IN THE SUPREME COURT OF THE STATE OF KANSAS
No. 93,470
In the ESTATE OF NORMAN B. HJERSTED, deceased.
SYLLABUS BY THE COURT
1. Generally, the determination of property value is a question of fact.
2. A minority discount allows an appraiser to adjust for a "lack of control" over an entity on the theory that the minority interests are not worth the same as the majority interests due to the lack of voting power. A marketability discount allows an appraiser to adjust for a "lack of liquidity" in the interest itself on the theory that there is a limited supply of purchasers of that interest.
3. Under the facts of this case, the district court erred in focusing on the surviving spouse's lack of consent in determining whether discounts purportedly inherent in limited partnership interests should be applied in the process of valuing those interests for purposes of the spousal elective share.
4. Under the facts of this case, the Court of Appeals erred in affirming the district court on an alternate basis by holding as a matter of law that discounts for lack of control and lack of marketability were unnecessary to value limited partnership interests for purposes of the spousal elective share.
5. Under the facts of this case, the valuation of certain limited partnership interests for spousal elective share purposes is best left to the district court for initial determination.
6. When a life tenant and remainderman unite in a nonjudicial sale of their property, without agreeing as to a division or disposal of the sale proceeds, the life tenant is entitled to receive from the proceeds the estimated value of his or her estate at the time of sale.
Review of the judgment of the Court of Appeals in 35 Kan. App. 2d 778, 135 P.3d 202 (2006). Appeal from Leavenworth district court; GUNNAR A. SUNDBY, judge. Judgment of the Court of Appeals affirming the district court on the limited issues subject to our review is affirmed in part and reversed in part. Judgment of the district court on those issues is affirmed in part, reversed in part, and remanded with directions. Opinion filed February 1, 2008.
Michael R. Ong, of Law Office of Michael Ong, P.A., of Leawood, argued the cause, and Michelle M. Burge, of the same firm, was with him on the briefs for appellant.
Terrence J. Campbell, of Barber Emerson L.C., of Lawrence, argued the cause, and Byron E. Springer, William N. Fleming, and Cheryl L Trenholm, of the same firm, were with him on the briefs for appellee.
The opinion of the court was delivered by
NUSS, J.: This case concerns a dispute between a widow, Maryam Hjersted, and her stepson, Lawrence Hjersted, over the value of her spousal elective share of her deceased husband's estate under K.S.A. 59-6a201 et seq. There is no dispute about the percentage share to which she is entitled. The parties simply disagree on the value of two particular assets transferred to Lawrence within 2 years of the death of Maryam's husband, Norman: (1) Norman's interest in the family limited partnership and (2) Norman's life estate in Nebraska farmland which was sold. Our jurisdiction is pursuant to K.S.A. 20-3018.
The issues on appeal, and our accompanying holdings, are as follows:
1. Did the district court err in determining the value of Norman's family limited partnership interest that he transferred to Lawrence? Yes.
2. Did the district court err in determining the value of Norman's life estate interest in proceeds from the sale of the Nebraska farmland? No.
Accordingly, we reverse the decision of the district court and the Court of Appeals on Issue 1 and remand with directions. We affirm the decision of the district court and the Court of Appeals on Issue 2.
FACTS
Norman B. Hjersted (Norman) and his wife, Maryam, were married in June 1981. Together they had a son, Timothy, and Norman had three children from a prior marriage: Lawrence, Karen, and Ingrid. Since its incorporation in 1981, Norman had totally owned a closely held company called Midland Resources, Inc., (MRI) that manufactures chemicals used in the treatment of water and wastewater.
The Hjersted Family Limited Partnership and Norman's revocable trust
On February 20, 1997, Norman and Lawrence created the Hjersted Family Limited Partnership (HFLP). Norman transferred all (500) shares of MRI to the HFLP; these shares were the only asset of the limited partnership. Norman kept 96% of the limited partnership interest in HFLP for himself. The remaining HFLP interests were owned as follows: 2% general partnership owned by Norman, 1% general partnership owned by Lawrence, and the last 1% of the limited partnership interest in HFLP owned by Lawrence. They purchased their interests through delivery of cash and promissory notes. Section 1.4 describes the "Character of Business" as:
"The Partnership's purpose is to facilitate communication among family members in connection with business matters, to reduce costs associated with the disability of any of the partners, to preserve family control of Partnership assets, and the conduct of any other business which shall be legal for a limited partnership to conduct in Kansas."
