Justia Trusts & Estates Opinion Summaries

After the death of Marjorie Johnson in 2020, her daughter, Rita Johnson, was appointed as executrix of her estate by the Wayne County, Michigan probate court. Rita initiated probate proceedings to determine whether certain assets belonged to the estate or to the Johnson Family Trust, which had a provision requiring arbitration of disputes. Amos C. Johnson, Marjorie’s son and trustee of the Trust, sought to compel arbitration in state court, but the request was denied. Subsequently, Amos and the Trust filed suit in the United States District Court for the Eastern District of Michigan, seeking to compel arbitration of the probate dispute under § 4 of the Federal Arbitration Act (FAA).The district court ordered the plaintiffs to show cause why the case should not be dismissed for lack of subject matter jurisdiction, citing the probate exception, the prior-exclusive-jurisdiction doctrine, and potential lack of diversity. The court ultimately dismissed the case, finding that the FAA does not provide an independent basis for federal question jurisdiction and that the probate proceedings were in rem, meaning the federal court would improperly interfere with property under the state probate court’s control.On appeal, the United States Court of Appeals for the Sixth Circuit reviewed the district court’s dismissal de novo. The Sixth Circuit held that federal courts may only compel arbitration under § 4 of the FAA if they would have jurisdiction over the underlying dispute. Because the probate proceedings were purely matters of state law and involved property already under the state court’s jurisdiction, the federal court lacked both federal question and diversity jurisdiction. The Sixth Circuit affirmed the district court’s dismissal, holding that the federal court did not have subject matter jurisdiction to compel arbitration of the state probate proceedings. View "Johnson v. Johnson" on Justia Law

After the death of Rolland Lane, the Lane Family Trust was divided into two sub-trusts, Trust A and Trust B, with Karla Lane serving as the sole trustee of Trust A and John Edwards, Scott Edwards, and Keith “KC” Lane as co-trustees of Trust B. The main asset of the trusts was a house and acreage in Caldwell, Idaho, owned equally by both trusts. Disputes arose over the sale of this property, with Karla seeking to sell it for no less than one million dollars, while the co-trustees of Trust B objected and pursued a different sale arrangement. After a cash offer of $1,350,000 was made, the district court ordered all trustees to accept the offer and close the sale by a specified date. Karla refused to comply, leading to further litigation.The District Court of the Third Judicial District of Idaho, Canyon County, ultimately removed Karla as trustee of Trust A, finding her refusal to follow the court’s order to sell the property constituted grounds for removal under Idaho law. The court appointed KC as the new trustee of Trust A. Karla appealed, arguing that her actions were within her discretionary authority as trustee and that she was acting in the best interests of the beneficiaries by seeking a higher sale price.The Supreme Court of the State of Idaho reviewed the case and affirmed the district court’s order. The Supreme Court held that Karla had waived all arguments on appeal due to significant deficiencies in her briefing, including raising new arguments for the first time on appeal, failing to provide an adequate record, and not articulating how the district court abused its discretion. The Supreme Court also awarded attorney fees and costs to the respondents, finding the appeal to be frivolous. View "Edwards v. Lane" on Justia Law

