i.e.,
misrepresentation, reliance, etc.) or a breach of duty arising out of a
confidential or fiduciary relationship.” Id. In other words, “such fraud
may be actual or constructive.” Geels II, 243 N.E.3d at 1071 (internal
quotation marks and citation omitted). While actual fraud requires intent
to defraud, constructive fraud does not. See Kalwitz, 822 N.E.2d at 280–81.
Constructive fraud can occur when there is a “breach of a duty arising
from a confidential or fiduciary relation.” Id. at 280 (quoting Hall, 351
N.E.2d at 38).

3The clear-and-convincing-evidence standard is an intermediate standard of proof used in
cases “where the wisdom of experience has demonstrated the need for greater certainty, and
where this high standard is required to sustain claims [that] have serious social consequences
or harsh or far reaching effects on individuals.” J.C.C. v. State, 897 N.E.2d 931, 935 (Ind. 2008)
(quoting Est. of Reasor v. Putnam Cnty., 635 N.E.2d 153, 159–60 (Ind. 1994)).

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 10 of 15
A. The Existence of a Fiduciary Relationship

Here, the trial court found that “a fiduciary relationship existed”
between Father and the Aunt, with the Aunt as the “superior party.”
Appellant’s App. Vol. 2, p. 49. This finding meets the clear-and-
convincing-evidence standard.

A fiduciary relationship exists when a party places such confidence in
another that it results in “superiority and influence.” Kalwitz, 822 N.E.2d
at 281. Whether a fiduciary relationship exists is a question of fact for the
fact finder. Id. In Kalwitz, the Court of Appeals found that a fiduciary
relationship existed between parents and their adult son because of the
son’s long-standing management of their family farm and the parent-child
relationship. Id. at 282. In Morfin v. Estate of Martinez, the Court of Appeals
found a fiduciary relationship between an uncle and his deceased nephew
where the uncle was the personal representative of the nephew’s estate,
the uncle helped the nephew obtain housing and several jobs, and
witnesses described their relationship as “very close” with the uncle
acting as a surrogate father to the nephew. 831 N.E.2d 791, 802 (Ind. Ct.
App. 2005).

Likewise, the circumstances here—namely, their sibling relationship
and the Aunt’s management of Father’s legal and financial affairs—
support the trial court’s finding of a fiduciary relationship between Aunt
and Father. Father was experiencing financial difficulty and approached
Aunt for help. Appellant’s App. Vol. 2, p. 25. As his health worsened,
Aunt and her husband paid Father’s medical bills, rent, child support,
utility bills, and more. Id. at 27. Aunt also prepared Father’s taxes in 2018,
2019, and 2020. Id. at 28. In addition, Father and Aunt were co-owners of
two bank accounts so that Aunt could make transactions on Father’s
behalf. Id. at 27, 28. Aunt also requested that Father’s friend give her the
money from the sale of Father’s car because Father “just doesn’t handle or
[know] how to budget his money.” Id. at 46.

Aside from finances, Aunt had influence over Father’s legal affairs.
Father executed a durable power of attorney, making Aunt his attorney-
in-fact. Id. at 26. She helped Father hire an attorney to litigate his child-
custody case over Marley. Id. at 25. He also appointed Aunt to be the

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 11 of 15
executor of his estate. Id. at 32. Finally, Aunt had power over Father’s
health decisions when he named her as his health-care representative. Id.
at 28. Although Aunt’s decisions occasionally upset Father, like when she
terminated his lease and moved his belongings to storage, Father took no
action to counter her decisions. Id. at 46. By handling virtually all of
Father’s financial, legal, and health affairs, Aunt became “a de facto
guardian” over Father. Id. at 27. In short, Aunt exercised superiority and
influence over Father, evidence of which supports the trial court’s finding
of a fiduciary or confidential relationship.

B. Aunt’s Breach of Her Fiduciary Duty to Father
After finding that Aunt and Father had a fiduciary relationship, the
trial court concluded that Aunt “breached her fiduciary duty” to Father
after she refused to follow his “instructions to distribute the proceeds of
the life insurance to his [D]aughters.” Id. at 49. Fiduciaries owe a “duty of
complete loyalty” and cannot act with self-interest. Matter of Living Trust
Agreement of Morningstar, 136 N.E.3d 1139, 1154 n.16 (Ind. Ct. App. 2019).
Therefore, constructive fraud can occur when a fiduciary “gains an
advantage through a transaction involving the weaker party.” Morfin, 831
N.E.2d at 803. For instance, after finding the requisite fiduciary
relationship, the Court of Appeals in Morfin imposed a constructive trust
against the uncle who, as the named beneficiary of his nephew’s life-
insurance policies, kept the proceeds for himself despite the nephew’s
wishes to allocate those proceeds to his daughters. Id. at 796, 803–04.