Sixteen months later on June 8, 1998, Norman created the Norman B. Hjersted Revocable Trust and named himself trustee. The same day, he executed his "Last Will and Testament." The will "poured over" probate assets into the trust.
Fifteen months after the creation of Norman's revocable trust, on September 10, 1999, Norman transferred to his trust his 96% limited partnership interest and his 2% general partnership interest in HFLP. Other assets not relevant to this appeal also were transferred.
Gift/sale transaction
Approximately 3 years after the creation of HFLP, on March 1, 2000, Norman entered into a gift/sale transaction with Lawrence concerning his 96% limited partnership interest in HFLP. $675,000 worth of Norman's 96% interest–the maximum allowable without incurring federal gift tax–was gifted to Lawrence. According to their contract, the balance of Norman's 96% interest was sold at a price to be determined by later appraisal. Norman retained his 2% general partnership interest as contained in his revocable trust for which he served as trustee.
Norman's and Lawrence's appraiser, John Korschot of Stern Brothers Valuation Advisors (Stern Brothers), testified at the later trial that in May 2000 he was tasked with determining the fair market value of a nonmarketable limited partnership. Korschot first valued the HFLP's only asset, the 500 shares of MRI stock, at $4500/share, for a total of $2.25 million. This result was reached after applying a "lack of marketability" discount of 20%.
Because the MRI stock was also contained within HFLP, a limited partnership, Korschot applied a discount of 10% for lack of control and an additional 25% discount for lack of marketability, resulting in a combined effective discount of 32.5% for the limited partnership value. In response to a question by the district court, Korschot testified that he was not "double discounting." He described the basis for the discounts: "a Limited Partner has few, if any rights in the affairs in the Partnership, compared to the General Partner [so] a discount for lack of control of the Limited Partnership should be considered. Also, a discount for the lack of marketability should be considered, since there is no readily available market for the Limited Partnership interest." According to Korschot, the fair market value of the transferred 96% limited partnership interest in HFLP was the net asset value of MRI ($2.25 million) times the percentage of limited partnership interest transferred (96%), reduced by the additional discounts (32.5%), for a total of $1,458,000.
Because $675,000 of the $1,458,000 was transferred to Lawrence by gift, Korschot's appraisal meant that Lawrence owed Norman a balance of $783,064. Of this amount, Lawrence paid 5% ($39,150) and signed a promissory note for the remaining $743,914.
On May 18, 2000, approximately 2 1/2 months after the gift/sale transaction, Norman executed a new trust agreement, which amended and restated the prior trust agreement. The new agreement included provisions for the disposition of Norman's property both before and after his death. Norman remained trustee, and Lawrence was named successor trustee. Lawrence later stepped in as trustee in late 2000 or early 2001 because Norman's stroke at that time left him in a coma for 10 days.
Nebraska farmland
Norman owned a life estate in certain farmland in Richardson County, Nebraska, and Lawrence owned the remainder interest. In September 1999, under purported threat of condemnation, the property was deeded to the United States Army Corps of Engineers for $292,950. The price included both the life estate and the remainder interest, but the entire proceeds were deposited into Lawrence's bank account. Lawrence later contributed those proceeds toward the purchase of a Florida orange grove as a like-kind investment. At the time of this purchase, Norman wrote to Lawrence: "It is my intent and has always been that you retain ownership of the Florida Farm. I would like and need some of the profits but not to exceed 5% / year of value of money received from the Corp. of Engineers."
Norman's death and subsequent events
On April 28, 2001, approximately 13 months after the gift/sale transaction, Norman died. Among the assets remaining in his revocable trust at that time was his 2% general partnership interest in HFLP.
In August 2001, rather than take what was provided for her under Norman's will, Maryam filed a petition for elective share of surviving spouse, requesting the court to determine her elective share of the couple's augmented estate pursuant to K.S.A. 59-6a201 et seq. Thereafter, the district court admitted Norman's will into probate and appointed Lawrence executor of the estate. As executor, Lawrence filed a proposed calculation of Maryam's unsatisfied elective share. However, the parties did not agree on the valuation and treatment of all of the property, particularly the gift/sale transaction and the life estate in the Nebraska farmland. A trial therefore occurred on June 16 through 19, 2003.
