Justia Trusts & Estates Opinion Summaries

Articles Posted in US Court of Appeals for the Eighth Circuit
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Employer-appointed trustees filed a complaint in the district court seeking the appointment of an impartial umpire to resolve a deadlock on a motion, pursuant to Section 302(c)(5) of the Labor Management Relations Act, brought by one of the employer-appointed trustees. The district court dismissed the complaint and declined to appoint an umpire.The Eighth Circuit affirmed, concluding that, based on the entirety of the Trust Agreement, the delegation proposed by the employer trustees' motion is beyond the trustees' authority to implement. The court explained that because the proposed delegation and amendment to the Trust Agreement are beyond the trustees' authority to implement, the deadlocked motion is not a matter arising in connection with the administration of the plan or a matter within the trustees' jurisdiction. Therefore, the Trust Agreement does not authorize the appointment of a neutral umpire to resolve the deadlocked motion. Furthermore, because the court found that adopting the employer trustees' proposed motion would require amending the Trust Agreement, the court also necessarily concluded that the deadlocked motion does not concern trust fund "administration" under section 302(c)(5). Accordingly, the deadlocked motion is not a matter of trust "administration" under either the Trust Agreement or section 302(c)(5), and thus the district court did not err in declining to appoint an umpire. View "Gillick v. Elliott" on Justia Law

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The Eighth Circuit affirmed the district court's dismissal, based on lack of subject matter jurisdiction, of plaintiff's suit against the government under the Federal Tort Claims Act (FTCA), alleging that the VA provided negligent psychiatric care that resulted in her son's death. In this case, plaintiff concedes she was not the appointed trustee under Minnesota law and was only the next-of-kin at the time she filed a claim with the VA. Therefore, plaintiff failed to present the VA with her authority to act as the trustee as required by the FTCA. Because this was a jurisdictional requirement under the FTCA, the court held that the complaint was properly dismissed. View "Rollo-Carlson v. United States" on Justia Law

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The Eighth Circuit reversed the district court's grant of summary judgment for Northport in a wrongful death action brought by plaintiff, Mark, as the representative of the estate of his deceased father. Another son, Matt, signed the admission agreement, which included an arbitration agreement, at the residential rehabilitation center owned by Northport. Northport sought to compel arbitration and the district court granted the motion. Mark appealed, asserting that the district court misused the third-party beneficiary theory when no underlying agreement was present between the Poseys and Northport.Arkansas courts have repeatedly declined to find that individuals like Matt—relatives without power-of-attorney or other legal authority who admit a family member to a nursing home—possess valid authority to bind their relatives to arbitration under a third-party beneficiary theory. In this case, because Matt was undisputedly not his father's legal guardian or attorney-in-fact, he lacked the capacity to sign the contract as his father's representative. Accordingly, the court reversed the order compelling arbitration and remanded for further proceedings. View "Northport Health Services of Arkansas, LLC v. Posey" on Justia Law

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This consolidated appeal stemmed from the trusts' motion for a temporary restraining order and preliminary injunction enjoining the use of Phyllis Schafly's intellectual property. The Eighth Circuit affirmed the denial of preliminary injunctive relief under 28 U.S.C. 1292(a)(1) and held that the trusts would not be entitled to the traditional presumption of irreparable harm in trademark cases because they did not promptly seek preliminary injunctive relief concerning the trademark infringement, regardless of whether the presumption survived recent Supreme Court decisions emphasizing the movant's burden to show that irreparable injury was likely in the absence of an injunction. The court dismissed the appeal of the order staying litigation for lack of appellate jurisdiction, because the order was temporary and did not effectively end the litigation. View "Phyllis Schlafly Revocable Trust v. Cori" on Justia Law

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The Eighth Circuit affirmed the district court's summary judgment orders in an action where creditors were attempting to collect on judgments against Vertical and Defendant Reuter by levying assets now belonging to Reuter's wife. Leaving aside the question whether creditors have made a sufficient showing to justify piercing the corporate veil, the court held that creditors' tenancy-by-the-entirety theory failed under Missouri law. In this case, no reasonable jury could conclude that there was clear, cogent and convincing evidence that Reuter and his wife participated in the tortfeasor partnership as a married couple, and thus summary judgment in their favor for the claims seeking to pierce the corporate veil and reach the assets that once belonged to them as a married couple was proper. In regard to plaintiff's alternative theory, the court held that the bankruptcy court correctly determined that Reuter did not own 50 percent of the Trust as a settlor, and thus creditors' allegation that he fraudulently transferred his share to his wife necessarily failed. View "Cutcliff v. Reuter" on Justia Law

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The Eighth Circuit affirmed the district court's grant of summary judgment against plaintiff in an action seeking funds from her husband's trust that was transferred from an Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001-1461, plan. The husband had requested the "Accrued Benefit" amount from his ERISA employee-benefit plan be transferred to his trust days before he passed away. Applying an abuse of discretion standard to this case, the court held that the plan administrative committee reasonably explained its interpretation and relied on substantial evidence to deny plaintiff's claim. Therefore, the committee did not abuse its discretion when it determined that the relevant inquiry was not when funds were received by a participant, but rather when funds were transferred out of the plan. View "Wengert v. Rajendran" on Justia Law

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FCR filed suit against numerous defendants associated with the Life Investors Owners Participation Trust, alleging breaches of fiduciary duties and conversion. The Eighth Circuit affirmed the district court's grant of summary judgment to defendants, holding that Trust section 11.9 authorized the Trustees to deduct funds from the Trust accounts to reimburse Life Investors for the money it advanced to pay for the defense in the Maryland litigation; the Trustees did indeed incur "cost" in the form of attorney's fees in defending the Maryland action unsuccessfully brought by Corrado and FCR; the Trustees did not breach their fiduciary duties; there was no material dispute as to the reasonableness of the attorney's fees because plaintiffs failed to challenge the fees; and the conversion claim failed because plaintiffs were unable to prove the first element of conversion, that their interests were subject to the terms of the Trust. View "Corrado v. Life Investors Insurance Co." on Justia Law

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PNC Bank appealed a jury verdict in favor of a special deputy receiver finding PNC liable for negligence and breach of fiduciary duty in violation of its duties as trustee of various preneed trusts created by NPS. The Eighth Circuit held that appellees' claims arose under trust law rather than tort law and appellees were thus entitled only to the damages afforded under trust law; damages to the Missouri trusts after Allegiant's trusteeship or outside of the Missouri trusts were not recoverable from PNC as Allegiant's successor; the trust beneficiaries were NPS, consumers in Missouri, and the funeral homes that were to provide services to those consumers pursuant to the consumers' preneed contract; PNC was not relieved of liability unless Allegiant ensured that Wulf was investing trust assets within the authority of a reasonably prudent trustee; appellees' trust-law claim should have been tried to the court under the general rule; and the court rejected appellees' cross-appeal. Accordingly, the court affirmed in part, reversed in part, and remanded for further proceedings. View "Jo Ann Howard and Associates v. National City Bank" on Justia Law