Here, the evidence supports the trial court’s finding that Aunt breached
her fiduciary duty to Father when she refused to distribute the proceeds to
Daughters. Three years prior to Father’s death, Mackenzi texted Aunt to
say that, according to Father, he had instructed Aunt to split his life-
insurance benefits among the Daughters with Marley’s share held in trust.
Appellant’s App. Vol. 2, p. 27. Aunt responded, “Yes I am convincing him
of [a] trust to protect his assets and avoid court with [Stephanie],” adding
that “it will pay out when [Marley] is 18” and “will allow you and
Lindsay to get yours without taxes.” Id. Instead of refuting Mackenzi’s
statement, Aunt acknowledged that the Daughters would receive the life-

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 12 of 15
insurance proceeds. There was also evidence in the record that Father
intended to leave all his possessions to his Daughters. In Father’s will, he
stated, “I leave all my worldly goods money and property to my children
No other items are to be distributed.” Id. at 32. The will also appointed
Aunt as the executor of the estate and instructed her to distribute all
property between the Daughters in equal amounts with Marley’s share in
a trust fund to be distributed “as [Aunt] sees fit” until Marley turned
twenty-one. Id. Multiple witnesses also testified that Father greatly loved
his Daughters and intended to leave everything to them. Id. at 40.

Aunt argues that the clear and convincing evidence does not support
the trial court’s finding that Father intended Aunt to give the life-
insurance proceeds to the Daughters. Appellant’s Br. at 12. Aunt testified
that Father never instructed her to distribute the proceeds because she
never knew about the policies in the first place. Appellant’s App. Vol. 2, p.
33. But given Aunt’s own admission that Father once said he had life
insurance, the trial court did not find her testimony credible. Id. at 33–34.
Aunt also argues that Father intended for her to get the proceeds to pay
her back for the financial assistance she provided. But while Aunt testified
that Father had promised to pay her back, she never testified that Father
specifically said he would repay her with the life-insurance proceeds. Id.
at 28. To find that Father intended for Aunt, rather than the Daughters, to
receive the proceeds would require us to reweigh the evidence and
reassess witness credibility which we will not do. See Morfin, 831 N.E.2d at
801. The evidence supports the trial court’s finding that Father intended
Aunt to distribute the life-insurance proceeds to the Daughters.

As Father’s fiduciary, Aunt owed Father a duty of loyalty. By claiming
the insurance proceeds for her own advantage rather than fulfilling
Father’s wish to provide for his Daughters, Aunt breached her fiduciary
duty. See id. at 803. As the trial court explained, “Aunt does not feel the
same loyalty to her nieces as she did to her brother,” leaving one to
suspect that she “saw an opportunity to claim the entire $150,000.00 for
herself.” Appellant’s App. Vol. 2, p. 49. By failing to fulfill Father’s wish to
distribute the proceeds to the Daughters and instead claiming the
proceeds for herself, the trial court’s finding that Aunt breached her
fiduciary duty was not clearly erroneous.

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 13 of 15
Because Aunt and Father had a fiduciary relationship, and because
Aunt breached her fiduciary duty, Aunt’s actions constitute constructive
fraud. See Kalwitz, 822 N.E.2d at 280.

Although the trial court found no fraud or undue influence in Aunt’s
“designation as the beneficiary,” Appellant’s App. Vol. 2, p. 50, that is
completely separate from the question of whether Aunt breached her
fiduciary duty to Father (i.e., engaged in constructive fraud). Daughters
had alleged that Aunt was the one who listed herself as the beneficiary on
the policies, and the trial court concluded that Daughters failed to prove
so. Id. Therefore, the trial court concluded there was no actual fraud as to
Aunt’s beneficiary designation. Nevertheless, by claiming the insurance
proceeds for her own advantage at the expense of Father’s wishes, Aunt
breached her fiduciary duty, amounting to constructive fraud.

For these reasons, the trial court’s imposition of a constructive trust was
not clearly erroneous. The evidence supports the trial court’s findings that
Aunt and Father had a fiduciary relationship and that Aunt breached her
fiduciary duty, amounting to constructive fraud. And a finding of
constructive fraud supports the imposition of a constructive trust.

Conclusion
ERISA preemption is a choice-of-law defense that has to be
affirmatively raised. By failing to raise preemption to the trial court, Aunt
waived the issue for appeal. Applying state law, the trial court did not err
in imposing a constructive trust for the benefit of the Daughters. The trial
court’s findings that Aunt and Father had a fiduciary relationship and
Aunt breached her fiduciary duty were not clearly erroneous. We affirm.

Rush, C.J., and Massa and Molter, JJ., concur.
Slaughter, J., dissents, believing transfer should be denied.

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 14 of 15
ATTORNEY FOR APPELLANT
Robert J. Palmer
May Oberfell Lorber, LLP
Mishawaka, Indiana

ATTORNEYS FOR APPELLEES
Nathan S.J. Williams
Shannon K. Connors
Shambaugh Kast Beck & Williams, LLP
Fort Wayne, Indiana

Indiana Supreme Court | Case No. 25S-PL-225 | April 8, 2026 Page 15 of 15