During the trial, both Korschot and an appraiser retained by Maryam, Timothy Meinhart, of Willamette Management Associates ("WMA"), testified. Meinhart testified about his appraisal report dated June 11, 2003, in which he had determined the "fair market value" of the common stock of MRI as of March 1, 2000. He admitted that he was neither asked to, nor did, consider the value of the MRI stock as contained within HFLP, a limited partnership. He determined that the value of the MRI 500 shares of stock was $2.66 million, which included a 10% discount for its lack of marketability, presumably as a closely held corporation. Accordingly, he calculated that the value of Norman's 96% of the $2.66 million of MRI stock was $2,553,600.
Based upon the parties' competing experts, and the down payment and promissory note amounts of the March 2000 gift/sale transaction, the parties' financial arguments were essentially as follows:
Maryam's Calculations
Value of MRI (@ 10% discount) $2,660,000
Value of Norman's 96% MRI interest $2,553,600
Consideration Paid by Promissory Note ($ 743,914)
Consideration Paid at Closing ($ 39,150)
Net Uncompensated Transfer to be added to augmented estate $ 1,770,536
Lawrence's Calculations
Value of MRI (@ 20% discount) $2,250,000
Value of Norman's 96% MRI interest $2,160,000
Discount for HFLP (32.5%) (adjusted) ($ 701,936)
Consideration Paid by Promissory Note ($ 743,914)
Consideration Paid at Closing ($ 39,150)
Net Uncompensated Transfer to be added to augmented estate $ 675,000
Of the approximate $1.1 million difference in value, $393,000 was attributable to the difference in values attached to the MRI stock by the competing experts and $701,936 was attributable to Korschot's "second layer" of discounts, i.e., in the HFLP.
On July 12, 2004, the district court issued its 15-page memorandum decision. Among other things, the court found that Meinhart's opinion of the MRI stock value of $2.66 million was "better supported" than Korschot's.
"16.g: That after analysis of the written reports submitted by both experts and weighing the testimony provided by both experts, that the opinion of Meinhart is better supported (in particular with regard to use of more recent data concerning the increase in pretax income in early 2000, the on sight investigation, and the inherent bias to minimize value by Korschot in performing the task hired for), and the court finds that the value of 500 shares of Midland Resources Inc. to be $2,660,000."
The district court also found that the partnership was organized for valid family and business purposes; that Lawrence was the heir apparent of Norman's business; that Norman had an estate planning and business objective to pass the family business to his son; and that HFLP "was a valid and existing limited partnership at the time of the gift on March 1st, 2000 and continues to be so." However, because Maryam did not consent to the transfer, the court found that the full value of the limited partnership interest, i.e., without Korschot's 32.5% discounts for marketability and control, must be included in the augmented estate. It adopted Maryam's calculations for calculating the uncompensated transfer at $1,770,536 (then later agreed with Lawrence that K.S.A. 59-6a205[c][3] required the court to reduce the amount of the uncompensated transfer by $10,000, to $1,760,536).
The district court also concluded that the value of Norman's life estate in the Nebraska farmland–which sold for $292,950–was $137,394. Coupled with its value of the uncompensated transfer of MRI stock, it concluded that those two nonprobate transfers to be added to the augmented estate totaled $1,907,930.
In determining the augmented estate, the court added (1) the net probate estate of $1,754,089, (2) the values of the two nonprobate transfers of $1,907,930, (3) Norman's nonprobate transfers to Maryam of $241,370, and (4) Maryam's assets of $857,475, for an augmented estate total of $4,760,863. After calculating Maryam's entitlement at 50% of the augmented estate based on the length of her marriage to Norman, and then deducting her assets and Norman's nonprobate transfers to her, the court found that Maryam's unsatisfied elective share was worth $1,281,587.
After Lawrence's motion for reconsideration, the court later modified its prior judgment. Among other things, the court decreased the probate estate to $1,363,208, decreased the total net probate estate to $1,551,558, decreased the value of Norman's nonprobate transfers to others by $10,000 because of the federal exemption for a gift in 1 year, and now valued the augmented estate at $4,548,333. Based on the modified numbers, the court reduced Maryam's unsatisfied elective share from $1,281,587 to $1,175,322.