A woman died in September 2021, survived by four sons. One son, Mark, submitted a will dated September 15, 2021, naming himself as sole beneficiary and personal representative, excluding his three brothers. Another son, Michael, objected, arguing that their mother lacked testamentary capacity at the time of the will’s execution and that the will was the product of undue influence. Evidence at trial included testimony from family members, a friend who notarized the will, and a nurse who described a prior incident in which Mark threatened the decedent. Mark also sought to introduce a 2016 document (exhibit 7) showing a similar disposition of the estate, but the county court excluded it.The County Court for Douglas County found that Mark failed to prove the decedent’s testamentary capacity and that the will was the product of undue influence, ordering the estate to proceed in intestacy with Michael as personal representative. Mark appealed. The Nebraska Supreme Court, in a prior decision, reversed the exclusion of exhibit 7, holding it was relevant to show a constant and abiding scheme for property distribution, and remanded for reconsideration on the existing record, including exhibit 7.On remand, the county court admitted exhibit 7 but declined to consider new evidence, including an affidavit from the decedent’s sister. The court again found that Mark failed to prove testamentary capacity and that the will resulted from undue influence, giving little weight to exhibit 7 regarding the decedent’s state in 2021. Mark appealed again.The Nebraska Supreme Court held that the county court properly limited its review to the existing record and exhibit 7, as required by the mandate. The Supreme Court affirmed the findings that the decedent lacked testamentary capacity and that the will was the product of undue influence, and affirmed the order for intestate administration with Michael as personal representative. View "In re Estate of Walker" on Justia Law

A married couple undertook renovations on a property owned by a family trust, based on an alleged oral agreement with the original cotrustees (the couple’s relatives). The couple claimed they were to be reimbursed for the renovation costs, excluding labor, after the property was sold. The renovations expanded in scope as new issues were discovered. After the cotrustees passed away, a new trustee (also a family member) sold the property but did not reimburse the couple, citing a lack of available funds due to a line of credit and other expenses. The couple, who were also beneficiaries of the trust, requested reimbursement and a full accounting of the trust’s assets, but were denied.The District Court for Douglas County held a bench trial and found that, while there was evidence of an agreement, its terms were too indefinite to constitute a legally enforceable contract. The court also denied the couple’s claims for unjust enrichment, finding insufficient evidence that the renovations increased the property’s value or that the costs were reasonable. Claims for promissory estoppel and breach of fiduciary duty/accounting were also denied, with the court noting that it was not required to make detailed findings absent a specific request. The court further declined to hold the trustee personally liable.On appeal, the Nebraska Supreme Court reviewed the district court’s findings under a clearly erroneous standard. The Supreme Court affirmed the lower court’s decision, holding that the oral agreement lacked the definiteness required for contract enforcement, that the evidence did not establish unjust enrichment or reasonable value, and that the claims for promissory estoppel and breach of fiduciary duty/accounting were properly denied based on conflicting evidence. The court also found no basis for personal liability of the trustee. The judgment of the district court was affirmed. View "Morris v. Dall" on Justia Law

The case concerns a lawsuit brought by the executor of an estate against a city, alleging that the city’s negligence in failing to address a hazardous tree led to a fatal accident. The estate claimed that the city owned the tree and had ignored repeated warnings about its dangerous condition, resulting in the decedent’s severe injury and subsequent death after a tree fell on him while he was riding a motorcycle on a city street.After the complaint was filed, the city submitted an answer denying the allegations and raising several defenses, including a general assertion that the complaint failed to state a claim upon which relief could be granted. However, the city did not specifically assert political-subdivision immunity as a defense. The case experienced delays due to a judge’s recusal and the COVID-19 pandemic. As the case progressed, the estate pursued discovery and moved for partial summary judgment. The city failed to timely respond to discovery and only raised the political-subdivision immunity defense for the first time in an untimely motion for summary judgment, after the deadlines for dispositive motions had passed. The trial court struck the city’s motion and later denied the city’s request for leave to amend its answer to add the immunity defense, finding the delay unjustified and prejudicial.The Seventh District Court of Appeals affirmed the trial court’s decision, holding that the city’s general assertion of failure to state a claim did not preserve the specific defense of political-subdivision immunity, and that the trial court did not abuse its discretion in denying leave to amend the answer. The Supreme Court of Ohio agreed, holding that a party does not preserve the defense of political-subdivision immunity under R.C. Chapter 2744 by merely asserting failure to state a claim, and that unjustified and prejudicial inaction supported the denial of leave to amend the answer. The judgment of the court of appeals was affirmed. View "Durig v. Youngstown" on Justia Law