Both parties filed timely notices of appeal on numerous grounds. The Court of Appeals first provided an overview of the Kansas spousal elective share statutes:
"In 1994, the Kansas Legislature amended the Kansas Probate Code to incorporate a comprehensive spousal elective share scheme patterned after the Uniform Probate Code. See K.S.A. 59-6a201 et seq. The statutory scheme gave the surviving spouse the right to take an elective share amount equal to the value of an elective share percentage of the augmented estate, the percentage determined by a statutory table based on length of the marriage. K.S.A. 59-6a202. For purposes of determining the augmented estate, certain uncompensated nonprobate transfers to others are included, including certain of those during the 2-year period next preceding the decedent's death. K.S.A. 59-6a205 and K.S.A. 59-6a207.
. . . .
"In a situation such as that presented here, upon the election by a surviving spouse, the statutory scheme requires analysis of nonprobate transfers to determine whether assets should be 'pulled back' or included in the augmented estate, together with valuation of those assets at date of transfer. K.S.A. 59-6a205 to K.S.A. 59-6a208. Once the augmented estate has been composed generally from the net probate estate and the eligible uncompensated nonprobate transfers, the surviving spouse is entitled to the elective share percentage shown in the statutory table. K.S.A. 59-6a202 to K.S.A. 59-6a203. Award of fees and other administrative expenses reduce the augmented estate for these purposes. K.S.A. 59-6a204." In re Estate of Hjersted, 35 Kan. App. 2d 778, 782-83, 135 P.3d 202 (2006).
Regarding the only two issues now before this court on Lawrence's petition for review, the Court of Appeals held that the district court erred in focusing on Maryam's lack of consent in determining whether discounts purportedly inherent in limited partnership interests should be applied in the valuation process. It correctly held that the value of the 96% limited partnership interest in HFLP on March 1, 2000, must be included in the augmented estate to the extent it was not supported by consideration. It further held that on the question of value of this interest, the district court's adoption of Meinhart's evaluation of the MRI stock at $2.66 million was supported by substantial competent evidence.
The Court of Appeals acknowledged that the district court had a "misfocus" on the value of the MRI stock rather than the limited partnership interest, which could be error because it disregarded discounts for lack of control and marketability purportedly inherent in the fact that the stock was held in a limited partnership. 35 Kan. App. 2d at 787. Nevertheless, the court proceeded to hold that
"[d]iscounts for lack of control and lack of marketability were unnecessary under these circumstances for several reasons:
" Discounting individual share holdings injects into the appraisal process speculation on the various factors which may dictate the marketability of such holdings. Cavalier Oil Corp. v. Harnett, 564 A.2d 1137, 1145 (Del. 1989);
" Control and marketability discounts are not appropriate when the purchaser is either the majority shareholder or the corporation itself. Arnaud v. Stockgrowers State Bank, 268 Kan. 163, Syl. ¶ 3, 992 P.2d 216 (1999). Similarly, when the result of the transaction unifies the interests of a partnership in the same individual [Lawrence], albeit as an individual and a trustee, such discounting is illusory;
" Where the sole asset of the partnership is corporate stock that has already been discounted for lack of marketability, no further discount is appropriate when valuing the partnership interests because the partnership did not perform a management function for such asset. See Estate of Bongard v. Commissioner, 124 T.C. 95, 126-29 (2005) (transfer of stock to a limited partnership does not satisfy bona fide sale exception to 26 U.S.C. § 2036[a] [2000]);
" Where, as here, the artificiality or illusory nature of the partnership entity is manifest by its disregard in practice, including illusory capital contributions, lack of any filing of state or federal partnership tax returns, MRI dividends paid directly to Lawrence and Norman rather than the entity, and charter forfeiture by the State, the separate legal existence of the partnership entity at death does not require discounting that might otherwise be appropriate in valuing partnership interests. See Estate of Thompson v. C.I.R., 382 F.3d 367 (3d Cir. 2004); Estate of Reichardt v. Commissioner, 114 T.C. 144 (2000); Estate of Morton B. Harper, 83 T.C.M. (CCH) 1641 (2002); Estate of Dorothy Morganson Schauerhamer, 73 T.C.M. (CCH) 2855 (1997) (all of which hold that where a decedent's relationship to transferred assets remains the same before and after transfer, the assets transferred are returned to gross estate for estate tax purposes).
" Recognition of discounting under these circumstances could encourage the creation of layers of illusory ownership for nonprobate transfers, each with the potential for additional discounting, and all for the purpose of insulating the true value of assets transferred, in furtherance of a scheme to disinherit a spouse. Such encouragement would be counter to the legislative purpose of the Kansas spousal elective share statutes. See In re Estate of Antonopoulos, 268 Kan. 178, 181-82, 993 P.2d 637 (1999); Ackers v. First National Bank of Topeka, 192 Kan. 319, 332-33, 387 P.2d 840 (1963)." 35 Kan. App. 2d at 787-89.
Accordingly, the court affirmed the district court's valuation of the transfer and the resulting addition of $1,760,536 to the augmented estate.
Regarding the second issue for which this court later accepted review, the Court of Appeals also affirmed the district court's inclusion in the augmented estate of the life estate interest in the Nebraska farmland because the life tenant, Norman, and the remainderman, Lawrence, united in a nonjudicial sale of the property. 35 Kan. App. 2d at 791-92.
Additional facts will be provided as necessary to the analysis.
ANALYSIS
Issue 1: The district court erred in determining the value of Norman's family limited partnership interest that he transferred to Lawrence.
Lawrence argues that the Court of Appeals erred in affirming the district court's valuation, explaining:
"[T]he value of the 96% limited interest in HFLP that Norman transferred to Lawrence is one of the key issues in this appeal because the Kansas Spousal Elective Share statute 'pulls back' the value of Norman's gift to Lawrence as an addition to the augmented estate. See K.S.A. 59-6a205(c) (augmented estate includes value of gifts made within two years prior to death). To the extent this litigation ultimately determines that the value of the 96% limited partnership interest in HFLP is greater than the amount of Norman's gift [$675,000] plus Lawrence's payment [$783,064 in cash and note], the additional value constitutes an additional gift which must be included in the augmented estate. One of the key determining factors in the value of the 96% limited interest in HFLP is whether to apply the 32.5% valuation discount for lack of control and lack of marketability." (Emphasis added.)
As we have explained, a minority discount allows an appraiser to adjust for a "lack of control" over the entity on the theory that the minority interests are not worth the same as the majority interests due to the lack of voting power. A marketability discount allows an appraiser to adjust for a "lack of liquidity" in the interest itself on the theory that there is a limited supply of purchasers of that interest. See Arnaud v. Stockgrowers State Bank, 268 Kan. 163, 165, 992 P.2d 216 (1999) (citing Hood et al., Valuation of Closely Held Business Interests, 65 UMKC L. Rev. 399, 438 [1997]).
The Court of Appeals refined the salient issue: the value of the 96% HFLP interest on March 1, 2000. Generally, the determination of property value has been a question of fact. See Board of Johnson County Comm'rs v. Smith, 280 Kan. 588, 597, 123 P.3d 1271 (2005) (condemned property's fair market value is jury question); Hotchkiss v. Fischer, 139 Kan. 333, 31 P.2d 37 (1934) (value of stock in closely held corporation is jury question). The determination of asset value concerning the augmented estate, as in the case at bar, was a question of fact for the district court in In re Estate of Antonopoulos, 268 Kan. 178, 190-92, 993 P.2d 637 (1999) (issue of value of properties in joint tenancy and of value of homestead remanded to district court for determination). Indeed the district court here included as one of its findings of fact a determination that the value of the 500 shares of MRI stock was $2,660,000.
The Court of Appeals ruled that substantial competent evidence supported this district court determination of MRI value. See U.S.D. No. 233 v. Kansas Ass'n of American Educators, 275 Kan. 313, 318, 64 P.3d 372 (2003) (substantial evidence is evidence possessing both relevance and substance which furnishes a substantial basis of fact from which the issues can reasonably be resolved). Inherent in the Court of Appeals' use of this standard of review is an acknowledgment that valuation is a question of fact. Indeed, it earlier stated: "To the extent that the district court made fact findings, particularly as they regard valuation issues, we review those findings to determine whether they are supported by substantial competent evidence." (Emphasis added.) 35 Kan. App. 2d at 784. As a result, the Court of Appeals further acknowledged that "we do not weigh conflicting evidence, pass on the credibility of witnesses, or redetermine questions of fact." 35 Kan. App. 2d at 784.