A married couple established a family trust in 2003, which, after the husband’s death in 2013, split into three sub-trusts. The Potter Exemption Trust (PET) became the owner of approximately 4,000 acres of land and a minority interest in E Bar L Ranch, LLP, which operates a guest ranch on both its own land and land leased from the PET. The wife, Betty, is the income beneficiary of the PET, while the husband’s children from a prior marriage are remainder beneficiaries. The PET’s trustees were initially three friends of the deceased husband, who later appointed successors, including Caitlin Wall and James Stone. Wall is also an employee of E Bar L, and Stone has performed contract work for E Bar L. In 2022, the PET and E Bar L entered into a new five-year lease for the PET land, with Wall participating as both PET trustee and E Bar L employee.Betty filed a petition in the Montana Fourth Judicial District Court seeking Wall’s removal as trustee, alleging a conflict of interest due to Wall’s dual roles, and requesting access to E Bar L’s financial records to investigate potential breaches of trust. She also challenged the validity of the 2022 lease. The PET, E Bar L, and other interested parties countered, seeking declaratory judgment affirming the trustees’ authority and the lease’s validity. The District Court granted summary judgment against Betty on all but one issue, finding no conflict of interest, denying her access to E Bar L’s financials, upholding the lease, and ruling that the trust instrument did not require three trustees or allow Betty to appoint successors.The Supreme Court of the State of Montana reversed the District Court’s summary judgment on the issues of conflict of interest, the validity of the lease, access to financial information, and Wall’s removal as trustee, holding that genuine issues of material fact precluded summary judgment. The Court affirmed the District Court’s ruling that the trust instrument did not mandate three trustees or permit Betty to appoint successors. The case was remanded for further proceedings. View "In re Potter Exemption Trust" on Justia Law

After the death of an individual who had lived in Johnston County, Oklahoma, for several years before his final illness and death in Oklahoma County, a dispute arose over the proper county for probate and which of two purported wills should be admitted. The decedent had executed a will in 2018, naming Cheryl Moore as personal representative and leaving his estate to his neighbors, the McClendons. In 2019, he executed another will and a trust, naming Moore as personal representative and leaving his assets to a trust benefiting the Oklahoma City Community Foundation, Inc. (OCCF). At his death, he owned property in Johnston County but had spent his last months in Oklahoma County for medical reasons.The District Court of Johnston County held an evidentiary hearing and determined that venue was proper in Johnston County, as the decedent had not abandoned his Johnston County residence. The court admitted the 2018 will to probate, finding the 2019 will was not executed with the statutory formalities required under Oklahoma law and could not be admitted as a lost or destroyed will. The court also found that Moore had renounced her right to serve as personal representative by not petitioning for probate within thirty days of the decedent’s death.The Supreme Court of the State of Oklahoma affirmed the district court’s rulings that venue was proper in Johnston County and that the 2018 will should be admitted to probate, as the 2019 will was not validly executed and did not revoke the earlier will. However, the Supreme Court reversed the finding that Moore had renounced her right to serve as personal representative, holding that mere passage of time without knowledge of her nomination was insufficient for renunciation. The case was remanded for further proceedings consistent with these holdings. View "ESTATE OF CUNNINGHAM v. MOORE" on Justia Law