After the district court's adoption of Meinhart's valuation of MRI stock, it essentially declined to analyze Korschot's additional discounts for lack of control and marketability which were based upon the MRI stock's containment within the HFLP. It instead rejected these discounts simply because "the surviving spouse did not consent to this transfer." The Court of Appeals correctly determined that rejection on the consent basis was error because under K.S.A. 59-6a205 and K.S.A. 59-6a207, consent is irrelevant.
Although the Court of Appeals reviewed the district court's MRI valuation finding based upon Meinhart's opinion as a question of fact, it then proceeded to reject the Korschot additional discounts because they were "unnecessary under these circumstances." 35 Kan. App. 2d at 787. While the court did not articulate its standard in arriving at this determination, its analysis reveals a de novo review and resultant legal conclusion. However, it did not similarly review Meinhart's admitted use of a 10% lack of marketability discount as a matter of law, but apparently embraced the propriety of his discount within the "factual" determination.
As analyzed below, the Court of Appeals was incorrect in establishing several legal reasons for total rejection of Korschot's additional discounts "under these circumstances" as an alternate basis for affirming the district court.
Among other things, one of the Court of Appeals' ostensible legal reasons–the "artificiality or illusory nature of the partnership entity"–was apparently based upon that court's independent determination of facts after reviewing evidence in the record. The facts highlighted by the Court of Appeals, e.g., a lack of filing of state or federal partnerships tax returns, are inconsistent with findings made by the district court. These findings include the trial court's express determination that HFLP was organized for valid family and business purposes, that Lawrence was the heir apparent of Norman's business, and accordingly that Norman had an estate planning and business objective to pass the family business to his son.
As mentioned, an appellate court does not weigh conflicting evidence, pass on the credibility of witnesses, or redetermine questions of fact. We also accept as true all inferences to be drawn from the evidence which support or tend to support the findings of the district court. Evenson Trucking Co. v. Aranda, 280 Kan. 821, 837, 127 P.3d 292 (2006). Our deferential review of the record reveals that substantial competent evidence supports these district court findings. Norman and Maryam's attorney at the time the HFLP was created in 1997, Denver Vold, testified that the purpose of the HFLP was: (1) to shield Norman's assets from a potential claim related to environmental litigation, (2) to shield assets from business creditors, (3) for estate planning and business succession purposes–so that Lawrence would receive all of his interests in his closely held businesses and manage the company, and (4) to reduce taxes by reducing the value of Norman's estate. Vold further testified that although a merger had been contemplated by Norman and Lawrence of their various enterprises, they decided to first form the HFLP, because of the possibility that through merger Norman's estate taxes would increase as a result of the increase in the value of Lawrence's business.
These district court findings in turn partially supported its determination in its July 12, 2004, journal entry: "The court finds that the partnership was a valid and existing limited partnership at the time of the gift on March 1st 2000 and continues to be so." (Emphasis added.) This determination impliedly rejected Maryam's argument, acknowledged by the court in its finding that "the surviving spouse . . . counters that the family partnership was not properly created or properly maintained and thus a discount is not applicable." Accordingly, the Court of Appeals was incorrect in weighing conflicting evidence and in relying upon the purported artificiality or illusory nature of the HFLP to conclude that Korschot's discounts were unnecessary.
Another reason given by the Court of Appeals for totally rejecting Korschot's additional discounts as unnecessary was its belief that discounting individual share holdings injects into the appraisal process speculation on the various factors which may dictate the marketability of such holdings. 35 Kan. App. 2d at 787. However, the Court of Appeals itself previously accepted such alleged speculation-based marketability discounting in this case. It had already supported the district court's adoption of Meinhart's appraisal which applied a 10% marketability discount when determining the value of Norman's 96% individual holding in MRI: $2,553,600. Accordingly, we cannot agree with the Court of Appeals' rejection of Korschot's additional discounts on this basis. Other grounds for our rejection of the Court of Appeals' "legal" reasons will be addressed later in the opinion while discussing other issues.
Moreover, with the Court of Appeals' absolute rejection, as a matter of law, of Korschot's additional discounts, the court effectively eliminated the only evidence in the record on the value of the transferred 96% limited partnership interest in HFLP on March 1, 2000, which value that court itself described as "the paramount consideration." 35 Kan. App. 2d at 786. As mentioned, Meinhart freely admitted that he did not value the HFLP interest: only its sole asset, the MRI stock. Consequently, the Court of Appeals' decision ultimately made case-dispositive a valuation that made no pretense of addressing that court's paramount issue: value of the HFLP