Carol Hudson died in 2018, leaving most of her estate to her sons through her will and a revocable trust. Her long-term partner, Doug Nail, claimed entitlement to an elective spousal share of her estate, asserting that he and Carol were common-law spouses under Montana law. Carol’s son, Alan Johnson (AJ), disputed this claim, arguing that Carol did not consider Doug her husband and had consistently identified herself as single on official documents. The couple had lived together in Montana for nearly a decade, shared a home, and were viewed by many friends and family as married, though Carol kept her own name and filed taxes as single.The Eighteenth Judicial District Court of Gallatin County consolidated probate and declaratory relief actions and held a bench trial. After hearing conflicting testimony from friends, family, and the parties themselves, the District Court found that Doug and Carol were common-law spouses. The court credited testimony that Carol and Doug had mutually consented to a marital relationship and held themselves out as married to their community, despite evidence that Carol identified as single on financial and medical documents. The District Court concluded that Doug was entitled to seek an elective share of Carol’s estate.The Supreme Court of the State of Montana reviewed the District Court’s findings for clear error and its legal conclusions for correctness. The Supreme Court held that substantial credible evidence supported the District Court’s findings that Doug and Carol mutually consented to marriage and confirmed their marriage by public repute. The Supreme Court affirmed the District Court’s ruling, holding that Doug and Carol were common-law spouses at the time of Carol’s death, and Doug was entitled to pursue an elective share of the estate. View "In re Estate of Hudson" on Justia Law

After the death of Gary Wayne Johnson, who died without a will in 2021, his sister, Zoa Ann Manners, opened his estate and filed a creditor’s claim. Her claim was based on a document titled “Article of Agreement,” which Gary had prepared, signed, and delivered to her in 2002. Zoa Ann argued that this document created a contractual obligation for Gary, and subsequently his estate, to distribute a one-fourth interest in certain real property (specifically, Lots 12 and 13 of Lenzi Farms Subdivision) to her and her sisters, in accordance with their parents’ wills. The document was notarized but never recorded, and its language referenced the parents’ testamentary intentions.The Chancery Court of Marshall County held a hearing on Zoa Ann’s claim. After considering her testimony and the document, the chancery court found that the Article of Agreement was ambiguous, lacked sufficient clarity to convey a present interest in land, and did not meet the requirements of a deed or a contract. The court denied her claim against the estate. Zoa Ann appealed, and the Mississippi Court of Appeals reversed the chancery court’s decision, holding that the Article of Agreement did constitute a valid deed conveying a vested future interest in the property, and remanded the case for further proceedings.The Supreme Court of Mississippi reviewed the case on certiorari. It held that the Article of Agreement did not create a contractual obligation nor did it operate as a valid deed, as it failed to convey a present interest in the property and was testamentary in nature. The Supreme Court reversed the judgment of the Court of Appeals and reinstated and affirmed the judgment of the Chancery Court of Marshall County, denying Zoa Ann’s claim. View "In the Matter of the Estate of Gary Wayne Johnson v. The Estate of Gary Wayne Johnson" on Justia Law

The defendant, a former U.S. Coast Guard employee, was convicted by a jury of murdering two co-workers in Alaska. At the time of the government’s collection action, he held approximately $450,000 in a Thrift Savings Plan (TSP) account, a federal retirement savings plan. His wife had a statutory right to a joint and survivor annuity from the account, and federal law generally requires spousal consent for lump-sum withdrawals. Following his conviction, the government sought to collect the entire balance of his TSP account as restitution for the victims’ families.The United States District Court for the District of Alaska initially ordered restitution from the defendant’s retirement and disability income, including his TSP funds, but limited lump-sum withdrawals from the TSP without spousal consent, instead permitting monthly payments. On appeal, the United States Court of Appeals for the Ninth Circuit vacated the restitution order, holding that the district court could not use the All Writs Act to bypass statutory garnishment limits and remanded for a determination of whether the defendant’s benefit streams constituted “earnings” subject to a 25% garnishment cap under the Consumer Credit Protection Act.On remand, the district court issued amended restitution orders authorizing the government to collect the entire TSP account balance as a lump sum. The defendant appealed, arguing that statutory spousal protections limited the government to periodic garnishments. The United States Court of Appeals for the Ninth Circuit held that the government may only cash out a defendant’s TSP account to satisfy a restitution order under the Mandatory Victims Restitution Act if the plan’s terms would allow the defendant to do so at the time of the order. Because spousal consent was required and not obtained, the court vacated the restitution orders and remanded for further proceedings. View "United States v. Wells" on Justia Law